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APA Offers Comments on Revised Income Withholding Order

BY: William Dunn, CPP | 03/04/20

Every three years, the federal Office of Child Support Enforcement (OCSE) is obligated to update its standardized income withholding order (IWO) and its instructions. APA’s Government Relations Task Force Subcommittee on Child Support and Other Garnishments offered comments on the latest proposed changes for the IWO and the electronic version, the e-IWO.

OCSE’s Proposed Changes

OCSE has proposed these changes to the IWO:

  • Identify which entity (employer or child support agency) is expected to complete each section
  • State the actual date withholding should begin and establish that an IWO is in effect immediately upon receipt by the employer
  • Add a link directing employers to state disbursement units for information on payment options
  • Encourage voluntary reporting of workers’ compensation payments

In general, APA supports the proposed changes, which it believes will improve the form’s clarity and provide employers with useful information.

APA’s Recommended Changes

Here are the changes APA recommends:

  • Eliminate the Order ID field. The IWO includes more fields for identification numbers than a payroll system can accommodate. The Order ID is an optional field in the e-IWO record layout and is the best candidate for removal.
  • Add a checkbox for independent contractors. The IWO has four checkboxes to identify the nature of the order, and this recommendation would add a fifth.
  • Acknowledge extra pay periods. The IWO should include a statement explaining that an employer paying weekly or biweekly will occasionally experience an extra pay period, and the resulting amount withheld might not match the amount directed to be withheld on the IWO.
  • Add payment amount for daily pay frequency. The IWO currently covers amounts to withhold for weekly, biweekly, monthly, and semimonthly pay frequencies.
  • Require a valid FEIN. A valid federal employer identification number (FEIN) is required on the e-IWO, and APA believes it also should be required on the paper IWO.
  • Expand use of the e-IWO. APA recommends that courts and private attorneys be allowed to send child support orders via e-IWO.
  • Include a field for responses to employers in the e-IWO. Currently, employers can report lump sum payouts via e-IWO, but a state is unable to respond electronically if there is no need to withhold.

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William Dunn, CPP, is Director of Government Relations for the APA.