If you received an economic stimulus check in the last two years, you might have questions about how it will affect your child support. Whether you receive child support payments or make them, it is important to understand how different types of income could matter for child support purposes.
Can Economic Stimulus Checks Be Intercepted to Pay Child Support?
Congress authorized economic stimulus payments to many Americans in March 2020. These payments are also referred to as “economic impact payments” or “recovery rebate payments.” There were several payments made to those who qualified, starting in early 2020 and continuing into 2021. The second and third rounds of payments were authorized by Congress in December 2020 legislation.
The first round of payments can be intercepted to pay for past-due child support in North Carolina. The bill authorizing the payments that Congress passed permits states to refer child support debts to a federal collection program. This program can intercept economic stimulus payments and apply them to overdue child support obligations that North Carolinians owe. However, not all past-due child support obligations are reported to the federal program. The threshold for reporting varies depending on what kind of money is owed: $150 or more for public assistance cases and $500 or more for non-public assistance cases.
Unlike the first round, the second and third rounds of payments cannot be intercepted to pay for past-due child support. The bill in which these payments were authorized specifically exempts them from the federal program that collects state debts such as past-due child support. The state of North Carolina also will not garnish these payments from bank accounts.
What If You Didn’t Qualify for Stimulus Payments?
People who didn’t qualify for economic stimulus payments or didn’t receive the full amount may be eligible for a tax credit called a Recovery Rebate Credit. Unlike the second and third economic stimulus payments, the Recovery Rebate Credit can be intercepted by the federal program to pay for overdue North Carolina child support.
Can Tax Refunds Be Intercepted to Pay Child Support?
In general, state and federal tax refunds can be intercepted by Child Support Services to pay for past-due child support. Tax refunds that are intercepted are applied first to debt owed to the state and then to debt owed to the custodial parent. Similar to the intercept of the first economic stimulus payments, the threshold for reporting for intercept varies depending on what kind of money is owed: $150 or more for public assistance cases and $500 or more for non-public assistance cases. For state tax refund intercept, you must owe $50 or more for non-public assistance cases.
Which Other Kinds of Income Can the State Withhold to Pay Child Support?
In addition to tax refunds, the first economic stimulus payment and the Recovery Rebate Credit, the state of North Carolina can withhold other kinds of income to pay past-due child support. These types of income include:
- Wages from employment
- Salary from employment
- Unemployment compensation
- Workers’ compensation
- Some Social Security Administration (SSA) benefits
- Retirement benefits
- Some veterans benefits
- Work release payments
To withhold, for example, wages from employment, the state sends a notice to the employer requiring that it withholds part of each paycheck and sends it to the state.
Some types of income are exempt from withholding for past-due child support, such as Supplemental Security Income (SSI), federal death benefits, veterans disability and death benefits, and public assistance. Similar to the second and third economic stimulus payments, the state of North Carolina cannot withhold these and apply them to past-due child support.
If you have questions about which kinds of income can pay for overdue child support in North Carolina, seek a lawyer’s help. North Carolina family law and divorce lawyers can assist with child support questions. When child support is overdue, you may need legal help to move forward.
Let New Direction Family Law Assist You
If you need advice about child support payments, the team at New Direction Family Law is available today to answer your questions. With decades of combined legal experience, our attorneys are knowledgeable, effective, and compassionate professionals. We will help you understand your legal rights and work hard toward your best outcome. We proudly serve clients in Wake, Johnston, Durham, and surrounding counties. Contact New Direction Family Law at (919) 646-6561 to schedule a consultation, or visit us at our website.