By: Kayleen Carter, CA DCSS
Over federal fiscal year (FFY) 2018, the California Department of Child Support Services (CA DCSS) and Sierra Nevada Regional Department of Child Support Services (Sierra Nevada Regional DCSS) successfully increased employer lump-sum collections statewide by more than 23 percent. This significant increase was in large part due to proactive steps taken by CA DCSS and Sierra Nevada Regional DCSS to encourage employers to report bonuses and lump-sum payouts to CA DCSS.
In January 2018, several large employers such as AT&T, Home Depot, and Wal-Mart, publicly announced that they would be providing their employees with bonus payouts in response to recent federal tax changes. In response to these announcements, CA DCSS created a list detailing the names of these employers and the amounts they were going to pay. This was then compared to a list of those who were already reporting lump-sums to CA DCSS and it was discovered that most of the employers were not already reporting their lump-sum payouts to the state.
CA DCSS partnered for several years with Sierra Nevada Regional DCSS to administer the lump-sum program. CA DCSS is the central point of contact for employers to report their upcoming payouts which is shared with Sierra Nevada Regional DCSS who then issues the Lump-Sum Incoming Withholding Order (IWO).
“We had an opportunity to be proactive,” said CA DCSS Operations Division Enforcement Unit Manager, Meredith Ford. “We usually wait for employers to report to us that they are paying out a bonus.”
Following executive approval, CA DCSS conducted outreach to help encourage employers to report their future lump-sum payouts.
Employers can choose to report bonus payouts electronically through an electronic IWO, upload the information on a spreadsheet using the Federal Office of Child Support Enforcement’s Employer Services Web Application, send the information via email, or report the information by phone.
CA DCSS issued Lump-Sum IWOs for employees owing more than $500 in past-due child support and overall employer lump-sum collections totaled $3.2 million for FFY 2018, a 23 percent increase over FFY 2017.