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Last Updated: 12/17/2018

Uncollectible Debt

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When a debt becomes uncollectible, the Minnesota Department of Revenue may stop active collections on that debt. (See Minnesota Statute 16D.09.)

 We determine a debt is uncollectible when the: 

  • statute of limitations expired
  • debt is discharged in bankruptcy
  • only liable debtor is deceased or indigent

We may also determine a debt is uncollectible when: :

  • we exhausted all reasonable collection efforts
  • it costs more to collect the debt than the amount owed
  • your available income and assets are insufficient to pay
  • it is not in the state‚Äôs best interest to pursue collection

We may continue to apply tax refunds for up to 10 years after a debt originated. After that time, we remove the debt from our records.

If we are collecting the debt for another agency, we return it to that agency to decide whether it is uncollectible or try to collect it themselves.