Is NJ seizing ANCHOR rebates? What you need to know

💲 NJ can seize funds for unsettled debts
💲 If you owe back child support can NJ take your money?
💲 The appeals process is difficult

The New Jersey Department of the Treasury announced that ANCHOR payments have begun to go out and applications will continue to be processed until all payments are made.

While the state does seize certain funds for back taxes or other reasons, the Treasury says this season's ANCHOR payments are not subject to seizure by the Division of Taxation.

Back taxes, unpaid child support and/or alimony and even debts owed to Motor Vehicles could cause the state to seize your money.

This article looks at how and why the state can seize your rebate and what, if anything, you can do about it.

New Jersey can just take my money?

Yes.

Its technically called a Set-Off or Offset program and there are several in place in the state of New Jersey.

Under the Set-off program, New Jersey will divert taxpayer refunds and government payments to pay federal or state debts.

What will trigger a fund diversion?

The most common Set-Off is for unpaid taxes, traffic fines, child support or other government programs, according to the New Jersey Department of the Treasury.

If you know you owe back taxes, alimony, or child support it would be safe to assume the state could take your rebate money.

The state can also seize a portion or all of your rebate check if you owe money, penalties or fees to agencies like the Motor Vehicle Commission or the Department of Labor and Workforce Development.

Will they take the entire benefit?

That depends on how much you owe. They won't take more than what is in arrears.

The amount of the payment that is intercepted also depends on the amount owed and whether the noncustodial parent has other child support cases.

Will I be notified if the state is taking my money?

In most cases, yes.

If an agency claims you have a debt, and a tax refund or benefit payment is available, you should get a notice in the mail from the Department of Treasury.

The notice will tell you:

✔ The amount of tax refund or benefit payment available to pay that debt.
✔ The name of the agency or agencies that requested payment and each agency’s contact information.

What if I owe money in another state?

It depends on the state.

New Jersey has Reciprocal Set-Off agreements with California, Connecticut, Maryland, and New York.

According to the Department of Treasury, the state will send New Jersey Income Tax refunds to offset taxes owed in those states.

If you receive a notice that you owe another state and you believe it is an error you have 90 days to respond in writing to the address provided in the notice in order to appeal the claim.

EDITOR'S NOTE: An earlier version of this story should have said that this year's ANCHOR rebate benefit is not being seized by the Division of Taxation. 

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