CS 072 In-Kind Support and Proof of Direct Payments
03/92 Revised 04/02/14 Training Completed 02/06/13
CS 072.1 Introduction
U.C.A. 62A-11-307.2 (4)(b) states:
“(i) If an obligee agrees with an obligor to receive payment of support other than in the court or administratively ordered manner and receives payment as agreed with the obligor, the obligee shall immediately deliver the cash equivalent of the payment to the office.
(ii) If the amount
delivered to the office by the obligee under
Subsection (4)(b)(i) exceeds
the amount of the court or administratively ordered support due, the office shall
return the excess to the obligee.”
The Office of Recovery Services (ORS) gives credit to non-custodial parents (NCP’s) for in-kind support payments that s/he has made in lieu of cash support payments when certain conditions exist. The in-kind payments may have been in lieu of court-ordered child support, and may or may not have been addressed in the court order or a modification. In-kind payments may have also been made when no court order existed. To receive credit, the NCP must provide verification of the in-kind payment (e.g., cancelled checks or notarized statements signed by the custodial parent (CP)).
When a CP is receiving IV-A cash assistance
from the State of Utah, or if a child has been placed in state custody, the state
has the right to receive child support payments to offset the costs of those
programs. If the CP (or a former CP for
state custody situations) receives direct payment of support from a NCP during
those time periods, the CP has “retained support” that legally belongs to the
State of Utah. Whether or not the NCP
may receive credit for in-kind payments, or whether the CP is pursued for
retained support on in-kind payments, depends on the individual circumstances
of the case.
CS 072.2 Definition
In-kind Support – Defined pursuant to Administrative rule, R527-056 as “support provided by the obligor to the obligee in lieu of payment of a cash support amount.”
In-kind support examples include situations where the NCP buys food or clothing for the children or pays the CP’s rent, mortgage, utilities, etc. Child care is generally not considered in-kind support.
CS 072.3 Determining When to Give Credit for In-Kind Support
1. No Support Order: If there is no support order and the NCP has verified that s/he has made in-kind support payments to or on behalf of the CP or child(ren), and payment was made prior to the date the NCP received a Notice of Agency Action (NAA), apply the payment to current support owed for the month in which the payment was made up to the guideline amount due for that month. In-kind support paid during one month generally should not be credited for a different month’s obligation.
EXAMPLE: The NCP and CP separated in May 2008. The CP applied for Child Support Services (CSS) services or the child went into state custody in July 2008. You located and served the NCP an NAA in September, 2008 based on a guideline amount of $201.00 per month. In October, the NCP provides proof that he paid the CP’s rent for July, August, September and October of $400.00 per month. Credit the NCP for $201.00 for the months of July, August and September. Do not credit October’s rent because the NAA the NCP received in September informed him of his obligation to the state.
EXCEPTION: On a IV-A case, if the in-kind payment was made after the NCP received notice of his obligation to pay the state, you may credit the amount paid toward the NCP’s child support debt if you are negotiating a settlement of all arrears. Consult with your manager on these cases before allowing the credit. CSS will not collect retained support from the CP for in-kind support paid while no order exists.
CIC NOTE: On Children In Care (CIC) cases, CIC will not give credit for in-kind support payments after the NCP has been informed of his/her obligation to the state either by attendance at the Juvenile Court hearing or receipt of the NAA. CIC will not collect retained support from the former CP (either before or after notice of the state obligation) where no court order exists.
2. Valid Child Support Order Exists: If there is a valid order for child support and the order does not provide/allow for in-kind payments (see below), do not give credit for in-kind payments.
a. In-kind Support Ordered: If in-kind support is ordered by a divorce decree in lieu of child support payments (for example, the NCP was ordered to pay the house payment instead of paying child support), give the NCP credit up to the monthly support obligation as follows:
i. CSS cases: Give credit up to the monthly support obligation for each month that the order was in effect and the NCP complied with the order (for example, paid the house payment). If the CP and children are receiving IV-A cash assistance, IMMEDIATELY refer the case to the Attorney General’s Office (AGO) to request a modification of the order to stay the in-kind agreement while the family is on cash assistance, and to order a monthly guideline amount.
ii. CIC cases: Give the NCP credit up to the monthly support obligation through the month s/he was informed of the obligation by attendance at the Juvenile Court hearing.
EXAMPLE: The guideline support obligation is $200.00 per month, the house payment is $450.00 per month, and the NCP verifies that he has been making the house payments. On a CSS case, give the NCP credit for $200.00 per month for the months the house payments were made and the in-kind support order was in place. On a CIC case, give the NCP credit for $200.00 per month for the months the house payments were made up through the month s/he received the NAA. Do not give the NCP credit against arrearages or future support for the remaining balance of $250.00, as it is in excess of the monthly support obligation.
b. In-kind Support Not Ordered, Written Agreement Exists: In order for the NCP to receive payment credit on a case with an existing order for support that does not specifically order in-kind support, there must be an in-kind support agreement between the CP and NCP that meets all the criteria listed below.
i. The NCP and the CP have agreed to the in-kind support payments.
ii. The agreement is in writing.
iii. The agreement predates the CP receiving the IV-A cash assistance.
NOTE: If this criteria (i. - iii.) is met, do not proceed administratively. Immediately refer the case to the AGO to determine how to proceed to collect support.
The following items (iv. - viii.) are additional items the AGO will review and consider.
iv. The agreement was filed with the court (e.g., the court order has not been modified to include in-kind support payments); however, the court has been notified of the arrangement.
v. The value of the in-kind support is undisputed.
vi. The in-kind support is easily valued.
vii. The value of the in-kind support provided in a month equals or exceeds the monthly amount of cash support ordered by the court.
viii. CSS had notice of the agreement and registered no objection to the agreement when the CP applied for cash assistance.
CIC NOTE: On CIC cases, when a child is placed in the care or custody of the state, any in-kind support agreement between the parents becomes invalid after the month s/he receives the NAA or after the date of the Juvenile Court hearing if the parent is in attendance; therefore, CIC will not give credit for in-kind support payments based on a written agreement after the NCP has been informed of his/her obligation to the state. Since no credit is given to the NCP, CIC will not collect the retained support from the former CP on CIC cases when in-kind support is paid based on a written agreement. For in-kind payments made prior to the NCP’s notice of state obligation, do not collect the retained support from the former CP.
c. In-Kind Support Not Ordered, No Written Agreement Exists: If the court order specifies an amount to be paid for child support and does not order in-kind support, or the NCP and CP do not have a written agreement, do not give the NCP credit for any in-kind payments. Enforce the support obligation as specified in the order.
CS 072.4 Verification Process
The customer must provide verification of the in-kind payment or proof of payment in the form of cancelled checks or bank-provided substitute checks (copies of fronts and backs), redeemed money orders, receipts (e.g., for clothing, food, rent, etc.), a receipt written by the CP, or a notarized statement signed by the CP. These types of verification may contain financial account, identity or other sensitive information about the customer. ORS has chosen not to add any proof of payment or in-kind support documentation to the electronic case file and not to maintain copies of this documentation in any other format. These documents will be processed by a designated Quality Assurance Specialist (QA) in each region.
NOTE: If verification is received and imaged as correspondence in the electronic case file, the document should be reattributed to the appropriate QA mailbox with the appropriate note added to the Comment field to ensure both parties have the opportunity to respond to the information provided. Refer to the steps listed below for more information.
Follow the steps listed below:
1. The customer provides documentation of in-kind payment or proof of payment that were not processed by ORS (e.g., copies of original cancelled checks or bank-provided substitute checks, fronts and back, redeemed money orders, receipts, or a notarized statement signed by the CP). The information may be:
a. Delivered personally to an ORS office by the customer.
i. Inform the customer that the assigned caseworker will contact both the NCP and CP by mail for the next step in the verification process within 15 days of receiving the information.
ii. If the documentation is dropped off at the front desk, the front desk worker will scan the documentation and assign the batch to the appropriate regional QA mailbox. If the documents cannot be scanned when the CP/NCP drops off the documentation, make duplicate copies to scan at a later time and return the originals to the participant.
NOTE: When creating the auto import mail batch class for proof of payment documentation, update the Comment field to allow QAs to easily identify the correct documents.
iii. If you obtain the documentation while meeting with the customer, you may review the in-kind payment or proof of payment being provided during the appointment with the customer; however, the document copies or the notarized statement should then be scanned and routed to the appropriate QA mailbox. If the front desk worker is unable to scan the documentation immediately, make duplicate copies so the customer may keep the originals.
b. Mailed directly to the ORS/CSS correspondence address.
i. When the routed envelope or any incoming mail containing proof of payment or in-kind documents is received by the Central Imaging Unit (CIU), these documents are imaged as case mail and routed to the appropriate QA mailbox
ii. Return all original documents to the customer.
A. Generate the Notice of Proof of Payments letter. The Notice is used when returning the documentation to the customer. It advises him/her to maintain the proof of payment in case it is needed in the future (e.g., to dispute the determination of the agent, to present in retained support hearings, etc.),
B. Choose the Select Participant option.
C. Choose the Return Document to Sender option, and the Mail Room Closure option.
NOTE: If other documentation (i.e., insurance verification, pay stubs, etc,) is sent in with proof of in-kind or direct payment documentation, the different types of documentation should be separated and imaged as separate batches according to the type of information received. If multiple types of documentation is scanned with proof of payment documentation, contact a regional authorized user to split the documents and attribute the imaged documents accordingly.
c. The QA will complete the following steps:
i. Complete the Excel worksheet and record the details of all the documents provided. This provides a standardized process to maintain a record of proof of payment documents, credit requests, participant reviews, approvals, and adjustments. The QA will document the payment ID (check numbers), type of payment, dates, payor, payee, bank name, amounts, type of proof provided (e.g., endorsement signature of CP), and any unusual or identifying information about the payment or document (e.g., comments) on the worksheet. This information should include details such as where the check was cashed, if ID was used, and if the information is legible or difficult to read. Include details and wording for itemized receipts for food or clothes, receipts written by the CP or notarized statements by the CP. Include your ORS ID in the comments field.
NOTE: ALL payment documents provided by the NCP or CP should be recorded on the worksheet by the QA. The QA should not make the determination as to whether the information should be included on the worksheet or not. It will be at the caseworker’s discretion to allow the credit based on the strength of the evidence provided.
ii. Verify the applicable case number, NCP, and CP (including participant ID numbers), and document this information on the worksheet.
iii. Complete the Date Information Received field with the applicable date.
iv. Save the worksheet using the ORS case number and the date (MMDDYY).
v. Send an email to the assigned caseworker notifying him/her of the documents sent in for credit. Include the case number and the worksheet as an attachment in the email.
vi. Reattribute proof of payment documents to the Recycle Bin.
vii. Document all actions taken in the case narratives.
2. When the caseworker receives the email from the QA, s/he will review the worksheet and take the steps below:
a. For each document or item listed on the worksheet, indicate a preliminary finding of whether that amount will be credited toward the support debt in the Credit to Account field based on the strength of the evidence documented. The pull down options include: Pending, Yes or No. If your preliminary finding is pending, indicate in the comments field any additional information you need from either of the participants. Your comments should be in addition to any documented comments by the QA. Include your ORS ID in the comments field.
NOTE: Review any existing saved worksheets to verify if any of the documentation has previously been submitted and credit given.
b. The Total Credited on Account field on the worksheet will automatically calculate a total based on your findings.
c. Add the date the Notice is being sent to the Date Notice Sent field on the worksheet.
d. Save the worksheet to your personal network drive using the ORS case number and the date (MMDDYY).
e. Generate Notices to the NCP and the CP with the Notice of Payments Claimed option as notification of the pending adjustment. Enclose a copy of the worksheet with each letter.
f. To generate a Notice to both participants, each letter must be created separately.
g. Set a reminder to remind you to take an action after the 30-day response period.
h. Throughout the 30-day response period, consider any new evidence.
i. New evidence may be sent or taken to an ORS office by the customer or via mail. These documents should be processed by a QA. For procedures and more information, refer to step 1 above.
i. Based on the new evidence, determine any changes to the credit on the worksheet. Additional evidence processed by the QA will result in multiple worksheets for the same timeframe. The caseworker should consolidate the additional evidence from the new worksheet into the original worksheet by using the Copy and Paste feature of the worksheets.
NOTE: An item containing proof of payment or in-kind documentation may be inadvertently imaged by mailroom staff as it did not contain copies of checks, (i.e., it appeared to be correspondence and is sent to you as mail). This could be a written response to the Notice, a written receipt or notarized statement by a CP, etc. The documentation should be reattributed to the appropriate QA mailbox with the appropriate note added to the Comment field to ensure all the information from the item is properly recorded on the worksheet.
ii. Generate Notices to the NCP and the CP with the Notice of Payments Claimed option. Enclose the updated copy of the worksheet with each letter.
iii. Allow 30 days after the date of the letter for either party to respond to the additional evidence. You may need to adjust the action due date on your reminder.
i. If the parties agree to your findings prior to the end of the 30-day response period, you may immediately make the appropriate adjustment (refer to subsection Giving Credit for In-kind Support below).
j. Make the final determination of credit based on the strength of the evidence submitted and documented on the worksheet. Consult with your manager as needed. The participants do not need to agree on the decision concerning the amount of the credit to be given if it is substantiated by the documentation of the evidence.
EXAMPLE: The NCP has provided copies of four checks endorsed by the CP as proof of payment documented on the worksheet. Every check is for $150.00 for each month of February, March, April, and May. Ordered current support is $300.00 per month. The CP disputes the proposed credit stating that those payments were paid to her for a credit card debt owed by the NCP. Her comments should not be considered in the credit determination unless supported by documented evidence. The CP then submits a copy of her Decree of Divorce stating that NCP is to pay ˝ the parties’ debt. She provides a written agreement signed by the NCP to pay $150.00 per month toward that debt. She submits copies of checks for $300.00, with memos stating “child support” for six months prior and three months after the period NCP is requesting credit. The evidence indicates that the NCP consistently paid the $150.00 monthly for the agreed credit card debt in the same manner, and the full $300.00 monthly child support with separate checks. It is determined that the NCP owes child support for the period in question – February, March, April, and May. The evidence suggests that the payments submitted for credit were for other debts owed by the NCP. The documentation and determination is recorded on the worksheet.
k. Make or request the appropriate adjustment on ORSIS and, if necessary, an overpayment referral as described below.
l. After the adjustment is made on ORSIS, the caseworker will complete the following fields on the worksheet:
i. The Date of Adjustment;
ii. Adjustment Approval (ORS ID of Manager); and,
iii. Date of Overpayment Referral (if applicable).
m. Print the completed worksheet and a copy of the appropriate ORSIS screens and route them to CIU to be imaged. The validator will attribute the imaged worksheet to the case.
n. Generate Notices to the NCP and the CP with the Copy of Adjustment Made option to notify the participants of the credit. Enclose a copy of the completed worksheet with each letter.
o. Document all actions taken in the case narratives.
NOTE: If either party does not agree with the credit determined, that party may pursue the matter judicially.
CS 072.5 Giving Credit for In-Kind Support
On a pre-order case, first establish the order giving the NCP credit for the amount of the in-kind support by including the time period in the judgment for arrears section of the NAA and showing the in-kind credit in the less payment field. Then, add the full ordered amount for the time period on ORSIS using retroactive calculation. On both pre-order and post-order cases, give credit for the in-kind payments by adjusting the debt balance as described below.
1. Make or request the appropriate adjustment to the debt balance to give the NCP credit for the amount of in-kind support. Follow the steps below.
a. Adjust the debt.
b. If appropriate, make a retained support referral.
c. Document all actions taken in the case narratives.
NOTE: If an administrative order was issued and you subsequently learn that the CP had received and retained direct support payments from the NCP for the same time period covered in the judgment, review the order and consider amending the administrative order. Amend the order if the entire judgment obligation was paid by the respondent prior to the entry of the order. Otherwise, adjust the ORSIS accounting records to reflect the correct amount due without amending the order.
If there is a judicial court order, do not allow credit for in-kind support payments, unless the order provides/allows for in-kind payments.
CS 072.6 Retained Support and In-Kind Support
Individuals who apply for IV-A financial assistance are notified in the Notice of Services that they cannot enter into an agreement with the NCP to accept in-kind support in place of the court ordered support while receiving IV-A cash assistance. If the IV-A CP accepts in-kind support, s/he must deliver its cash value to CSS. If the CP does not deliver the cash value to CSS, s/he is considered to be retaining support in violation of UCA 62A-11-307.2(4)(b)(i) and CSS may recover the value of in-kind support from the CP not exceeding the amount of support ordered, up to the amount of cash assistance received.
NOTE: On CIC cases, retained in-kind support is not recovered from the former CP under certain circumstances based on when the in-kind support was provided, when the NCP received notice of the obligation to the state, and whether the NCP is receiving credit for the in-kind support.
You may make a retained support referral for in-kind support payments if ALL the conditions below exist.
1. A support order has been established.
2. The criteria for a written agreement above were not met.
3. Parties are aware of the obligation to the state:
a. CSS Case: The CP is or was receiving IV-A cash assistance and s/he:
i. Signed the Assignment of Rights;
ii. Signed the DWS assignment – Duty of Support;
iii. Received written notice that when receiving IV-A assistance, prospective payments must be paid to CSS as ordered by the court; or,
iv. Is unable to deliver its cash value to CSS.
b. CIC Case: The NCP has been notified of the obligation to the state either via NAA or by attendance at the Juvenile Court hearing.
4. The NCP and CP continued with their in-kind support agreement after receiving notice pursuant to #3 above and the NCP is receiving credit for those in-kind payments toward the support debt owed to the state.
On a IV-A case, consult with your management chain (Manager and Associate Regional Director – others as needed) about whether it is appropriate to refer the CP’s in-kind support amount to the Retained Support team for collection of retained support.