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Child Support – Income Withholding for Employers and Payors of Funds
Payors of funds include trustees, self-employed people, financial institutions, unemployment insurance, worker’s compensation insurers, unions, individuals or companies paying independent contractors and others who make periodic payments.
If a parent has been ordered to pay child support and is employed, even in another state, that parent’s employer, when notified, must withhold child support from the parent’s paycheck.
State and federal laws require employers and other payors of funds to comply with court orders to withhold child support and spousal maintenance. Income withholding may be in place even if a parent is current with their child support payments.
Under Minnesota law, all income, including commissions and lump sum payments, is subject to withholding.
To offset the administrative cost of withholding, employers may charge the employee up to $1 for each payment withheld.
Employers may not fire, refuse to hire or discipline employees because they must withhold child support for them.
Employers and payors of funds should withhold support from an employee’s income when they receive a copy of an order or a notice to withhold support from:
Orders and notices will specify the types of support and the amount due.
When an employer receives an order or notice to withhold support, the employer must comply with the terms of the document and begin income withholding.
Employers who receive an order or a notice from another state should send the support to the payment center designated in the order or notice.
Employers who receive documents from an employee or obligee should verify the information in the order with the county child support office.
Employers who receive a tribal order to withhold should send the support to the entity designated in the order or notice.
Employers have 14 days to process an order or notice to withhold. Employers must begin withholding no later than the first pay period following this 14-day time period.
Employers must send child support to the location listed on the notice, or order to withhold, within seven (7) business days of paying an employee.
Employers who withhold child support should promptly send the money they withhold to the child support agency.
Employers who withhold child support from more than one employee may combine all support withheld during the same pay period into one payment. Employers should identify the payments and note the amount of to be credited to each employee’s child support obligation.
Unless directed otherwise, employers should send child support withholding to Minnesota Child Support Payment Center.
The employer can:
Some employees may have more than one child support order requiring income withholding. Employers must comply with all notices to withhold.
Minnesota law requires that basic support, spousal maintenance, medical support, child care support, and support arrearages or debts take priority over other attachments, executions, garnishments or wage assignments.
The Consumer Credit Protection Act (CCPA) limits the total amount of child support that employers may withhold from the employee’s pay. The act does not apply to independent contractors.
The act allows an employer to withhold up to:
Lump sums include, but are not limited to, accumulated vacation or sick pay, severance pay, bonuses, commissions, and profit sharing.
Lump sum payments need special attention. If an employer pays a lump sum of $500 or more to an employee when income withholding is in place, the employer must:
Lump sum payments are not held to Consumer Credit Protection Act limits. Employers who receive an order or affidavit from a child support agency regarding a lump sum must follow the requirements of that order or affidavit.
Employees can report lump sum payments for terminated employees on Minnesota Child Support Online.
If income withholding was in place, the employer must notify the child support agency of an employee ending employment within 10 days of the ending date. The employer must notify the child support agency of the:
The employer must withhold support from the last payment made to the employee, including any lump sum payments such as sick pay, vacation pay, tax deferred savings pay or severance pay.
If an employee returns to work, employers must resume income withholding immediately.
Employers can report terminations online at Minnesota Child Support Online.
Employers must continue to withhold income until they receive a notice to stop from the child support agency or a court order stopping income withholding.
State and federal laws require employers to comply with court orders from child support income withholding. If employers intentionally fail to comply, a court may:
A payor of funds responsibility to withhold does not change by classifying obligors as independent contractors.
Minnesota Statutes can be found on the Minnesota Office of the Revisor website.
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