(1) If the department has assessed more than one overpayment against an employee, the department will apply payments and offsets beginning with the oldest debt. The department will apply payments and offsets to the outstanding balance in the following order:

(a) Court costs including, but not limited to, filing fees and surcharges paid to the court for their official services, and surcharges and fees collected by the court for distribution to other programs or funds. It does not, however, apply to surcharges paid to the court under RCW  40.14.027 which are applied under (f) of this subsection;

(b) Interest;

(c) Penalties based on fraud;

(d) Charges for payments dishonored by nonacceptance or nonpayment;

(e) Overpaid benefits; and

(f) Surcharges assessed under RCW  40.14.027.

(2) The department will charge twenty-five dollars for each dishonored payment the employee submits. This is considered a commercial charge under the Uniform Commercial Code (RCW  62A.3-515).