EDD took my state tax refund for overpayment - will they take federal too?

Just got blindsided by EDD. They sent me an overpayment notice about 5 months ago saying I owed $4,750 from benefits I received in 2024. I was planning to set up a payment plan but kept putting it off (my fault, I know). Just filed my taxes and discovered they intercepted my entire state tax refund of $867! No warning, just gone. Now I'm worried about my federal refund which is much bigger - around $2,100. Does anyone know if EDD automatically takes your federal tax refund too for unemployment overpayments? Or do they only have the power to grab state refunds? Really counting on that federal money for some car repairs I can't put off much longer.

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16 comments

Jay Lincoln

•26d

They CAN take your federal refund through the Treasury Offset Program (TOP), but it doesn't always happen automatically or immediately. Here's what you need to know: 1. EDD typically needs to certify the debt to the federal government first 2. You should receive a notice from the Treasury Department 60-90 days before they offset your federal refund 3. If you set up a payment plan with EDD before your federal refund processes, you might be able to protect it Call EDD collections ASAP at 800-676-5737 to set up a payment plan. They're much more willing to work with you if you're proactive, and a payment plan can sometimes stop the federal tax intercept.

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Kennedy Morrison

•26d

I had the same problem trying to reach EDD about an overpayment. What finally worked for me was using Claimyr to connect with an EDD agent. I was skeptical at first, but it actually worked - got me through to someone in about 20 minutes after trying for weeks on my own. Their website is claimyr.com and they have a video showing how it works: https://youtu.be/JmuwXR7HA10?si=TSwYbu_GOwYzt9km Once I finally talked to a real person, I was able to set up a payment plan that worked for my budget. They stopped the process of taking my federal refund since I had a plan in place.

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Wesley Hallow

•26d

Here's what you should do immediately: 1. File Form 911 (Taxpayer Advocate Service) with the IRS if EDD has already certified your debt for federal offset 2. Request a payment plan with EDD as others suggested 3. Keep documentation of EVERYTHING - every call, letter, and payment I went through this exact situation in 2023 with a $5,600 overpayment. I was able to keep my federal refund by setting up a payment plan, but you have to act quickly before the Treasury Department processes the offset.

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Jay Lincoln

•26d

Just to clarify a few things: 1. For your federal refund, EDD must refer your debt to the Treasury Offset Program 2. You should receive a "Notice of Intent to Offset" letter before they take your federal refund 3. Setting up a payment plan can prevent the offset, but timing is critical Based on my experience helping others with this issue, if you set up a payment plan now, there's about a 70% chance you can protect your federal refund if it hasn't already been processed. Call that collections number first thing in the morning (right when they open at 8:00 AM) for the best chance of getting through.

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