Taxpayer Identifying Number Requirement

DEPARTMENT OF THE TREASURY

Fiscal Service

31 CFR Part 212

RIN 1510-AA61

Taxpayer Identifying Number Requirement

AGENCY: Financial Management Service, Fiscal Service, Treasury.

ACTION: Withdrawal of notice of proposed rulemaking.

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SUMMARY: The Debt Collection Improvement Act of 1996 (DCIA) requires

executive agencies to include payee taxpayer identifying numbers (TINs)

on certified payment vouchers which are submitted to disbursing

officials. The Financial Management Service (FMS), the Department of

the Treasury disbursing agency, and other executive branch disbursing

agencies are responsible for examining certified payment vouchers to

determine whether such vouchers are in proper form. To ensure that

executive branch agencies submit payment certifying vouchers in a form

which includes payee TINs, FMS issued a proposed rule on September 2,

1997. The rule, as proposed, would require disbursing officials to

reject payment requests without TINs.

Upon review of the comments received in response to the proposed

rule, FMS has determined that a better approach to ensure compliance

with the DCIA TIN requirement, in lieu of issuing a final rule, is to

require each executive agency to submit a TIN Implementation Report to

FMS documenting how the agency is complying with this requirement.

Accordingly, FMS is issuing this document withdrawing the September 2,

1997, notice of proposed rulemaking. The Policy Statement outlining TIN

Implementation Report requirements is being published in the Federal

Register concurrently with this document.

DATES: The notice of proposed rulemaking published at 62 FR 46428 is

withdrawn on October 9, 1998.

FOR FURTHER INFORMATION CONTACT: Cindy Johnson (Director, Cash

Management Policy and Planning Division) at 202-874-6657, Dean Balamaci

(Director, Agency Liaison Division, Debt Management Services) at 202-

874-6660, Sally Phillips (Policy Analyst) at 202-874-6749, or James

Regan (Attorney-Advisor) at 202-874-6680. This document is available on

the Financial Management Service's web site: http://www.fms.treas.gov.

SUPPLEMENTARY INFORMATION: On April 26, 1996, the Debt Collection

Improvement Act of 1996 (DCIA) was enacted as Chapter 10 of the Omnibus

Consolidated Rescissions and Appropriations Act of 1996, Pub. L. 104-

134, 110 Stat. 1321-358. A major purpose of the DCIA is to enhance the

government-wide collection of delinquent debts owed to the Federal

Government.

Section 31001(d)(2) of the DCIA, codified at 31 U.S.C. 3716(c),

generally requires Federal disbursing officials to offset an eligible

Federal payment to a payee to satisfy a delinquent non-tax debt owed by

the payee to the United States. A Federal disbursing official will

conduct such an offset when the name and Taxpayer Identifying Number

(TIN) of the payee match the name and TIN of the delinquent debtor,

provided all other requirements for offset have been met. This process,

known as ``centralized offset,'' also may be used to collect delinquent

debts owed to States, including past-due child support. The Department

of the Treasury, Financial Management Service (FMS) is responsible for

implementing the DCIA, including the centralized offset authority.

Section 31001(y) of the DCIA, codified at 31 U.S.C. 3325(d),

facilitates centralized offset by requiring the head of an executive

agency or an agency certifying official to include the TINs of payees

on certified payment vouchers which are submitted to Federal disbursing

officials. FMS, as the Department of Treasury disbursing agency,

disburses more than 850 million Federal payments annually. See 31

U.S.C. 3321. FMS and other executive branch disbursing agencies are

responsible for examining certified payment vouchers to determine

whether such vouchers are in the proper form. 31 U.S.C. 3325(a)(2)(A).

In an effort to ensure that executive branch agencies submit

certified payment vouchers in a form which includes payee TINs, FMS

issued a proposed rule on September 2, 1997 (62 FR 46428), 31 CFR Part

212, Taxpayer Identifying Number Requirement. The rule, as proposed,

would require disbursing officials to reject payment requests without

TINs, effective 6 months after publication of the final rule.

After careful review and consideration of the comments submitted by

Federal agencies in response to the proposed rule, FMS has determined

that a better approach to ensure compliance with the DCIA TIN

requirement, in lieu of issuing a final rule, is to require each

executive agency to submit an agency TIN Implementation Report to FMS.

This approach will address more effectively the underlying barriers to

collecting TINs, and therefore increase compliance with the DCIA. The

rejection of payment requests lacking TINs, as contemplated in the

notice of proposed rulemaking, may not resolve these underlying

barriers, and would unduly interfere with the timely disbursement of

Federal funds.

Some of the barriers to collecting and providing TINs as identified

by agencies include systems reprogramming requirements, the need for

agency finance and procurement offices to coordinate on TIN collection

and data sharing requirements, the need to develop a reliable TIN

validation process, as well as the resolution of TIN requirements

involving payments to third parties or escrow agents. Many agencies

also suggested that certain classes of payments should be exempt from

the DCIA TIN requirement such as payments under the witness protection

program and foreign payments to entities who do not have assigned TINs.

Agency TIN Implementation Reports will address the current status

of agency compliance with the requirement to furnish TINs with each

certified voucher, strategies for achieving compliance, agency specific

barriers to collecting and providing TINs, and strategies for resolving

such barriers. The preparation and review of TIN Implementation Reports

will enable payment certifying agencies and FMS to best determine how

to resolve these issues. For additional information on these reports,

FMS is publishing elsewhere in this issue of the Federal Register a

Policy Statement concurrently with this document.

Agencies are reminded that the DCIA has required them to furnish

the TINs of payment recipients on all certified vouchers submitted to

disbursing officials since April 26, 1996, the effective date of the

DCIA. In its interim rule creating 31 CFR Part 208, Management of

Federal Agency Disbursements, FMS advised agencies of this DCIA

requirement. See 61 FR 39254, July 26, 1996. Prior to the enactment of

the DCIA, FMS issued Treasury Financial Management Bulletin No. 95-10

on August 18, 1995, which required that the payee's TIN be included on

all certified vouchers for vendor, miscellaneous, and salary payments.

Currently, FMS is working to ensure that TIN requirements for

contractors and vendors are incorporated in anticipated revisions to

the Prompt Payment circular issued by the Office of Management and

Budget (OMB) (OMB Circular No. A-125, rev. Dec. 12, 1989), in

consultation with FMS, and in anticipated revisions to the Federal

Acquisition Regulations (48 CFR).

Therefore, for the foregoing reasons, FMS withdraws the proposed

rule published on September 2, 1997. Agency compliance requirements

with respect to the TIN requirement are set forth in the Policy

Statement referenced above.

Authority and Issuance

For the reasons set out above, 31 CFR Part 212, Taxpayer

Identifying Number Requirement, Proposed Rule, 62 FR 46428, September

2, 1997, is withdrawn.

Authority: 5 U.S.C. 301; 31 U.S.C. 321, 3301, 3302, 3321, 3325,

and 3528.

Dated: October 5, 1998.

Richard L. Gregg,

Commissioner.

[FR Doc. 98-27069 Filed 10-8-98; 8:45 am]

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