[Code of Federal Regulations]
[Title 45, Volume 1]
[Revised as of October 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 45CFR30.29]

[Page 98-99]
 
                        TITLE 45--PUBLIC WELFARE
 
                           AND HUMAN SERVICES
 
PART 30_CLAIMS COLLECTION--Table of Contents
 
       Subpart D_Suspending and Terminating Collection Activities
 
Sec. 30.29  Suspension of collection activity.

    (a) Generally. The Secretary may suspend collection activity on a 
debt when:
    (1) The Department cannot locate the debtor;
    (2) The debtor's financial condition is expected to improve; or
    (3) The debtor has requested a waiver or review of the debt.
    (b) Financial condition. Based on the current financial condition of 
a debtor, the Secretary may suspend collection activity on a debt when 
the debtor's future prospects justify retention of the debt for periodic 
review and collection activity, and:
    (1) The applicable statute of limitations has not expired;
    (2) Future collection can be effected by administrative offset, 
notwithstanding the expiration of the applicable statute of limitations 
for litigation of claims, with due regard to the 10-year limitation for 
administrative offset prescribed by 31 U.S.C. 3716(e)(1); or
    (3) The debtor agrees to pay interest on the amount of the debt on 
which collection will be suspended, and such suspension is likely to 
enhance the debtor's ability to pay the full amount of the principal of 
the debt with interest at a later date.
    (c) Waiver or review. (1) The Secretary shall suspend collection 
activity during the time required for consideration of the debtor's 
request for waiver or administrative review of the debt if the statute 
under which the request is sought prohibits the Secretary from 
collecting the debt during that time.

[[Page 99]]

    (2) If the statute under which the waiver or administrative review 
request is sought does not prohibit collection activity pending 
consideration of the request, the Secretary may use discretion, on a 
case-by-case basis, to suspend collection. Collection action ordinarily 
will be suspended upon a request for waiver or review if the Secretary 
is prohibited by statute or regulation from issuing a refund of amounts 
collected prior to agency consideration of the debtor's request. 
However, collection will not be suspended when the Secretary determines 
that the request for waiver or review is frivolous or was made primarily 
to delay collection.
    (d) Bankruptcy. Upon learning that a bankruptcy petition has been 
filed with respect to a debtor, in most cases the Secretary must suspend 
collection activity on the debt, pursuant to the provisions of 11 U.S.C. 
362, 1201, and 1301, unless the Secretary can clearly establish that the 
automatic stay has been lifted or is no longer in effect. The Office of 
the General Counsel should be contacted immediately for legal advice, 
and the Secretary will take the necessary legal steps to ensure that no 
funds or money are paid by the Department to the debtor until relief 
from the automatic stay is obtained.