The Facts About Federal Restitution

Federal restitution, which is a court-ordered payment to compensate the victim for financial losses resulting from a crime, is typically determined during the sentencing process. Once the restitution amount is set, it can be challenging to reduce or modify it. However, there are a few potential avenues that could potentially lead to a reduction in federal restitution after sentencing:

1.     Appeal: If you believe that the restitution amount was determined improperly or there was an error in the sentencing process, you may choose to appeal the decision. It is important to consult with an attorney experienced in appellate law to assess the viability of an appeal in your specific case.

2.     Financial Hardship: If you are facing genuine financial hardship that makes it impossible or extremely difficult for you to make the required restitution payments, you can request a modification or adjustment based on your changed circumstances. You would typically need to provide evidence of your financial situation, such as income, expenses, assets, and liabilities. The court may consider adjusting the restitution payment plan accordingly.

3.     Change in Victim’s Circumstances: If the victim’s financial situation significantly improves or changes after the sentencing, it may be possible to request a modification of the restitution amount. This would typically require demonstrating that the victim’s losses have been mitigated or that the initial restitution calculation was based on inaccurate or outdated information.

4.     Is Restitution tax deductible? I’m often asked this question, and while I am not an accountant, nor would ever dispense tax advice, recent rulings state that, if handled properly, the restitution payments could be tax deductible on one’s federal income taxes.