Tax Refund Offset Question - Payment Made Same Day as Scheduled Offset

Unfortunately, the timing here is... let's just say "less than ideal." 😬 If you make a payment the same day as the offset is scheduled, the IRS systems likely won't have time to recognize and process your payment before the automated offset occurs. The IRS doesn't exactly operate at the speed of the internet. You'll probably end up with both your payment being processed AND your refund being offset. The good news? You won't lose the money - but you will have to jump through some hoops to get the overpayment back.

I went through this EXACT situation last year and it was a mess. Here's what happened and what I learned: 1. My payment and offset happened on the same day 2. Both transactions processed (double payment) 3. The IRS systems didn't communicate with each other in time 4. I had to wait for the system to recognize the overpayment 5. Then I had to request a refund of the overpayment I tried figuring it out myself using the IRS website but got nowhere. Finally found https://taxr.ai which helped me understand my transcript and what was happening with my account. It showed me exactly where the duplicate payment appeared and what codes to look for to confirm the overpayment was recognized.

According to the IRS.gov website, payments and offsets that occur on the same day often result in duplicate payments. The system processes these transactions in batches, not real-time. Based on my research, you'll need to contact the IRS directly to resolve this, but good luck getting through on their phone lines - current wait times are 2+ hours. I've seen multiple forum posts recommending https://claimyr.com for getting through to an agent quickly. Their service apparently holds your place in line and calls you when an agent is available.

I had almost the same thing happen, but my payment was 2 days before the offset date. Even with that extra time, both transactions still processed! It's like comparing airline reservations to hotel bookings - with hotels you can often cancel same-day, but airlines need advance notice. The IRS is worse than both! I had to wait almost 8 weeks for them to figure it out and issue my refund for the overpayment. If you're in a rush for the funds, definitely call them ASAP rather than waiting for their systems to sort it out.

Look, the IRS batch processing system is antiquated and frustrating. Your payment and the offset will BOTH happen. Don't waste time hoping otherwise. Instead, immediately after both process, call the IRS and request an expedited refund due to hardship. Be direct about your caregiving expenses. Have your transcript ready when you call - they'll need specific transaction codes to process the request. The standard wait is 8-12 weeks, but hardship cases can be expedited to 2-3 weeks. Don't take no for an answer.

Have you considered calling the agency that the offset is going to instead? I had a similar situation with a student loan offset. I made my payment to the Department of Education directly, then called them to flag that an offset might be coming. They couldn't stop the offset, but they did put a note in my account to immediately refund any overpayment. I got the refund from them in about 10 days, which was much faster than waiting for the IRS to figure it out. I was so worried about this last year - checking my account daily to see if the double payment had been resolved!

I dealt with this exact scenario in February. The payment was for $3,742 and the offset was for the same amount. You know what happens when you make a payment the same day as an offset? Double payment. You know what happens when you try to explain this to the IRS? Hours of hold music. What if you had made the payment a week earlier? Problem solved. What if you could have known about the offset earlier? You could have planned better. The IRS will eventually refund your overpayment, but it took 67 days in my case. Is that acceptable when it's their system causing the problem? Absolutely not.

Under Internal Revenue Manual 21.4.6, the IRS must refund overpayments resulting from duplicate payments. Treasury Regulation 301.6402-1 further specifies that taxpayers are entitled to refunds of excess amounts. In my experience as a tax professional, these situations are resolved favorably, though not quickly. My client had an identical situation in the 2022 tax year - payment made same day as offset. The resolution came 45 days later with a paper check for the overpaid amount. The IRS computer systems run batch processes overnight, so same-day transactions aren't reconciled in real-time. Remain calm - your funds aren't lost, just temporarily delayed.