DCL-00-24, Federal Tax and Administrative Offset Collection Report for December 1999

DCL-00-24 FEB 23, 2000

TO: ALL STATE IV-D DIRECTORS

RE: Federal Tax and Administrative Offset Collection Report for December 1999 -
Extra Cycle

Dear Colleague:

We are pleased to forward you an additional Collections/Adjustment/Address and corresponding name change reports for the combined 1999 Federal Tax Refund and/or Administrative Offset Programs. In spite of programming challenges in 1999, we are pleased to report another record breaking year with collections in the offset program exceeding $1.3 billion. This represents an increase of over $206 million from 1998. We want to take this opportunity to thank you, our state partners, for helping make these collections possible.

Enclosed is the collection report representing federal tax refund and/or administrative offsets for the last cycle of December 1999 less the tax refund offset fee of $7.45 per offset, and the administrative offset fee of $9.00 per offset, and any adjustments made during this period for the 1993 through 1999 processing years. The net collection total for this cycle for 2,394 offsets is $2,283,137.69. The year-to-date (through Feb 7th) net collection total for 1999 from 1,442,739 offsets is $1,343,535,502.97.

This extra cycle was received at OCSE too late to be included in the December report already forwarded to your state. However, since these collections correspond to 1999 collections and related service fees, it is not appropriate to include them in the February 2000 report.

The detailed collection reports are sent to states via Connect:Direct data transmission as soon as the collection report is run. Because the cover reports must be printed out and a letter signed, it is a few days before a copy of this Dear Colleague letter and corresponding reports are distributed. The transfer of funds through the Automated Clearing House (ACH) is scheduled for February 28^rd.

We are also pleased to report that OCSE and IRS have successfully implemented procedures to reduce the number of full reversals. IRS processing changes in 1999 increased full reversals from 30,000 a year to over 100,000. The IRS recently reported to OCSE that the processing

program for PY2000 has been changed to ensure that injured spouse claims will be processed at the same time as the original return. This will allow FMS to offset the net amount of the payment thus reducing the number of full reversals.

If you have any questions, please contact the Special Collections Unit at (202) 401-9389.

Sincerely,

David Gray Ross
Commissioner
Office of Child Support Enforcement

Enclosures

cc: Tax Offset Contacts
Regional Program Managers