Lowell L. Groundland, Director
Administrative Office of the Courts
Carvel State Office Building
810 N. French Street
Eleventh Floor
Wilmington, DE 19801
Re: Pre Deprivation Notice for Tax Intercept Program
Dear Mr. Groundland:
You have asked whether a claimant agency must provide a debtor-taxpayer with notice and an opportunity for a hearing before the intercept of a tax refund in order to satisfy both federal and state due process requirements. We answer your question in the affirmative.
The authority for the Director of Revenue to collect a debt due to another state agency from the proceeds of an overpayment of tax is found in 30 Del. C. § 545. In § 545(a)(3) the Director is required to notify the taxpayer that an overpayment has been reduced by an amount to satisfy the debt to the claimant agency. Subsection 545(c) of the law, titled "Regulations" requires the Director to promulgate regulations providing for among other things:
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