Stack of 100 dollar bills and words "tax refund" with a red strikethrough

The IRS is taking more heartless measures than ever in an attempt to collect old tax debts from the deceased.

Recently the Washington Post reported that Uncle Sam is “intercepting” tax refunds from hundreds of thousands of taxpayers this year to wipe out Social Security debts that may have been held by their parents.

“The Post is unclear on exactly how many grown children are now being asked to pony up on behalf of dear Mom and Dad. However, it seems to be a significant amount. The 2008 Farm Bill gave the Treasury Department permission to collect on debts more than 10 years old, and since 2011, it has been doing so with gusto. This year, the Social Security Administration has found 400,000 taxpayers who, it says, collectively owe $714 million to the government for debts that have been lingering more than a decade,” wrote Jordan Weissmann in a recent Slate piece.

Just a few weeks back, without any warning, the Treasury Department seized Mary Grice’s tax refunds from both the IRS and the state of Maryland. Grice did not receive notice that the U.S. government had taken her money until she opened a letter saying that, “her refund had gone to satisfy an old debt to the government – a very old debt,” several days later, wrote Marc Fisher for the Washington Post.

Grice’s father died in 1960, when she was only a toddler. The surviving members of her family were her mother and Grice’s five siblings. Grice’s mother received survivor benefits (for food and clothes) from Social Security until each of her children turned 18.

“Now, Social Security claims it overpaid someone in the Grice family – it’s not sure who – in 1977. After 37 years of silence, four years after Sadie Grice died; the government is coming after her daughter. Why the feds chose to take Mary’s money, rather than her surviving siblings’, is a mystery,” wrote Fisher.

Throughout the U.S., hundreds of thousands of Americans are anticipating the day they receive their tax refund, but instead they may be receiving a letter telling them their check has gone to pay a debt they never knew about or incurred.

“The Treasury Department has intercepted $1.9 billion in tax refunds already this year – $75 million of that on debts delinquent for more than 10 years, said Jeffrey Schramek, assistant commissioner of the department’s debt management service. The aggressive effort to collect old debts started three years ago – the result of a single sentence tucked into the farm bill lifting the 10-year statute of limitations on old debts to Uncle Sam,” wrote Fisher.

In Grice’s case, Social Security officials informed Grice that six people had collected benefits from her father’s account. The scary part of this whole story is that the government “doesn’t look into exactly who got the overpayment,” wrote Fisher. The current procedure is to seek repayment from the oldest sibling and “work down through the family” until the debt is paid in full.

While the government is trying to balance their books, they are interfering in the financial lives of many unknowing and innocent Americans. Not a good thing.

If you have a similar tax issue, or if you anticipate such an issue in the near future, you should call a tax resolution lawyer to gain an understanding of your situation, and get some legal protection.

Contact the experts at U.S. Tax Shield to schedule a free consultation with a tax resolution attorney. Our knowledgeable team will help get you protected and help you settle your back taxes today.