Payments

As an employer, you must send all payments to the state disbursement unit listed in the Remittance Information section of the Income Withholding for Support (IWO). This applies to an IWO issued by a child support agency, court, attorney, or other party, unless the order was:

• Entered before January 1, 1994, and with no arrears, never modified, or is not a child support case enforced by the state child support agency.
• Issued by a tribal child support agency: Send the payment to the payee shown on the order. Learn more about working with tribes and tribal orders.
• Issued by South Carolina: Send the payment to the payee on the order until South Carolina establishes a state disbursement unit.

Some states require employers to remit child support payments electronically.

For additional information, check out these questions and answers about sending child support payments, and the matrix of state-specific contacts and payment requirements for employers.

Sending child support payments electronically saves employers time and money. It eliminates printing and mailing costs and reduces errors.

There are several ways to send a child support payment electronically:

• Use your own payroll software to send Automated Clearing House credit payments (similar to direct deposit) through the Federal Reserve’s banking system with EFT/EDI, using the standard child support addendum segment
• Use a state’s web-based payment service—contact the state child support agency where you send payments for details
• Use a payroll service provider that is already sending child support payments electronically
• Use your bank's online bill-paying service

Step 1: Determine whether your payroll/accounting system supports electronic payments for child support.

If it does not, you may want to explore these options:

• In-house information technology staff may be able to make programming changes so that you can produce electronic payments for child support, including the EDI DED (Deduction) child support addendum record that child support agencies need to identify the payments.
• Your payroll/accounting software developer may have an enhancement that supports electronic payments for child support. Contact your user’s group or software representative.
• Your bank may have a software package that will enable you to produce the file formats necessary for electronic payments. Contact your bank and ask for someone in cash management, treasury management, or treasury services.

Step 2: Contact the appropriate child support agency’s SDU —in the state that issued the underlying child support order or where you currently send funds—to find out the EFT/EDI start-up procedures for sending payments.

Step 3: Conduct the EFT/EDI start-up procedures for each child support agency you contacted in Step 2.  These procedures will typically include:

• An exchange of basic banking information (routing codes, account numbers), Federal Employer Identification Number (FEIN), and locator code information with the child support agency
• A reconciliation between child support agency records and employer records of names, Social Security numbers, and case identification numbers so that each employee’s withholdings are properly credited
• A transmission of an initial test file, or pre-note, to ensure that the Automated Clearing House records are formatted and transmitted properly

• The National Automated Clearing House Association publishes the User Guide for Electronic Child Support Payments  (PDF) to provide SDUs, employers, and their financial institutions with current formats, definitions, and implementation recommendations to remit child support payments and payment information electronically through the Automated Clearing House network using current conventions and standards
• Contact your state child support EFT representative
• Email the Employer Services Team