Under a new FAR provision effective in February 2016, the Government typically will not enter into a contract with any corporation that has an unpaid Federal tax liability that is not being contested or timely repaid. The same new FAR provision prohibits the Government, in most cases, from awarding a contract to a company recently convicted of a Federal felony.
The new FAR provision requires a corporate offeror to represent whether it has any unpaid tax liabilities or recent felony convictions. If the answer to either question is “yes,” the Government cannot award a contract unless it has first considered suspension or debarment of the offeror, and determined that suspension or debarment is unnecessary to protect the Government’s interests.