This bill establishes a new position, the "Overpayment Czar," within the Office of Federal Financial Management, tasked with assisting executive agencies in identifying, preventing, and mitigating improper payments and fraud. This Czar will develop strategies, recommend policy changes, and annually report corrective actions to improve payment integrity across the Federal Government. Additionally, the legislation amends financial management plan requirements, mandating that agencies include the Overpayment Czar and a specific plan to decrease improper payments in their annual submissions. The legislation expands the scope of programs identified as susceptible to significant improper payments, now including new federal programs with substantial outlays in their initial years of operation. A significant provision introduces financial penalties for executive agencies that are persistently noncompliant in addressing improper payments. Agencies found noncompliant for one fiscal year will face a 5% reduction in their highest-level administrative appropriation account, increasing to a 10% reduction for two or more years of noncompliance. The bill also strengthens reporting requirements, mandating annual submissions from agencies to Congress on their progress in implementing financial controls, fraud risk principles, and strategies to curb fraud. Furthermore, it requires states receiving funding for major programs like Temporary Assistance for Needy Families (TANF), Medicaid, and the Supplemental Nutrition Assistance Program (SNAP) to utilize specific payment integrity tools published by the Office of Management and Budget. States must report on the effectiveness of these tools, and those failing to comply will be required to remit payment to the Treasury for the total amount of overpayment in the affected programs. Finally, the bill removes limitations on the "Do Not Pay" working system, allowing its use for all authorized purposes to prevent improper payments.