A bill (H.R. 1488) under which child support payments would be withheld from noncustodial parents’ paychecks by the IRS was the subject of a hearing held on March 16 by the House Ways and Means Subcommittee on Human Resources.
Sponsored by Reps. Henry Hyde (R-IL) and Lynn Woolsey (D-CA), H.R. 1488 would require the W-4 tax forms filed on behalf of employees who owe child support to indicate their monthly payment amount. The IRS would then collect the monthly child support—in addition to monthly Social Security, FICA, and income taxes—and distribute the child support to the custodial parent.
Testifying on behalf of the proposal, Rep. Woolsey said, “The IRS has the tools and the experience to collect child support.” She said that in 1998, state child support collection systems were successful in collecting 23 percent of overdue child support. “The IRS has an 85 percent collection rate,” she said, adding: “That gets a lot more money to needy families than the 23 percent collected by the states.”
Rep. Hyde cited preliminary federal statistics showing that $50 billion in child support arrearages is owed to 30 million children across the nation. In addition to the children directly affected, Rep. Hyde said, “we must remember the taxpayers who pay for the public services sought by these families when children are abandoned in this way by their parents.”
Much of the testimony referred to a hearing held last September by the same subcommittee. During that hearing, Dr. Olivia Golden of the Department of Health and Human Services testified on the implementation of child support provisions included in the 1996 welfare reform law (P.L. 104-193). She described national databases to help child support caseworkers track noncustodial parents across state lines, a program allowing the denial of passports to parents with more than $5,000 in unpaid child support, and a cooperative effort with banks to track the bank records of delinquent parents (see The Source, 9/24/99, p. 5).
At the March 16 hearing, Rep. Hyde said the number of arrearages collected has “slightly increased” in the wake of the 1996 welfare law provisions, but “we’ve tried just about everything and the states have not been up to this job.” Therefore, he said, “the IRS should be given a chance at filling a terrible void.”
Geraldine Jensen of the Association for Children for Enforcement of Support (ACES) described reports from her organization’s membership on problems with the current system and the 1996 welfare law changes. “H.R. 1488 is needed because even states with aggressive enforcement programs have not been able to collect support from the majority of parents who owe it,” she said.
Art Alexakis of the rock and roll band “Everclear” offered support for the bill, describing his experience as a child whose noncustodial parent avoided paying any child support. He called for passage of H.R. 1488, saying it would “end this ability for parents to be able to get away with not paying.” He added: “People will learn this because we will use the muscle of the IRS to teach them.”
However, Subcommittee Chair Nancy Johnson (R-CT) spoke strongly against the proposal. “We are beginning to see the results of the 1996 reforms,” she said, adding that because of them, the current system “is showing steady and significant improvement.” She said that Ways and Means Chair Bill Archer (R-TX) and other members of the committee “are greatly concerned that the IRS not be given additional responsibilities.” She also said the IRS collection rate for taxes should not be compared with state collection rates for child support. “This is comparing apples and oranges,” she stated.
Rep. Johnson cited a letter that she received from Jonathan Talisman, Assistant Secretary of the Treasury, whose department is in charge of the IRS. In his letter, Assistant Secretary Talisman said, “Implementation of the Hyde-Woolsey bill would be a monumental undertaking requiring the allocation of substantial additional resources within the IRS. New personnel would have to be hired, new computer systems developed, and new operating procedures established.” He added that the IRS is “trying to overcome significant challenges…as it seeks to implement the reforms of the IRS Restructuring and Reform Act (P.L. 105-206).”
Victoria Williams of Policy Studies, Inc. said that under H.R. 1488, it would be difficult to collect child support from “those involved in the underground economy.” She said many of the noncustodial parents who owe child support work for cash only, and they “do not have employers who report to databases or who can deduct child support from wages.” In addition, she questioned the bill’s enforcement, highlighting states’ ability to put delinquent parents in jail under the current system. “Many thousands of noncustodial parents who are now marginally employed would happily quit working…if they were not under constant threat of going to jail,” she told the subcommittee.
Wayne Doss of the National Child Support Enforcement Association (NCSEA) said, “One of the primary assumptions underlying H.R. 1488—that obligated parents can be expected to voluntarily report the existence of their obligations to their employers—is flawed.” He added: “It may have taken longer in coming than we would have liked, but a highly effective system for support withholding now exists across the nation.” He said improvements are needed, but they “can be made far more readily than the development of a system at the IRS.”
