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Can I sue the Virginia department of taxation for wrongful garnishing my federal tax refund?

Newport News, VA |

Va Dept . of Taxation ( 804 - 367 - 8031 ) has garnished my federal tax refund electronic deposit this year 2013 stating I owe then taxes for year 1998 and 2002 and I'm active duty military since 1989 - currently . They also stated they have a different last name for me on record however , my SSN and DOB matches so DFAS allowed them to garnish my refund . Now my home of record was IL until 2007 ( no state tax required for AD military ) and 2008 and currently is TN ( no state tax for AD military as well ) but now I have to request 1998 / 2002 LES and W - 2s from archives to prove my home of record . I have never been required to pay any state tax legally therefore this seems wrong that all of a sudden this would happen and properly happening to others . I have NOT received from any agency about this before .

Correction, I meant to say the IRS instead of DFAS. Also, I never received any correspondence about such a debt. It's not even on my credit reports as a collection.

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Attorney answers 3


Regrettably, the doctrine of "sovereign immunity" prevents such a suit. This doctrine is sometimes stated as, "The king can do no wrong." It applies t the State of Virginia.

However, that does not mean that this matter can not be fixed. You're just not going to get any extra money out of this situation. You are going to need a tax attorney or a CPA to get you ID and your taxes straightened out. I will wait to see my tax attorney brethren chime in with helpful thoughts on fixing your problem. Good luck.

Don't forget to click on the "Best Answer" button, if you appreciate this wit and wisdom. This answer is not intended to create an attorney-client relationship and may not be relied upon as legal advice. A careful examination of the facts is necessary before a legal answer may be relied on. You should consult your own attorney before taking or refraining from any legal action.


Can you sue the state? Yes.
Can you win? No. In fact, your case would be dismissed almost immediately. (The State is immune in suit--on grounds of Sovereign Immunity).

You MAY be able to recover what was taken (and nothing more)--you'll need an attorney with expertise in the Commonwealth's tax code--if that attorney had an understanding of LESs and DFAS it wouldn't hurt. Youu'll need to document your home of record was properly recorded with DFAS on your LESs. Inshort you will have to prove the state wrong--it’s doable, but not easy and there will be some cost inolved..

READ THIS BEFORE CALLING OR EMAILING ME: I am licensed to practice before the state and federal courts in Virginia. We have not established an attorney-client relationship unless we have a signed representation agreement and you have paid me. I am providing educational instruction only--not legal advice. You should speak with an attorney to whom you have provided all the facts, before you take steps that may impact your legal rights. I am not obligated to answer subsequent emails or phone calls unless you have hired me. I wish you the best of luck with your situation.


You should file an appeal of the matter with the Virginia Dept of Taxation. The appeal process is described in the Virginia Taxpayer Bill of Rights You generally have 30 days from the date of the collection action.

As the document I linked above states, you have 30 days to file the appeal -- which is the administrative appeal. You have no limitation on filing a lawsuit in state District court, and yes, you can win. Dept of Taxation actions are not subject to "sovereign immunity" and I regularly win these kinds of lawsuits where the collection action was inappropriate. Moreover, the state usually settles out of court once filed.

If you can prove you were never in Virginia as a resident, then Virginia has no authority under state law to levy you, and yes, if you can show you were not a resident, then you will win.

What has happened most likely (tipoff: Name mismatch) is that someone is using your SSN illegally. This is not uncommon, as many illegal immigrants are buying credentials to use in order to get work. You should get credit reports for yourself from all the credit agencies and contact the Social Security Administration to determine if someone is using your SSN.

The legal information presented at this site is for informational purposes only and should not be construed to be formal legal advice nor the formation of a lawyer or attorney client relationship. Your receipt of the information on this website is not intended to create, and receipt does not constitute, a contract for representation by A. Izaak Bozof, Esq. Any results set forth here were dependent on the facts of that case and the results will differ from case to case. This posting is not intended to solicit clients outside the states of Maryland, Connecticut or the District of Columbia, except where the issue is a Federal tax matter (Member: United States Tax Court Bar).

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