Your Tax Refund or Lottery Money Was Sent to the EDD

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The EDD works with the IRS, the State of California Franchise Tax Board, the California State Lottery, and the California State Controller to collect any debt you owe from an Unemployment Insurance (UI) or State Disability Insurance (SDI) benefit overpayment.

You received a Notice of Overpayment (DE 1444) because you were paid UI or SDI benefits that you were not eligible for. Refer to Overpayments and Penalties for more information on the Benefit Payment Control program’s purpose and legal authority.

The EDD can collect unpaid debt by reducing or withholding the following:

  • Federal income tax refunds
  • State income tax refunds
  • State Lottery winnings
  • Funds from unclaimed property

If you believe the amount withheld was incorrect, call 1-800-676-5737 or write to us at:

Employment Development Department
Benefit Overpayment Collection Section
PO Box 826218, MIC 91
Sacramento, CA 94230-6218

Federal Income Tax Refund

The IRS, through the Treasury Offset Program (TOP), can withhold all or part of your federal income tax refund to repay your overpayment debt. The TOP can collect UI overpayments due to fraud by federal law under Title 26, United States Code Section 6402 (f).

Visit Treasury Offset Program (TOP) FAQs for more information on how the EDD participates in the TOP.

For general information about the TOP, visit Treasury Offset Program (TOP) Questions Most Frequently Asked by the Public.

California State Income Tax Refund

The FTB withheld all or part of your California state income tax refund to repay your UI or SDI overpayment debt. Government Code Section (§) 12419.5 allows the Controller to offset any amount due to a state agency from a person or entity.

California State Lottery Winnings

The California State Lottery withheld all or part of your lottery winnings to repay your UI or SDI overpayment debt. Government Code Section (§) 12419.5 allows the Controller to offset any amount due a state agency from a person or entity.

California Unclaimed Property

The State Controller withheld all or part of your unclaimed property funds to repay your UI or SDI overpayment debt. Unclaimed property includes uncashed cashier’s checks or money orders, life insurance benefits, inactive bank accounts, stock dividends, and other similar items. Government Code Section (§) 12419.5 allows the Controller to deduct any amount you owe the State by using your unclaimed property.