What Must Employers Do with a Child Support Income Withholding Order?

When a child support order is in place, a state child support agency or court can order an employer to withhold support from an employee's pay. The employer receives the federal Income Withholding for Support (IWO) form. The rules come from 42 U.S.C. 666(b) and 45 CFR 303.100, with limits set by the Consumer Credit Protection Act at 15 U.S.C. 1673.

What the notice tells the employer. Under 45 CFR 303.100(e), the IWO states the amount to withhold and that the total withheld, including any fee, may not exceed the federal limits. It also states that the employer must send the amount to the State Disbursement Unit within 7 business days of the date the employee is paid and report the date of withholding. The withholding is binding until further notice from the state. An employer may combine payments for several employees in one payment if it identifies each employee's share.

Withholding limits. For support orders, 15 U.S.C. 1673(b)(2) caps garnishment at 50 percent of disposable earnings if the employee supports another spouse or dependent child, and 60 percent if not. Those limits rise to 55 and 65 percent when the support covers a period more than 12 weeks before the workweek. States may set lower limits, and the employee's work state controls the maximum amount, timing of payments and employer fee.

Priority. Child support withholding has priority over other legal process under state law against the same income. OCSS guidance says child support comes before other garnishments except an IRS tax levy entered before the support order was established.

Employer liability. An employer that fails to withhold as the notice directs is liable for the amount it should have withheld. Federal law requires states to fine an employer that discharges, refuses to employ or disciplines an employee because of withholding. An employer that complies with a notice that is regular on its face is not subject to civil liability for that conduct.

Terminations. The employer must notify the state promptly when the employee leaves, and provide the last known address and the new employer's name and address if known. The IWO form includes a section for this notice.

Related duties. Withholding often starts after a new hire report, and the IWO may include cash medical support. Health coverage orders use a separate form, the National Medical Support Notice. Related FAQs cover new hire reporting and the National Medical Support Notice. Program updates appear in the Learn Laws® news item on the child support deregulation proposal and the news item on OCSE employment services. Compliance training covers order processing for payroll staff.