1.       What is the Arkansas refund offset program?

The government can collect certain debts by intercepting your income tax refund. In other words, if you owe money to certain agencies, they can keep your income tax refund.

Married individuals may receive a joint tax refund if they file an Arkansas return as “married filing joint” or “married filing separately on the same return.” This joint refund can be offset (kept by the government) to pay either spouse’s debts. The spouse who does not owe the debt can appeal to keep his or her share of the refund so that it is not applied to the other spouse’s debt.

2.       How does the Tax Appeals Commission handle joint refund offset appeals?

The Commission handles joint refund offset appeals through the normal appeal process, which begins when the Nondebtor Taxpayer files the petition. These cases require more information than other appeals, so a petition addendum is required in addition to the petition.

3.      Who is the Debtor Taxpayer, and who is the Nondebtor Taxpayer?

The Debtor Taxpayer is the spouse who owes the debt. That individual is listed on the Notice of Refund Offset with the claimant agency and the amount of the refund offset. The Nondebtor Taxpayer is the spouse who is not listed as owing the debt to the claimant agency.

4.      What is the claimant agency?

The claimant agency is the state or local government agency to which the debt is owed.

5.      I don’t think that I owe the debt, or I have paid the debt already. Can the Commission hear my case?

No. The Tax Appeals Commission cannot hear disputes about whether a debt is owed or for how much. It can only hear appeals for spousal relief. A taxpayer seeking to dispute an amount that has been certified for debt collection can contact the claimant agency. 

6.      What is the schedule for a joint refund offset appeal?

The appeal petition to the Tax Appeals Commission must be filed within thirty (30) days after the Notice of Refund Offset is received. The Commission will schedule a hearing if requested. Once the hearing is concluded, the Commission will issue a written decision within twenty (20) days.

7.       How do I file an appeal petition?

The Tax Appeals Commission recommends filing the appeal petition online. You can also mail or deliver it to the commission’s office in Little Rock.

8.      What do I need to include in my appeal petition for spousal relief from a joint refund offset?

You must provide the following four things for an appeal for spousal relief. The petition addendum will help guide you through this process.

• The petition, signed by Nondebtor Taxpayer.
• The Notice of Refund Offset (which you received from the Department of Finance and Administration).
• A letter from the claimant agency stating that the Nondebtor Taxpayer does not owe any debts to the claimant agency.
• The amount of the refund that should not be used to pay the debt. Show your calculation of the Nondebtor Taxpayer’s share of the refund and provide supporting documentation, including:

  • A complete copy of the Arkansas income tax return (typically an AR1000F).
  • All W-2s, 1099s, and any direct payments of taxes made to the Department of Finance and Administration.

9.      What does the claimant agency’s certification for the Nondebtor Taxpayer need to say?

This can be a letter from the claimant agency verifying that the Nondebtor Taxpayer is not a debtor of the claimant agency. Some examples include:

• [Nondebtor Taxpayer’s Name] is not a debtor of the agency.
• The agency does not have any record of debts owed by [Nondebtor Taxpayer’s Name].
• [Nondebtor Taxpayer’s Name] has a balance due of $0.00.

10.      How will the Commission Decide My Appeal?

The Commissioner assigned to your case will consider the Nondebtor Taxpayer’s and the Debtor Taxpayer’s shares of income, taxes, credits, and taxes withheld or other payments made. The Commissioner will decide each spouse’s proportionate share of the refund and will determine whether all other requirements for relief have been met.

For examples of how the Tax Appeals Commission has decided joint refund offset appeals in the past, see Tax Appeals Commission Decisions Search.

11.   I received an Order to Supplement Petition. What can I do?

An Order to Supplement Petition means you are missing required information. This is usually one or more of the four required items listed in Question 8. You should submit the missing information as soon as possible, or your appeal may be dismissed.

12.  I filed for injured spouse relief with the Internal Revenue Service. Is that enough?

No. That is a separate, federal program. Filing a Form 8379, Injured Spouse Allocation, with the Internal Revenue Service does not affect the Arkansas refund offset program.

For more information on the joint refund offset program, see Arkansas Code §§ 26-36-301 to 26-36-321.