Sec. 1.1914  Collection in installments.

    (a) Whenever feasible, and except as otherwise provided by law, 
debts owed to the United States, together with interest, penalties, and 
administrative costs as required by this subpart should be collected in 
full in one lump sum. This is true whether the debt is being collected 
by administrative offset or by another method, including voluntary 
payment. However, if the debtor is financially unable to pay the 
indebtedness in one lump sum, payment may be accepted in regular 
installments. The Commission will obtain financial statements from 
debtors who represent that they are unable to pay the debt in one lump 
sum. If the Commission agrees to accept payment in regular installments, 
it will obtain a legally enforceable written agreement from the debtor 
which specifies all of the terms of the agreement and which contains a 
provision accelerating the debt in the event the debtor defaults. The 
size and frequency of installment payments should bear a reasonable 
relation to the size of the debtor and debtor's ability to pay. If 
possible, the installment payments should be of sufficient size and 
frequency to liquidate the Government's claim in not more than 3 years. 
Installment payments of less than $50 per month will be accepted only if 
justifiable on the grounds of financial hardship or for some other 
reasonable cause.
    (b) If the debtor owes more than one debt and designates how a 
voluntary installment is to be applied among those debts, that 
designation must be followed. If the debtor does not designate the 
application of the payment, the Commission will apply payments to 
various debts in accordance with the best interests of the United 
States, as determined by the facts and circumstances of the particular 
case, paying special attention to applicable statutes of limitations.

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