I want to update a 2015 post on the subject of federal criminal restitution collection. I wrote that state law exemptions such as Florida homestead would not stand up against federal collection, but that state property law would apply so that tenants by entireties assets would be exempt from restitution orders against one spouse.
I had recently to address the restitution issue for a different Florida client. In updating my research a found a case decided later in 2015 that contradicts my statement earlier about the treatment of entireties property . In this case, the debtor argued that a restitution order could not be collected by garnishment of a government retirement plan because the plans were exempt under Florida Statute. The court said that restitution is collected as if it were a tax liability owed to the IRS. The U.S. Supreme Court has previously held that the IRS can go after a taxpayer’s 50% interest in tenants by entireties properties where one spouse owes taxes. There is certain property that is exempt from collection of taxes or criminal restitution. These exempts are expressed in a federal statute and Internal Revenue Code, and the exemptions apply to debtors in all states.