Connecticut Notice of Intent to Offset Refund Checklist
A Connecticut Notice of Intent to Offset Refund is an official notification from the Connecticut Department of Revenue Services (DRS) informing you that your tax refund will be intercepted to pay outstanding debts. This notice applies to both state and federal tax refunds, depending on the type of debt you owe.
Connecticut participates in two offset programs. The state refund offset program intercepts Connecticut state income tax refunds to pay debts owed to state agencies, including unpaid state taxes, other state obligations, and defaulted student loans made or guaranteed by the Connecticut Student Loan Foundation or Connecticut Higher Education Supplemental Loan Authority.
The federal Treasury Offset Program (TOP) intercepts federal income tax refunds to pay Connecticut state income tax debts. DRS sends the Notice of Intent to Offset by certified mail to ensure you receive proper legal notice and to establish the timeline for your response.
Types of Debts That Trigger Offset
Connecticut law authorizes refund offsets for several categories of debt:
● State Tax Debts: Unpaid Connecticut income tax, including assessed taxes, penalties, and accrued interest from previous tax years.
● Other State Agency Debts: Money owed to Connecticut state agencies for various obligations, such as overpaid unemployment benefits, unpaid tuition or fees at state colleges, or other financial obligations to state entities.
● Defaulted Student Loans: Loans made or guaranteed by the Connecticut Student Loan Foundation or the Connecticut Higher Education Supplemental Loan Authority that are in default status.
● Child Support Arrears: Connecticut child support enforcement agencies are enforcing past-due child support payments.
When the federal Treasury Offset Program intercepts your federal tax refund, it can collect past-due child support, federal agency non-tax debts (such as defaulted federal student loans), state income tax debts, and certain state-administered obligations. Connecticut has signed a reciprocal agreement with the U.S. Department of the Treasury under the federal Debt Collection Improvement Act to participate in this program.
Your 60-Day Response Deadline
Upon receiving a Connecticut Notice of Intent to Offset, you have precisely 60 days from the date of the certified notice to take action. This deadline is critical and applies whether you are contesting the debt or making payment arrangements.
Failing to meet this 60-day window means DRS will proceed with offsetting your refund without further notice. The certified mailing date establishes when your 60-day period begins, so act promptly after receiving the notice.
How to Respond to the Notice
You have two primary options within the 60-day response period:
Option 1: Pay the Debt in Full
You must pay the complete amount listed on the Notice of Intent to Offset, including all ongoing interest that continues to accrue on unpaid balances. Use the payment coupon included with the notice when mailing your payment, or pay electronically through the Connecticut Taxpayer Service Center (TSC-IND) without needing to send the coupon.
Paying in full before the 60-day deadline expires is the only guaranteed way to prevent the offset from occurring.
Option 2: Request an Administrative Review
If you believe the debt is incorrect, not legally enforceable, already paid in full, or inaccurate in amount, you must request an administrative hearing in writing within 60 days. Send your written request along with supporting evidence to:
Connecticut Department of Revenue Services
Collection & A/R Management
450 Columbus Blvd. Ste. 1
Hartford, CT 06103
For student loan debt offsets, the administrative hearing process follows the same procedure before an officer designated by the Commissioner of Administrative Services.
For child support debt offsets, the administrative review follows special procedures under Connecticut law. A court appeal is only available after you complete the administrative hearing process. You cannot skip the administrative review and go directly to court.
Payment Plans Do Not Prevent Offset
Many taxpayers mistakenly believe that having an active payment plan with DRS protects them from offset. This is incorrect.
Even if you have a current installment agreement with DRS and are making all scheduled payments on time, DRS will still offset both your federal and state tax refunds to satisfy any remaining balance. The offset remains in effect as long as any unpaid balance exists, regardless of your payment arrangement status.
Suppose you receive a Notice of Intent to Offset while on a payment plan. Continue making your scheduled payments until the debt is fully paid. The offset will be applied toward your outstanding balance, potentially reducing or eliminating the amount you still owe.
Joint Returns and Injured Spouse Rights
If you filed a joint federal tax return and the refund is offset due to a debt that only your spouse owes, you may be able to recover your portion of the refund.
File IRS Form 8379 (Injured Spouse Allocation) with the Internal Revenue Service to request your share of the joint refund. This form allocates the refund between spouses based on each person's income, deductions, and tax payments. You can file Form 8379 with your original joint return if you anticipate an offset, or you can file it after the offset occurs.
Download Form 8379 from the IRS website at www.irs.gov or call the IRS at 1-800-829-3676. For questions about completing the form, contact the IRS at 1-800-829-1040. Mail the completed form to the IRS center where you filed your original tax return.
Injured spouse allocation is different from innocent spouse relief. Innocent spouse relief addresses liability for underreported income or incorrect items on a joint return, not refund allocation after an offset.
Fees and Overpayment Refunds
Connecticut DRS does not charge any fees for processing tax refund offsets. However, interest continues to accrue on your unpaid tax debt until it is paid in full.
If you pay DRS in full but your refund is still offset due to timing issues, DRS will refund any overpayment once it posts to your account. Allow a minimum of four weeks for DRS to receive payment from the Treasury Department and for the payment to appear on your account. If the overpayment resulted from a joint federal return, the refund will be issued in the names of both spouses.
If you file a missing Connecticut tax return and prove that all tax due was paid through withholding or estimated payments, the money offset from your federal refund will be returned to you.
Special Circumstances: Bankruptcy
If you have filed for bankruptcy, contact DRS immediately. The bankruptcy automatic stay prevents offset of your federal income tax refund while the stay remains in effect.
Call the DRS Bankruptcy Unit between 8:30 a.m. and 4:30 p.m. at 860-297-5940, or mail your bankruptcy information to:
Connecticut Department of Revenue Services
Collection Unit - Bankruptcy Team
450 Columbus Blvd. Ste. 1
Hartford, CT 06103
Provide your bankruptcy case number and the bankruptcy court information. While protected from offset during the automatic stay, you remain obligated to file all required tax returns.
Understanding Offset Consequences
A tax refund offset is an administrative collection action and does not directly appear on your credit report or damage your credit score. However, the underlying tax debt may lead to other collection actions, including state tax liens, wage garnishment, or bank levies, which can have broader financial consequences.
If collection actions such as wage garnishment have already been initiated and your offset will satisfy the debt in full, immediately send a copy of the offset notice to the DRS Enforcement Unit at the address above or fax it to 860-541-5843. DRS will review your account and adjust collection activity accordingly.
How to Verify Your Debt
If you are uncertain about the debt amount or believe it may be incorrect, contact DRS at the phone number or address provided on your Notice of Intent to Offset. A DRS representative can confirm your balance information and explain what tax years or debts are included in the offset amount.
DRS sends updated account information to the Treasury Department regularly, but timing differences between when you make payments and when offset requests are processed can result in offsets exceeding your current balance. In such cases, DRS will refund the overpayment after it posts to your account.
Moving Forward
Receiving a Connecticut Notice of Intent to Offset Refund requires immediate attention. Mark your calendar with the 60-day deadline, gather documentation about the debt, and decide whether to pay in full or request an administrative hearing.
Acting within the 60-day window gives you the best chance to protect your rights, resolve disputes, or arrange payment before losing your tax refund. Do not ignore this notice, as DRS will proceed with the offset automatically if you fail to respond within the required timeframe.
Received a State Tax Notice?
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance
