Hill Gives IRS Debt-Collection Duties: Lawmakers Irked at U.S. Agencies' Failing to Use Powers

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Lawmakers are turning to the Internal Revenue Service to help collect $50 billion owed the federal government.

The debts are not for taxes, but for loans, royalties, fines and overpaid benefits owed Uncle Sam. According to a report released yesterday, agencies have shown little progress in collecting these debts despite passage last year of legislation designed to help them do so.

"We've handed the government departments the tools to clamp down on people who owe the money, yet they continue to let the debt pile up," said Rep. Carolyn B. Maloney, New York Democrat, and author of the Debt Collection Improvement Act of 1996.

"At the very least, agencies ought to refer debts . . . to the Internal Revenue Service for tax refund offset," said Rep. Steve Horn, California Republican, who co-sponsored the legislation with Mrs. Maloney.

According to Mr. Horn, the Department of Treasury's Financial Management Service has spent between $20 million to $30 million implementing the Debt Collection Improvement Act, but only collected an additional $2.8 million.

As part of a program begun in 1992, agencies have asked for the IRS' assistance in collecting about $11 billion. According to Treasury, the IRS in 1996 used about $1.7 billion in tax refunds to offset federal debts. The IRS has also been asked to help state and local governments collect $38.1 billion in delinquent child-support payments.

The departments of Education, Defense, Agriculture, Health and Human Services are owed the most. …