The Social Security Administration announced Monday that it will immediately stop efforts to collect on taxpayers’ debts to the government that are more than 10 years old. This means the SSA will no longer seize state and federal refunds from people who had relatives who owed money to the agency.
The Washington Post reported that the SSA’s practice impacted the refunds of 400,000 Americans. In many cases, the people whose refunds were intercepted had never heard of any debt, and the debts dated as far back as the middle of the past century.
In 2008, the farm bill lifted the statute of limitations on government debts that are more than 10 years old. Next, the U.S. Treasury Department set up rules for the government to settle these old debts with taxpayers’ refunds. Altogether, the department has collected about $2 billion in intercepted tax refunds this year, $75 million of which was for debts beyond the 10 year statute of limitations.
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