Tenn. Comp. R. & Regs. 1240-02-02-.05 - INFORMATION FOR WITHHOLDING BY TENNESSEE EMPLOYERS/PAYERS OF INCOME

(1) The Income Withholding for Support, also referred to as an Order for Income Assignment, Income Assignment, Income Assignment Order, or Assignment, must be implemented no later than fourteen (14) calendar days after the date noted at the top-right portion of that form, the date of personal service, or the other date of any other form of transmission of this notice.

(2) The payments may be deducted from the employee's or income recipient's wages, or other income, either weekly, biweekly, semimonthly, or monthly to coincide with his/her pay periods or other periods for payment of income, but must be sent to the Department's centralized collection unit at the address shown on page 2 of that Order within seven (7) days of the date the employee or income recipient is paid along with the date the deduction was made.

(3) "Employer, person, corporation or institution," who or which may be required to withhold income, includes the federal government, the State and any political subdivision thereof and any other individual or business entity which has in its control funds due to be paid to a person who is obligated to pay child support.

(4) The amount withheld for support may not be in excess of fifty percent (50%) of the net wages of an employee or other income due an income recipient after the deduction of FICA, withholding taxes, and health insurance premiums which cover the child(ren).

(5) This Order for Income Assignment is binding until further notice by the issuer. If the payor of income fails to withhold income in accordance with the provisions of this Order, the payor is liable for any amount up to the accumulated amount which should have been withheld from the income of the employee or income recipient. In addition, the payor may be subject to financial penalties pursuant to T.C.A. § 36-5-501(p). Compliance with this Order shall operate as a discharge of liability to the affected employee or other recipient of income as to that portion of the employee's or recipient's income affected by the Order.

(6) T.C.A. § 36-5-501(i) provides that the employer, person, corporation, or institution that is ordered to comply with this order shall be subject to a fine for a Class C misdemeanor if the income assignment is used as a basis to refuse to employ a person or to discharge the employee or for any disciplinary action against the employee, or if the employer fails to withhold the amounts from the employee or fails to pay such amount to the Clerk of the Court or the Department of Human Services as may be directed by the Order.

(7) Withholding of support in accordance with this notice shall have priority over any other legal process under state law against the same wages or other income for debts other than child support.

(8) If the payor is unable to deduct the full amount specified in this order due to the fifty percent (50%) limitation, the payment should also specify, for each obligor, the individual's income after taxes, FICA, health insurance premiums deducted to cover the child(ren), and whether the payor has received prior Income Assignments which prevent the payor from fully complying with this order.

(9) The payor may, at its discretion, charge the employee or other recipient of income an amount of up to five percent (5%), not to exceed five dollars ($5) per month, for costs in complying with this order. This amount could vary upward depending on changes in the law at T.C.A. § 36-5-501(l).

(10) If a payor is required to withhold support from more than one person, it is allowable to combine withheld amounts in a single payment to each appropriate court or other entity ordering the assignments; however, the payor must provide a listing indicating which portion of the single payment is attributable to each individual.

(11) The date the support was deducted from the obligor's paycheck must be provided with each payment transmitted to the Department.

(12) Pursuant to T.C.A. § 36-5-501(g), the payor is required to notify the Department when the employee terminates employment or if income payments are terminated and provide the Department the last known address of the employee/recipient of income and the name and address of his/her new employer, or new source of income, if known. The Income Assignment is binding upon successive employers fourteen (14) days after it is transmitted to them.

(13) Priorities for Payments if More Than One Income Withholding for Support Is Received.

If the employer, person, corporation or institution or other payer of income receives more than one (1) Income Assignment against the employee/obligor, priority in deducting income shall be as follows:

(a) First priority: To all orders for amounts due for current support due a child;

(b) Second priority: To all orders for amounts due for arrearages due a child;

(c) Third priority: To all orders for amounts due for current support due a spouse;

(d) Fourth priority: To all orders for amounts due for arrearages due a spouse; and,

(e) Fifth priority: To all statutory fees and court costs.

(14) The payor must honor all withholdings to the extent the total amount withheld from wages does not exceed fifty percent (50%) of the employee's wages or a recipient's income after FICA, withholding taxes, and a health insurance premium which covers the child(ren) are deducted.

(15) Multiple Income Assignments for One Employee or Recipient of Income.

If the payor receives any Order for Income Assignment for current child support against the employee's income which would cause the deductions from any two (2) or more assignments for current child support to exceed fifty percent (50%) of the employee's income after FICA, withholding taxes, and a health insurance premium which covers the child(ren) are deducted, the following process shall be utilized:

(a) Determine the total of all current child support ordered withheld by all Income Assignments received for the employee or recipient of income;

(b) Then calculate the percentage that each current child support order represents of the total;

(c) The available income will be allocated by the payor according to the percentage which each Income Assignment for current child support bears to the total of all Income Assignments involving this employee or recipient of income for current child support.

(d) In the event all current child support obligations are met from the assignments and child support arrearages exist in more than one case and there is not sufficient income to pay all ordered child support arrearages, then the child support arrearages will be allocated by the payor on the same basis as in steps a - c.

(16) The payor must provide for each case the following information: docket number, county, state, full ordered amount, the percentage that each current support order represents of the total ordered amounts from all income assignments ordered for this employee or recipient of income, and the date the amount is deducted from the employee's or recipient's income.

(17) Example of a Proration for Multiple Income Assignment.

(a) Assume an employee's net income after taxes, FICA, and a health insurance premium to cover the child(ren) is deducted is $900. Therefore, the available income for use in the income assignment is only $450 (50% maximum of the employee's net income).

(b) If the employee is ordered to pay $250.00 per month under support order A; $200.00 per month for support order B; and $150.00 per month for support order C; then the total of all income assignments is $600.00. This total exceeds income available for income assignment [after deduction for taxes, FICA, and health insurance premiums which cover the child(ren)].

(c) Pay the amount of the available income that each Income Assignment represents as a percentage of the total of all Income Assignments as follows:

1. Order A = $250/$600, or 42%, x $450 = $189.00;

2. Order B = $200/$600, or 33%, x $450 = $148.50;

3. Order C = $150/$600, or 25%, x $450 = $112.50;

(d) If the employee has sufficient available income to satisfy all current child support orders, but not all ordered child support arrearages, apply the same proration procedure to the child support arrearage payment as shown above.

(18) Income assignments for child and/or spousal support have priority over a garnishment order issued by the Social Security Administration.

Notes

Tenn. Comp. R. & Regs. 1240-02-02-.05

Original rule filed December 17, 1985; effective January 14, 1986. Amendment filed October 17, 1986; effective January 27, 1987. Amendment filed August 25, 1989; effective October 13, 1989. Repeal and new rule filed December 7, 1994; effective February 20, 1995. Repeal and new rule filed October 14, 1999; effective December 28, 1999. Repeal and new rule filed August 17, 2005; effective October 31, 2005. Amendment filed September 8, 2009; effective December 7, 2009.

Authority: T.C.A. §§ 4-5-202, 8-21-403, 36-5-116, 36-5-501, and 71-1-132(c); 42 U.S.C. §§ 651 et seq., 42 U.S.C §§ 652(a)(11), 654(9)(E), 654a(g)(1)(A)(ii), 654b(a), and 666(a)(8) and (b); 20 C.F.R § 422.435(e)(2), 45 C.F.R. §§ 303.6(c)(1), 303.7, and 303.100 ; and United States Department of Health and Human Services Office of Child Support Enforcement Action Transmittal 04-05 (July 15, 2004).