zombie debt collection

[woeisme]

So our chapter 13 closed and discharged last summer. About 2 years ago we were contacted, while still in our CH 13, by a debt collector for a court fee that they said my husband owed from his divorce case in 1990. Now my husband had filed CH 7 about a year after his divorce, and this debt was included, then 15+ years later we filed a CH 13 and were 3+ years into it when they contacted us about the debt, so our lawyer sent them a copy of our CH 13 filing and sent them a copy of the CH 7 discharge from the early 1990's.

Fast forward to last week, when we get a letter from the state telling us that the Ohio attorney general was going to keep $400 of our tax refund this year to pay back the county court for the fee (which was less than $100) and late penalties (the other $300). I don't think it'll be worth the attorney fees to fight it, but am so disgusted that they can ignore the TWO bankruptcy discharges, one which specifically listed the court fee on the credit matrix (the 1992 CH 7) and take $ from our joint tax refund for a 20+ year old debt!!!

Has anyone ever had anything so crazy happen to them? And how can the state violate federal BK law like this? Sorry, it's just chapping my a$$ so I had to vent. :-)

[justbroke]

It very simple. Send a certified letter, return receipt requested with a letter. The letter should show the case number, date, year, and demand that they return the funds. Also remind them that the debt was discharged. Include a copy of the discharge, and a copy of the schedules showing the scheduled debt. I would also include a copy of the BNC (bankruptcy noticing center) proof of service to show that the discharge was sent.

If this is very egregious, which I think that is shown by ignoring the prior requests to stop collecting and actually offsetting a tax refund, then you may be able to get an attorney to take the discharge violation on contingency. There are many cases out there where State tax agencies have been found in violation of the discharge injunction. They are not above federal law (and neither is the IRS for that matter).

They will keep doing this to people unless and until we fight them every single time they do this.

[mynameainttracy]

When we filed ch13 we had some state tax debt that was listed but the state never filed a claim so it didn't get paid back in our plan. About 3 years into our plan we got a letter in the mail saying that our state tax return was incorrect and we should have gotten a $150+ refund but to pay on our debt they were keeping it. It infuriated me because they were the ones that didn't file a claim yet kept our money. Since it wasn't money I was counting on I just let it go even though I knew they were in the wrong. It just wasn't worth the fight at the time but I now wish I had done something because if I still lived there they would have done this to us every year if we were getting a refund.

[justbroke]

When we filed ch13 we had some state tax debt that was listed but the state never filed a claim so it didn't get paid back in our plan. About 3 years into our plan we got a letter in the mail saying that our state tax return was incorrect and we should have gotten a $150+ refund but to pay on our debt they were keeping it. It infuriated me because they were the ones that didn't file a claim yet kept our money. Since it wasn't money I was counting on I just let it go even though I knew they were in the wrong. It just wasn't worth the fight at the time but I now wish I had done something because if I still lived there they would have done this to us every year if we were getting a refund.

Since you were in a Chapter 13 at the time, that would been a violation of the automatic stay. Sure it's only $150, but it appears to me that the State should have filed a motion for relief from stay in order to setoff (offset) the refund to pay for your "pre-petition" tax debt.

Oh well... it happens!