Why did Treasury keep my income tax refund when I'm in bankruptcy?
Treasury's ability to withhold a taxpayer's income tax refund is determined by the chapter under which the bankruptcy was filed:
- Chapter 7 - The refund is held until a discharge is issued.
- Chapter 11 (Business Filed) - Bankruptcy will offset an assessed officer's refund when:
- The business has defaulted in chapter 11 plan payments.
- The Pre-Petition debt exists and is not included for payment through the business bankruptcy.
- The confirmed plan will offset for Post Confirmation debt.
- Chapter 11 (Corporate Officer filed) - If a plan has been confirmed and there are post-confirmation debts, Treasury will apply corporate officer refunds to post-confirmation assessments.
- Chapter 13 - Income tax refunds are returned to taxpayers.
I would like to set up an installment agreement on a bankruptcy account. Why am I receiving billings while I am in bankruptcy? Why did Treasury keep my income tax refund when I'm in bankruptcy?
Why did the State of Michigan take my refund? Why did I get this bill? I want to talk to someone in person about my bill.
Where are the Field Offices? What is the Michigan Accounts Receivable Collection System (MARCS) and why do I have to deal with them? Can I overnight or Fed Ex my payment?
How do I get a levy released? What is a Notice of State Tax Lien? What is the difference between a lien, a levy, a warrant and a garnishment? What does a tax lien do? Why did you place a tax lien on my property? Where are the Registers of Deeds offices located?
"Where is my refund"? What is an offset? I have an Installment Agreement and have been making timely payments. Why did Treasury take (offset) my refund? Will the offset payment count towards my monthly Installment Agreement payment? Will you take my income tax refunds and vendor payments?