By Gina Tabonares
Variety News Staff

THE District Court of Guam has approved the additional form to be used to address the “offset” issue in the immediate payments of $10 million in earned income tax credit for the 1997 and 1998 claims.
In an order issued yesterday, Chief Judge Frances Tydingco-Gatewood granted the Government of Guam’s request to approve a substitute form for the EITC settlement agreement where “early” payments for the 1997 and 1998 claims are subject to partial or complete offsets.
The additional form was also agreed to by the counsels for the directors of the Department of Revenue and Taxation and the Department of Administration, as well as lead class counsel Mike Phillips, who supports the “early” payment notice.
In an earlier motion, Daniel Benjamin, the governor’s counsel, said the additional form is needed in preparation for the early payments of the 1997 and 1998 claims.
Benjamin said the government has encountered an additional challenge not addressed by any existing forms.
He said there are offsets for unpaid child support and liabilities owed by taxpayers to the government, but the settlement also calls for the “early” payments where persons eligible for 1997 and 1998 EITC payments will receive a partial or full payment in the form of a check.
Benjamin said members of the 1997 and 1998 EITC classes will also receive notices explaining that if they deposit the “early” payment checks, they forfeit the right to opt-out and will be bound by the settlement if the court grants final approval.
The lawyer also said that many of the early payments are subject to offsets, but the settlement agreement form does not address the possibility of offsets.
“As to tax year 1998, approximately 3,200 of the eligible claimants out of 11,000 accepted claims have been found to owe (the government). In some cases, the amount is such that the offset will completely cover the ‘early’ payment the claimant would have received. In other cases, they will still be owed something because the offset is only part of the amount,” Benjamin said.