After Uproar, Social Security Chief Halts Seizures of Tax Refunds to Pay for Old ‘Errors’

The U.S. government is halting a relatively new debt collection practice after media reports revealed that the Social Security Administration was seizing tax refunds.
Those IRS refunds belonged to the children of parents or other relatives who had died allegedly owing the government for old debts, in some cases these debts amounted to Social Security overpayments that were not the fault of the recipient.
U.S. Senators Barbara Boxer (D-California) and Barbara Mikulski (D-Maryland) praised Monday’s announcement by Social Security Acting Commissioner Carolyn W. Colvin.
An uproar from lawmakers and consumer advocates led to Colvin’s move. She has ordered “an immediate halt” to the policy of seizing taxpayers’ refunds to make up for decades-old errors that led to the overpayment of benefits, pending a thorough review by the agency.
The Senators wrote to Colvin on Friday, urging her to use the discretion granted to the agency under federal law to waive recovery of Social Security overpayments more than ten years old in cases where the beneficiary is not at fault.
In the letter, the Senators highlighted a Washington Post story that detailed the case of Mary Grice of Takoma Park, Maryland, whose tax refund was seized by the U.S. government to repay an overpayment of benefits made to an unknown member of her family in 1977.
“On the eve of Tax Day, families preparing their budgets across Maryland and our nation are counting on refunds they are owed. Garnishing these refunds to collect overpayments incurred through no fault of their own and based on decades-old errors is a policy that must not continue,” Senator Mikulski said.

J. Lipsky

Hello, I am John, born in Cedar Rapids, but lived a lot of years in Latin America. I am an economist and have specialized in credit and debt. Originally sovereign debt, but later on, in credit score management and debt consolidation. I write for many publications. Here in eCreditDaily, I write about credit, second chance banking, and debt. I also write for other websites and bulletins about inflation and country risk.

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