Indebtedness (For Separation Only)

Indebtedness (For Separations Only) is the second option on the SPPS Special Payroll Processing System Main Menu Screen. This option is used to (1) record debts not recorded in ABCO Administrative Billings and Collections System for a separated employee, (2) view existing debts for the separated employee, and (3) process the final payment due the employee.

If an employee separates from an Agency before repaying an amount that is owed, the balance of the debt will automatically be collected from any subsequent payments due the employee.

Payments include:

• Final salary
• Lump sum leave payment
• Retirement contributions
• Cash awards

NFC collects from the final salary, cash awards, lump sum leave payments, or any other payments processed by NFC National Finance Center. The Office of Personnel Management (OPM) collects from retirement contributions.

If an employee is separated and has an advanced leave balance, the T&A Time and Attendance will be held in SPPS Special Payroll Processing System. It will be the Agency's responsibility to release the record from SPPS Special Payroll Processing System and forgive or change the amount the employee owes from the advanced leave. These employees will always appear on the CULPRPT Payroll/Personnel Report Generator System Report P0166, Indebtedness/Active Cases as of XX/XX/XX until released.

Payments for indebted separated employees may be released based on completion of certain fields by the user.

After the transaction has been processed (i.e., an SPPS Special Payroll Processing System job has executed), it is no longer available for change or deletion; however, it can be viewed through the Inquiry option. All payments are scheduled for disbursement after they are released and accepted by SPPS Special Payroll Processing System. Payments are processed when SPPS Special Payroll Processing System executes and are disbursed when transmitted to Treasury.

ABCO/PAYE Debts

Any debt being collected through payroll deductions prior to separation is established in ABCO Administrative Billings and Collections System. If the debt still exists at separation and no other debts are incurred, these debts are collected during the processing of PAYE Payroll Computation System and before SPPS Special Payroll Processing System is run. These debts are not to be entered in SPPS Special Payroll Processing System.

Any debt not collected through the final PAYE Payroll Computation System process should be entered in SPPS Special Payroll Processing System for calculation and disbursement of the final payment. To ensure that all debts are collected, an indebtedness record should be established as soon as it is known that the employee is separating.

Note: Once all payments have been made to the employee and the indebtedness record was not established in SPPS Special Payroll Processing System, all outstanding debts must be forwarded to ABCO Administrative Billings and Collections System for collection.

The following receipt account types may be entered in SPPS Special Payroll Processing System:

• Educational Loans
• Travel Advance Repayment
• Property Lost, Destroyed, or Stolen
• Subsistence (Travel Payments)
• Personal Telephone Calls
• Parking Fees
• Recovery of Jury Duty Fees
• Travel Overpayment
• Uniforms
• Other Types (other Departments) (e.g., theft and embezzlement)
• Other Types (USDA)

Caution: When establishing a debt in SPPS Special Payroll Processing System, it is to be noted that collection of debts through PAYE Payroll Computation System recorded in ABCO Administrative Billings and Collections System will not display in SPPS Special Payroll Processing System until the Tuesday following the biweekly process. Therefore, do not release the payment in SPPS Special Payroll Processing System until the Tuesday following biweekly process; otherwise, the collection may be made twice.

If a debt established in SPPS Special Payroll Processing System is repaid by the employee before the final payment is released, delete the debt on the Employee Indebtedness Update screen.

Advanced Leave

Debts for advanced leave can only be entered in SPPS Special Payroll Processing System by using the Advanced Leave screen and not through the Employee Indebtedness Update screen. Prior to entering data on the Advanced Leave screen, a leave audit must be completed and validated. Users should request a copy of CULPRPT Payroll/Personnel Report Generator System Report P0053, Error Analysis By Contact Point, to identify separated employees with negative leave balances.

If a separating employee has advanced leave that will not be forgiven, he/she may be eligible for tax credits. In these instances, NFC National Finance Center will compute the tax credit amount. If the employee has unforgiven advanced leave, separates, and receives his/her final pay in the same tax year, he/she is entitled to a refund of retirement contributions; city, county, State, Federal, Federal Insurance Contribution Act (FICA), HIT Hospital Insurance Tax taxes collected from the leave. The employee is also entitled to a refund of Federal Employees Group Life Insurance (FEGLI) contributions if the unforgiven advanced leave is 80 hours or more. If the employee separates in one tax year and payment is disbursed in a subsequent year, he/she is only entitled to a refund of the FICA Federal Insurance Contributions Act and HIT Hospital Insurance Tax taxes, if applicable.

Separating employees with advanced leave who may be due tax credits are listed on CULPRPT Payroll/Personnel Report Generator System Report P0162, Indebtedness Advanced Leave - Tax Credit Suspense Report.

An employee is listed on Report P0162 if:

• He/she was identified as having advanced leave at the time the indebtedness record was established in SPPS Special Payroll Processing System.
• A leave audit has been completed, validated, and all applicable hours have been entered in SPPS Special Payroll Processing System.
• The advanced leave is not forgiven.

When NFC National Finance Center calculates the tax credit amount, a message displays on Report P0162 indicating that the payment is ready to be released. The user can then release the payment for disbursement to the employee.

Leave balances for an indebted, separating employee should be adjusted in the Time Inquiry - Leave Update System (TINQ Time Inquiry - Leave Update System). If advanced leave for an employee is not forgiven and the Advanced Leave screen is not completed, the employee's final payment will not be processed.

If an indebted separated employee is normally paid manually, the Agency must establish an indebtedness record in SPPS Special Payroll Processing System by completing the Establish/Delete Indebtedness screen for the employee's final payment to be processed through SPPS Special Payroll Processing System. All payment information must be forwarded to NFC Payroll/Personnel Operations Section on Form AD-343, Payroll Action Request. The information is entered in SPPS Special Payroll Processing System by NFC National Finance Center Payroll/Personnel Operations personnel on the Manual Payments screen and released for payment. If payment information for a manually-paid employee is not forwarded to NFC National Finance Center, the indebtedness record will remain in SPPS Special Payroll Processing System and the payment will not be released.

If the employee does not have a payment to be disbursed (i.e., an employee was on leave without pay prior to separation), the payment record will be sent to ABCO Administrative Billings and Collections System. All collections will go against the employee's retirement contributions.

It is the Agency's responsibility to ensure that all debts have been recorded and the final payment released to the employee. If the employee separates and all debts are not collected because of insufficient funds and the employee is rehired by another Department, the gaining Department should resume collection. If the employee is not rehired, a bill is generated from ABCO Administrative Billings and Collections System.

SPPS Special Payroll Processing System archives complete payment data at the beginning of each year. The completed record remains in SPPS Special Payroll Processing System between 12 and 24 months, depending on when the payment was released.

Once the final payment is processed (released and disbursed), the only options that will be accessible are option 6, Remarks, and option 7, Payment Inquiry.

To Access the Indebtedness (For Separations Only) Screen:

1. Type 2 at the Select (1-3) prompt on the SPPS Special Payroll Processing System Main Menu.
2. Press Enter. The File Control Information screen is displayed.

   

3. Complete the fields as follows:

   Field	Instruction
   SSNO	Type the employee's SSN Social Security number.
   AGCY	Type the employee's Agency code.
   POI	Type the employee's POI personnel office identifier.

    

4. After completing the fields, press Enter. The Indebtedness Menu is displayed with eight options.

   

Below is a brief description of each option.

• Establish/Delete Indebtedness - Used to establish or delete an indebtedness record. Once the indebtedness record is established in SPPS Special Payroll Processing System, the employee's final payment will not be released until all options requiring data entry are completed and the payment is coded for release or the record is deleted.

Note: If an employee is normally paid manually and/or does not have a salary record, the Agency must contact the NFC National Finance Center Contact Center 1-855-NFC-4GOV (1-855-632-4468) to indicate that an SPPS Special Payroll Processing System record cannot be established. To establish an SPPS Special Payroll Processing System record, the employee must be a payrolled employee.

• Adjustment Due to Employee Indebtedness - Used to add, change, or delete administrative debts entered in SPPS Special Payroll Processing System and query debts processed through ABCO Administrative Billings and Collections System, PAYE Payroll Computation System, and SPPS Special Payroll Processing System.
• Pending Disbursement - Used to display a preliminary calculation of distribution amounts.
• Payment Certification - Used to confirm receipt of all the necessary documentation to process and authorize the separated employee's final payment or collection.
• Check Mailing Information - Used to display the check mailing information as displayed in the payroll/personnel database and allow changes to be made to that information.
• Remarks - Used to record pertinent claim information.
• Payment Inquiry - Used to display details of actual payments made to the separated employee.
• Manual Payment(s) (NFC Only) - Used by NFC National Finance Center employees to add, change, or delete manual payments and enter the tax credit amount.

To select an option from the Indebtedness Menu, type the option number at the Select Option (1-8) prompt and press Enter. The screen for the selected option will be displayed. Follow the instructions.