0022 - Debt Related Queston: Bankruptcy Question # 0022

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QUESTION #0022:

I was expecting a big tax refund, but instead received nothing. The assessment states that the funds were transferred to a debt I owe. How is this possible? Can I get it back?



ANSWER:

Debts owed to the Federal, or Provincial, Government may be recovered through seizing, or garnishing, your tax refund. They may also seize GST Credits. Garnished funds are only returned upon proof of payment of the debt for which it was collected. The assessment or notice should state what the debt was for, such as EI overpayment, Student Loans, Medical Services Plan, etc. Always investigate that this debt is accurate by contacting the office that seized the funds. Ensure they have your correct contact information. Sometimes the garnishments happen without apparent contact simply because the individual office doesn’t know where you are. If that is the case, they simply process a garnishment under your Social Insurance Number for tax refunds and GST Credits. Once the details on the debt are known you can proceed to negotiate a payment schedule directly with the collection department.