The Government Will Take Your Money For Your Dead Parent's Debts

[TransitJohn]

Here is something that may come as a surprise: the U.S. government can—and will!—confiscate your tax refund or Social Security money because of overpayments that it made to your parents decades ago.

The Washington Post today investigates this confiscatory and little-publicized practice, which no branch of the government is very eager to take credit for. They tell the story of Maryland resident Mary Grice, 58, who saw her tax refunds confiscated by the government this year. Why? Because "Social Security claims it overpaid someone in the Grice family — it's not sure who — in 1977." We are not even talking about, say, old loans that your parents took out. We are talking about the government itself mistakenly overpaying benefits to your parents decades ago, and now, all these years later, coming to you and taking that money out of your pocket, because, you know, your mom probably used it to buy you baby food.

The Federal Trade Commission, on its Web site, advises Americans that "family members typically are not obligated to pay the debts of a deceased relative from their own assets." But Social Security officials say that if children indirectly received assistance from public dollars paid to a parent, the children's money can be taken, no matter how long ago any overpayment occurred.

There used to be a ten year statute of limitations on collections like these, but that was done away with three years ago, and now the tax man is free to go into your pockets for, hell, an extra bushel of corn that your Great x 10 grandpa Jebediah got after the Revolutionary war. You will not want to miss this classic government explanation for this process: "Congressional staffers say the request probably came from the bureaucracy."

Seems likely, yes.

http://gawker.com/the-government-will-take-your-money-for-your-dead-paren-1562241535

[Brigid]

1. This country is just humming along like a well-oiled machine.

Yep, uh huh.

[Historic NY]

2. I knew they can collect from an estate....

once a person is deceased tax accrues on the estate until settled.

[progressoid]

3. Nice.

[blkmusclmachine]

4. ,

,

[pragmatic_dem]

5. it's perfectly fine as long as the richest among us are never inconvenienced nt

[JDPriestly]

6. I can't believe this since a child would not be able to defend against a charge like that.

If it is true, the law needs to be changed. That is petty.

I don't find any citation to a law that says it is true. Does anyone else?

Some states require you to support your parents if they cannot support themselves. But Social Security allows parents to be self-sufficient. That is one of many reasons it is so important.

[JayhawkSD]

7. The repayment was not for "dead parents' debt."

The collection was for overpayment of death benefits paid to the same children from whom it was collected. I do not agree with collecting 30-year-old overpayments, but let's not be indulging in the Republican habit of spreading lies. The collection was levied on the same person to whom the money was originally paid by the government. It was not owed by the parents.

They can collect for "an extra bushel of corn that your Great x 10 grandpa Jebediah got after the Revolutionary war." No, that is utter nonsense.

[fleabiscuit]

8. Awww...

You're not supposed to interject truth and reason when it is time to run around with hair on fire over big government.

[Art_from_Ark]

9. Even if that's true,

if this action was for an "overpayment" that was made 37 years ago, the government should just write it off.

[JayhawkSD]

16. I agree.

As I said in my comment, I do not agree with collecting 30-year-old overpayments and think the statute of limitations should have been left at 10 years.

[passiveporcupine]

10. thank you

I had a feeling it was something like this. People not telling SS that their parents died and continuing to claim benefits. I bet a lot of people try to get away with this.

[JayhawkSD]

17. That's not what it was.

It was death benefits. These are payments for the death of a parent which are paid directly to the child. A parent usually collects and administers the payments, serving as the guardian, but the chaecks are made payable to the child and it is the child's money.

In the case that you cite it is fraud and they would not seek repayment, they would pursue criminal charges with prison terms.

[passiveporcupine]

21. You are correct

I found a better article at Washington Post.

http://www.washingtonpost.com/politics/social-security-treasury-target-hundreds-of-thousands-of-taxpayers-for-parents-old-debts/2014/04/10/74ac8eae-bf4d-11e3-bcec-b71ee10e9bc3_story.html

the part that bothers me is that the government claims an overpayment and then when people ask for proof, they say they have nothing to show them...how then, can they claim anyone was overpaid? If they don't have records that show that?

And apparently the ten year statute of limitation being dropped was inserted into a farm bill three years ago, and nobody knows who did it? Huh?

There is a story of one man who admits he was overpaid, and they asked him in 1978 to repay $600 and he did. Now they just took almost $200 more money out of his tax return without any notice. He wants some kind of letter from them stating his debt has been paid in full, and they said they probably can't (won't) do that. This has got to be very frustrating. Who keeps records that far back?

I'm guessing they are going after money paid to children who were no longer eligible. But the way they are doing this is really not cool.

[JayhawkSD]

22. Except that the article inaccurately references "parents' old debts."

The text of the article is somewhat more accurate than the headline, in that it describes the original payment as death benefits, but it manages to leave the impression that the benefit was paid to Mary Grice's mother rather than, as is actually the case, directly to her. As has been discussed elsewhere, it is unreasonable and unfair to collect overpayment which was made to a child 30+ years after the fact, but the fact remains that the government is collecting her debt, not her parents' debt.

"Who keeps records that far back?" Which is, of course, the whole point of the statute of limitations, along with fading memories and the availability of witnesses, and is precisely why the statute should not have been increased beyond ten years.

"And apparently the ten year statute of limitation being dropped was inserted into a farm bill three years ago, and nobody knows who did it?" Yes, appalling. Too much nasty legislation is passed by inserting "riders" into "must pass" legislation; items which could never pass on their own merits and which are totally unrelated to the bill to which they are attached, but which get passed unnoticed as "add ons" in critical bills which cannot be voted down. The authorship of the rider is deliberately left off, for obvious reasons. It is a monstously corrupt practice which is as common as wheels on a freight train, and is but one small symptom of the sewer of corruption that our government has deteriorated into.

[7962]

11. No, the article states the money was taken because of an overpayment to "someone"

The FTC says it can take money from children who receive overpayments. But in this case, obviously they are doing more than that. Mary Grice didnt get the extra money. The FTC isnt going to admit they've screwed up. The govt rarely DOES admit such a thing. If they cant prove who DID get it, then there shouldnt be any money withheld from anyone.
Democrat or Republican, this type of stuff should piss all of us off.

[JayhawkSD]

18. The article did not equivocate.

It said clearly that it was death benefits. Who received it and administered it serving as guardian for the child is irrelevant. The money was paid to the child. The checks were issued payable to the child.

Yes, it pisses me off, because the statute of limitations should have been left at ten years, and for Congress to extend it to 30 years and more in incomprehensible. But let's stick to the truth. Republicans lie. We don't because the truth will serve us better. The government is not demanding repayment of moneies from people who did not receive that monmey to begin with. Lets's leave that kind of slander to lying Republicans and not become lying Democrats.

[joshcryer]

12. While you're correct, a child should not be held responsible.

At the time of the payments they were children. They had no choice that the money was spent as the money was cashed by and spent by the parents.

You're levying a charge on an individual who had no control over the payments, much less the validity of the payments.

But you're not wrong and I am not saying you are arguing that it is right to levy the charge, I recognize you're explaining the situation.

[gvstn]

13. Still a child cannot enter a contract.

If SSA paid too much it should be related to the parent's account. It is akin to a landlord saying your parents didn't pay the rent back in August of 1974 when you were living in my apartment and because I was unsuccessful in collecting that month's rent from them I am getting the IRS to take it out of your refund because you benefited from your parents living in my apartment that month.

Private businesses can't keep debts on their books for more then seven years and the government shouldn't be able to either. It goes for overpayments and student loans as well. The law is bad and should be changed. The question is who inserted the sentence into the bill and why didn't anyone object.

[jtuck004]

14. "who inserted the sentence" - Not a sentence, a philosophy. Popular with one side of the aisle

because they are myopic and bad at business and popular with the other because they can profit from the blood of others while pretending to be pragmatic.

From slightly before the rules were changed for welfare-to-work to this most recent tactic to collect debt from working people while letting banks and other thieves who contribute to your party off without consequence, it's a spreading, inequality-fostering movement that is dismembering and moving back from the New Deal.

This is what the wealthy want, because it is one of the ways their wealth is propped up. So it is what their paid-for politicians deliver.

[JayhawkSD]

19. It's not a contract...

...because there is no exchange. In order for there to be a contract there must be and exchange of benefits, and there was not. The money is simply given to the child with nothing required in return.

It is not related to the parent's rent. The rent was a contract: money in exchange for a place to live, and it was between the parents and the landlord, not involving the child at all. The landlord never, under any circumstances, has any claim on the child. If you are the landlord you will never in a million years get the IRS to take back rent of of anyone's paycheck.

I agree this is a bad law, and I am disgusted and outraged at Congress that it was passed, but we cannot claim that it was illegal based on the basis that the child could not enter into a contract. We cannot claim that it is illegal at all. It is immoral, outrageous, corrupt, and contemptible, but it is not illegal.

[2pooped2pop]

15. well, they can't tax the rich, so they had to find a way to screw

the middle and lower class for more money to give to BOA, Koch, Exxon, in subsidies.


They won't stop until they have every damned penny.

[pitohui]

20. thats a gawker link

enough said about the credibility of this claim