INCOME WITHHOLDING

CS 734P-1 Notice to Withhold, Workers’ Compensation

10/98 Revised 01/23/03

38 U.S.C. 3101; UCA 62A-11-103 and 406(4); and R527-378

 

Introduction

 

Workers’ Compensation (WC) is a wage replacement and medical care program for a worker whose injury or illness is work related.  Almost all employers are required to have WC insurance.  To determine who the WC insurance carrier is for an employer, call the State of Utah Labor Commission’s Policy Section at (801) 530-6842 or (800) 530-5090.  A worker may be eligible for the WC benefits listed below.

 

1.                  Temporary Total Compensation - This benefit is paid to replace lost wages.  It is a percent of the worker’s average gross weekly wage.

 

2.                  Permanent Partial Impairment Rating (PPI) - This benefit may be paid if the worker sustains a permanent impairment due to a job related injury or illness.  It is a partial impairment because the worker is able to return to work.  The impairment rating is determined by a doctor.

 

3.                  Permanent Total Disability Compensation (PPD) - This benefit may be paid if the worker sustains a permanent disability which is totally disabling and prevents him/her from returning to any type of work, e.g., loss of two limbs such as both legs, arms, eyes or a combination.

 

If a non-custodial parent (NCP) is receiving WC benefits, contact the insurance carrier to determine how the benefits are being paid, e.g., scheduled payments, lump sum settlement, or both. If a lump sum settlement is going to be paid to the NCP, you may:

 

 

 

Procedures

 

Send a send a “Notice to Withhold Income for Child Support: Unearned” if the withholding amount up to the percentage cap will pay the past-due support in full.  If the withholding amount will NOT pay the past-due support in full, follow the procedures for a Notice of Lien Levy, Other Than Financial Institutions.  Refer to the examples below.

 

EXAMPLE #1:

NCP owes $2,500 for current and arrears

WC settlement amount is $6,000

“Notice to Withhold” withholding cap is 50%

 

EXAMPLE #2 (Lien Levy):

NCP owes $2,500 for current and arrears

WC settlement amount is $3,000

“Notice to Withhold” withholding cap is 50%

 

Determine when to send a “Notice to Withhold” by multiplying the settlement amount by the withholding cap.  If the result is equal to or more than what the NCP owes, send the “Notice to Withhold” instead of doing a lien-levy.

 

Example #1, send a “Notice to Withhold” because $3,000 ($6,000 X 50% = $3,000) is more than what the NCP owes.

 

Example #2, follow lien-levy procedures because $1,500 ($3,000 X 50%) is less than what the NCP owes and would NOT pay the NCP’s debt in full.