State Returns Illegally Intercepted Refunds to Low Income Taxpayers

August 1, 2006

Author: Susan C. Antos

In 1997 and 1998 nearly 28,000 low income taxpayers had their New York State tax refunds taken to recover alleged public assistance overpayments. In many cases, their taxes were taken without adequate notice or an opportunity for a fair hearing. As a result of class action litigation in Federal (Dantzler v. Wing) and State (Watts v. Wing) courts, an agreement was reached to allow those with intercepted refunds to request a review which would result in a return of their refund if it was taken without due process. Further, the agreement established that in such cases, any alleged overpayment that was recovered without due process, would be declared void.  Since February of 2006, the Office of Temporary and Disability Assistance (OTDA) has been sending out notices to class members on a staggered basis, (2333 per month), and will continue to due so through January of 2007, until all class members have received a notice.

To date, over 1,000 class members have been determined to be entitled to a refund and 210   refunds totaling $81,609.67 have been issued to Watts and Dantzler class members.  Class members have 60 days from the date they receive a notice from OTDA to request a refund,  and the OTDA has 5 months after that to make a determination as to whether a refund is due.  Of those who received notices in February, 2006, about 30% requested that OTDA review their case, and of those requesting review, nearly 80% were determined eligible to receive a refund.  Therefore if you have clients who come to you with Watts/Dantzler notices, advise them if they submit their review request form, they are likely to obtain a refund if they file a request for review.

If you have questions, please contact Susan Antos at 1-800-635-0355, x15.  The pleadings and settlement agreements in Watts and Dantzler, including the form notices, can be found in the Benefits Law Database at: http://onlineresources.wnylc.net/welcome.asp?index=Welcome Dantzler v. Wing was brought by the Empire Justice Center (Susan Antos, Barbara Weiner) and Watts v. Wing was brought by the New York Legal Assistance Group (Jane Stevens).