Treatise on Federal Nontax Law
Fiscal Service will publish this Treatise incrementally in several parts. We will expand the Table of Contents as we draft new chapters. You may access completed chapters using the active links below. These chapters represent the views of the Bureau of the Fiscal Service. They do not necessarily reflect the official policy or position of the Department of Treasury.
Provides federal agency counsel and program staff with an in-depth explanation and interpretation of the laws that govern administrative collection of federal nontax debts, including statutes, regulations, federal common law, interpretive guidance, and the positions that Fiscal Service has taken on debt collection legal matters.
Provides a background on how appropriations principles underlie the federal debt collection process and give rise to an affirmative duty to collect, an overview of federal common law and constitutional principles that govern federal debt collection, and the history of federal debt collection law.
Part I contains multiple chapters;or only individual chapters as needed:
Chapter A: Appropriations Law & the Affirmative Duty to Collect
Provides a background on how appropriations principles underlie the federal debt collection process and give rise to an affirmative duty to collect. Also provides an overview of federal common law and constitutional principles that govern federal debt collection, many of which have been codified and expanded upon in statutory law.
Chapter B: Due Process
Summarizes the constitutional due process requirements for collecting federal nontax debts owed to the United States. Because federal debt collection affects a person’s property rights, the due process guarantee in the Fifth Amendment to the U.S. Constitution is generally implicated by agencies' collection efforts. Statutes and regulations further define what process is due.
Part II contains multiple chapters;or only individual chapters as needed:
Chapter A: Definitions of Debt, Debtor, and Delinquency
Addresses the meanings of the terms debt, debtor, and delinquency in the context of nontax debt collection by federal agencies.
Chapter B: Federal Priority Statute
Claims of the United States have priority over claims owed to other creditors and, when a person is insolvent, federal claims must be satisfied first.
Chapter C: Deceased Debtors
Death generally does not extinguish debts and, as with other types of debts, agencies must pursue collection of debts owed by deceased debtors. In light of certain exceptions, agencies should ensure that no law precludes continued collection before collecting on a debt owed by a deceased debtor.
Chapter D: Debtors in Bankruptcy
Describes some basic bankruptcy concepts and addresses some of the factors that agencies should consider when a debtor files for bankruptcy protection, and alerts agencies to common bankruptcy issues and should not be relied on as a thorough explanation of bankruptcy law.
Chapter E: Entities Out of Business
Provides a broad overview of how entities created under state law can dissolve through state law dissolution proceedings, wind down their business, and liquidate, and how agencies should be aware of state law when pursuing entities that are out of business.
Chapter F: Interest, Penalties, & Costs
With certain exceptions, agencies must charge interest, penalties, and administrative costs on delinquent federal nontax debts.
Part III contains multiple chapters;or only individual chapters as needed:
To facilitate their collection efforts, agencies may use internal and third-party resources to obtain information about the debtor, including the debtor’s mailing address, phone number, employment information, or ability to pay. The debt collection industry is highly regulated and is subject to a number of federal, state, and local laws, and agencies should be aware of the laws with which many data providers must comply.
Describes methods of payments, collection in installments and compromise.
A significant portion of the Government’s administrative and judicial collection activities is centralized within the Department of the Treasury's Bureau of the Fiscal Service and the Department of Justice, respectively. Pursuant to the Debt Collection Improvement Act of 1996, federal agencies generally must refer delinquent nontax debts to Treasury for administrative debt collection action.
Define offset, distinguishes it from other, similar remedies, and explains the law governing each type of governmentwide offset. Chapter does not address authorities specific to an agency or program or the law of setoff in bankruptcy.
Discusses Administrative Wage Garnishment (AWG) authorized by 31 U.S.C. § 3720D, which can be used by federal agencies seeking to collect delinquent federal nontax debts.
Agencies have statutory authority to procure the services of private collection contractors to recover federal nontax debts; however, there are limits on the authority that agencies may delegate to PCCs.
In general, the government should not provide financial assistance to those who have failed to repay other debts owed to the United States. To facilitate this objective, 31 U.S.C. § 3720B requires federal agencies to deny certain types of federal financial assistance to delinquent debtors.
Part IV contains multiple chapters;or individual chapters as needed:
Chapter A: Introduction
Discusses the rules generally applicable to the suspension and termination of collection activity, and explains the distinctions between the two terms and other, related terms.
Chapter B: Terminology
Terminology related to suspension and collection of collection action.
Chapter C: General Principles Applicable to Suspension & Termination
General and agency-specific authorities to suspend or terminate debt collection action, authorities regarding fraud and antitrust claims, and the effect on claims with joint and several liability.
Chapter D: Standards for Suspension of Debt Collection Action
Although federal agencies operate under a broad mandate to 'aggressively collect all debts arising out of activities of, or referred or transferred for collection services to, that agency,' agencies also have express statutory and regulatory authority to temporarily suspend collection of these debts.
Chapter E: Standards for Termination of Debt Collection Action
The Federal Claims Collection Standards (FCCS) interpret and provide guidance as to when it is appropriate to terminate collection action on a claim owed to the United States.
Chapter F: Write-Off and Reporting Discharge of Indebtedness
Termination of debt collection action, discharge, and close out, and the requirement to report discharge of indebtedness to the Internal Revenue Service.
Last modified 11/29/18