Government ends efforts to collect old Social Security debtsNews added by Benefits Pro on April 16, 2014

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By Lisa Barron

The Social Security Administration is suspending a program in which thousands of people were having their tax refunds seized to recoup decades-old debts owed by relatives.

“I have directed an immediate halt to further referrals under the Treasury Offset Program to recover debts owed to the agency that are 10 years old and older pending a thorough review of our responsibility and discretion under the current law,” the acting Social Security commissioner, Carolyn Colvin, said in a statement this week.

The move came after Social Security recipients and members of Congress complained that people were being forced to repay overpayments that were sometimes paid to their parents or guardians when they were children.

The effort to collect on old debts began after a line in the 2008 farm bill lifted the statute of limitations on debts to the government that are more than 10 years old.

The Treasury Department then set up rules that allowed the government to settle such debts by intercepting taxpayers’ refunds.

That enabled authorities to reportedly withhold the tax refunds of 400,000 people who had relatives with debts to Social Security, some of them going back as far as the middle of the last century.

The Social Security Administration also reached out to individuals whose refunds might have been seized.

“If any Social Security or Supplemental Security Income beneficiary believes they have been incorrectly assessed with an overpayment under this program, I encourage them to request an explanation or seek options to resolve the overpayment,” Colvin said.

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