Colorado – Amended Debt Collection Offset Procedures

SALT Report 2548 – The Colorado General Assembly recently amended the procedural requirements for offsetting debts against state tax refunds. Senate Bill 247 requires that the Department of Personnel and Administration send written notification to a taxpayer regarding their unpaid debt before the Department of Revenue can initiate any collection activity. The notice must also inform the taxpayer that they have 30 days to request a hearing to dispute the tax refund offset.

In addition, the Bill authorizes the state to enter into a reciprocal debt collection agreement with the federal government and any state. If under a reciprocal debt agreement there are multiple creditors with claims against the same taxpayer, the order in which the debts will be paid is as follows:

  • Colorado agencies and institutions,
  • Political subdivisions of the state,
  • The federal government, and
  • Other states

The provisions of this Bill are effective August 7, 2013.

For Further Information

Colorado General Assembly – Senate Bill 247, Laws 2013