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Last Updated: 12/11/2018

Offsets of Federal Refunds or Payments (Federal Offsets)

The Minnesota Department of Revenue may offset (take) your income tax refunds or federal payments and apply them to pay income tax debts or debt referred to us from other Minnesota agencies. (See Minnesota Statute 16D.18.)

The U.S. Treasury Department may also take your state tax refunds or payments and use them to pay debts you owe the federal government. (See the federal law 26 U.S. Code 6402(e).

Note: The Treasury Department manages several programs that use offsets to collect overdue state and federal debts. For more information, see the Treasury Offset Program website.

How does it work?  

  • We file an “offset claim” at the Treasury Department for any federal refunds or payments and apply them to your debt.

  • Sixty days prior to filing an offset claim, we send a letter to your last known address notifying you of the claim. The Treasury Department notifies you when they send us all or part of your federal refund or payment. See Offset Letters.

  • The type of debt we are collecting affects which payments we can take. We cannot take federal payments if you are in bankruptcy. See the below table.

What refunds or payments can we take?  

​Debt type

​We may take

​We may not take

​Tax

  • ​Tax refunds

  • Expense reimbursements

  • Travel advances

  • Vendor or contractor payments

  • Grants

  • ​Social Security income

  • Veterans benefits

  • Railroad Retirement benefits

​Other

  • ​Expense reimbursements

  • Travel advances

  • Vendor or contractor payments

  • Grants

  • ​Social Security income

  • Veterans benefits

  • Railroad Retirement benefits

  • Tax refunds

Your right to review tax data about yourself

You have the right to see or get copies of data we have about you, unless it is confidential. For more information, see Your Right to Private Data about Yourself. For information about a debt referred to us by another agency, contact the agency listed on your letter.