If you are expecting your tax refund but it doesn’t arrive, then it may make space or some financial problems for you. The tax offset is the term that means that the government has garnished your tax returns. This generally occurs if you are having an outdated payment, especially student loans. There are different ways too, to prevent this from happening. Today, in this article, we are going to discuss tax refund offset reversal and what are the steps you can take to prevent tax offset.
If your loan is defaulted, then the IRS may check up your pending payments. If you have a tax refund as well as pending payment, then the IRS have the right to garnish the tax refund. The money isn’t wasted, instead, it will be used to pay the defaulted student loan. However, if you are going through a hard time, then you might want Tax refund offset reversal.
People who are going through financial hardship can apply for this. The process is tedious, but if you are eligible for a tax refund, you should go for it. You would be required to submit different documents. Following are certain conditions where a qualification seems possible:
If you are suffering from a complete disability
The student loans are repaid by you.
An open Bankruptcy case is going on
If you have already talked with the Education Department and have agreed to repay the loans on time.
That being said, make sure that the documents prove to suffice and you can make a valid argument on your financial hardship.
Avoiding Tax Return Offset
You can avoid this complete situation in certain cases. Student Loans are different from other conventional loans and hence, it offers certain relaxation to customers if they are going through financial hardship.
Following are certain ways through which you can avoid Tax Return Offset.
Make Timely Payments
More than 250 days are generally there after which your loan is considered as default. Try to make minimum payments when it is due to avoid this situation. However, due to sudden financial issues, you can not repay the amount, then you can enter into a payment agreement.
Payment Agreement
You can request the Educational Department for a Payment Agreement if tax offset has not occurred. They will send a notice that will be composed of the agreement and certain rules. Go through it carefully.
This was all about tax refund offset reversal. We hope that the article has served its purpose and will help you in knowing about the same.