Frequently Asked Questions
due process and notification - (updated July 8, 2015)
1. Can or should a local government publicize their intent to participate in the debt setoff program?
Yes, we encourage you to "get the word out" with press releases, websites or other means so local debtors will be aware of the potential that their tax refund and/or lottery winnings may be setoff in the event of delinquent local government debts.
2. Is a local government required to notify the debtor in writing about their intent to submit debt(s) against their tax refund and/or lottery winnings?
Yes, a letter must be sent to their last known address, even if the local government knows the debtor has moved and the letter will be returned.
3. Does the notification letter need to be sent by certified mail?
No, legislation states that it only be sent using regular U.S. mail.
4. Can the notification information be printed on an invoice or bill, rather than a separate letter?
No, the Clearinghouse requires it to be a separate letter.
5. What if a local government doesn't have the correct address for a debtor that needs a letter of notification?
Legislation requires that a letter only be sent to the last known address. In the event of an appeal a local government needs to be able to prove that a notification letter was sent it to the last known address. Whether the letter is returned as undeliverable is irrelevant.
6. Does a local government have to retain anything to prove that notification letters were sent?
Yes, we recommend the local government keep some type of electronic or hardcopy proof of your mailings to debtors in the event of an appeal by the debtor. Retain this information according to the state regulations associated with retention of public documents. Our client software has the option to create a pdf of the notification letters.
7. Can a third-party administrator send the notification letters on behalf of a local government?
Yes, a third-party company can send letters on a local government's behalf. Just have them keep a record of all debtors they sent letters in the event of an appeal. However, it must use the letterhead and contact information of the local government, not the third-party administrator.
8. Can a third-party administrator list their contact information and phone number on the notification letters?
No, all information on the letter must refer to the local government, not the third-party. If the debtor makes contact to the local government, the local government can then refer the debtor to contact the third-party vendor and provide the debtor with the appropriate contact information.But the initial contact has to be to the local government.
9. Can a local government send notification letters to any or all debtors without actually sending the debts to the Clearinghouse?
Yes, a local government can send letters without submitting the data to the Clearinghouse. Many local governments have received tremendous response and payments just on the notification letters. However, since you've gone to the expense of the mailing costs for notification, we suggest you proceed with the submission to the Clearinghouse for even further recovery of these outstanding debts.
10. How many days delinquent does a debt need to be before the due process notification can begin?
The Clearinghouse requires a debt to be sixty (60) days delinquent before the required notification letter be sent to the debtor's last known address by regular mail. This letter gives the debtor thirty (30) days to request a hearing.
11. Can a local government send debt setoff notification letters to debtors prior to the debt being 60 days delinquent?
No, do not send a debt setoff letter prior to the debt(s) being 60 days delinquent.
12. Can a debt be submitted to the Clearinghouse BEFORE the 30 day hearing request period has passed ?
Yes, but the Compliance Date must be a date after the 30 day period. The Clearinghouse does not send the debt to the NC Department of Revenue until the Compliance Date has passed.
13. What are the requirements for describe the debt(s) in the notification letter?Legislation states that each debt must be described in detail. Each debt must list the type of debt and the amount. The debts cannot be summed into one total debt amount. We suggest listing the department, such as Tax, EMS, Utilities, Health, etc. and the account number along with the debt amount.
14. Can the entire Social Security Number or just the last four be included on the debt setoff notification letter?No, for security and privacy concerns, do no list any portion of the Social Security Number. Be descriptive with the debt: account number,type of debt and amount should be enough information.
15. Are there any sample notification letters?
Below are several sample letters (all in Microsoft Word
and PDFs) - updated September 2010 - all previous versions invalid
16. Will the Clearinghouse assist in creating the notification letters?
Yes, the Clearinghouse will take your information in one of
four formats: 1) our client software; 2) ASCII file; 3) Excel file; 4) hard copy data entry fax form.
If using our client software, we will connect and assist in generating a pdf for saving and printing. We can even assist in importing an external file, if available.
If not using our software we can still do a mailmerge and return the letters to you electronically. We do NOT put the Social Security Number in the letter so we can send you the merged letters via email or place in your assigned secure folder.
17. Is there any cost for the Clearinghouse to assist in creating the notification letters?
No, the Clearinghouse will only create electronic copies for the local government to print, stamp and mail. The local government will print on their printer
using their letterhead, envelopes and postage.
18.
What are some tips in the event that a debtor requests a hearing?