Consolidating debt procedures

The effective date of this rule is January 22, 1999.

Final Rule Interim rule Notice of Proposed Rulemaking Back To Top Section 285.5 - Centralized Offset of Federal Payments to Collect Non-Tax Debts Owed to the United States SUMMARY: This interim rule describes the general rules and procedures applicable to the centralized offset of federal payments to collect delinquent, nontax debts owed to federal agencies.

The Debt Collection Improvement Act of 1996 has seven purposes: To reduce losses arising from debt management activities by requiring proper screening of potential borrowers, aggressive of all accounts, and sharing of information within and among federal agencies.

To ensure that debtors have all appropriate due process rights, including the ability to verify, challenge, and compromise claims, and access to administrative appeals procedures which are both reasonable and protect the interests of the United States.

It is our intent to expeditiously implement the law to fulfill the Congressional mandate.

It also affects persons who owe delinquent nontax Federal debts and who receive payments from States. Interim Rule Back To Top Section 285.7 - Salary Offset SUMMARY: The Debt Collection Improvement Act of 1996 (DCIA) requires the federal government to withhold or reduce certain federal payments to satisfy the delinquent non-tax debts owed to the United States by the payee.

This rule does not apply to collection of past due support debts (see 31 CFR 285.1), the offset of Federal tax refund payments, the offset of Federal salary payments, or the offset of other Federal payments excluded from offset by law. This process is known as "administrative offset." In addition, the DCIA requires federal agencies, using a process known as centralized salary offset computer matching, to identify Federal employees who owe delinquent non-tax debt to the United States. Final Rule Interim Rule 5 CFR Part 550 Pay Administration (General); Collection by Offset From Indebted Government Employees (Final Rule) 5 CFR Part 550 Pay Administration (General); Collection by Offset from Indebted Government Employees (Notice of Proposed Rulemaking) Back To Top Section 285.8 - Offset of Tax Refund Payments to Collect Certain Debts Owed to States (State Income Tax and Unemployment Compensation Debts SUMMARY: This rule implements the authority added by the SSI Extension for Elderly and Disabled Refugees Act of 2008, as amended by the Claims Resolution Act of 2010, to offset overpayments of Federal taxes (referred to as "tax refund offset") to collect delinquent State unemployment compensation debts.

This interim rule establishes centralized computer matching procedures for comparing delinquent debt information with federal salary payment information for the purpose of offsetting the salary payments of those employees who owe debt to the United States once they are identified. FMS has promulgated a rule governing the offset of federal tax refunds to collect delinquent State income tax obligations at 31 CFR 285.8.

Background Within the Omnibus Consolidated Rescissions and Appropriations Act of 1996 (Public Law 104-134) is the Debt Collection Improvement Act of 1996.

The legislation provides an excellent opportunity for the federal government to move toward its goal of increased electronic commerce and improved cash and debt collection management.

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