Pulaski County to Collect Unpaid Debts by Intercepting State Income Tax Refunds

If you owe Pulaski County money, the county will soon be able to garnish your state income tax refunds. The county commissioners Tuesday agreed to take part in the Tax Refund and Exchange Compliance System.

Treasurer Teresa Bryant said it was put together by the Association of Indiana Counties and the Indiana Department of Revenue and was approved by the state legislature last year. “If we have some people that are delinquent on their property taxes or other things, not just property taxes, if they’re delinquent on their sewer liens, if they’re delinquent to the hospitals, if they’re delinquent to the schools for, say, school fees and things like that, we could go and actually garnish – what’s considered a garnishment of their income tax refund, just their Indiana one, not their federal,” she explained.

Under the program, Bryant would be able to submit a list of delinquent taxpayers. The Association of Indiana Counties would then compare that with the list of people set to get a state income tax refund and notify her of any matches. “I would need to send them a letter – they would have 30 days to respond – and say that we would possibly garnish their income tax refund,” Bryant told the commissioners. “They have a chance to appeal it, as well.”

Bryant said that in the counties that took part in a trial run last year, most people simply paid whatever they owed before any income tax refunds were actually intercepted. If refunds do end up being garnished, that person would be charged a fee. The only cost to the county would be the cost of sending the notification letters.

To implement the program in Pulaski County, the commissioners approved a memorandum of understanding with the Association of Indiana Counties and the Indiana Department of Revenue, pending the review of County Attorney Kevin Tankersley. Bryant said the agreement would not only cover Pulaski County government but also other entities within the county, like the hospital and school districts.

She hoped the new system will cut down on the need for tax sales. “It’s just a way for us to kind of track some of these people down,” Bryant said. “We’ve got so many properties on our tax sale listing that just reoccur all the time.”

Pulaski County’s next tax sale takes place this morning at 9:00 EDT at the Pulaski County Highway Garage.