New York State Comptroller

Procurement and Disbursement Guidelines

Bulletin Number:	A226 R1
Date Issued:	12/19/1989	Date Last Updated:	11/1/1999
Bulletin Name:	Contract Voucher Offsets

Introduction:	OSC and the Department of Taxation and Finance (DTF) have entered into an agreement effective 1/2/90 to "offset" contract payments if the contractor has a delinquent tax account with DTF. Offsets involve OSC diverting all or part of a contract payment to DTF to credit the contractor's tax account.
Notifying Contractors:	Before requesting OSC to offset payments, DTF will notify the contractor that he has 20 days to reach settlement terms with DTF. If the contractor does not comply he will be advised that OSC has been authorized to offset future contract payments. If OSC applies an offset, OSC will notify the contractor by letter, of the amount diverted, originating agency code, voucher number, contract number, check number and check date.
OSC/Agency Processing:	When applying offsets, OSC will automatically reject contract vouchers based on a lien/offset indicator in the contract master record. The voucher will be reprocessed by OSC after changing the Payee Name to the "NYS Comm. of Taxation and Finance" and adding an alpha suffix to the Batch Number. The alpha suffix will confirm on Payee Lists (VOU065) that a lien/offset has been applied. The Payee ID will remain unchanged for payment history and 1099 reporting purposes. Originating agency code and voucher number will also remain unchanged. NOTE: Agencies should process contract payments as usual, even after becoming aware of setoffs applied against a contractor. All information relating to a contractor's tax obligation is confidential and must not be released.
Payee ID's:	A key element in applying a DTF offset accurately, is the Payee ID used on the contract and voucher. Using incorrect Payee ID's may delay contract approval or payments to contractors. If the accuracy of a Payee ID is in question, please confirm it with the contractor. For individuals, the Payee ID is the social security number. For corporations, partnerships and other business entities, the Payee ID is the Federal Tax Identification Number (the number used to report Federal Withholding Taxes). Payee ID corrections in contract master records can be processed on AC340 -Contract Encumbrance Requests in the usual manner.
Questions:	Direct questions regarding delinquent tax accounts to the Manager-Contract Offset Unit, Department of Tax & Finance, (518) 457-7502. Direct questions on this bulletin to the Accounting Information Center at (518) 473-1170.