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Question of the day

Tuesday, Mar 27, 2012 - Posted by Rich Miller

* The setup

Illinoisans eagerly awaiting their state tax refunds could be in for a big letdown under a new law that went into effect earlier this year.

In its search for a quick infusion of cash, the city of Chicago and a handful of other local governments have struck an agreement allowing the state to withhold millions of dollars in tax refunds from people who owe the cities money.

Since going into effect, Illinois Comptroller Judy Baar Topinka’s office has notified 40,735 people that their tax refunds will be smaller or nonexistent because they owe money for old traffic tickets and unpaid water bills.

While the bulk of people affected by the Local Debt Recovery Program are from Chicago, it could affect residents throughout Illinois. Other governments participating in the program include Aurora, Joliet, Springfield, Collinsville and Lakeland Community College in Mattoon.

* The Question: Should all local governments be allowed to tap state income tax returns to recover money owed for unpaid traffic tickets and water bills? Take the poll and then explain your answer in comments, please. Thanks.


       

46 Comments
  1. - Cheryl44 - Tuesday, Mar 27, 12 @ 10:20 am:

    I said yes but I had to pay the state this year. I wonder how many other people won’t be seeing a refund this time.


  2. - Turnabout - Tuesday, Mar 27, 12 @ 10:24 am:

    Sure! And if I owe, and the state owes my small business money, I should be able to withhold what I owe until the state pays me, right?


  3. - PPHS - Tuesday, Mar 27, 12 @ 10:25 am:

    Yes. I am tired of people that owe money, simply not paying. They are moochers. All of them.


  4. - Just a Guy - Tuesday, Mar 27, 12 @ 10:28 am:

    If lenders can dock your paycheck, why can’t local governments dock tax refunds? Child support already has dibs on tax refunds. Given a time like this, where governments are strapped, this is a way for them to get money that is already owed to them. On the flip side, maybe people should deduct what the state owes them from any taxes that are due…


  5. - Demoralized - Tuesday, Mar 27, 12 @ 10:30 am:

    Yes!! Absolutely. The government should be able to use whatever means necessary to seize whatever money is owed to it. It’s pretty simple people: pay your fines, fees and taxes. And if you don’t have the money like a lot of people payment plans can always be worked out. Some money is always better than none.


  6. - Colossus - Tuesday, Mar 27, 12 @ 10:40 am:

    I voted yes because, well, that’s the way this works. I don’t like it, but I’ve also lost out on four figure tax refunds because the Treasury had dibs on the whole shebang. It sucks, but it takes care of debts that otherwise are all too easy to ignore.

    That said, Turnabout makes a good point when it comes to providers that are owed by the state. Allowing them to withhold tax payments as an offset against what the state owes them is an interesting and tantalizingly fair proposal, though I’m sure it’s completely unworkable in reality.


  7. - Fed up - Tuesday, Mar 27, 12 @ 10:45 am:

    Yes.


  8. - so.... - Tuesday, Mar 27, 12 @ 10:46 am:

    Considering I never received a refund from the state (always end up owing


  9. - so.... - Tuesday, Mar 27, 12 @ 10:47 am:

    Considering I never received a refund from the state (always end up owing right around $1) I wish Chicago the best of luck in trying to collect on that parking ticket that I refuse to pay.

    I wonder if people have thought about who this will really affect. Sure, you’ll probably catch some well-off scofflaws, but the ones who are gonna get hurt by this are the lower income people who receive the earned income tax credit.

    For example, my aunt, who is retarded and receives the earned income tax credit, has not received her state tax refund for five years running because she’s still working off debt from unemployment benefits that it turns out she was not entitled to.


  10. - Colossus - Tuesday, Mar 27, 12 @ 10:48 am:

    That’s a good point, even when I was in EITC territory I ended up owing the state a few cents (literally), and this year I owed a painless amount as well. How many people actually receive refunds from the state instead of a bill? That would be a good question. Further, the 40K people who were notified they would be getting less, were they notified because they lived in a municipality that was participating in the program and owed the municipality, or did they doublecheck the list of debtors against the list of those who were scheduled for a refund?


  11. - Dirty Red - Tuesday, Mar 27, 12 @ 10:49 am:

    Chicago alone is projected to rake in $8 million from this system. That’s $8 million it was owed but would have otherwise been ignored. This is a cheaper and more efficient way to collect on outstanding debt than hiring an outside debt collection agency or using the small claims courts.

    As to vendors withholding services until they are paid: that has already happened. Many businesses refuse to service the State of Illinois because of the backlog.


  12. - Anonymous - Tuesday, Mar 27, 12 @ 10:52 am:

    I voted no. I feel that local governments getting your money from state tax returns is an invasion to privacy. I believe the state has absolutely no right to share that information, and money, with anyone.


  13. - Foxfire - Tuesday, Mar 27, 12 @ 10:52 am:

    I voted yes. State and local governments need to work together to ensure that scofflaws cannot dodge their responsibilities. This is a good program that provides an additional opportunity for local govt. to collect what is due.


  14. - so.... - Tuesday, Mar 27, 12 @ 10:57 am:

    ==That’s a good point, even when I was in EITC territory I ended up owing the state a few cents (literally), and this year I owed a painless amount as well. How many people actually receive refunds from the state instead of a bill? That would be a good question. Further, the 40K people who were notified they would be getting less, were they notified because they lived in a municipality that was participating in the program and owed the municipality, or did they doublecheck the list of debtors against the list of those who were scheduled for a refund? ==

    I imagine the number of individual taxpayers who receive refunds from the state is rather small. Illinois has a pretty simple flat tax, so they generally collect what they’re entitled to out of withholding. Then most people end up owing a little extra for income that isn’t subject to withholding, like interest income and capital gains.


  15. - Immi - Tuesday, Mar 27, 12 @ 11:00 am:

    I wouldn’t have too much of a problem, if there wasn’t the rise of the red light cameras. It has moved to a pervasive “guilty before proven innocent” culture and one has to go through a lot of hassle to prove one’s innocence. The cameras are a money-making scam and this is just a way to enforce the collection of that money.


  16. - 47th Ward - Tuesday, Mar 27, 12 @ 11:02 am:

    Does the state get a cut of any found revenue like other collection agencies?


  17. - Hickory - Tuesday, Mar 27, 12 @ 11:07 am:

    No! Received a ticket from Chicago for an auto that was never in the City.


  18. - Yellow Dog Democrat - Tuesday, Mar 27, 12 @ 11:12 am:

    Hickory is on-point.

    There was JUST an item in the news about a suburban guy who had his tax return wrongly withheld for a vehicle he never even owned.

    Chicago is notorious for its ticketing scandals. Allowing them to essentially attach a lien to your tax return without due process is egregious.


  19. - Irish - Tuesday, Mar 27, 12 @ 11:12 am:

    I voted yes with the following stipulations. If you are a business or someone who is owed money by the state you should get be able to withhold that amount from the taxes you pay. If it works one way it has to go the other.

    Also, and it might be this way I dont know, if a municipality takes your money then they should have to give you a complete thorough copy of the document showing what you owe, ie: a legible copy of a traffic ticket, so you have all the facts to dispute the bill if it is not yours. And there must be a process where you can dispute the claim if it is not valid. I don’t trust the state or municipalities to get it right and be thorough enough to be positively sure before they debit a tax return.


  20. - Kasich Walker, Jr. - Tuesday, Mar 27, 12 @ 11:24 am:

    “Chicago alone is projected to rake in $8 million from this system.”
    +++++++++
    That’s a lot of dough for a consumer, but not much for a municipality.

    Replace percentage takes with realistic transaction costs on the amounts campaign donating traffic camera companies hold back from the city.

    ….and legalize & commercialize recreational use of marijuana.


  21. - Way Way Down Here - Tuesday, Mar 27, 12 @ 11:30 am:

    Yes, but as others have pointed out there should be a process for review and dispute. Interesting that Lakeland Community College has joined the effort.


  22. - wordslinger - Tuesday, Mar 27, 12 @ 11:40 am:

    No. Why should the state just take the word of the local governments? Everyone has stories about traffic ticket and bill disputes that take forever to resolve.


  23. - Bluefish - Tuesday, Mar 27, 12 @ 11:51 am:

    Yes. There are protections built into the system. The money does not immediately go to the local government. Instead, it is withheld to allow time for the alleged scofflaw to appeal.


  24. - Anonymous - Tuesday, Mar 27, 12 @ 12:03 pm:

    I voted no, becauase many local governments have abused their fee (taxes) system with guilty until proven innocent approaches (red light camera, inoperable parking meters etc) that they do not merit State confiscation of resources without an appeal process.


  25. - Anonymous - Tuesday, Mar 27, 12 @ 12:18 pm:

    If you owe the government money, they should be able to deduct those funds from your IRS and state refund checks.
    Why should ANY government body ever pay an individual any amount of funds if you owe the government money?
    Common sense prevails on this topic.


  26. - Stones - Tuesday, Mar 27, 12 @ 12:30 pm:

    Yes, fair game.


  27. - Anonymous - Tuesday, Mar 27, 12 @ 12:34 pm:

    none of them should as some the “debts” are bogus. i have been contacted three different times about red light violations- never drove any where near the three locations then. actually have never driven there ever.


  28. - Raising Kane - Tuesday, Mar 27, 12 @ 12:39 pm:

    anonymous 12:34…don’t they show you a copy of your license plate going through the intersection. I believe that is required. If they didn’t you should for sure challenge that. Because if you don’t pay up they are sending you to collection agencies (before you go on offset) and it will really ding your credit record…and be way more costly in the long run than a fine.


  29. - mokenavince - Tuesday, Mar 27, 12 @ 12:46 pm:

    Yes I pay my tickets and water bills. I say collect from the deadbeats.


  30. - Plutocrat03 - Tuesday, Mar 27, 12 @ 12:49 pm:

    I voted no because of the dismal record Chicago in particular has with resolving false claims.

    The due process is laughable.

    That said, if the claims for money due were to be truly legitimate, then that could be a reasonable venue to make collections.


  31. - titan - Tuesday, Mar 27, 12 @ 1:00 pm:

    I voted no.
    After a horrendous ordeal dealing with the City of Chicago over an erroneous notice (ticket issued for a car that was never in the City - no evidnce was sufficient for the City to acknwledge its mistake) - I can’t contenance giving the City further power to abuse the innocents that will be abused through this.


  32. - Chicago Bars - Tuesday, Mar 27, 12 @ 1:06 pm:

    Yes in theory, but voted No.

    Chicago’s Dept of Administrative hearings is often a kangaroo court, and time after time have watched their freelance parking ticket writers write utterly bogus parking tickets because they can’t figure out permit parking signage.

    This turnip wants a little due process, before being bled any further with Administrative Notices of Violations written by employees (or third party contractors) with no accountability for issuing bum tickets.


  33. - OPP - Tuesday, Mar 27, 12 @ 1:06 pm:

    What if there is a conflict? Multiple fines owed in multiple jurisdictions? Who would get priority?


  34. - Retired Non-Union Guy - Tuesday, Mar 27, 12 @ 1:07 pm:

    Voted no. The State should not be in the business of collecting for non-State entities. If you owe the State money, then your refund is fair game. Otherwise, hands off.


  35. - Anonymous - Tuesday, Mar 27, 12 @ 1:15 pm:

    raising kane 12:39 it was collection agencies that called all three times. never actually received a ticket. had to argue the fact that the vehicles involved were not mine. they went through the phone book and pulled names that matched the plate holder records. just started calling them all. very rude also, so i was rude in kind.


  36. - Judgment Day - Tuesday, Mar 27, 12 @ 1:50 pm:

    No. Having had to deal with the back office side of local government collection efforts for processing administrative fines and fees, this would be a complete exercise in administrative lunacy.

    Here’s why:

    1. Local government assesses/charges fees/fines (could be parking, traffic, inspection fees of a number of different different types, garbage/trash collection, water/sewage disposal fees, etc., etc.)
    2. Data sent (somehow) to State of IL. placing a ‘lien’ (in effect) on individual/business tax refund (if exists).
    3. Refund exists (miracles do occur!), so lien is applied and money is sent by State to local government.
    4. Local government has to then apply amount (as partial/complete payment) to existing liability on record(s) within aforesaid local government.

    Step 1 is a likely potential nightmare. There’s already a massive number of ‘due process’ issues, not to mention the probability of a large number of invalid charges.

    Step 2 is also going to be fun. What’s to say the ‘flag’ on an individual/business tax account ever gets removed after it is first applied. I mean, it’s not like the State of IL ever makes mistakes, right?

    Step 3 makes me wonder about additional charges, which just happen to get passed onto the hapless taxpayer. How long before the offending liability is $1.25 or so, and the different and various administrative charges are $125.00 or so?
    ($1.25 liability + $125.00 = $126.25 total due).

    And then we get to Step 4. We are doomed!

    OTOH, if we have some judges and staff people we want to force into retirement or drive out of office, they need to be placed in charge of adjudicating and correcting all of the errors that will undoubtedly occur. After 3-4 weeks of doing nothing but handing all these cases from 09:00 - 4:30 5 days a week, they’ll be certifiable (”It’s time to take me away, HaHa….”).

    It’s a winner of an idea from afar. It’s a loser of an idea up close, and particularly if you’re part of the process having to make it work.


  37. - Cal Skinner - Tuesday, Mar 27, 12 @ 1:52 pm:

    You can certainly tell the ratio of those readers loving government to those who are skeptical is weighted toward those who trust government.


  38. - In 630 - Tuesday, Mar 27, 12 @ 3:09 pm:

    I have a hard time believing many debts will be collected out of state income tax refunds if only because the refunds are so rare.

    Now if a municipality has a high concentration of state employees, and those employees rack up parking tickets- this is an excellent program for collecting on that.


  39. - D.P. Gumby - Tuesday, Mar 27, 12 @ 3:27 pm:

    Yes, but only if there has been an adjudication opportunity…not just those dangling noticed mailed that are inaccurate half the time.


  40. - reformer - Tuesday, Mar 27, 12 @ 4:13 pm:

    If Chicago gets to do it, why not other municipalities? (On the other hand, since CPS pays for its teacher pensions, why not other school districts?)


  41. - wishbone - Tuesday, Mar 27, 12 @ 4:14 pm:

    “….and legalize & commercialize recreational use of marijuana.”

    Great afterthought.


  42. - aufjunk - Tuesday, Mar 27, 12 @ 4:30 pm:

    My first reaction was to vote yes. Then I thought about my dealings with local government and remembered getting one of those bogus parking tickets from Chicago (I live in the St Louis metro area and have driven in Chicago exactly once). I quickly changed my mind and sent in my “no” vote, and it looks like lots of people who have had dealings with local governments agree with me. Fair is one thing, honest is another, and IL politicians fall on the wrong side of that equation.


  43. - wordslinger - Tuesday, Mar 27, 12 @ 5:20 pm:

    –You can certainly tell the ratio of those readers loving government to those who are skeptical is weighted toward those who trust government.–

    Cal, I voted no. I’d count myself as one who knows that you have to pay to get government services, but also as one who knows that you should never take any government’s word at face value that someone owes a fine or is guilty of some penalty until there is due process in real court, not just administrative law judges.

    Let the locals go dun citizens in court if they want the money.

    Those views are not contradictory, in my mind.


  44. - Sunshine - Tuesday, Mar 27, 12 @ 5:46 pm:

    Yes. I also like the idea of being able to withhold payments to the state for the money the state owes me.


  45. - RFL - Tuesday, Mar 27, 12 @ 6:15 pm:

    Frankly, I wouldn’t mind if states could tell the federal government how much is owed in aggregate to units of goverment in a state & have that amount withheld from federal tax refunds. I think this is already done with past due student loan payments & could reasonably be expanded.

    That said, as a downstater, I am surprised as how much the internet seems to backup the viewpoint about parking fines in Chicago being a mess. I know some state legislators read this. I hope in the end Mayor Emanuel hears enough complaints about the parking fine mess in Chicago to do something about it.


  46. - Easy Rider - Tuesday, Mar 27, 12 @ 11:10 pm:

    No-I got a ticket on a day I was not even in town-the process is guilty until prove Innocent-hours of time to prove I wasn’t in town or simply pay the fine? Who paid me back? or said sorry? Since I did the work proved I wasnt in town if they had the money the refund would have taken how long.


Sorry, comments for this post are now closed.


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