Frequently Asked Questions for States as Debtors
The questions on this webpage are about states in their capacity as debtors that owe overdue debts to the United States. For questions about how states can work with the Treasury Offset Program (TOP) to collect debts that people and businesses owe to them, see State Programs. To understand more about TOP, see How TOP Works.
Examples of debts states might owe the federal government include, but are not limited to, disallowed grants, loans, Medicare debts, and overpayments on projects.
TOP treats debts owed by states the same way it treats debts owed by other debtors, including individuals, businesses, and other entities. For general questions about how TOP works, visit Frequently Asked Questions for Debtors in TOP . For a general description of how TOP collects from states, visit Resources for State Agencies in TOP as Debtors .
The taxpayer identification number or “TIN” is used to identify entities (including states) liable for a federal debt. Any payment to an entity using the same TIN as the entity that was referred to TOP is eligible for offset or levy to collect the referred debt.
When TOP offsets (i.e., intercepts) a payment, it sends a letter to the debtor/payee. Because the part of the state that owed the debt may be different from the part of the state that is owed the payment, the state may need to conduct internal coordination between those two parts.
To help this coordination, TOP can provide monthly reports to state comptrollers to help identify delinquent non-tax debts that the state owes to the federal government. These monthly reports include information about whom to contact in the relevant federal agency for each debt.
If you are concerned about a debt owed by your state agency, contact your state comptroller's office for the monthly report. You can also get information on whom to contact about your state agency's debt from the TOP Interactive Voice Response system. (See the Contact Us page.)
TOP uses the taxpayer identification number (TIN) to know who owes the debt. You may have received the decreased payment if your state agency's TIN is the same as another agency in your state that owes a debt. Coordinate with the other state agency to work out this issue.