About the GEAR Program

Governmental Enterprise Accounts Receivable Collections (GEAR): is a collection program, authorized by S.C. Code § 12-4-580 (enacted in 1996), that allows the the Department of Revenue to use setoff debt and additional collection tools, such as payment plans, wage garnishments and bank levies to collect bad debts for public entities. SCAC has been assisting counties and other special purpose districts with GEAR collections since 2001.

The GEAR program is administered similar to the individual income tax refund setoff debt collection program. SCAC provides free software and technical assistance to participating entities to manage their GEAR data.

Governmental entities can opt to use Setoff Debt, GEAR, or both programs. Entities have flexibility in deciding which accounts to put into the GEAR program and/or the setoff debt collection program. SCAC assists in maintaining separate data files and financial files for each program.

GEAR allows continued collections when a debtor does not have an income tax return. With GEAR, governmental entity debt is treated like any State tax debt, subject to the same collection tools available to DOR such as levy and garnishment. This allows a higher collection rate for larger debts.

Using GEAR, entities can lighten administrative burden to staff. SCAC assists entities with the daily program and data operations. SCDOR, using a customer service focus, sends collection notices, handles phone inquiries, sets up payment schedules, and makes collections.

SCAC Services are FREE to participating entities. SCDOR charges a 28.5% fee, paid by the entities, for debts that are collected.

The initial collection rate with GEAR has been 11% to 27%, depending upon the debt type.

Must have a valid Social Security Number for individuals to submit an account.

Debts must be at least $300, or multiple accounts must sum to $300, to be submitted to the GEAR program.

Entities must follow due process procedures for debtors, as defined in the statute (see Setoff Debt Collection Act). Entities must provide notice and an opportunity to be heard to all new debtors. SCDOR provides notification for any garnishments.

Entities must meet the deadlines for sending letters and submitting their data file. (See Dates to Note.)

There is a one-time placement of debts into the GEAR program. Debts will rollover to the next year until paid in full, or removed at the request of the entity.