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Tax Intercept Program

The California Department of Social Services, in conjunction with the Internal Revenue Service, the Food and Nutrition Service, the State Controller’s Office, and the Franchise Tax Board, administer a federal and state Income Tax Refund Intercept Program. The California Work Opportunity and Responsibility to Kids (CalWORKs) and Food Stamp (FS) Intercept Program is designed to assist counties in the collection of delinquent CalWORKs overpayments and FS overissuances.

Has Your Tax Refund Been Intercepted?

State Program Background

The Franchise Tax Board has been intercepting state tax refunds of Californians who owe delinquent amounts to state and local agencies since 1975. The California Department of Social Services joined the program to begin intercepting state tax refunds to collect delinquent court-ordered restitution on Aid to Families with Dependent Children (AFDC) overpayments in 1982. Beginning with tax year 1982, non-court ordered AFDC and Food Stamp overissuances were added. In 1996, California (as well as the rest of the nation) underwent Welfare reform and AFDC became CalWork’s (California Work Opportunity and Responsibility to Kids) This program allows needy Californians the ability to gain needed job skills at the same time preserving the family unit with supported child care and other assistance deemed necessary for the individual to become a working Californian. Food Stamp debt is no longer collected via this program. Food Stamp debt is collected through the Federal program know as the Treasury Offset Program or TOP. (See below) California Government Code Section 12419.5 (added by Stats. 1951, AB 1813) is the statutory authority for The California Department of Social Services to intercept state tax refunds. Other authorities include California Government Code Sections 12419.2, 12419.3, 12419.7, 12419.9, 12419.10 and 12419.11 as well as State Administrative Manual Sections 8790.1 through 8790.8.

Federal Program Background

The Deficit Reduction Act of 1984 (PL 98-369, Section 2653) set general criteria for determining which debts are referable under federal tax offset. The California Department of Social Services began the Federal Tax Intercept program in tax year 1992, collecting Food Stamp overissuances consisting of Food Stamp Intentional Program Violations and Inadvertent Household Errors at the Internal Revenue Service under special authority of section 17(b) of the Food Stamp Act. Final Regulations 7, Code of Federal Regulations, Part 271 were published on September 1, 1995. The Debt Collection Act of 1982 as amended (PL 97-365) authorized federal agencies to offset debts through federal wage, salary and retirement payments, although this match was not initiated by FNS until 1996. The Debt Collection Improvement Act of 1996 (PL 104-134) mandated state participation in the Treasury Offset Program, which includes the Federal Tax Intercept Program and the Federal Salary Offset Program. It also expanded Federal Salary Offset Program to include Social Security payments in addition to salaries and benefits. In addition to Inadvertent Household Errors and Intentional Program Violations, The California Department of Social Services began submitting Food Stamps Administrative Error overissuances for collection in 2001.

Public Contact Information for Intercepted Tax Refunds Note:The counties maintain all debt records and make all decisions regarding the debt including removal from the Tax Intercept program, if necessary. If you have been intercepted for a public assistance debt, and know the county to which the debt is owed, please contact the appropriate county office listed below for more information. The telephone numbers listed below are for Tax Interception questions only.

If you do not know the county to which the debt is owed please contact the The California Department of Social Service's Fraud Bureau at (866) 808-3790 or (916) 263-5727.