§ 421.17B — Administrative wage assignment cooperative agreement

Iowa § 421.17B

• Jurisdiction: Iowa
• Title X: FINANCIAL RESOURCES
• Ch. 421: DEPARTMENT OF REVENUE

Text

1. Definitions. As used in this section, unless the context otherwise requires:
a. “Employer” means any person or entity that pays an obligor to do a specific task.
“Employer” only includes such a person or entity in an employer-employee relationship and
does not include an obligor acting as a contractor, distributor, agent, or in any representative
capacity in which the obligor receives any form of consideration.
b. “Employment” means the performance of personal services for another. “Employment”
only includes parties in an employer-employee relationship and does not include one acting
as a self-employer, contractor, distributor, agent, or in any representative capacity.
c. “Facility” means the centralized debt collection facility of the department of revenue
established pursuant to section 421.17, subsection 27.
d. “Obligor” means a person who is indebted to the state or a state agency for any
delinquent accounts, charges, fees, loans, taxes, or other indebtedness due the state or
indebtedness being collected by the state.
e. “Wage” means any form of compensation due to an obligor. “Wage” includes, but is not
limited to, wages, salary, bonus, commission, or other payment directly or indirectly related
to employment. If a wage is assigned to the facility, “wage” only includes a payment in the
form of money.
2. Purpose and use.
a. Notwithstanding other statutory provisions which provide for the execution,
attachment, garnishment, or levy against accounts, the facility may utilize the process
established in this section to collect delinquent accounts, charges, fees, loans, taxes, or other
indebtedness due the facility or being collected by the facility provided all administrative
remedies have been waived or exhausted by the obligor. Any exemptions or exceptions
which specifically apply to enforcement of such obligations also apply to this section.
Administrative wage assignment under this section is the equivalent of condemning funds
under chapter 642. It is expressly provided that these remedies shall be cumulative and that
no action taken by the director or the attorney general shall be construed to be an election
on the part of the state or any of its officers or representatives to pursue any other remedy
provided by law.
b. An obligor is subject to this section if the obligor’s debt is being collected by the facility.
c. Anyamountforwardedtothefacilitybyanemployerunderthissectionshallnotexceed
the delinquent or accrued amount of the obligor’s debt being collected by the facility.
3. Notice of intent to the obligor.
a. The facility may proceed under this section only if twenty days’ notice of intent has
been sent by regular mail to the last known address of the obligor, notifying the obligor that
the obligor is subject to this section and the facility intends to use the process established in
this section. The twenty days’ notice period shall not be required if the facility determines
that the collection of past due amounts would be jeopardized.
b. The facility shall notify an obligor subject to this section of the initiation of the wage
assignment action. The notice of initiation from the facility to the obligor shall be sent by
regular mail within two working days of sending the notice to the employer pursuant to
subsection 6, paragraph “b”, and shall contain all of the following:
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(1) The name and social security number of the obligor.
(2) A statement that the obligor is believed to have employment with the stated employer.
(3) A statement that pursuant to the provisions of this section, the obligor’s wages will be
assigned to the facility for payment of the specified debts and that the employer is authorized
and required to forward moneys to the facility.
(4) The maximum amount to be forwarded by the employer, which shall not exceed the
delinquent or accrued amount of debt being collected by or owed to the facility by the obligor.
(5) The prescribed time frames the employer must meet in forwarding any amounts.
(6) A statement that any challenge to the action must be in writing and must be received
by the facility within ten days of the date of the notice to the obligor.
(7) The address of the facility and the account number utilized by the facility for the
obligor.
(8) The telephone number of the agent for the facility initiating the action.
4. Verification of employment and immunity from liability.
a. The facility may contact an employer to obtain verification of employment, and any
specific information from the employer that the facility needs to initiate, effectuate, or
maintain collection of the obligation. Contact with an employer may be by telephone, fax,
or by written communication. The employer may require proof of authority from the person
from the facility and the telephone number of the authorized person from the facility before
releasing an obligor’s employment information by telephone.
b. The employer is immune from any civil or criminal liability for information released by
the employer to the facility pursuant to this section.
c. The facility may obtain multiple wage assignments of an obligor who is subject to this
section. If the obligor has multiple employers, the facility may receive wage assignments
from each employer until the full debt obligation of the obligor is satisfied. The facility shall
give notice to each employer when the facility is seeking a wage assignment.
5. Costs. The facility is not liable for any costs incurred or imposed for initiating,
effectuating, or maintaining an administrative wage assignment under this section. Such
costs will be the sole responsibility of the obligor and will be added to the amount to be
collected by the facility.
6. Administrative wage assignment — notice to the employer.
a. If an obligor is subject to this section, the facility may initiate an administrative wage
assignment to have compensation due the obligor to be assigned by the employer to the
facility up to the amount of the full debt to be collected by the facility.
b. To initiate a wage assignment, the facility shall send a notice to the employer more
than twenty days after the notice of the intent to use the levy process is sent to the obligor
pursuant to subsection 3, paragraph “a”. The notice shall inform the employer of the amount
to be assigned to the facility from each wage, salary, or payment period that is due the obligor.
The facility may receive assignment of up to one hundred percent of the obligor’s disposable
income, salary, or payment for any given period until the full obligation to the facility is paid
in full.
c. The notice to the employer shall contain all of the following:
(1) The name and social security number of the obligor.
(2) A statement that the obligor is believed to be employed by the employer.
(3) A statement that pursuant to the provisions of this section, the obligor’s wages are
subject to assignment and the employer is authorized and required to forward moneys to the
facility.
(4) Themaximumamountthatshallbeforwardedbytheemployer,whichshallnotexceed
the delinquent or accrued amount of debt being collected by or owed to the facility by the
obligor.
(5) The prescribed time frame the employer must meet in forwarding any amounts.
(6) The address of the facility and the account number utilized by the facility for the
obligor.
(7) The telephone number of the agent for the facility initiating the action.
7. Responsibilities of employer. Upon receipt of the notice of wage assignment from the
facility, the employer shall do all of the following:
19 DEPARTMENT OF REVENUE, §421.17B
a. Immediately give effect to the wage assignment and hold compensation which the
obligor has owing to the extent of the debt indicated in the notice from the facility.
b. No sooner than ten days, and no later than twenty days from the date the employer
receives the notice of wage assignment, unless notified by the facility of a challenge of
the wage assignment by the obligor, the employer shall begin forwarding the obligor’s
compensation, to the extent required in the notice, to the facility with the obligor’s name
and social security number, the facility’s account number for the obligor, and any other
information required in the notice.
c. The employer may assess a fee against the obligor, not to exceed twenty-five dollars,
for forwarding of moneys to the facility. This fee is in addition to the amount owed to or
being collected by the facility from the obligor. If insufficient moneys are available from the
obligor’s compensation to cover the fee and the amount in the notice, the employer may
deduct the fee amount prior to forwarding moneys to the facility and the amount credited
to the obligor’s account with the facility shall be reduced by the fee amount. However, if
the employer can present evidence to the facility that the employer’s costs were in excess
of twenty-five dollars and that such costs were necessary and reasonable, then the employer
may impose a fee in excess of the twenty-five dollar fee limit.
8. Challenges to action.
a. Challenges under this section may be initiated only by an obligor. An administrative
wage assignment only occurs after the obligor has waived or exhausted administrative
remedies. Reviews by the facility of a challenge to an administrative wage assignment are
not subject to chapter 17A.
b. The obligor challenging the administrative wage assignment shall submit a written
challenge to the person identified as the agent for the facility in the notice, within ten days of
the date of the notice of initiation of the assignment.
c. The facility, upon receipt of a written challenge, shall review the facts of the
administrative wage assignment with the obligor within ten days of receipt of the challenge.
If the obligor is not available for the review on the scheduled date, the review shall take place
without the obligor being present. Information in favor of the obligor shall be considered by
the facility in the review. The facility may utilize additional information if such information
is available. Only a mistake of fact, including, but not limited to, a mistake in the identity
of the obligor or a mistake in the amount owed to or being collected by the facility shall be
considered as a reason to dismiss or modify the administrative wage assignment.
d. If the facility determines that a mistake of fact has occurred, the facility shall proceed
as follows:
(1) If a mistake in identity has occurred or the obligor does not have a delinquent or
accruedamountbeingcollectedbyorowedtothefacility, thefacilityshallnotifytheemployer
that the administrative wage assignment has been released. The facility shall provide a copy
of the notice to the obligor by regular mail.
(2) If the delinquent or accrued amount being collected by or owed to the facility is less
than the amount indicated in the notice, the facility shall provide a notice to the employer of
the revised amount, with a copy of the original notice, and issue a notice to the obligor by
regular mail. Upon written receipt of the notice from the facility, the employer shall release
the funds in excess of the revised amount and forward the revised amount to the facility
pursuant to the administrative wage assignment.
(3) Any moneys received by the facility in excess of the amount owed to or to be collected
by the facility shall be returned to the obligor.
e. If the facility finds no mistake of fact, the facility shall provide a notice to that effect to
the obligor by regular mail and notify the employer to forward the moneys pursuant to the
administrative wage assignment.
f. Theobligorshallhavetherighttofileanactionforwrongfulassignmentindistrictcourt
withinthirtydaysofthedateofthenoticetotheobligor, eitherinthecountywheretheobligor
is located or in Polk county where the facility is located. Actions under this section are in
equity and not actions at law.
g. Recovery under this subsection is limited to restitution of the amount that has been
wrongfully encumbered or obtained by the department.
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h. A challenge to an administrative action under this subsection cannot be used to extend
or reopen the statute of limitations to protest other departmental actions or to contest the
amount or validity of the tax. Only issues involving the assignment can be raised in a
challenge to an administrative action under this subsection.
9. Validity and duration of a wage assignment notice.
a. A notice sent to the obligor under this section is effective without the serving of another
notice until the earlier of the following:
(1) The debt owed to the facility is paid in full.
(2) The obligor receives notice that the wage assignment shall cease.
b. Cessation of the wage assignment does not affect the obligor’s duties and liabilities
respecting the wages already withheld pursuant to the wage assignment.