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Can a debt collector take my tax return if they have only sent me a letter stating what I owe for and how much? I live in FL

Melbourne, FL |

My star card was turned over to a debt collector because I fell behind on payments. I was told by a representive from NCO FINANICAL that called to collect this debt that they can take my tax return, is this true?

Attorney Answers 3


No, this is not true and is a violation of the Fair Debt Collection Practices Act. Before they can garnish wages or freeze bank accounts, or get a tax refund (unless it is child support arrears) they have to sue you and get a judgment.

Judgments are filed in the office of the clerk in the place (jurisdiction) where the suit was filed. They can be filed in other jurisdictions as well by being recorded in additional clerks offices.

The judgment gives the judgment holder the right to use various means to collect the judgment. The two most familiar are wage garnishment and freezing bank accounts. The judgment can also constitute a lien on any real property that is in your name. The judgment can sit in the Clerks office for many years, accumulating interest until you want to sell a house or refinance the mortgage on a property, and then title or the loan cannot be secured unless the judgment is paid off.

Disclaimer: This answer does not constitute legal advice. I am admitted in the States of New York, New Jersey and Massachusetts only and make no attempt to opine on matters of law that are not relevant to those three States. This advice is based on general principles of law that may or may not relate to your specific situation. Facts and laws change and these possible changes will affect the advice provided here. Consult an attorney in your locale before you act on any of this advice. You should not rely on this advice alone and nothing in these communications creates an attorney client relationship. The opinions expressed herein are those of the author only and the fact that he has worked as an Assistant District Attorney; State Supreme Court Clerk; Special Assistant United States Attorney (Hawaii); Assistant Cornell University Counsel or Judge Advocate, United States Marine Corps should not be relied upon to assume that these statements reflect the policy of these organizations.

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I have not heard of a "Star" Card. (My best guess is that it's similar to or another name for an AFES (Exchg.) card but that is just a guess).

With the common exceptions of child support, educational loans, and past due taxes, a creditor (such as "Star") or their collector (such as NCO) is not going to be able to go fairly directly to any refund you may be owed by the IRS. NCO would need a judgment and could only get the refund proceeds after you receive the refund. This assumes that refund is not derived solely from the earned income tax credit and that you have no other exemptions remaining under Florida law to exempt any otherwise non-exempt portion.

So, until NCO sues you and obtains and judgment against you (if they are successful), the collector's statements that you have described misleading.

This answer does not constitute and is not intended as legal advise. I would need additional facts in order to confirm that I understand your situation and advise you.

Don Petersen
Orlando, FL

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I agree with Theodore. It sounds like this may be a violation of the Fair Debt in Collection Practices Act. There are attorneys who may go after debt collection firms for you. I believe Morgan and Morgan does debt harassment suits on a no costs until collection basis.

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