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Bad Debt Scenario – Incorrect Balances

The article briefly discusses CSS processes when there is a bad debt due to incorrect balances.

When a receipt applied to incorrect balances,

a bad debt may not have to be created. If the principal or interest credit is less than current support and current support is due next month, current support may be reduced up to 25%. If the overpayment is more than 25%, update the balances based on the arrearage computation (A/C) and send a Finance Action Request (FAR).

Incorrect foster care balance types (E/F) –

Receipts logged to E that should have been F, or vice versa, determine how many receipts are involved. If there are less than 10 receipts that need to be moved, send a FAR. If there are more than 10 receipts, a FAR will not be sent, but correct the remaining balances.