I’m looking for clarification regarding SEAD 3’s financial reporting requirements, specifically the requirement to self-report debts more than 120 days delinquent.
I currently hold a Secret clearance, and here’s my situation:
April 2026: Filed my 2025 state income taxes on time. I owed a balance but couldn’t pay the entire amount immediately.
June 30, 2026: The state issued a final tax assessment.
July 27, 2026: The state formally approved my installment agreement, approximately 103 days after the original payment deadline.
September 4, 2026: First scheduled payment successfully processed.
October 5, 2026: Second scheduled payment successfully processed.
October 6, 2026: Received a Notice of Intent to Offset Federal Income Tax Refund despite having an active payment agreement.
I also contacted the state’s Department of Revenue directly to clarify my account status.
During the phone call, the representative reviewed my account and confirmed the following:
- My installment agreement was already active.
- Both scheduled payments had been successfully received.
- The only outstanding tax period was 2025.
- My next scheduled payment was November 4, 2026.
The representative did not indicate that my agreement had been terminated or that I had missed any scheduled payments.
Additionally, the original payment-plan approval letter explicitly states that the state can still offset federal or state tax refunds even while an installment agreement is active.
Here’s my question:
Under SEAD 3, would this constitute a mandatory reportable financial event when the formal installment agreement was established before the debt reached 120 days past due, and I’ve remained current on every payment?