Uncollectible Debt

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 has expired
• The debt is discharged in bankruptcy
• The liable debtor is deceased or indigent
• We made 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’s 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 may remove the debt from our records.

If we are collecting debt for another agency, we return it to that agency.