# Non-Child Support Debtors May Find CoronaVirus Payments Garnished

- Link: https://thechildsupporthustle.com/non-child-support-debtors-may-find-coronavirus-payments-garnished/
- Published: 2024-05-06T14:23:34+00:00
- Author: MsRockMon

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April 15, 2020 

Kenya N. Rahmaan

As the announcement was made that non-custodial parents (NCPs) allegedly owing child
support would not receive a CoronaVirus stimulus payment, there were many reactions
across social media.  On the one hand, NCPs, reeling from pandemic both financially
and emotionally from being alienated from their children, are understandably upset
about the exclusion from the much needed payment.  While others, mostly custodial
parents, not only agree with the government’s choice to exclude the other parent
from receiving the payment, but are finding humor in the decision. The reaction 
of custodial parents and supporters of the child support system to ban NCPs from
receiving a payment designed to help during this financially devastating time is
both selfish and hypocritical.  Especially considering that many of these people
owe debt to other companies outside of the government and would be extremely distressed
if a debt collector intercepted their stimulus payment to recover a debt that he
or she is accused of owing. Offsets of income tax refunds are a regular occurrence
for NCPs after they file their annual taxes. 

To be clear, according to The Office of Child Support Enforcement (OCSE) (2019),
an offset occurs when the Federal Income Tax Refund Offset Program intercepts federal
tax refunds of noncustodial parents who owe past-due support.  However, there have
been new reports that if non-child support debtors owe certain debts, their bank
accounts may be frozen by debt collectors.  One may think that these are two separate
issues, however, they are very similar considering one staple similarity. As with
NCPs, there are little to no remedies in place to ensure that money seized from 
tax intercepts or bank account seizures can be recovered once intercepted.  Likewise,
there may be limited remedies to restore seized bank accounts of those not involved
with the child support system. This may, finally, make people aware of how NCPs 
are negatively affected by tax offsets and bank seizures executed by the child support
system.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act provides _fast and
direct_ economic assistance for American workers, families, and small businesses,
and preserve jobs for our American industries, (United States Department of Treasury).
The Federal government has included provisions that make certain debts (i.e. student
loan debt, taxes debt, etc.) exempt from being offset. However, as [Sarah Hansen](https://thechildsupporthustle.com/non-child-support-debtors-may-find-coronavirus-payments-garnished/\"https://www.forbes.com/sites/sarahhansen/\")
from Forbes (2020) reported,  there is no provision in the CARES Act that prohibits
private debt collectors from garnishing stimulus money that is sitting in a personal
bank account.  The tactic of forcing people to sign up for direct deposit and using
bank account seizures to collect on a debt is nothing new to people involved with
the child support system.  

Recipients of Social Security and Supplemental Social Security benefits were mandated
to apply for bank accounts in order to receive payments via direct deposit several
years ago.  According to the Social Security Administration (SSA), a new law went
into effect March 1, 2013, requiring that you receive your payments electronically.
The result of the mandate was that thousands of NCPs reported that their bank accounts
had been frozen and seized to pay for child support arrears.  Because there are 
minimal protections provided to NCPs when they deal with the child support system,
most of the time, the money is never returned.

hey are left with nothing and cannot close the bank account and receive a paper 
check because the Treasury can only grant exceptions to this mandate on ‘rare occasions’.
Recipients of Social Security and Supplemental Social Security benefits were mandated
to apply for bank accounts in order to receive payments via direct deposit several
years ago.  According to the Social Security Administration (SSA), a new law went
into effect March 1, 2013, requiring that you receive your payments electronically.
The result of the mandate was that thousands of NCPs reported that their bank accounts
had been frozen and seized to pay for child support arrears.  Because there are 
minimal protections provided to NCPs when they deal with the child support system,
most of the time, the money is never returned. They are left with nothing and cannot
close the bank account and receive a paper check because the Treasury can only grant
exceptions to this mandate on ‘rare occasions’.

The government has included social security payments money that cannot be seized
during the CoronaVirus pandemic, as long as the payment is made within a specific
time frame.  The Treasury Department released ‘Guidelines for Garnishment of Accounts
Containing Federal Benefit Payments’ in March of 2020 which outlined the following
instructions,

> _financial institutions that receive a garnishment order are required to determine
> the sum of protected federal benefits deposited to the account during a two month
> period, and to ensure that the account holder has access to an amount equal to
> that sum or to the current balance of the account, whichever is lower._

Citizens can be comforted in knowing that their money is safe for at least two months
during a specified time frame. If a debt collector can prove that the garnishment
covers money held in or deposited into the account outside of the designated time
frame, the money may be legally seized.  And then, just like so many NCPs, their
money may be gone forever.

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Surprisingly, when NCPs and child support reform advocates contacted government 
officials and child support case workers about possibly suspending child support
payments during the pandemic, the answer was a resounding, NO.  There was no uproar
or even a whisper concerning the negative impact this refusal would, undoubtedly,
have on parents as they try to survive during the COVID-19 pandemic. The uproar 
is happening now that other people may have their stimulus money seized.  The National
Consumer Law Center (NCLC) (2020) is demanding that the Department of the Treasury
must act immediately to ensure that the stimulus payments about to go out to millions
of Americans are available for food and necessities and are not grabbed by debt 
collectors.  This is proof that the U.S. views and treats NCPs as second class citizens
no matter what crisis the country may be fighting.

There are a couple of states that have implemented some type of protections for 
its citizens in the event that bank accounts are frozen during the stimulus payout.
Massachusetts and Texas have issued their own emergency regulations that prevent
debt collectors from issuing new garnishment orders, but most states don’t have 
those protections, (Hansen, 2020).  Ohio is the latest state to issue protections
for stimulus money. For states without protections, such as Nebraska, the KNEB station
has shared a letter from Legal Aid of Nebraska explaining some steps someone can
take if their bank account is seized after the stimulus money has been deposited.
It is important to note that the stimulus money has been designated to assist low
and middle class citizens (and corporations) so every penny that reaches these households
is much needed, and the same is true even in NCP households.

Just like with child support debt collectors, private debt collectors will pull 
every trick to collect on an outstanding.  According to Legal Aid of Nebraska, under
Nebraska law these payments are probably ultimately exempt for most low-income families(
after a complex legal process, including a court hearing), creditors can still take
these stimulus payments by moving ahead and garnishing bank accounts.  Unfortunately,
most people are unaware of how to maneuver through a complex legal process which
may or may not include a court hearing. And what if there are court costs and filing
fees involved? Most low-income people do not have the money or the time to fight
a bank seizure.

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housholds-child-support.jpg.com/wp-content/uploads/2020/08/SourceLane-CPA.jpg\")

After the garnishment is issued and the bank account is frozen, the account holder
will be unable to access any of the funds that could be used for rent, groceries,
and other necessities.  The account holder, once he or she realizes that their account
has been frozen, must act quickly. The presumption will be that the stimulus payment
funds are not exempt, unless the debtor requests a hearing, files an inventory, 
and attends a court hearing, (Legal Aid of Nebraska).  If the account holder merely
checks their account to verify receipt of the deposit without withdrawing the money
right away, the money may not be available when he/she attempts to access the funds.

What makes matters worse, there is  a very small window of time in which the account
owner can act and try to have the account freeze unfrozen.  Legal Aid of Nebraska(
2020) explains that after three days, if no hearing is requested, creditors can 
request that the bank turn the funds over to the creditor.  Without some sort of
protections, there is no way to determine how many citizens across the country will
find themselves being treated just as NCPs have been treated for decades.  The more
information that becomes available concerning the stimulus money allegedly intended
to assist people in this time of need, the more it seems that it is really here 
to help the debt collectors.

As the country and world continue to battle with the CoronaVirus and will hopefully
soon begin to recover, there are certainly lessons that we can learn from the pandemic.
One very important lesson is that NCPs have been treated as second class citizens
for a long time with zero recourse. One of the most devastating examples of second
class treatment endured by NCPs is through financial abuse.  People cheer when a
non-residential parent, mostly fathers, has all of their money taken and he or she
is left with next to nothing to survive. However, the situation is not as cheerful
when other low-income citizens have their bank accounts seized in order to cover
a debt that they may or may not owe. 

In hundreds of thousands of child support cases, the debt is owed to the government
and will never reach the children that the funds are supposed to be used to help.
In those same cases and hundreds of thousand more, arrears on child support cases
are calculated retroactively, which causes NCPs to start the child support case 
indebted for tens of thousands of dollars.  These parents never recover from the
debt and are always subject to bank liens. And they are continuously ignored. We
as a nation and as a world, can and must treat NCPs as citizens, and not second 
class citizens.  In other words, when and if a private debt collector garnishes 
your stimulus money, imagine how a NCP feels every payday, every tax season, and
anytime the child support agency feels the urge to freeze and seize their bank account.

References:

Hansen, S. (2020, April 10). _Stimulus checks are coming next week. Could private
debt collectors grab them?_ Forbes. [https://www.forbes.com/sites/sarahhansen/2020/04/10/stimulus-checks-are-coming-next-week-could-private-debt-collectors-grab-them/#4b7693561f57](https://thechildsupporthustle.com/non-child-support-debtors-may-find-coronavirus-payments-garnished/\"https://www.forbes.com/sites/sarahhansen/2020/04/10/stimulus-checks-are-coming-next-week-could-private-debt-collectors-grab-them/#4b7693561f57\")
KNEB. (2020, April 13). 

_Federal stimulus payments intended for basic needs may disappear for thousands 
of low-income Nebraskans unless action is taken_.

National Consumer Law Center. (2020, April 1). _U.S. treasury must protect stimulus
payments from garnishment by debt collectors_. [https://www.nclc.org/media-center/u-s-treasury-must-protect-stimulus-payments-from-garnishment-by-debt-collectors.html](https://thechildsupporthustle.com/non-child-support-debtors-may-find-coronavirus-payments-garnished/\"https://www.nclc.org/media-center/u-s-treasury-must-protect-stimulus-payments-from-garnishment-by-debt-collectors.html\")

Office of Child Support Enforcement. (2019, February 1). _Overview of the federal
collections and enforcement program_. Office of Child Support Enforcement | ACF.
[https://www.acf.hhs.gov/css/resource/overview-of-the-federal-collections-and-enforcement-program#fop](https://thechildsupporthustle.com/non-child-support-debtors-may-find-coronavirus-payments-garnished/\"https://www.acf.hhs.gov/css/resource/overview-of-the-federal-collections-and-enforcement-program#fop\")

 1.  S. Department of Treasury. (n.d.). _The CARES Act works for all Americans_. Front
    page | U.S. Department of the Treasury. [https://home.treasury.gov/policy-issues/cares](https://thechildsupporthustle.com/non-child-support-debtors-may-find-coronavirus-payments-garnished/\"https://home.treasury.gov/policy-issues/cares\")

U.S. Department of Treasury. (n.d.). _Federal withholdings and offsets_. Bureau 
of the Fiscal Service. [https://fiscal.treasury.gov/top/faqs-federal-withholdings-and-offsets.html](https://thechildsupporthustle.com/non-child-support-debtors-may-find-coronavirus-payments-garnished/\"https://fiscal.treasury.gov/top/faqs-federal-withholdings-and-offsets.html\")

_U.S. treasury must protect stimulus payments from garnishment by debt collectors_.(
2020, April 1). National Consumer Law Center. [https://www.nclc.org/media-center/u-s-treasury-must-protect-stimulus-payments-from-garnishment-by-debt-collectors.html](https://thechildsupporthustle.com/non-child-support-debtors-may-find-coronavirus-payments-garnished/\"https://www.nclc.org/media-center/u-s-treasury-must-protect-stimulus-payments-from-garnishment-by-debt-collectors.html\")