{"data":{"id":"us-ky/krs-45.238","jurisdiction":"us-ky","citation":"KRS 45.238","heading":"Powers and duties of Department of Revenue to collect referred debts --","body":"Cost-ineffective debts -- Treatment of collected debts -- Annual report.\n(1) Debts that are certified by an agency or by a local government as provided in KRS\n45.237 shall be referred to the department for collection. The department shall be\nvested with all the powers necessary to collect any referred debts.\n(2) (a) For those debts deemed unfeasible or cost ineffective to pursue, the\ndepartment shall maintain written reco rds of the debt and the reason the debt\nwas deemed unfeasible or cost ineffective to pursue.\n(b) In the case of agencies, these debts shall be written off in accordance with\nadministrative regulations promulgated under the authority of subsection (6)\nof this section.\n(c) In the case of local governments, these debts shall be returned to the referring\nlocal government for further action.\n(d) In the case of public postsecondary education institutions, these debts shall be\nreturned to the referring institution , except that enrollment -related debts and\nliquidated debts shall only be returned to the referring institution in\naccordance with KRS 45.241.\n(3) (a) All certified debts of agencies received by the department after the sixty (60)\nday collection period all owed in KRS 45.237(4), and all certified debts of a\nlocal government received by the department after the ninety (90) day\ncollection period allowed by KRS 45.237(5), shall be subject to:\n1. Interest at the tax interest rate determined under KRS 131.183 on the\namount of the debt plus all accruals authorized by law, from the date the\ndebt is certified to the department until it is satisfied; and\n2. A one (1) time twenty -five percent (25%) collectio n fee imposed on the\namount of the debt plus all accruals authorized by law, as of the time of\nreferral.\n(b) The department may retain the collection fee.\n(c) In the case of agencies and the Court of Justice, recovered funds and interest\nmay, at the discre tion of the secretary of the Finance and Administration\nCabinet, be returned to the agency certifying the debt or improper payment or\nto the Court of Justice for allocation as otherwise provided by law. If the\nrecovered funds and interest are not returned to the agency or Court of Justice,\nthe amounts shall be deposited in the budget reserve trust fund established in\nKRS 48.705, except for Medicaid benefits and funds required by law to be\nremitted to a federal agency.\n(d) In the case of local governments, r ecovered funds and interest shall be\nreturned to the referring local government for allocation as provided by\nordinance, resolution, or as otherwise provided by law.\n(e) In the case of public postsecondary education institutions, recovered funds\nand interest shall be returned to the referring institution less the collection fee\nretained by the department under paragraphs (a) and (b) of this subsection.\n(4) The commissioner of the department may refer to the Attorney General any\nunsatisfied claim, demand, account, or judgment in favor of the Commonwealth for\nfurther civil or criminal action under KRS 15.060.\n(5) (a) The department shall report annually by October 1 to the Legislative Research\nCommission on all referred certified debts, including at least a su mmary of\nthe debts by agency, fund type, and age, the latter compiled in the following\nfour (4) categories:\n1. Debts from ninety (90) to one hundred seventy-nine (179) days old;\n2. Debts from one hundred eighty (180) to three hundred sixty -four (364)\ndays old;\n3. Debts over one (1) year old but less than three (3) years old; and\n4. Debts three (3) years old or older.\n(b) The annual report shall also include the collection amount of the debts in\nparagraph (a) of this subsection and the accounts to which the amounts are\ncredited.\n(6) The department shall promulgate administrative regulations in accordance with\nKRS Chapter 13A to establish standards that agencies shall use in determining\nwhen to write debts off the books.\n(7) This section shall not affect the c ollection of delinquent taxes by sheriffs or county\nattorneys under KRS 91A.070 or 134.504.","path":["KRS Chapter 45"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=58008","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:49:04Z","sha256":"1765e82ff3ebae55c519bdd119a7ca22dac414f4b9ec625be3f98f7f24021e7c","source_id":"us-ky","stale":false,"prev":"us-ky/krs-45.237","next":"us-ky/krs-45.239"},"notice":"GroundRules: Original legal text. Not legal advice."}