Debt collection processFirst we determine if the debt is valid and make any necessary adjustments. The validation process takes 120 days or more. If we determine you are due money, you will receive a check. Corrected W2 forms are issued each January.
If the debt is valid, we will notify you with a written explanation, description of your debt and a debt statement showing how the debt amount was calculated. It will list entitlements, deductions, payments, and the amount overpaid.
What happens if I don’t pay my debt?
If you disagree with your debt
If you disagree with your debt, you can file a formal protest.
Debts and taxes
Debts and taxes
If you received an overpayment of a taxable item, the IRS requires it be reported under wages in the year it was paid. As you pay off the debt, we will issue a tax certificate each January for the principal paid in the prior year. Your tax professional or the IRS should answer questions about the certificate.
If you paid taxes on your disability severance pay, you could be due a refund. A refund is awarded in the same calendar year in which a military member received disability severance pay. To obtain a refund from us you must submit your Veterans Affairs compensation letter to us before December 31 of the year in which the disability severance pay was paid. Submit your request to:
Refunds of prior tax years cannot be refunded by us. If you received your funds in prior tax years please contact the Internal Revenue Service at 800-829-1040.
Page updated March 12, 2015.