Frequently Asked Questions for Federal Agencies
Treasury's official publication for its policies, procedures, and instructions is the Treasury Financial Manual (TFM).
The Debt Collection Improvement Act of 1996 (DCIA). Under that law, federal agencies must transfer nontax debt that is more than 180 days overdue (delinquent) to Fiscal Service for collection. Fiscal Service must then take appropriate action to collect the money. Learn more about the DCIA.
The Digital Accountability and Transparency Act of 2014 amended the DCIA to require agencies to notify Fiscal Service of all debts delinquent over 120 days for purposes of administrative offset.
Here is how it works:
Each year, the agency signs an agreement with Fiscal Service that covers both Cross-Servicing (our program for collecting delinquent debt) and the Treasury Offset Program (TOP, where we match federal payments and delinquent debtors and withhold money to cover a delinquent debt). The agreement sets forth the facts that the agency is certifying when they refer the delinquent debt. Generally, the agency's Chief Financial Officer or equivalent officer should sign the agreement.
The facts that an agency certifies are, among other things, that when they transfer a debt,
- the debt is valid, delinquent, and legally enforceable,
- there are no bars to collecting the debt, and
- the agency has provided all required due process to the debtor.
It is the agency's responsibility to ensure that the person who refers the debt to Fiscal Service has the appropriate authority to do that, including compromise authority.
Yes. See I TFM 4-4035.10 – Complete an Agency Profile Form.
The Agency Profile Form gives us basic information about the agency's debt program and reflects the requirements of the TFM chapter.
If the same basic debt collection rules apply to all your agency's debt collection programs, we need only one profile form for all those programs. However, if requirements differ by debt types, you may need to fill out a separate profile form for different programs.
We must have the appropriate profile form before we can service the agency's debts.
See the Agency Profile Form.
No. Unless otherwise noted, the new or updated form governs all the program's debts, whether the debts were referred before or after the profile was updated.
Fiscal Service charges the agency who referred the debt its collection fees. Fiscal Service does not charge debtors directly for its fees. Generally, agencies must by law pass those fees on to debtors.
See I TFM 4-4045.10 – Fees Charged to the Creditor Agency.
Check our Contact Us page for contact information for federal agencies with questions.
Full Compromise Authority
See 31 U.S.C. 3711(g)(1)(A), (5) and I TFM 4-4030.30 – Fiscal Service Authority to Compromise Debts and/or Collect Debts in Installment.
Agencies generally must refer debts to Fiscal Service for collection when the debt is more than 120 days overdue (delinquent). When that happens, Fiscal Service acts for the agency. Fiscal Service then has the same authority over that debt as the head of the referring agency has, including the authority to compromise (negotiate a settlement or forgive the debt).
The agency agrees to this authority in its Agency Profile Form.
If the agency has legal reasons why it cannot grant full compromise authority to Fiscal Service, the agency must cite the relevant law on the Agency Profile Form. If you need further guidance about this, contact us.
No, not necessarily. Generally, only specific legal prohibitions are valid exceptions to giving Fiscal Service full compromise authority. If your agency has a sufficiently compelling reason to withhold compromise authority, you should contact us to discuss.
Your agency may need to re-evaluate your internal policies for delegating authority so you ensure that each person who refers debts to Fiscal Service has the authority to do so, including granting full compromise authority.
Fiscal Service's goal is to collect the full amount of the debt. We compromise a debt only if it is the best interest of the government and is consistent with the Federal Claims Collection Standards.
Agencies generally may not impose parameters for our decisions on Fiscal Service, unless there is specific statutory authority for those parameters. If there are, they must be cited on the Agency Profile Form.
If your agency has policy considerations that it wants Fiscal Service to consider, you can tell us about them. We may, at our discretion, use those when considering a compromise.
Fiscal Service's private collection agencies (PCAs) have limited authority to negotiate a compromise with a debtor. Any compromise offers between a PCA and a debtor above 50 percent must have Fiscal Service approval.
Proof of Debt Documentation
No. You can still refer the debt.
We will work with your agency to help you fulfill the requirements of 1 TFM 4-4000.
Your agency must make reasonable efforts to provide the documentation we need at or near the time you refer the debt or within a short time of our request for documentation.
See I TFM 4- 4035.40 – Transfer Eligible Debts to Fiscal Service; Provide Debt and Debtor Information to Fiscal Service.
Yes. Agencies must update Fiscal Service with any new information. For example, agencies must notify us if a debtor files for bankruptcy and the agency is consequently barred from pursuing collection.
You must update us about debts owed to your agency for at least these three reasons:
- Meet the requirements in the agreement the agency signed
Providing updates is part of what the agency agreed to in its annual certification with Fiscal Service.
- Collect delinquent debts
Agency must collect delinquent debts. Giving Fiscal Service updated information that helps us collect those debts means you are fulfilling that requirement.
See I TFM 4-4035.40 – Transfer Eligible Debts to Fiscal Service; Provide Debt and Debtor Information to Fiscal Service.
- Keep accurate records
Agencies are responsible for keeping accurate records about the debts, including accurate debt balances, even after they refer the debts to Fiscal Service for collection.
See I TFM 4-4035.50 – Maintain Records.
Use of All Debt Collection Tools
It depends. Generally, agencies must authorize Fiscal Service to use all available debt collection tools, and that includes administrative wage garnishment (AWG).
If you believe that AWG is not in the best interest of the government, you should give us your reasons. We will work with you to evaluate your concerns.
See I TFM 4-4035.30 – Comply with Relevant Laws and Authorize Use of All Appropriate Debt Collection Tools.
Partial matches can happen in the Treasury Offset Program (TOP) when there is an incomplete match between a debt record and a payment record.
TOP works by matching the Taxpayer Identification Number (TIN) to the TINs in a database of delinquent debtors. (For individuals, the TIN is usually the Social Security Number. For businesses, the TIN is usually an Employer Identification Number.)
In a full match, the TIN and the name on the payment match the TIN and name in the database.
Sometimes, however, the TIN matches but the name is not the same. That can be the result of a typo in the name or it can be because the debtor uses (or has used) more than one name or different versions of the name. When the TIN matches, but the name does not, we have a partial match.
We do not offset payments based on a partial match.
However, we research partial matches to see if additional names (alias names) need to be added to that debtor's records. In this research, Fiscal Service uses established criteria and only adds an alias name if we are reasonably confident that the name is really another name of that debtor.
The situations that most often cause partial matches where there should have been a full match include:
- change from a maiden name to a married name
- a business using an acronym sometimes and full name sometimes
- a typo or transcription error in the debtor's name
I TFM 4-4035.30 – Comply with Relevant Laws and Authorize Use of All Appropriate Debt Collection Tools
I TFM 4-4000 Section 4040.30 – Modify Records.