Several Agencies are publishing a
regulation to implement statutory restrictions on the garnishment
of Federal benefit payments. Social Security benefits, Supplemental
Security Income benefits, Veterans benefits and Federal Civil
Service retirement benefits are exempt under Federal Law from
garnishment orders. The intent of the Agencies is to address the
hardships that recipients of federal benefits are encountering when
financial institutions freeze an account and the difficulties that
financial institutions have in determining whether funds deposited
in an account are exempt from garnishment. The proposed rule
establishes straightforward, uniform procedures that financial
institutions must follow when a garnishment order is received for
an account into which Federal benefit payments have been directly
deposited. Financial institutions that comply with the required
procedures are given a safe harbor under the rule. The rule
requires a financial institution to review the account, to
determine if any exempt benefit payments have been directly
deposited within the 60 calendar days prior to the receipt of the
garnishment order, and, if so, requires the financial institution
to ensure that the account holder has access to a protected amount
of funds in the account. Once the account review is completed the
financial institution must notify the accountholder of the receipt
of the garnishment order and provide certain additional
information. In addition, a financial institution must maintain
certain records of account activity and actions taken in response
to garnishment orders sufficient to demonstrate compliance with the
rule.
US Code:
12
USC 1818 Name of Law: Federal Deposit Insurance Act
US Code: 12
USC 1786 Name of Law: Federal Credit Union Act
Treasury is reducing the burden
estimate for producing the notice to reflect that fewer notices
will be sent.
No
No
No
No
No
Uncollected
Barbara Wiss 2026225034
No
On behalf of this Federal agency, I certify that
the collection of information encompassed by this request complies
with 5 CFR 1320.9 and the related provisions of 5 CFR
1320.8(b)(3).
The following is a summary of the topics, regarding
the proposed collection of information, that the certification
covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a
benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control
number;
If you are unable to certify compliance with any of
these provisions, identify the item by leaving the box unchecked
and explain the reason in the Supporting Statement.
Notice of Right to Garnish Federal Benefits to a Child Support Order Sent to a Financial Institution