Sec. 12-742. Withholding of refund from persons owing debts or obligations to the state or in default of certain student loans.
Sec. 12-742. Withholding of refund from persons owing debts or obligations
to the state or in default of certain student loans. (a) In cases where any person or
entity is due a refund of state income taxes, and that same person owes a debt or obligation
for which the Commissioner of Administrative Services is seeking reimbursement, the
Commissioner of Revenue Services, upon notification by the Commissioner of Administrative Services, shall withhold the payment of said refund to such person or entity to
the extent of such debt or obligation, provided the Commissioner of Revenue Services
shall notify such debtor that he or she has the right to a hearing before an officer designated by the Commissioner of Administrative Services if he or she contests the validity
or amount of the Commissioner of Administrative Services' claim, except that where
the debt or obligation is a debt resulting from failure to pay an order for child support,
the administrative review process will be held in accordance with subsection (e) of
section 52-362e. If the debtor fails to apply in writing to the Commissioner of Administrative Services for a hearing within sixty days of the issuance of notice of withholding,
the Commissioner of Revenue Services shall remit the amount of the withheld refund
to the Commissioner of Administrative Services. If the debtor elects an administrative
hearing within this time, the Commissioner of Revenue Services shall remit the amount
of the withheld refund in accordance with any decisions of the hearing officer or the
court upon an appeal of the hearing officer's decision.
(b) (1) In cases where any person or entity is due a refund of state income taxes,
and that same person is in default of a student loan made or guaranteed by the Connecticut
Student Loan Foundation or the Connecticut Higher Education Supplemental Loan Authority, the Connecticut Student Loan Foundation or the Connecticut Higher Education
Supplemental Loan Authority, as appropriate, shall notify the Commissioner of Administrative Services of such default. The Commissioner of Revenue Services, upon notification by the Commissioner of Administrative Services, shall withhold the payment of
said refund to such person to the extent of such default, provided the Commissioner of
Revenue Services shall notify such person in default that he or she has the right to a
hearing before an officer designated by the Commissioner of Administrative Services
if he or she contests the validity or amount of the Commissioner of Administrative
Services' claim. If the person in default fails to apply in writing to the Commissioner
of Administrative Services for a hearing within sixty days of the issuance of notice
of withholding, the Commissioner of Revenue Services shall remit the amount of the
withheld refund to the Commissioner of Administrative Services, who in turn shall remit
the amount of such withheld refund to the Connecticut Student Loan Foundation or
the Connecticut Higher Education Supplemental Loan Authority, as appropriate. If the
person in default elects an administrative hearing within this time, the Commissioner
of Revenue Services shall remit the amount of the withheld refund in accordance with
any decisions of the hearing officer or the court upon an appeal of the hearing officer's
decision. If a person in default also owes a debt or obligation described in subsection
(a) of this section, the refund shall be applied against such debt or obligation before
being credited against the amount of the default.
(2) The Commissioner of Revenue Services, the Commissioner of Administrative
Services, the president of the Connecticut Student Loan Foundation or the executive
director of the Connecticut Higher Education Supplemental Loan Authority, as appropriate, on behalf of such corporation, shall enter into an agreement for the crediting of
income tax refunds against the amount a taxpayer is in default of a loan pursuant to
subdivision (1) of this subsection. The agreement shall include procedures for the Connecticut Student Loan Foundation or the Connecticut Higher Education Supplemental
Loan Authority, as appropriate, to (A) notify the Commissioner of Administrative Services of a default, and the amount of the default, and (B) reimburse the Department of
Administrative Services and the Department of Revenue Services for any costs incurred
by the departments in carrying out the provisions of this subsection.
(June Sp. Sess. P.A. 91-3, S. 93, 168; P.A. 92-253, S. 7; P.A. 01-102, S. 6, 7; P.A. 07-108, S. 4; 07-247, S. 65.)
History: June Sp. Sess. P.A. 91-3, S. 93, effective August 22, 1991, and applicable to taxable years of taxpayers
commencing on or after January 1, 1991; P.A. 92-253 added phrase "except that where the debt or obligation is a debt
resulting from failure to pay an order for child support, the administrative review process will be held in accordance with
subsection (c) of section 52-362e"; P.A. 01-102 designated existing provisions as Subsec. (a), made technical changes in
Subsec. (a) and added Subsec. (b) re person or entity in default of a student loan; P.A. 07-108 amended Subsec. (b) to add
provisions re Connecticut Higher Education Supplemental Loan Authority, effective July 1, 2007; P.A. 07-247 amended
Subsec. (a) by replacing reference to Sec. 52-362e(c) with reference to Sec. 52-362e(e).