If you expect a federal tax refund but have past due federal taxes, unpaid child support, or other federal or state debts, you could be subject to a refund offset. This means the IRS or the Bureau of Fiscal Service may use all or part of your refund to pay the outstanding debt. However, if it’s a federal tax debt and you need the refund for essential living expenses such as housing, food or utilities, you might qualify for an Offset Bypass Refund (OBR). An OBR allows you to receive part of your refund before the rest is applied to your federal tax debt. But you must act before a refund offset occurs, which generally means you should request the OBR when you file your tax return.
