Did you know that over 3.3 million Americans were delinquent on child support payments in mid-2020? Since the economy has been in a nosedive since then, it’s safe to say that even more Americans have fallen behind.
While getting behind on your obligations isn’t the worst offense, it can come with consequences.
Receiving a Tax Topic 151 letter is one of those consequences. Falling behind on your child support payments isn’t the only reason you might receive this important IRS notification, though. If you do get an IRS 151 letter in the mail, you need to understand what it is and what it means for your future.
Below, learn more about what Tax Topic 151 means and what to do if you get this IRS notification.
What Is a Tax Topic 151 Letter?
Are you still waiting on your tax refund? Did you receive a Tax Topic 151 letter in the mail, or did you receive a Tax Topic 151 alert when you attempted to log into the IRS’s “Where’s My Refund” tool? If so, then you’re likely feeling pretty confused.
In a nutshell, you’ll ific situation.
What Does Tax Topic 151 Mean for Taxpayers?
If you received this notice, then you can expect either a portion or all of your tax refund to get offset. In other words, you won’t be getting your full tax refund.
Why Did I Receive a Tax Topic 151 Letter?
If you received this notice, then you owe a significant debt. For the majority of taxpayers, that means they owe money in the form of:
- Child support payments
- Tax debt from previous years
- Federal student loans you’ve defaulted on
When you owe money for these reasons, the IRS is legally authorized to withhold part or all of your tax return money in order to settle your debts. The letter you receive regarding the situation will explain why you received a notice and what actions the IRS plans to take next.
Identifying the Debt You Owe
Another important detail that will be in your letter is the type of debt and the amount of debt you owe. Identifying this information is crucial. If you disagree with any of the information outlined in the letter, take note of those details for later.
If you do agree with the type of debt and the amount of debt you owe, you’ll still have the opportunity to resolve it. For instance, if you have tax debt, then you might be able to resolve your offset by agreeing to an installment plan with the IRS instead. Getting on a payment plan will not only help you access your tax refund, but it will also help you begin to pay back your tax debt burden.
Is Tax Topic 151 Good or Bad for Your Finances?
When you initially see a Tax Topic 151 error or letter, it’s normal to feel upset and frustrated. After all, it’s like losing money that you were counting on! It’s not all bad news, though, as this letter gives you the opportunity to finally handle debts you’ve been putting off. If you can’t pay the overall debt right away, you’ll still be able to get back in good standing by starting to pay it down.
What Steps Should You Take Next?
If you’ve been notified about your refund offset, then you really only have two options for moving forward. You can resolve the debt with the entity or party you owe the money to or appeal the IRS’s decision.
Where to Find More Tax Topic 151 Refund Information
Are you looking for more Tax Topic 151 refund information? Whether you opt to appeal the IRS offset or you want to resolve the debt with the entity you owe, it’s in your best interests to talk to a tax specialist about how to move forward. A tax expert can help you consider your options moving forward. They can help you decide what course of action to take moving forward.
Your Right to Appeal
Do you disagree with the IRS offset, the debt outlined in your letter, or something else? If so, it’s important to understand your right to appeal. This right, along with the next steps to take to appeal, should be outlined in your IRS letter. Regardless, it’s still in your best interests to consider consulting with a tax attorney about your situation before you move forward with an appeal.
Learning More About Tax Topic 151 and Other Tax Issues
Many Americans rely on their tax refunds to make ends meet, and an unexpected Tax Topic 151 notification can be quite financially unsettling. If you’ve recently received this notification in the mail, there’s a chance that your taxes will end up getting offset. The only things you can do to prevent an offset is to either resolve the debt that’s causing the issue or file an appeal with the IRS.
Do you have more questions about your Tax Topic 151 letter? Do you currently owe a tax debt that you’d like to resolve, or have other important tax questions you need answered? Our team is here for you. Fill out our online form today to get in touch. We look forward to helping you!