If you owe back taxes to the IRS, then yes, the IRS can take
your state income tax refund to offset back taxes. When this happens, your state is supposed to
give you a notice of the levy, and the IRS will also provide you a notice after
the levy is made, with an opportunity to appeal. However, the IRS won’t send you a notice if
you’ve previously received a notice of intent to levy.
If you don’t owe back taxes to the IRS, then, no, your current
year state tax refund won’t be applied to your current year IRS debt.
For more information, see the Treasury
Offset Program website.
