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Omar Farouk

Tax refund seized by ESD for PUA overpayment - never received notification

I'm in absolute shock right now. Just checked my bank account expecting my tax refund (was supposed to be $5,800) and only received $2,300. Called the IRS and found out ESD took $3,500 for a supposed PUA overpayment from 2021! Here's the situation: I moved from Washington to Oregon last year for a better job opportunity. Apparently ESD sent verification requests to my old address, which never got forwarded. Since I was working full-time, I stopped checking my ESD portal. Had NO IDEA they needed additional documentation. I've been completely blindsided by this. No TOPS letter, no notification about offsetting my refund - NOTHING. This refund was going to pay for my spring semester tuition, and now I'm scrambling. I've already tried calling ESD about 20 times but can't get through. Submitted all my income documentation through the portal last week (which is what they originally wanted). Also filed an appeal AND submitted a waiver back in February. It's like they're deliberately ignoring my case. Has anyone dealt with ESD taking tax refunds without proper notification? Any success getting money back after submitting the documentation they wanted? I have PROOF I qualified for every dollar of PUA I received. I'm desperate - tuition payment deadline is in 3 weeks.

OMG THIS EXACT THING HAPPENED TO ME LAST MONTH!!! I was supposed to get $4200 back and only got $1800!! When I called IRS they said ESD took $2400 for 'benefit overpayment' but I NEVER GOT ANY NOTICE EITHER!!! I've been calling ESD for WEEKS and can't get through - either busy signal or it hangs up after the automated message. So frustrating!!! I submitted all my documents again through the portal but haven't heard anything back. This system is completely broken!!! I had all the documentation they needed the whole time but they never bothered to actually look at it before taking my money!!

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It's maddening! Have you tried submitting a waiver? I'm wondering if that might help our cases. Did you move during/after the pandemic too? I'm thinking that might be why we both missed notifications.

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This is unfortunately happening to many people right now. ESD is required by law to send you a TOPS notice before intercepting tax refunds, but their notification system has been problematic, especially for people who moved. Here are some steps to take: 1. Document everything - dates you've called, copies of everything you've submitted 2. Submit a formal appeal through OAH if you haven't already 3. Contact your state representative's office - they often have liaisons who can escalate ESD issues 4. Continue submitting your documentation through the portal 5. If you submitted a waiver, follow up specifically on its status The good news is that if you can prove you qualified for the PUA benefits, ESD should reverse the overpayment determination and refund what was taken from your tax return.

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Thank you! I hadn't thought about contacting my state rep. Would I contact the one from my district in Washington even though I now live in Oregon? And do you know approximately how long the waiver review process takes?

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the esd system is GARBAGE. they took $1700 from me 2 yrs ago and i still havent got it back even tho i sent them all the docs they wanted. good luck getting anyone on the phone lol

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Two years?! That's terrifying. Did you ever get to speak with anyone at ESD about your case?

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I had a similar situation last year with an overpayment claim. The key for me was documenting EVERYTHING and being extremely persistent. Here's what worked: 1. Compile all your documentation into a single, organized PDF (income verification, communication attempts, etc.) 2. Write a formal demand letter stating that they failed to follow proper notification procedures before taking your refund (specifically mention Bureau of Fiscal Service requirements) 3. CC your state representatives and the ESD Commissioner's office on all communications 4. File a formal complaint with the state ombudsman office It took about 3 weeks, but they finally reviewed my documentation and reversed the overpayment. The tax refund portion took another 6-8 weeks to be returned. Don't give up - if you have the proper documentation, you can get this resolved. The system is overwhelmed, so you need to make your case stand out.

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This is really helpful, thank you! I'll start putting together that documentation package tonight. Did you mail the physical demand letter or submit it electronically? And which email address did you use for the Commissioner's office?

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I spent 2 months trying to get through to ESD about a similar issue. Regular phone line is useless - always busy or disconnects. I finally used Claimyr (claimyr.com) to get through to an actual ESD agent. It bypasses the phone queue somehow. They have a video that shows how it works: https://youtu.be/7DieNd3C7zQ?si=26TzE_zGms-DODN3 Got connected to an agent within 30 minutes who could actually see my account and documents. The agent confirmed they received my documentation but it was sitting in a backlog. They flagged it for expedited review and my overpayment was reversed a week later. Definitely worth it to actually talk to someone who can help instead of submitting things into the void.

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I hadn't heard of this service before! I'm going to check it out tomorrow. At this point, I just need to speak to a real person who can look at my documents. The portal feels like a black hole.

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Don't waste your time calling the regular ESD number. You need to specifically contact the ESD Collections department at 866-697-4831. They're the ones who handle tax refund intercepts and TOPS notices. Regular ESD agents often can't even see that information in their system. Also, be aware there are actually two separate processes going on: 1. The overpayment determination itself (which you can appeal) 2. The collection action (tax intercept) which you can also dispute separately Make sure you're addressing both issues. If you qualified for the benefits, focus on proving that with income documentation. If they failed to notify you properly, focus on the TOPS violation.

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I tried that collections number and it just puts you in another endless queue... been on hold for over an hour twice and never got through :

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u should file a complaint with the state attorney generals office too. they take this stuff seriously cuz its actually illegal for esd to take ur refund without sending a tops notice first. my cousin got her $ back that way after esd ignored her for months

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This is good advice. The AG's office can sometimes move things along faster than going through ESD's internal processes. Make sure to mention in your complaint that they failed to follow proper notification procedures required by the Bureau of Fiscal Service.

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UPDATE: Following everyone's advice, I compiled all my documentation (verification documents, record of all contact attempts, appeal confirmation, etc.) into a single PDF. Wrote a formal demand letter citing the Bureau of Fiscal Service requirements and CC'd my state rep and the Commissioner's office. Shockingly, I got an email response within 3 days saying my case was being expedited for review. Just checked my ESD portal today and all the disqualified weeks have been switched back to PAID status and my overpayment balance is now $0! They haven't mentioned when I'll get my tax refund portion back, but at least the overpayment is cleared. Thank you all for your advice - especially about including state officials in the communications. That seems to have been the key to getting attention on my case.

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That's fantastic news! For the tax refund portion, you'll likely need to follow up with the ESD Collections department specifically. They should issue a release to the IRS, but it typically takes 6-8 weeks for the IRS to process the refund. Keep documentation of the overpayment reversal in case you need it.

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This gives me hope!! I'm going to do exactly the same thing. Could you possibly share a template of your demand letter (without personal info of course)?

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Wow, this is amazing! I'm so glad you got it resolved. I'm dealing with a similar situation right now - ESD took $2,100 from my refund with zero notification. Would you mind sharing which state rep you contacted and how you formatted that demand letter? I've been spinning my wheels for weeks trying to get through to someone who can actually help. Your success story gives me hope that there's a way out of this nightmare!

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