§ 1951.122 - Finance Office screening.

The FmHA or its successor agency under Public Law 103-354 Finance Office will screen the accounts of all borrowers potentially eligible for IRS Offset. FmHA or its successor agency under Public Law 103-354 field offices will further screen these accounts based on the following ineligibility criteria. The Finance Office will determine the appropriate date for this screening based on IRS deadlines.

(a) General. All past due single family housing (SFH) and farmer program (FP) accounts are eligible for IRS Offset unless they meet one or more of the following criteria:

(1) Account has been referred to OGC for foreclosure and, based on the legal opinion required by § 1951.103(c), a collection by offset would jeopardize the litigation under State law. Existence of a foreclosure action pending flag is not a determining factor.

(2) Account has been discharged in bankruptcy or is under the jurisdiction of a bankruptcy court and the debt has not been reaffirmed. Existence of a bankruptcy action pending flag is not a determining factor.

(3) Account has a suspend code.

(4) Account has been assigned to a collection agency.

(5) Account is past due by less than $25, or if the borrower has multiple loans, the net amount past due is less than $25.

(6) Borrower is a Federal employee and collection is feasible under salary offset.

(7) Borrower was indebted to FmHA or its successor agency under Public Law 103-354 prior to entering full time active duty military service and the account is being serviced in accordance with FmHA or its successor agency under Public Law 103-354 Instruction 1950-C.

(8) Account is current under a subject to approved adjustment (SAA).

(b) Single Family Housing Borrowers. In addition to the criteria set forth in § 1951.122(a), the following criteria are for delinquent SFH borrowers:

(1) Borrower has one loan and it is less than 3 monthly payments delinquent (or, if annual borrower, the equivalent of less than 3 monthly payments for annual payments past due) or more than 9 years delinquent.

(2) Borrower has multiple loans, and the net amount past due is less than 3 monthly payments on the delinquent loans (or the equivalent of 3 monthly payments for annual payment borrowers).

(3) Account is under a moratorium.

(4) Account has an Additional Payment Agreement (APA) in effect and payments under the APA are less than 3 months past due.

(c) Farmer Program Borrowers. In addition to the criteria set forth in § 1951.122(a), the following criteria are for delinquent FP borrowers:

(1) Borrower is a partnership or corporation and/or is identified in the accounting system by an employer Identification Number (EIN rather than a Social Security Number (SSN).

(2) Account is less than 90 days past due.

(d) Servicing Condition Requirements for Farmer Program Borrowers. The FP accounts remaining after screening from § 1951.122 (a) and (c) are eligible for IRS offset only if either of the following servicing conditions takes place, whichever comes first:

(1) Borrower has received any combination of Attachments 3 through 10 of Exhibit A of subpart S of this part; and the borrower did not request an appeal of the decision; any appeal has been concluded; or

(2) Borrower's account(s) has been accelerated.