Skip To: Main content|Subnavigation|
Minnesota Department of Human Services Combined Manual
DHS Home CountyLink Home Manuals Home Bulletins
Advanced Search
Show/Hide Table of Contents  


ISSUE DATE: 08/2016

Compromising a claim consists of accepting a partial payment as full satisfaction of a claim on the condition that the payment is received promptly. Separate policies apply to claims depending on when initial notification is received on the claim.

For information on how to post payments to a compromised claim, see TEMP Manual TE02.09.46 (Compromising a Claim).


This policy applies to all collectible claims for which the initial notification of overpayment occurred on or after December 1, 2002. The text of all MAXIS overpayment notices issued on or after December 1, 2002, has been modified to include language that advises each debtor of:

The right to have their claim compromised.


The conditions that must be met to have their claim compromised.

The time limit for a debtor to make the compromise payment is 90 days from the initial notification of the claim to the household. If the initial overpayment notice is sent by first class mail, the 90 day period begins with the date the notice is issued. If the initial notice is returned to the local agency by the postal service, the right to an overpayment notice and compromise is renewed. If the initial overpayment notice is sent by certified mail and accepted by the household, the 90 day period begins with the date a household member signs for receipt of the notice.

The right to compromise does not apply when the initial notification of an overpayment occurs in conjunction with a criminal or civil court proceeding. This includes the occasion of securing a confession of judgment which also happens to be the initial notification of overpayment. None of these methods of establishing a claim, in fact, requires a MAXIS overpayment notice. If a MAXIS overpayment notice precedes any of these other actions and a timely compromise payment is received, the local agency is bound by the compromise. Consequently, a local agency that pursues criminal action would not be able to seek monetary restitution for the full amount of a previously compromised claim. This does not, however, prevent a local agency from charging the full amount of a compromised claim or from requesting additional fines, penalties, interest or non-monetary restitution in the sentencing phase of the criminal proceeding.

Claims are subject to compromise if voluntary payment is received within the 90-day time limit and either of the following conditions applies:

Claims for excess assets may be compromised if the amount of the overpayment is greater than the amount that assets exceeded program limits. A compromise payment can be made for the amount of excess assets. If the value of excess assets changed during the period of an overpayment, the acceptable compromise payment is based upon the maximum amount assets were over program limits.


Claims for any basis may be compromised by 25% if the remaining 75% is repaid. A claim for excess assets can be compromised under this provision if this method establishes a smaller payment than the prior provision.

Compromise amounts must be in the form of direct voluntary payment by a debtor. Recovery received by tax offset, recoupment, restored benefits or canceled EBT benefits cannot be applied toward a compromise.


This policy applies to claims that provided the initial notice of overpayment prior to December 1, 2002. Compromise of these claims may be done upon inquiry of the debtor to the local agency. A local agency representative may offer a compromise proposal subject to the following limitations:

The compromise is based upon the account of the debtor rather than an individual claim. This account includes all existing claims for which the debtor is responsible except new claims identified in Part A, fraud claims resulting from criminal conviction or pre-trial diversion and claims that have already been referred to the Minnesota Collection Enterprise (MCE) or the Treasury Offset Program (TOP).

In March, 2004 MCE changed its name to Collection Division of the Department of Revenue. The codes and process for debt referral will continue to be referred to as MCE on MAXIS.

At least 50% of the total amount owed on the claims in the account has been repaid prior to the compromise proposal.

The debtor repays 50% of the remaining balance within 90 days of the compromise proposal.

All forms of recovery can be credited in determining whether a debtor meets the 50% payment requirement.


A claim may be terminated and the claim balance adjusted to 0 when there is no realistic prospect for future recovery. This practice differs from a write off which is an accounting mechanism to remove a claim as an accounts receivable asset even though the claim is retained against the possibility of future recovery. All terminated claims are automatically written off, but claims that are written off are not necessarily terminated.

Terminate claims when:

The only responsible debtor for a claim has died and no future recovery actions are available.


The only responsible debtor for a claim has had that debt discharged by federal bankruptcy court in a Chapter 7 or Chapter 13 proceeding.


A claim is the sole responsibility of a debtor who resides in a Long Term Care Facility, there is no prognosis for a return to residential living in the community and there is no estate to repay the claim or there are existing commitments to repay higher priority obligations.


Initial notification on a claim occurred at least 10 years previous, there has been no recovery on any of the claims in the debtor’s MAXIS account in the preceding 6 years, criminal restitution is no longer required by district court, there is no docketed judgment and the debt is not certified for Revenue Recapture or the federal Treasury Offset Program (TOP).

Rate/Report this pageReport/Rate this page

© 2018 Minnesota Department of Human Services Updated: 8/1/16 6:31 AM | Accessibility | Terms/Policy | Contact DHS | Top of Page | Updated: 8/1/16 6:31 AM