Out-of-Service Debt
Administrative Offset
Treasury Offset Program

The Treasury Offset Program is a centralized debt collection program developed by the Financial Management Service designed to assist agencies in the collection of delinquent debts owed to the Federal Government. The Financial Management Service is responsible for disbursing over 922 million payments a year on behalf of over 400 Federal agencies. The Treasury Offset Program uses this process to match delinquent debtor files against payment files. When a match occurs, the payment is intercepted and the debt is offset up to the amount of the debt plus assessed administrative fees.

Delinquent account information is reported to the Department of Treasury on accounts having no payments received within 62 days of the date of the initial debt notification letter. Under the Treasury Offset Program, delinquent accounts are subject to administrative offset of United States government funds due individuals from various sources such as Federal Income Tax refunds, federal salary offset, and payments from other government agencies.

Under the Debt Collection Act of 1982 , and the Debt Collection Improvement Act of 1996 , administrative offset is authorized from payments due an individual from:

• Federal Income Tax Refunds - 100 percent of the remaining balance of the debt.
• Office of Personnel Management annuity payments - 15 percent of monthly disposable income.
• Social Security Administration payments - 15 percent of monthly disposable income.
• Non Department of Defense Federal Salary Offset - 15 percent of monthly disposable income.

The federal salary offset process allows for collection of delinquent debts from individuals receiving federal salary from government agencies other than DoD. Currently, there are several federal agencies participating in the federal salary offset process; National Finance Center, Department of the Interior, United States Postal Service, and General Services Administration.