Child Support Update - StarChapter · Office of Child Support Enforcement •Federal and state laws...
Transcript of Child Support Update - StarChapter · Office of Child Support Enforcement •Federal and state laws...
Child Support Update
Midwest Regional Payroll Conference
September 26, 2018
Office of Child Support Enforcement
• Employers reported over 67 million new hires in fiscal year
2017
• 75% of all child support collected nationwide is attributed to
employers implementing income withholding orders and
sending payments to child support agencies
• When available, employers enrolled millions of children in
health insurance plans
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PARTNERSHIP PAYS OFF FOR FAMILIES
THANK YOU EMPLOYERS!
LET’S SEE HOW MUCH YOU KNOW
ABOUT AN EMPLOYER’S ROLE IN
THE CHILD SUPPORT PROGRAM BY
PLAYING
PAYROLL SAYS! 3
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P_____
A_________
A_________
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EMPLOYER RESPONSIBILITIES
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Office of Child Support Enforcement
• Report new hires and respond to requests for employment verification
• Process income withholding for support (IWO) orders/notices
• Withhold income for support payments, health insurance premiums, and cash medical support
• Remit payments to the state disbursement unit (SDU) or tribal payee
• Forward National Medical Support Notice (NMSN) Part B to Plan Administrators to enroll children in health care
• Report terminations
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EMPLOYER RESPONSIBILITIES
N___ H____
T___________ I_____
N_____
P______
GO 9
VERIFICATION OF EMPLOYMENT
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Office of Child Support Enforcement
• Employers must respond to child support agencies requesting information about the following*
– wages
– withholdings
– health insurance availability
• Child support agencies and courts need recent verifications of income to help
– establish, modify, and enforce child support orders
– determine whether or not health insurance is available to a parent
*Not an all-inclusive list
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VERIFICATION OF EMPLOYMENT (VOE)
W_____
W___________
H____
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I_________
Office of Child Support Enforcement
• https://www.acf.hhs.gov/css/employers/employer-
responsibilities/verification-of-employment
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MORE INFORMATION ABOUT VOES
NEW HIRE REPORTING
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Office of Child Support Enforcement 15
NEW HIRE REPORTING – 7 FEDERALLY
REQUIRED DATA ELEMENTSData Element Definition
Employer Name Name associated with the Federal Employer Identification Number (FEIN)
Employer Address* Address associated with the FEIN entity that employs the individual
Federal Employer
Identification Number (FEIN)**Nine-digit number assigned to the employer by the Internal Revenue Service
Employee Name Full name associated with that employee's Social Security number (SSN)
Employee Address Current residential address of the new employee
Employee SSN Nine-digit SSN assigned to the employee by the Social Security Administration
Date of Hire First date the employee received pay for services
*It is strongly recommended that employers also report the payroll office address if it is different than the FEIN
address.
**It is critical that employers report both new hires and quarterly wages using the same FEIN. If employers report
under different FEINs, it could appear that they are not complying with new hire reporting requirements.
NOTE: Some states require additional data elements. See the State New Hire Reporting Contacts and Program
Requirements matrix for state-specific reporting requirements.
Office of Child Support Enforcement
• Federal and state laws require all employers to report newly hired and rehired employees to a State Directory of New Hires (SDNH) within 20 days of the employee’s first day of work; some states may require shorter timeframes.
• Newly hired and rehired employees are defined as
– an employee not previously employed; or
– an employee previously employed but separated for at least 60 consecutive days
Remember: Report new hires under the same Federal Employer Identification Number (FEIN) used to report Quarterly Wages
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NEW HIRE REPORTING LEGAL
REQUIREMENTS
Office of Child Support Enforcement
• Multistate employers can choose to report:
– to the state where each individual works; or
– all new hires to one state where they have employees
• Multistate employers must register with the Secretary of the
Department of Health and Human Services to report all new
hires to one state
– the Multistate Employer Registry is now on the Portal!
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MULTISTATE EMPLOYER REPORTING
GO
EMPLOYER
INFORMATION
N_____
F___
ADDRESS
EMPLOYEE
INFORMATION
N_____
S___ A________
D____O_ H____
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Office of Child Support Enforcement
• https://www.acf.hhs.gov/css/employers/employer-
responsibilities/new-hire-reporting
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MORE INFORMATION ABOUT NEW HIRE
REPORTING
INCOME WITHHOLDING ORDER
(IWO) FOR SUPPORT
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Office of Child Support Enforcement
• Standard form approved by the Office of Management and
Budget (OMB) that must be used by any entity sending a
withholding/garnishment request to an employer or other
income payor to deduct child and medical support payments
from a parent’s income
• Courts, private attorneys, child support agencies, and others
must send the OMB-approved Income Withholding for Support
Order to employers
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IWO
C___ S_______A______
A________C_________ P____
C_____
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P___ D__ S_______
GO
L___S___
C______ S_______
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C___ M______ S_______
Office of Child Support Enforcement
• Federal Consumer Credit Protection Act Withholding Limits:
– 50% - Supports a second family with no arrearage or less than 12
weeks in arrears
– 55% - Supports a second family and more than 12 weeks in arrears
– 60% - Does not support a second family with no arrearage or less than
12 weeks in arrears
– 65% - Does not support a second family and more than 12 weeks in
arrears
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WITHHOLDING LIMITS
Office of Child Support Enforcement
• Additional Information About Withholding Limits
– state limits may be lower than federal limits
– applies only to employees, not non-employees/independent contractors
– check the income withholding matrix for more information
acf.hhs.gov/programs/css/resource/state-income-withholding-contacts-and-
program-information
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WITHHOLDING LIMITS (continued)
Office of Child Support Enforcement
• UIFSA 2008 changes the definition of “state”; the Act no longer
requires an employer to honor a foreign income withholding
order issued directly by a foreign country
• Employers should return any IWOs from foreign countries and
advise them to send a request to the state child support
agency
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IWOs FROM OTHER COUNTRIES
Office of Child Support Enforcement
• Added optional field for employee’s date of birth
• Clarified that a One-Time Order/Notice for Lump Sum Payment is
sent after notice of an upcoming lump sum payment by an
employer or other source
• Clarified that the CCPA limit is one specific percentage and not a
range
• Changed Federal Information Processing Standard Code to
Locator Code
• Rewrote text regarding tribal withholding limits and added link to
addresses and contacts for tribes
• Added a link to the Child Support Portal27
REVISED IWO FORM – 2017 CHANGES
DETERMINE WHICH STATE LAW
APPLIES
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Office of Child Support Enforcement
Follow the law of the issuing state for:
– duration and amount of child support, both current and
arrears
– medical support terms
– where to remit payments
– payment of fees and costs charged (if any) by the child
support agency, issuing court, or custodial party’s attorney
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DETERMINE WHICH STATE LAW APPLIES
Office of Child Support Enforcement
Follow the law of the employee’s principal place of employment for:
– when to begin withholding
– when to remit payments (this may be from 1 to 7 days after payday)
– mandatory deductions
– maximum amount to be withheld (within CCPA limits)
– how to allocate withholding across multiple child support orders
– administrative fee that employer is permitted to charge
– other terms and conditions that may be set by state law
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DETERMINE WHICH STATE LAW APPLIES
(continued)
F____
M_____
P________
GO
DURATION
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S______
Office of Child Support Enforcement
• Always withhold child support first unless:
– an IRS tax levy is already in place and pre-dates the underlying child
support order (not the IWO)
• Contact the sender of the IWO to determine the date of the
underlying child support order if it was not sent with the IWO by an
attorney or other party
• When both a child support order and a creditor garnishment are in
effect:
– deduct the child support withholding first
– you may not be able to withhold for the creditor garnishment if the
child support withholding exceeds the CCPA withholding limits32
PRIORITY OF IWO OVER OTHER
GARNISHMENTS
Office of Child Support Enforcement
• IWO Form
acf.hhs.gov/programs/css/resource/income-withholding-for-
support-form
• IWO Instructions
acf.hhs.gov/programs/css/resource/income-withholding-for-
support-instructions
• IWO Training Presentation
acf.hhs.gov/programs/css/resource/income-withholding-for-
support-iwo-training
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IWO FORM, INSTRUCTIONS, AND TRAINING
ELECTRONIC INCOME
WITHHOLDING ORDER FOR
SUPPORT (e-IWO)
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Office of Child Support Enforcement
• e-IWO is an efficient and cost-effective way to electronically exchange IWO
information between child support agencies and employers
• OCSE is the hub
• All states and territories are using e-IWO except Guam, South Carolina, and U.S.
Virgin Islands
• More than 9 million e-IWOs processed since 2005!
• FEIN is the key to passing e-IWO data between the state and employer
• Factors to consider when selecting an option to implement e-IWO:
‒ number of IWOs received each week
‒ IT resource availability
‒ time available to implement
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e-IWO
Office of Child Support Enforcement
• System-to-System
– If you receive a significant number
of IWOs per week or month and
have available IT resources for a
three- to five-month programming
effort, “System-to-System” may
be the option for you.
e-IWO: YOUR CHOICE
• No Programming
– If you do not have IT resources, the fillable portable document format (PDF) or Excel spreadsheet are your best options.
– You receive an electronic PDF version of the IWO along with a prefilled PDF or Excel spreadsheet acknowledgement.
– You can complete an acknowledgement very quickly and easily.
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Office of Child Support Enforcement 37
INCOME WITHHOLDING
ACKNOWLEDGEMENT
Office of Child Support Enforcement 38
EMPLOYER INITIATED INCOME
WITHHOLDING ACKNOWLEDGEMENT
F_____ P_______
E__________
I____________________
R______ E_____
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P______
C
Office of Child Support Enforcement
• https://www.acf.hhs.gov/css/employers/e-iwo
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MORE INFORMATION ABOUT e-IWO
S__________
C_________
GO 41
Office of Child Support Enforcement
PACSS and the SDU
will be phased in over
a 10-month period,
beginning in October
2018
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PALMETTO AUTOMATED CHILD SUPPORT
SYSTEM (PACSS) AND STATE DISBURSEMENT
UNIT (SDU)
Office of Child Support Enforcement
• Impacts ALL support cases enforced in family court, not just
child support agency (Title IV-D) cases
• Changes where payments are collected and disbursed
• Automates the generation of the income withholding on ALL
cases (IV-D and non-IV-D)
• Offers EFT/electronic income withholding options once
statewide
• Automates the generation of the National Medical Support
Notices
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EMPLOYERS NEED TO KNOW
Office of Child Support Enforcement
• Employers should expect a higher volume of IWOs and
employment verifications as a result of automated matching in
IV-D cases
• If paying through income withholding, employers will
continue to send payments to the Clerks of Court until all
counties have converted to PACSS (August 2019)
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MORE INFORMATION FOR EMPLOYERS
EMPLOYER SERVICES
PORTAL APPLICATION
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Office of Child Support Enforcement
Employer Services Portal Application:
• Employer Information Updates
– provide contacts, addresses, and other information about your company that is shared with
child support agencies
• Multistate Employer Registry
– employers with employees in two or more states may register with OCSE to report all new
hires to one state
• Employer Reporting
– upcoming lump sum payments to employees
– employee terminations
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CHILD SUPPORT PORTAL
Office of Child Support Enforcement
Employer Reporting
• Lump Sum Entry – enter information on the Portal about an employee who is eligible for a lump sum payment
• File Upload – report multiple employees who are eligible for a lump sum payment
• File Errors – view file errors
• Termination Entry – report employee termination or respond to a new income withholding order that the person never worked or no longer works for you
• Reporting History – view information reported by your organization for 60 days
• Glossary – view common child support terms
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EMPLOYER REPORTING
Office of Child Support Enforcement
STATES
Contact employers to withhold child support, when applicable
FEDERAL OFFICE OF CHILD SUPPORT ENFORCEMENT (OCSE)
Matches employees to individuals who owe child support and notifies states when there is a match
EMPLOYERS
Report employee pending lump sum payouts
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LUMP SUM REPORTING OVERVIEW
Office of Child Support Enforcement
• Bonus
• Cash Service Award
• Commission
• Insurance Settlement
• Life Insurance Proceeds
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LUMP SUM ENTRY – PAYOUT TYPE
• Severance
• Sign-on Bonus
• Vacation Pay
• Workers’ Compensation
• Other
Payout Types:
Office of Child Support Enforcement
Expected Payout Date
– Must be 5 days later than today
– Early reporting is recommended!
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LUMP SUM EXPECTED PAYOUT DATE
• Some states require notification prior to making a lump sum payment to a parent who owes child support; you must follow applicable state law concerning hold periods.
Office of Child Support Enforcement 51
U_____ I____________
R_____ T___________
P________R_____
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S__ L___
EMPLOYER SERVICES CONTACT INFO
• Sherri Grigsby
• General
• Portal
• e-IWO
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T__________
Y__54