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Title 42, The Public Health and WelfareRelease 119-110

§654b Collection and Disbursement of Support Payments

Title 42 › CHAPTER 7 — SOCIAL SECURITY › SUBCHAPTER IV — GRANTS TO STATES FOR AID AND SERVICES TO NEEDY FAMILIES WITH CHILDREN AND FOR CHILD-WELFARE SERVICES › Part D — Child Support and Establishment of Paternity › § 654b

Last updated Sep 22, 2026|Official source

Summary

States must set up and run a State disbursement unit to collect and send out child support payments. The unit must handle all cases the State enforces and cases where the order was first issued in the State on or after January 1, 1994 and the noncustodial parent's pay can be withheld. The unit can be run by the State agency, by two or more agencies working together, or by a contractor that answers to the State. It should work with the State’s automated system when appropriate. The State may link local units with an approved computer network if it will not cost more or take longer than a single central unit. Employers must be given one place to send income withholding. The unit must use electronic and automated systems as much as possible to take in payments from parents, employers, and other States; to identify payments correctly; to pay the custodial parent quickly; and to give parents timely payment information on request. It does not have to convert certain old withholding records kept before this rule’s effective date. Money from periodic income must be sent out within 2 business days after the unit gets it, if the payee is properly identified. The unit may hold payments toward past-due amounts if a timely appeal about those arrears is pending. A "business day" means a day State offices are open for regular business.

Full Legal Text

Title 42, §654b

The Public Health and Welfare, Source: USLM XML via OLRC

(a)State disbursement unit
(1)In general
In order for a State to meet the requirements of this section, the State agency must establish and operate a unit (which shall be known as the “State disbursement unit”) for the collection and disbursement of payments under support orders—
(A)in all cases being enforced by the State pursuant to section 654(4) of this title; and
(B)in all cases not being enforced by the State under this part in which the support order is initially issued in the State on or after January 1, 1994, and in which the income of the noncustodial parent is subject to withholding pursuant to section 666(a)(8)(B) of this title.
(2)Operation
The State disbursement unit shall be operated—
(A)directly by the State agency (or 2 or more State agencies under a regional cooperative agreement), or (to the extent appropriate) by a contractor responsible directly to the State agency; and
(B)except in cases described in paragraph (1)(B), in coordination with the automated system established by the State pursuant to section 654a of this title.
(3)Linking of local disbursement units
The State disbursement unit may be established by linking local disbursement units through an automated information network, subject to this section, if the Secretary agrees that the system will not cost more nor take more time to establish or operate than a centralized system. In addition, employers shall be given 1 location to which income withholding is sent.
(b)Required procedures
The State disbursement unit shall use automated procedures, electronic processes, and computer-driven technology to the maximum extent feasible, efficient, and economical, for the collection and disbursement of support payments, including procedures—
(1)for receipt of payments from parents, employers, and other States, and for disbursements to custodial parents and other obligees, the State agency, and the agencies of other States;
(2)for accurate identification of payments;
(3)to ensure prompt disbursement of the custodial parent’s share of any payment; and
(4)to furnish to any parent, upon request, timely information on the current status of support payments under an order requiring payments to be made by or to the parent, except that in cases described in subsection (a)(1)(B), the State disbursement unit shall not be required to convert and maintain in automated form records of payments kept pursuant to section 666(a)(8)(B)(iii) of this title before the effective date of this section.
(c)Timing of disbursements
(1)In general
Except as provided in paragraph (2), the State disbursement unit shall distribute all amounts payable under section 657(a) of this title within 2 business days after receipt from the employer or other source of periodic income, if sufficient information identifying the payee is provided. The date of collection for amounts collected and distributed under this part is the date of receipt by the State disbursement unit, except that if current support is withheld by an employer in the month when due and is received by the State disbursement unit in a month other than the month when due, the date of withholding may be deemed to be the date of collection.
(2)Permissive retention of arrearages
The State disbursement unit may delay the distribution of collections toward arrearages until the resolution of any timely appeal with respect to such arrearages.
(d)“Business day” defined
As used in this section, the term “business day” means a day on which State offices are open for regular business.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

References in Text

For

Effective Date

of this section, referred to in subsec. (b)(4), see

Effective Date

note below.

Amendments

1997—Subsec. (c)(1). Pub. L. 105–33 inserted at end “The date of collection for amounts collected and distributed under this part is the date of receipt by the State disbursement unit, except that if current support is withheld by an employer in the month when due and is received by the State disbursement unit in a month other than the month when due, the date of withholding may be deemed to be the date of collection.”

Statutory Notes and Related Subsidiaries

Effective Date

of 1997 AmendmentAmendment by Pub. L. 105–33 effective as if included in the enactment of title III of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, Pub. L. 104–193, see section 5557 of Pub. L. 105–33, set out as a note under section 608 of this title.

Effective Date

Pub. L. 104–193, title III, § 312(d), Aug. 22, 1996, 110 Stat. 2209, provided that: “(1) In general.—Except as provided in paragraph (2), the

Amendments

made by this section [enacting this section and amending section 654 and 654a of this title] shall become effective on
October 1, 1998. “(2) Limited exception to unit handling payments.—Notwithstanding section 454B(b)(1) of the Social Security Act [42 U.S.C. 654b(b)(1)], as added by this section, any State which, as of the date of the enactment of this Act [Aug. 22, 1996], processes the receipt of child support payments through local courts may, at the option of the State, continue to process through
September 30, 1999, such payments through such courts as processed such payments on or before such date of enactment.” For provisions relating to

Effective Date

of title III of Pub. L. 104–193, see section 395(a)–(c) of Pub. L. 104–193, set out as an

Effective Date

of 1996 Amendment note under section 654 of this title.

Reference

Citations & Metadata

Citation

42 U.S.C. § 654b

Title 42, The Public Health and Welfare

Last Updated

Sep 22, 2026

Release point: 119-110