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Bureau of the Fiscal Service

Treasury Offset Program Collects Millions in State Unemployment Compensation Debts

March 31, 2011

FMS Media Relations

The U.S. Department of the Treasury's Financial Management Service (FMS) announced today that it has collected more than $16.7 million in the first five weeks of a new program to collect delinquent unemployment compensation debts owed to states through the Treasury Offset Program. FMS began collecting these debts on February 14, 2011, through a joint effort with the U.S. Department of Labor, Internal Revenue Service (IRS) and states participating in the program.

"This program shows tremendous potential to collect unemployment compensation debts on behalf of states," said Dave Lebryk, FMS Commissioner. "At a time when states are looking to increase revenues, Treasury is pleased to assist states in collecting these debts."

"We encourage other states to participate in this effort to collect unemployment compensation debts, as well as to take advantage of our other joint state/federal debt collection programs" added Lebryk.

On February 14, 2011, New York and Wisconsin became the first states to submit unemployment compensation debts to Treasury for collection. As of March 23, New York has collected more than $14.8 million and Wisconsin has collected more than $1.9 million. The funds recovered from these improper payments will be returned to both the federal and state agencies.

"The offset program has already helped states collect more than $23 billion of delinquent debt since 1997 including child support, state income tax and other state debts," stated Lebryk.

Recently, the President signed the Claims Resolution Act of 2010 which lifted previous restrictions that limited the authority to collect unemployment compensation debts to cases in which the debtor committed fraud and continued to live in the state collecting the debt. This change expands FMS reach to debtors regardless of where the debtor is residing or how long the debt has been owed.

FMS is working with the Department of Labor and IRS to provide outreach to state governments for voluntary support of the Treasury Offset Program (TOP). FMS has conducted webinars and hosted individual meetings with states to address questions on the program.

States interested in participating in the TOP can contact the Treasury Offset Division at 202-874-0540 for more information.

THE FINANCIAL MANAGEMENT SERVICE is a bureau of the United States Department of the Treasury. Our mission is to provide central payment services to federal program agencies, to operate the federal government's collections and deposit systems, to provide government-wide accounting and reporting services and to manage the collection of delinquent debt owed to the government. In FY 2010, FMS collected $5.45 billion of delinquent debt, with $2.10 billion in delinquent child support.

Last modified 07/16/19