AN ACT CONCERNING CHILD SUPPORT COLLECTIONS.

By law, the state (through an arrangement with the Internal Revenue Service) must intercept federal income tax refunds from child support obligors who owe past-due support (arrearages). The amount withheld is distributed based on a priority schedule in federal law. Until 2005, federal law required that any arrearages collected on behalf of families formerly receiving Temporary Assistance for Needy Families (TANF)-funded cash assistance (Temporary Family Assistance or TFA in Connecticut) went first to the state, with the remainder going to the custodial parent and the state. Currently, federal law allows states to choose whether to pay the family the collected arrearage first or use the pre-2005 rule. This bill explicitly allows the state to give the intercepted support first to the custodial parent, with any remainder going to the state and family. Under current law, the state has this option but has not exercised it.

The law requires the state and federal government to withhold tax refunds from child support obligors who owe past-due support. This withholding (called an offset) is for obligors owing $ 150 or more in cases in which the custodial parent received TFA, or $ 500 or more in non-TFA cases. Currently, the amount withheld for former TFA cases is paid to the state.

Under the bill, any collected support must be distributed in accordance with two separate provisions enacted in the federal 2005 Deficit Reduction Act (DRA). One provision establishes an alternate tax intercept distribution to the one in prior law for families that previously received cash assistance (42 USC § 657). Specifically, it requires states that choose this option to first pay to the custodial parent any excess amount (i. e. , beyond what is owed for current support) necessary to satisfy support arrearages that have not been assigned to the state. (As a condition of receiving assistance, cash assistance recipients must assign to the Department of Social Services (DSS) their right to child support accruing while they receive assistance. ) This provision also allows states to pass through this support to families and not pay the federal government its share of the collection regardless of whether it has been assigned (the federal government subsidizes state child support enforcement programs).

The other provision requires states, in the child support enforcement state plans that they must submit to the federal government, to include whether they have elected to use the new distribution option or will continue to use the old one, which favors the state (42 USC § 654).

Current law requires that the tax offsets be distributed as required by Title IV-D of the Social Security Act. Title IV-D is a large body of federal law governing child support enforcement, and in which the two sections cited above now reside.

Title IV-D of the Social Security Act contains the federal rules governing state child support enforcement programs. A IV-D support case is one in which (1) the child for whom support is sought has received assistance under the state's cash assistance (Temporary Family Assistance in Connecticut), Medicaid (HUSKY A in Connecticut), or certain other state programs or (2) the custodial parent asks the state's designated IV-D agency, which is the Bureau of Child Support Enforcement, for help to collect child support.

Yea

Nay

(02/26/2009)