EDD took my tax refund for overpayment - can I apply for unemployment again?
I just had a situation with EDD overpayment that I'm confused about. I had an overpayment balance of around $9,000 from benefits I received in 2023 (turns out I wasn't eligible for some reason that wasn't clear to me). While I was attending school full-time last year, I wasn't working and tried to apply for unemployment but was denied because of this outstanding balance. Just filed my taxes last week and my refund was supposed to be about $10,000, but they intercepted $9,300 of it to pay off my EDD debt. I'm assuming my balance is now cleared, but I'm wondering - does this mean I can apply for unemployment benefits in the future if I need them? Or am I permanently blacklisted from the system? I've graduated and am looking for work now, so this matters to me. Anyone dealt with something similar?
21 comments
Daniel Washington
ur not blacklisted lol. once u paid the overpayment ur good to go. they just wont let u get new benefits while u owe them $$$. same thing happened 2 my cousin last yr
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Lauren Zeb
•Thanks! That's a relief. Have you heard if there's any waiting period after the debt is cleared? Or can I literally apply right away?
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Aurora Lacasse
You are absolutely eligible to file for unemployment now that your overpayment has been satisfied through tax intercept. The system should automatically update your status within 10-14 business days after the payment posts. In some cases, it can take up to a month for the system to fully clear the flag on your account. A few important things to know: 1. Print and save proof that your tax refund was intercepted 2. Check your UI Online account to confirm the balance shows zero 3. If you apply and get an error message about overpayment, call and reference the tax intercept 4. Make sure you meet all other eligibility requirements (job loss not your fault, able to work, etc.) The previous overpayment won't affect your benefit amount for future claims as long as it's fully paid.
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Lauren Zeb
•This is super helpful! I'll definitely keep documentation of the tax intercept. I haven't been able to check my UI Online account yet because I seem to be locked out - probably because it's been a while since I accessed it. Going to try the account recovery process.
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Anthony Young
They STOLE your tax refund!! $9,300 is RIDICULOUS! I had the EXACT same thing happen but mine was only $3,400. The system is BROKEN!! Did they even send you proper notice before taking your money? They're supposed to send multiple warnings before tax intercept!!
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Lauren Zeb
•They did send me some notices, but I moved twice in the past year so I might have missed some. I was upset about losing so much of my refund, but honestly I'm just relieved the debt is gone now. Did you end up qualifying for benefits again after your tax refund was taken?
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Anthony Young
•Yeah I did qualify again but it took FOREVER. The EDD website still showed I owed money for like 2 months after they took my refund! Had to call them 37 times before someone fixed it in their system. The whole department is incompetent!!!!
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Charlotte White
My sister was in a similar spot last year. She owed about $6k and they took her refund too. She was able to apply again about a month later and got approved. Don't worry about being blacklisted, that's not a thing with EDD as far as I know. Once the debt is paid, you're back to square one.
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Admin_Masters
I work as a tax professional and see this situation frequently. Once the Treasury Offset Program (TOP) has intercepted your tax refund and applied it to your EDD overpayment, you are eligible to apply for benefits again - there is no permanent penalty or blacklisting. However, there are two important things to watch for: 1) Verify that the intercept fully cleared your balance. Sometimes penalties and interest aren't included in what shows on your online account. 2) If you had what's called a "fraud overpayment" rather than a "non-fraud overpayment," you might have penalty weeks assigned to your account. These are weeks where you'd qualify for benefits but won't be paid as an additional penalty. You can call EDD to confirm both of these points and get an official statement that your account is clear. I recommend doing this before applying again.
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Lauren Zeb
•Thank you for this detailed explanation! I don't think mine was a fraud case - it was just that they determined I wasn't eligible after initially approving me. But I'll definitely call to make sure everything is clear before I apply. Do you know if the 10-14 day processing time for the payment to be applied to my account is accurate?
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Admin_Masters
•Yes, 10-14 business days is typically accurate for the payment to be processed, but it can sometimes take up to 30 days for all systems to update and for the flags to be removed from your account. When you do call, request a specific confirmation that there are no penalty weeks on your record - this is something many people don't think to ask about.
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Matthew Sanchez
If you're trying to call EDD to check your status, good luck getting through! I spent DAYS trying to reach someone when I had a similar situation. Finally used a service called Claimyr (claimyr.com) that got me connected to an EDD rep in about 20 minutes. They have a video showing how it works here: https://youtu.be/JmuwXR7HA10?si=TSwYbu_GOwYzt9km Saved me hours of frustration and the agent was able to confirm my account was cleared after tax intercept. They also told me exactly when I could apply again.
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Lauren Zeb
•Thank you for this suggestion! I've been dreading making that call because I remember how impossible it was to get through last time. I'll check out that service if I can't get through on my own after a few tries.
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Anthony Young
•Does this actually work? I've tried calling EDD like 50 times and never get through!!
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Matthew Sanchez
•@profile8 Yes, it worked for me twice now. Both times I got through to someone in under 30 min. Way better than the redial-all-day approach I tried before.
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Ella Thompson
When they took my tax refund for overpayment last year, my UI Online account didn't update automatically. I had to bring it to their attention by calling. But after that was sorted out, I was able to apply for benefits about 6 weeks later when I lost my job. The system didn't give me any problems at that point. So yes, you should be fine to apply once everything is updated in their system!
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Charlotte White
wait i'm confused... if u were in school full time how were u eligible for unemployment anyway? don't u have to be available for full time work?
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Aurora Lacasse
•You're correct that generally, full-time students aren't eligible for unemployment because they're not considered available for full-time work. However, there are exceptions: 1. Students in approved training programs (like CTB - California Training Benefits) 2. Students who are willing and able to leave school for full-time work 3. Students taking primarily evening/weekend classes that don't interfere with standard work hours The original poster mentioned they were denied while in school, which is consistent with standard eligibility rules. Now that they've graduated and are looking for work, they would potentially be eligible (assuming the overpayment issue is resolved).
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Charlotte White
•oh that makes sense! thx for explaining
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Daniel Washington
btw make sure u check that they didn't take TOO MUCH money from ur refund. sometimes they mess up the calculations and take more than u actually owe. happened to my friend and he had to fight for months to get his $600 back
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Lauren Zeb
•That's a good point! I should double-check the exact amount I owed. The last letter I got said around $9,000 but I'm not sure if there were interest or penalties added. I'll definitely look into that.
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