What is a "debtor"?
"Debtor" means any individual having a delinquent debt or account with any claimant agency which has not been adjusted, satisfied, or set aside by court order, or discharged in bankruptcy. (defined by the Setoff Debt Collection Act, Section 12-56-20)
What is a "delinquent debt"?
"Delinquent debt" means any sum due and owing any claimant agency. It includes the collection costs, court costs, fines, penalties and interest which have accrued through contract, subrogation, tort, operation of law, or any other legal theory regardless of whether there is an outstanding judgment for the sum which is legally collectible and for which a collection effort has been or is being made. (defined by the Setoff Debt Collection Act, Section 12-56-20)
Examples: delinquent property taxes, rent, utility bills, parking fines, tuition fees, garbage fees, property damage costs, etc.
Can the Municipal Association and a participant collect a reasonable fee through setoff in addition to the original debt amount?
Yes. The Municipal Association charges an administrative fee of $25. A participant may charge an administrative fee up to $25. The system will add these fees to the original debt amount.
Can other means of collection such as a collection agency be used while the debt is pending setoff?
Yes. Other means of collection, such as a private collection agency, may be used after the debt has been submitted to the Department of Revenue. If the debt is collected by other means, the participant must immediately post the payment in the system. The Municipal Association will then notify the Department of Revenue. If the debt is setoff by the Department of Revenue in the interim, the participant must refund the setoff, including the DOR fee to the taxpayer.
How long will the list of claims be current?
One tax year. The Department of Revenue will match the list of claims submitted by the Municipal Association on behalf of participants against the refunds due for that tax year. The claims may be deleted from the list and the amount reduced but no new claims may be added or debt amounts increased after the initial list of debtors is forwarded to the Department of Revenue. A new list of debtors will be submitted to the Department of Revenue each December.
What happens if a debtor files bankruptcy?
In the event you receive notice that a debtor is in bankruptcy, the debt cannot be setoff if the debt is dismissed.