Hundreds of thousands of U.S. citizens are getting shocking letters in their mailboxes instead of tax refund checks – nastygrams informing them that the federal government has seized their money to repay debts their parents decades-old debts that they never settled.
In some cases, they’re debts the parents never knew they had. And no one warned their children.
The 2008 Farm Bill included a single line that made it possible, allowing the government for the first time to hunt down individual taxpayers who have owed Uncle Sam money for more than ten years.
If the debtor is deceased, according to the Federal Trade Commission, the money is considered a write-off. But the Social Security Administration has a different view of the law, chasing down adults whose parents cared for them with unintentionally overpaid benefits.
The Treasury Department has been exercising its new authority since 2011, bringing in $424 million in old debts that were previously considered out of reach.
Social Security says it’s identified 400,000 taxpayers whose families have owed a combined $714 million for ten years or more. Every oen of those, the agency claims, will learn their fate by this summer.
Since January the government has recovered more than $95 million in ancient obligations. That’s a fraction of the $1.9 billion the Treasury has seized overall in 2014, most of it owed for a much shorter time.
But it’s the targeting of Americans for their deceased parents’ decades-old delinquent Social Security accounts – often without solid evidence of exactly who received errant payments in the first place – that has people up in arms.
In the mean time…