Tax Debts
Uncollectible debt is debt that is removed by the Minnesota Department of Revenue from the state’s “
accounts receivable records”. The department is unable to collect the debt because the
statute of limitations (SOL) has expired, it was
discharged in bankruptcy or the only liable debtor is deceased or indigent. The department does not release expired liens.
Reasons in defining a debt as uncollectible:
- All reasonable collection efforts have been exhausted.
- The cost of further enforced collection action will exceed the amount owed.
- Available assets or income available for payment of the debt, whether current or anticipated, are insufficient.
- The debt has been discharged in bankruptcy.
- The statute of limitations (SOL) on the debt has expired.
- It is not in the state’s best interest to pursue collection of the debt.
- The only liable debtor is deceased or indigent.
Other Agency Debts (OAD)
Uncollectible
other agency debts are returned to the referring agency. The department uses some of the same tax debt factors to determine if a debt is uncollectible. The decision to declare the debt uncollectible belongs to the referring agency.
