Protection from application of joint overpayment against spouse's delinquencies or debts; recovery of protected monies; appeal

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42-2203. Protection from application of joint overpayment against spouse's delinquencies or debts; recovery of protected monies; appeal

A. Notwithstanding section 42-1122, at the time of filing a joint income tax return pursuant to section 43-309, a taxpayer may apply to the department for protection of the taxpayer's share of any overpayment or refund from setoff for the past due state taxes, child support, spousal maintenance or other obligations of the taxpayer's spouse that are ordered by a court or owed to an agency of this state.

B. The department shall receive applications for protection under this section in a form and manner prescribed by the department.

C. If the department grants relief under this section, the amount of the claimant's protected share:

1. Is determined by a proration based on each spouse's estimated tax payments or taxes withheld from wages. For purposes of this proration, estimated payments will be divided evenly between spouses unless it is clearly demonstrated by the taxpayers that a portion of the estimated payments were for income that is not community property.

2. May not exceed the portion of the entire refund or overpayment with respect to the joint return properly allocable to the claimant. The claimant has the burden of proving the portion properly allocable to the claimant.

D. If monies protected under subsection A of this section have already been distributed to an agency or political subdivision, the claimant shall file with the appropriate agency or political subdivision a request for recovery of the protected amount pursuant to section 42-1122.

E. A taxpayer may appeal a determination under this section pursuant to section 42-1251 or 42-1253.


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