The federal tax filing season is turning into debt-repayment season for Washington residents who owe money to the Washington state Employment Security Department.
The department has received its first disbursements from the Internal Revenue Service under the federal Treasury Offset Program (TOP). The program allows Employment Security to cross-match its computer files with IRS files and flag individuals who are delinquent in paying back benefit overpayments. The department can claim any tax refunds they have coming, after the IRS, delinquent child support, and other federal debts are paid.
The first two weeks of IRS disbursements netted $446,380. Additional disbursements will be issued each week.
"While this represents only a small dent in the total benefits debt, it sends a signal about the importance we place on running a fair and solvent unemployment-insurance system," says Employment Security Commissioner Dale Peinecke.
In December, Employment Security notified 25,000 people that their 2012 income-tax refunds might be intercepted to repay benefits they shouldn't have received. At that time, they owed a total of $61.7 million in delinquent debt.
Many people being targeted through TOP claimed unemployment benefits fraudulently. Federal law also allows states to use TOP to recover benefits from people who didn't disclose earnings they received while claiming benefits.
Washington is one of 31 states, plus the District of Columbia, currently approved to participate in TOP.
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