Revenue Recapture Related Information

The Minnesota Department of Revenue will not apply refunds to your agency's Revenue Recapture claims when a debtor is in bankruptcy. You must:

• place a hold on any claims during bankruptcy proceeding. (See Place a Claim on Hold.)
• cancel any claims for debts that are discharged in bankruptcy (See Cancel a Claim)

Once the claimant agency sends the Revenue Recapture Notice to Taxpayer, the debtor has the right to request a contested case hearing before an administrative law judge with the Minnesota Office of Administrative Hearings. The debtor must assert this right by sending the request in writing to the claimant agency within 45 days of receiving the Revenue Recapture Notice from them. (See Minnesota Statute 270A.08.)

If a debtor contacts your agency and requests a contested claim hearing, determine what the request is about –  the recapture claim against their refund or the debt owed to your agency – and respond as shown in the table below.  

The Minnesota Department of Revenue may take a joint refund (for married filers) for debts owed by one of the spouses. The other (nonliable) spouse may request a refund of their portion. If your agency receives a claim from a nonliable spouse, you must:

1. Determine how much of the original refund belongs to them.
2. Contact the Revenue Recapture Program about returning the refund.
3. Update the claim in the Revenue Recapture system.

Nonliable spouses must request their portion of any refund within 18 months of our recapture notice for that refund.

See Minnesota Rule 8165.0400.

When your agency files a Revenue Recapture claim for a debt, you must notify the debtor no later than five days after filing the claim by sending the notice to their last known address. If the notice is returned, attempt to locate a new address and resend the notice.

What information is required in the notice?

Your agency's Revenue Recapture notice must clearly state all of the following:

• The date, reason, and amount of the debt.
• That your agency intends to apply the debtor's state refunds to the debt until the debt is paid, cancelled, or the statute of limitations has expired.
• The debtor may dispute the recapture of their refund by requesting a contested claim hearing.
• Any other information required by law, depending on the type of debt or agency making the claim.

See Minnesota Statutes 270A.07 and Minnesota Rule 8165.0300.

Sample Revenue Recapture notices

General Notice 

Assistance Claims Notice 

Medical Notice 

Public Housing Notice 

Before refunding any Revenue Recapture overpayments of $30 or more, you must contact the Revenue Recapture Program. We will tell you whether to refund the payment to the debtor or return it to us. You must follow these steps:

1. Review the recapture claim in e-Services.
2. Cancel or update the balance.
3. Contact us and provide the:

• name(s)
• social security number(s)
• amount your agency received
• amount of the overpayment
• agency's 10-digit Revenue Recapture account number

You may not use Revenue Recapture to collect overpayments of public assistance in either of the below situations, unless there was a judicial or administrative finding of an intentional program violation: 

• The debtor is still a client of the assistance program and has not signed a waiver.
• The debtor is no longer a client of the assistance program but currently receives food support, transitional child care, or transitional medical care.

State or local laws typically set a time limit for collecting a debt ("statute of limitations"). Once the statute of limitations passes, you must cancel the recapture claim for that debt.

Claimant agencies cannot use outside debt collectors or other third parties to manage their Revenue Recapture claims. Only authorized employees of an agency are allowed to manage its claims. 

See Minnesota Statutes 270A.11.