15 C.F.R. PART 19—REFERRAL OF DEBTS TO THE IRS FOR TAX REFUND OFFSET
Title 15 - Commerce and Foreign Trade
Authority: 31 U.S.C. 3720A; Public Law 98–369; 98 Stat. 1153.
Source: 58 FR 39653, July 26. 1993, unless otherwise noted.
This part establishes procedures for the Department of Commerce (DOC) to refer past-due debts to the Internal Revenue Service (IRS) for offset against the income tax refunds of persons owing debts to the DOC. It specifies the agency procedures and the rights of the debtor applicable to claims for payment of debts owed to the DOC. (a) These regulations implement 31 U.S.C. 3720A which authorizes the IRS to reduce a tax refund by the amount of a past-due legally enforceable debt owed to the United States. (b) For purposes of this section, a past-due legally enforceable debt referable to the IRS is a debt which is owed to the United States and: (1) Except in the case of a judgment debt, has been delinquent for at least three months but has not been delinquent for more than ten years at the time the offset is made; (2) Cannot be currently collected pursuant to the salary offset provisions of 5 U.S.C. 5514(a)(1); (3) Is ineligible for administrative offset under 31 U.S.C. 3716(a) by reason of 31 U.S.C. 3716(c)(2) or cannot be collected by administrative offset under 31 U.S.C. 3716(a) by the Department against amounts payable to or on behalf of the debtor by or on behalf of the Department; (4) With respect to which, the DOC has given the taxpayer at least 60 days from the date of notification to present evidence that all or part of the debt is not past-due or legally enforceable, the DOC has considered evidence presented by such taxpayer, and has determined that an amount of such debt is past-due and legally enforceable; (5) Has been disclosed by the DOC to a consumer reporting agency as authorized by 31 U.S.C. 3711(f), unless a consumer reporting agency would be prohibited from using such information by 15 U.S.C. 1681c, or unless the amount of the debt does not exceed $100.00; (6) With respect to which, the DOC has notified or has made a reasonable attempt to notify the taxpayer that the debt is past-due and, unless repaid within 60 days thereafter, will be referred to the IRS for offset against any overpayment of taxes; (7) Is at least $25.00; (8) With respect to which, all other requirements of 31 U.S.C. 3720A and the Department of the Treasury regulations codified at 26 CFR 301.6402–6 relating to the eligibility of a debt for tax refund offset have been satisfied. In accordance with 4 CFR part 102, all administrative charges incurred in connection with the referral of a debt to the IRS shall be assessed on the debt and thus increase the amount of the offset. A request for a reduction of an IRS tax refund will be made only after the DOC makes a determination that an amount is owed and past-due and provides the debtor with sixty (60) days written notice. The DOC's notice of intention to collect by IRS tax refund offset (Notice of Intent) will include: (a) The amount of the debt; (b) A statement that unless the debt is repaid within sixty (60) days from the date of the DOC's Notice of Intent, DOC intends to collect the debt by requesting that the IRS reduce any amounts payable to the debtor as refunds of Federal taxes paid by an amount equal to the amount of the debt plus accumulated interest and other charges; (c) A statement that the debtor has the right to present evidence that all or part of the debt is not pass-due or legally enforceable; (d) A mailing address for forwarding any written correspondence and a contact name and phone number for any questions. (a) Notification by debtor. A debtor who receives a Notice of Intent has the right to present evidence that all or part of the debt is not past-due or not legally enforceable. To exercise this right, the debtor must: (1) Send a written request for a review of the evidence to the address provided in the notice. (2) State in the request the amount disputed and the reasons why the debtor believes that the debt is not past-due or legally enforceable. (3) Include in the request any documents which the debtor wishes to be considered or state that additional information will be submitted within the remainder of the sixty (60) day period. (b) Submission of evidence. The debtor may submit evidence showing that all or part of the debt is not past-due or not legally enforceable along with the notification required by paragraph (a) of this section. Failure to submit the notification and evidence within sixty (60) days will result in an automatic referral of the debt to the IRS without further action by the DOC. (c) Review of the evidence. DOC will consider all available evidence related to the debt. Within 30 days of the debtor's complete and timely response, if feasible, DOC will notify the debtor whether DOC has sustained, amended, or canceled its determination that the debt is past-due and legally enforceable. (a) Following review of the evidence, DOC will issue a written decision which will include the supporting rationale for the decision. (b) If DOC either sustains or amends its determination, it shall notify the debtor of its intent to refer the debt to the IRS for offset against the debtor's Federal income tax refund. If DOC cancels its original determination, the debt will not be referred to the IRS. If the debtor timely notifies the DOC that he or she is exercising the right described in §19.5(a) and timely submits evidence in accordance with §19.5(b), any notice to the IRS will be stayed until the issuance of a written decision which sustains or amends the DOC's original determination.
Title 15: Commerce and Foreign Trade
PART 19—REFERRAL OF DEBTS TO THE IRS FOR TAX REFUND OFFSET
Section Contents
§ 19.1 Purpose.
§ 19.2 Applicability and scope.
§ 19.3 Administrative charges.
§ 19.4 Notice requirement before offset.
§ 19.5 Review within the Department.
§ 19.6 Departmental determination.
§ 19.7 Stay of offset.
§ 19.1 Purpose.
top
§ 19.2 Applicability and scope.
top
§ 19.3 Administrative charges.
top
§ 19.4 Notice requirement before offset.
top
§ 19.5 Review within the Department.
top
§ 19.6 Departmental determination.
top
§ 19.7 Stay of offset.
top
