[Federal Register Volume 60, Number 8 (Thursday, January 12, 1995)]
[Proposed Rules]
[Pages 2910-2912]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-776]



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[[Page 2911]]

AGENCY FOR INTERNATIONAL DEVELOPMENT

22 CFR Part 213


Collection of Debts by Tax Refund Offset

AGENCY: Agency for International Development.

ACTION: Proposed rule.

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SUMMARY: The Agency for International Development proposes to issue 
regulations to allow the agency to recover delinquent debts owed the 
United States Government through the offset of tax refunds.

DATES: Comments must be submitted on or before February 13, 1995.

ADDRESSES: Comments may be mailed to Mr. Jan Miller, Office of the 
General Counsel, Room 6881, N.S., Agency for International Development, 
Washington, DC 20523.

FOR FURTHER INFORMATION CONTACT:
Jan W. Miller, (202) 647-6380.

SUPPLEMENTARY INFORMATION: The proposed rule will enable the agency to 
recover delinquent debts owed the United States Government through the 
offset of tax refunds. The proposed rule sets forth the procedures to 
be followed by AID in using tax refund offset.

Regulatory Flexibility and Impact Analysis

    This action will not have a significant economic impact on a 
substantial number of small entities including small businesses, small 
organizational units and small governmental jurisdictions.
    This action does not constitute a ``major rule'' under Executive 
Order No. 12291.

Environmental Impact

    This action does not constitute a major Federal action 
significantly affecting the quality of the human environment.

List of Subjects in 22 CFR Part 213

    Claims, salary offset.

    Accordingly, it is proposed to amend 22 CFR part 213 as follows:
    1. The authority citation for part 213 is revised to read as 
follows:

    Authority: Sec. 621 of the Foreign Assistance Act of 1961, as 
amended, 22 U.S.C. 2381; Subpart B also issued under 5 U.S.C. 5514; 
5 CFR part 5550, subpart K. Subpart C also issued under 31 U.S.C. 
3720A.

    2. Part 213 is amended to add a new subpart C as follows:

PART 213--COLLECTION OF CLAIMS

* * * * *

Subpart C--Collection of Debts by Tax Refund Offset

213.21 Purpose.
213.22 Applicability and scope.
213.23 Administrative charges.
213.24 Pre-offset notice.
213.25 Reasonable attempt to notify and clear and concise 
notification.
213.26 Consideration of evidence and notification of decision.
213.27 Change in conditions after submission to IRS.

Subpart C--Collection of Debts by Tax Refund Offset


Sec. 213.21  Purpose.

    This subpart establishes procedures for AID to refer past due debts 
to the Internal Revenue Service (IRS) for offset against income tax 
refunds of taxpayers owing debts to AID.


Sec. 213.22  Applicability and scope.

    (a) This subpart implements 31 U.S.C. 3720A which authorizes the 
IRS to reduce a tax refund by the amount of a past due and legally 
enforceable debt owed to the United States.
    (b) A past due legally enforceable debt referable to the IRS is a 
debt which is owed to the United States and;
    (1) Except for judgement debt or other debts specifically exempt 
from this requirement, is referred within 10 years after AID's right of 
action accrues;
    (2) In the case of individuals, is at least $25.00.
    (3) In the case of business debtors is at least $100.00;
    (4) In the case of individual debtors, cannot be currently 
collected pursuant to the salary offset provisions of 5 U.S.C. 5514(a).
    (5) Is ineligible for or cannot be currently collected pursuant to 
the administrative offset provisions of 31 U.S.C. 3716;
    (6) Is the debt of a debtor (or in the case of an individual 
debtor, his or her spouse) for whom AID records do not show debtor has 
filed for bankruptcy under title 11 of the United States Code or from 
whom AID can clearly establish at the time of the referral that an 
automatic stay under 11 U.S.C. 362 has been lifted or is no longer in 
effect;
    (7) Has been disclosed by AID to a consumer reporting agency as 
authorized by 31 U.S.C. 3711(f); and
    (8) With respect to which AID has given notice, considered any 
evidence, and determined that the debt is past-due and legally 
enforceable under the provisions of this subpart;


Sec. 213.23  Administrative charges.

    All administrative charges incurred in connection with the referral 
of debts to the IRS will be added to the debt, thus increasing the 
amount of the offset.


Sec. 213.24  Pre-offset notice.

    (a) Before AID refers a debt to the IRS, it will notify or make a 
reasonable attempt to notify the debtor that:
    (1) The debt is past due;
    (2) Unless repaid within 60 days thereafter, the debt will be 
referred to the IRS for offset against any overpayment of tax;
    (3) The debtor has at least 60 days from the date of the notice to 
present evidence that all or part of such debt is not past-due or not 
legally enforceable; and
    (4) AID will consider any evidence presented by the debtor and 
determine whether any part of such debt is past-due and legally 
enforceable.
    (b) The notice will explain to the debtor the manner in which the 
debtor may present such evidence to AID.


Sec. 213.25  Reasonable attempt to notify clear and concise 
notification.

    (a) Reasonable attempt to notify. AID will have made a reasonable 
attempt to notify the debtor under Sec. 213.24(a) if it used a mailing 
address for the debtor obtained from the IRS pursuant to the Internal 
Revenue Code, 26 U.S.C. 6103(m)(2) or (m)(4), unless AID receives clear 
and concise notification from the debtor that notices are to be sent to 
an address different from the address obtained from the IRS.
    (b) Clear and concise notification. Clear and concise notification 
means that the debtor has provided AID with written notification 
including the debtor's name and identifying number (as defined in the 
Internal Revenue Code, 26 U.S.C. 6109), the debtor's new address, and 
the debtor's intent to have the notices sent to the new address.


Sec. 213.26  Consideration of evidence and notification of decision.

    (a) AID will give the debtor at least 60 days from the date of the 
pre-offset notice to present evidence. Evidence that collection of the 
debt is affected by a bankruptcy proceeding involving the debtor shall 
bar referral of the debt.
    (b) If the evidence presented is not considered by an employee of 
AID but by an entity or person acting for AID, the debtor will have at 
least 30 days from the date the entity or person decides that all or 
part of the debt is past-due and legally enforceable to request review 
by an employee of AID of an unresolved dispute.
    (c) AID will provide the debtor with its decision and the decision 
of any entity or person acting for AID on to whether all or part of the 
debt is past-due and legally enforceable. [[Page 2912]] 


Sec. 213.27  Change in conditions after submission to IRS.

    AID will promptly notify the IRS if, after submission of a debt to 
the IRS for offset, AID:
    (a) Determines that an error has been made with respect to the 
information submitted to the IRS;
    (b) Receives a payment or credits a payment, other than an IRS 
offset, to the account of the debtor;
    (c) Receives notice that the debtor has filed for bankruptcy under 
title 11 of the United States Code or the debt has been discharged in 
bankruptcy;
    (d) Receives notice that an offset was made at the time when the 
automatic stay provisions of 11 U.S.C. 362 were in effect;
    (e) Receives notice that the debt has been extinguished by death; 
or
    (f) Refunds all or part of the offset amount to the debtor.

    Dated: November 22, 1994.
Tony L. Cully,
Controller.
[FR Doc. 95-776 Filed 1-11-95; 8:45 am]
BILLING CODE 6116-01-M