Less than 50% of custodial parents in the United States receive the full amount of child support. And the ratio even decreases when it comes to voluntary payment to meet child support obligations. In cases where non-custodial parents do not wish to pay the amount, the court involves the employers of the non-custodial parent in the child support process.
What is child support withholding?
Once the court has reached the decision of a certain amount to be paid as child support garnishment to the custodial parent, if the non-custodial parent refuses to pay the amount voluntarily, then the court sends a mandatory deduction order to their employers. After receiving this withholding notice, employers are required to make deductions for child support from the employee’s wages.
If a non-custodial parent is your employee and has a child support debt unpaid, the court or child support agency will send you an income withholding support order (IWO). Remember that you cannot terminate or fire an employee because of their unpaid debts or child support deduction orders from the court. The CCPA (Consumer Credit Protection Act) protects employees who have one debt that is subject to garnishment. However, if there is more than just a single debt, the CCPA will not protect the employee from other debts.
Federal requirements a payroll department must know for child support
Child support garnishment is a federal law and has certain standard rules for payroll departments to comply with if received a deduction order for an employee. Here are some requirements and points to keep in mind:
- The income withholding other has all the necessary information and guidelines mentioned for employers and payroll departments to follow. The details of the employee whose to withhold wages from, the amount to withhold, and how to send those payments to the state disbursement unit (SDU) is all mentioned and stated. Employers can contact the sender of IWO in order to confirm their doubts.
- Once you have received the order, you must withhold the amount as soon as possible. The time limit is different in multiple states, but that doesn’t change the fact that the sooner you withhold the money, the better it is. Failing to do so might cost the employer heavy penalties and fines.
- Do not stop withholding the child support amount or wait until the court has another hearing to favor your employee. The order has already been passed, and you would be going against the law if you stopped withholding the amount. If the employee has any concerns, they must contact the court.
- Most states allow you to charge an administrative fee for withholding child support but remember there is a limit to withholding these fees and it’s different in each state.
- Child support deductions are made from the disposable income of the employee, which means the deduction would only be calculated and made after the deduction of other taxes.
Final Words
Each state has its different laws for withholding child care support amounts, but it can get tricky if you receive this IWO from a different state. In such cases, you must consider the laws of both states
