Legal Process for the Enforcement of a Tax Levy or Criminal Restitution Order Against a Participant Account, 36438-36440 [2014-14937]
Download as PDF
<![CDATA[
36438
Proposed Rules
Federal Register
Vol. 79, No. 124
Friday, June 27, 2014
This section of the FEDERAL REGISTER
contains notices to the public of the proposed
issuance of rules and regulations. The
purpose of these notices is to give interested
persons an opportunity to participate in the
rule making prior to the adoption of the final
rules.
8401–79. The TSP is a tax-deferred
retirement savings plan for Federal
civilian employees and members of the
uniformed services. The TSP is similar
to cash or deferred arrangements
established for private-sector employees
under section 401(k) of the Internal
Revenue Code (26 U.S.C. 401(k)).
FEDERAL RETIREMENT THRIFT
INVESTMENT BOARD
Legal Process for the Enforcement of
Internal Revenue Service Levies or
Restitution Pursuant to the Mandatory
Victims Restitution Act
The TSP’s governing statute includes
an anti-alienation provision that
protects funds from execution, levy,
attachment, garnishment, or other legal
process, except for certain enumerated
exceptions that, until recently, did not
include federal tax levies. On January
14, 2013 the President signed into law
Public Law 112–267, 126 Stat. 2440
(2013), entitled ‘‘To amend title 5,
United States Code, to make clear that
accounts in the Thrift Savings Fund are
subject to certain Federal tax levies.’’
The legislation amends 5 U.S.C.
8437(e)(3) to state, ‘‘Moneys due or
payable from the Thrift Savings Fund to
any individual and, in the case of an
individual who is an employee or
Member (or former employee or
Member), the balance in the account of
the employee or Member (or former
employee or Member) . . . shall be
subject to a Federal tax levy under
section 6331 of the Internal Revenue
Code of 1986.’’ In enacting the
amendment to 5 U.S.C. 8437, Congress
placed IRS levies in a small company of
exceptions which include child support
obligations, alimony obligations, and
restitution pursuant to the Mandatory
Victims Restitution Act (MVRA).
Congress has deemed these instances as
the only permissible reasons for funds
to be diverted from a participant’s
account. The Agency has previously
promulgated regulations governing the
payments from accounts in each of these
situations. The proposed regulations for
levies and criminal restitution will be
similar to those previously issued.
The Agency proposes to add a new
section, Subpart D, to Part 1653, to
explain the Agency’s procedures for
responding to legal process for the
enforcement of a participant’s levy or
criminal restitution order.
5 CFR Part 1653
Legal Process for the Enforcement of
a Tax Levy or Criminal Restitution
Order Against a Participant Account
Federal Retirement Thrift
Investment Board.
ACTION: Proposed rule with request for
comments.
AGENCY:
The Federal Retirement Thrift
Investment Board (Agency) proposes to
amend its regulations to explain the
Board’s procedures for responding to tax
levies and criminal restitution orders
that comply with statutory
requirements.
SUMMARY:
Comments must be received on
or before August 26, 2014.
ADDRESSES: You may submit comments
using one of the following methods:
• Federal Rulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• Mail: Office of General Counsel,
Attn: James Petrick, Federal Retirement
Thrift Investment Board, 77 K Street
NE., Suite 1000, Washington, DC 20002.
• Hand Delivery/Courier: The address
for sending comments by hand delivery
or courier is the same as that for
submitting comments by mail.
• Facsimile: Comments may be
submitted by facsimile at (202) 942–
1676.
The most helpful comments explain
the reason for any recommended change
and include data, information, and the
authority that supports the
recommended change.
FOR FURTHER INFORMATION CONTACT: Erin
Graham at 202–942–1605.
SUPPLEMENTARY INFORMATION: The
Agency administers the Thrift Savings
Plan (TSP), which was established by
the Federal Employees’ Retirement
System Act of 1986 (FERSA), Public
Law 99–335, 100 Stat. 514. The TSP
provisions of FERSA are codified, as
amended, largely at 5 U.S.C. 8351 and
wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
DATES:
VerDate Mar<15>2010
13:54 Jun 26, 2014
Jkt 232001
Regulatory Flexibility Act
I certify that this regulation will not
have a significant economic impact on
PO 00000
Frm 00001
Fmt 4702
Sfmt 4702
a substantial number of small entities.
This regulation will affect Federal
employees, members of the uniformed
services who participate in the Thrift
Savings Plan, and their beneficiaries.
The TSP is a Federal defined
contribution retirement savings plan
created FERSA and is administered by
the Agency.
Paperwork Reduction Act
I certify that these regulations do not
require additional reporting under the
Paperwork Reduction Act.
Unfunded Mandates Reform Act of
1995
Pursuant to the Unfunded Mandates
Reform Act of 1995, 2 U.S.C. 602, 632,
653, 1501–1571, the effects of this
regulation on state, local, and tribal
governments and the private sector have
been assessed. This regulation will not
compel the expenditure in any one year
of $100 million or more by state, local,
and tribal governments, in the aggregate,
or by the private sector. Therefore, a
statement under § 1532 is not required.
List of Subjects in 5 CFR Part 1653
Taxes, Claims, Government
employees, Pensions, Retirement.
Gregory T. Long,
Executive Director, Federal Retirement Thrift
Investment Board.
For the reasons stated in the
preamble, the Agency proposes to
amend 5 CFR part 1653 as follows:
PART 1653—COURT ORDERS AND
LEGAL PROCESSES AFFECTING
THRIFT SAVINGS PLAN ACCOUNT
1. The authority citation for part 1653
continues to read as follows:
■
Authority: 5 U.S.C. 8432d, 8435, 8436(b),
8437(e), 8439(a)(3), 8467, 8474(b)(5) and
8474(c)(1).
2. Subpart D is added to read as
follows:
■
Subpart D—Process for the Enforcement of
a Participant’s Legal Obligation To Pay a
Federal Tax Levy or Criminal Restitution
Order
Sec.
1653.31 Definitions.
1653.32 Qualifying Federal tax levy.
1653.33 Qualifying criminal restitution
order.
1653.34 Processing Federal tax levies and
criminal restitution orders.
E:\FR\FM\27JNP1.SGM
27JNP1
Federal Register / Vol. 79, No. 124 / Friday, June 27, 2014 / Proposed Rules
1653.35
1653.36
Calculating entitlement.
Payment.
§ 1653.33
order.
Subpart D—Process for the
Enforcement of a Participant’s Legal
Obligation To Pay a Federal Tax Levy
or Criminal Restitution Order
§ 1653.31
Definitions.
(a) Definitions generally applicable to
the Thrift Savings Plan are set forth at
5 CFR 1690.1
(b) As used in this subpart:
Criminal restitution order means a
complete copy of the judgment in a
criminal case issued by a federal court
ordering restitution for a crime
described in 18 U.S.C. 3663A.
Tax levy means a signed form 668–A
served by the IRS for the satisfaction of
a federal tax debt.
wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
§ 1653.32
Qualifying Federal tax levy.
(a) The TSP will only honor the terms
of a tax levy that is qualifying under
paragraph (b) of this section.
(b) A tax levy must meet each of the
following requirements to be considered
qualifying:
(1) The Internal Revenue Service
issued the levy.
(2) The levy includes a signature
certifying that it attaches to a retirement
plan.
(3) The levy requires the TSP to pay
a stated dollar amount from a TSP
participant’s account.
(4) The levy is dated no earlier than
thirty (30) days before receipt.
(5) The levy is issued in the name of
the participant only.
(6) The levy expressly refers to the
‘‘Thrift Savings Plan’’ or describes the
TSP in such a way that it cannot be
confused with other Federal
Government retirement benefits or nonFederal retirement benefits.
(c) The following levies will not be
considered qualifying:
(1) A levy relating to a TSP account
with a zero dollar account balance;
(2) A levy relating to a TSP account
that contains only nonvested money,
unless the money will become vested
within 30 days of the date the TSP
receives the order if the participant were
to remain in Government service;
(3) A levy requiring the TSP to make
a payment at a specified date in the
future;
(4) A levy that does not contain a
signature certifying that it applies to
retirement plans;
(5) A levy requiring a series of
payments;
(6) A levy that designates the specific
TSP Fund, source of contributions, or
balance from which the payment or
portions of the payment shall be made.
VerDate Mar<15>2010
13:54 Jun 26, 2014
Jkt 232001
Qualifying criminal restitution
(a) The TSP will only honor the terms
of a criminal restitution order that is
qualifying under paragraph (b) of this
section.
(b) A criminal restitution order must
meet each of the following requirements
to be considered qualifying:
(1) The restitution must be ordered in
the sentencing of the participant as
required by 18 U.S.C. 3663A and 18
U.S.C. 3664.
(2) The restitution order and
accompanying documentation must
require the TSP to:
(i) Pay a stated dollar amount from a
participant’s TSP account; or
(ii) Freeze the participant’s TSP
account in anticipation of an order to
pay from the account.
(c) The following orders will not be
considered qualifying:
(1) A restitution order relating to a
TSP account with a zero dollar account
balance;
(2) A restitution order relating to a
TSP account that contains only
nonvested money, unless the money
will become vested within 30 days of
the date the TSP receives the order if the
participant were to remain in
Government service;
(3) A restitution order requiring the
TSP to make a payment in the future;
(4) A forfeiture order related to a
monetary garnishment of funds;
(5) A restitution order requiring a
series of payments from the TSP
account;
(6) A restitution order that designates
the specific TSP Fund, source of
contributions, or balance from which
the payment or portions of the payment
shall be made.
§ 1653.34 Processing tax levies and
criminal restitution orders.
(a) The payment of tax levies and
criminal restitution orders from the TSP
is governed solely by the Federal
Employees’ Retirement Systems Act, 5
U.S.C. chapter 84, and by the terms of
this subpart. Although the TSP will
honor tax levies or criminal restitution
orders properly issued, those entities
have no jurisdiction over the TSP and
the TSP cannot be made a party to the
underlying proceedings.
(b) The TSP will review a tax levy or
criminal restitution order to determine
whether it is enforceable against the
TSP only after it has received a
complete copy of the document. Receipt
by an employing agency or any other
agency of the Government does not
constitute receipt by the TSP. Tax levies
and criminal restitution orders should
be submitted to the TSP record keeper
PO 00000
Frm 00002
Fmt 4702
Sfmt 4702
36439
at the current address as provided at
https://www.tsp.gov. Receipt by the TSP
record keeper is considered receipt by
the TSP. To be complete, a tax levy or
criminal restitution order must meet all
the requirements of § 1653.32 or
§ 1653.33; it must also provide (or be
accompanied by a document that
provides):
(1) The participant’s TSP account
number or Social Security number
(SSN); and
(2) The name and mailing address of
the payee.
(c) As soon as practicable after the
TSP receives a document that purports
to be a qualifying tax levy or criminal
restitution order, the participant’s
account will be frozen. After the
participant’s account is frozen, no
withdrawal or loan disbursements will
be allowed until the account is
unfrozen. All other account activity will
be permitted, including contributions,
loan repayments, adjustments,
contribution allocations and interfund
transfers. Once a disbursement from the
account is made in accordance with the
restitution order or levy, the hold will
be removed from the participant’s
account.
(d) As soon as practicable after receipt
of a complete copy of a tax levy or
criminal restitution order, the TSP will
review it to determine whether it is
qualifying as described in § 1653.32 or
§ 1653.33. The TSP will mail a decision
letter to all parties containing the
following information:
(1) A determination regarding
whether the restitution order or levy is
qualifying;
(2) A statement of the applicable
statutes and regulations;
(3) An explanation of the effect the
restitution order or levy has on the
participant’s TSP account; and
(4) If the qualifying restitution order
or levy requires payment, the letter will
provide:
(i) An explanation of how the
payment will be calculated and an
estimated amount of payment;
(ii) The anticipated date of payment.
(e) The TSP decision letter is final.
There is no administrative appeal from
the TSP decision.
§ 1653.35
Calculating entitlement.
(a) A levy or criminal restitution order
can only require the payment of a
specified dollar amount from the TSP.
(b) If the restitution order or levy
awards a specific dollar amount, the
payee’s entitlement will be the lesser of:
(1) The dollar amount stated in the
levy or restitution order; or
(2) The vested account balance on the
date of disbursement, minus any
outstanding loan balance.
E:\FR\FM\27JNP1.SGM
27JNP1
36440
wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
§ 1653.36
Federal Register / Vol. 79, No. 124 / Friday, June 27, 2014 / Proposed Rules
Payment.
DEPARTMENT OF TRANSPORTATION
(a) Payment pursuant to a qualifying
levy or criminal restitution order will be
made 30 days after the TSP decision
letter.
(b) In no case will payment exceed the
participant’s calculated entitlement.
(c) The entire amount of a restitution
order or levy entitlement must be
disbursed at one time. A series of
payments will not be made. A payment
pursuant to a restitution order or levy
extinguishes all rights to any further
payment under that order or levy, even
if the entire amount of the entitlement
cannot be paid. Any further award must
be contained in a separate restitution
order or levy.
(d) If a participant has funds in more
than one type of account, payment will
be made from each account in the
following order, until the amount of the
levy or restitution order is reached:
(1) Civilian account;
(2) Uniformed services account;
(3) Beneficiary participant account.
(e) Payment will be made pro rata
from the participant’s traditional and
Roth balances. The distribution from the
traditional balance will be further prorated between the tax-deferred balance
and tax-exempt balance. The payment
from the Roth balance will be further
pro-rated between contributions in the
Roth balance and earnings in the Roth
balance. In addition, all payments will
be distributed pro rata from all TSP
Funds in which the participant’s
account is invested. All pro-rated
amounts will be based on the balances
in each fund or source of contributions
on the day the disbursement is made.
(f) The payment is taxable to the
participant and is subject to ten percent
Federal income tax withholding. The
tax withholding will be taken from the
payee’s entitlement and the gross
amount of the payment (i.e., the net
payment distributed to the payee plus
the amount withheld from the payment
for taxes) will be reported to the IRS as
income to the participant.
(g) A properly paid levy or restitution
order cannot be returned to the TSP.
[FR Doc. 2014–14937 Filed 6–26–14; 8:45 am]
BILLING CODE 6760–01–P
VerDate Mar<15>2010
13:54 Jun 26, 2014
Jkt 232001
Federal Aviation Administration
14 CFR Part 39
[Docket No. FAA–2013–0929; Directorate
Identifier 2013–CE–031–AD]
RIN 2120–AA64
Airworthiness Directives; DG
Flugzeugbau GmbH Gliders
Federal Aviation
Administration (FAA), Department of
Transportation (DOT).
ACTION: Notice of proposed rulemaking
(NPRM).
AGENCY:
We propose to adopt a new
airworthiness directive (AD) for any DG
Flugzeugbau GmbH Model DG–1000T
glider equipped with a Solo
Kleinmotoren Model 2350 C engine that
would revise AD 2013–22–14. This
proposed AD results from mandatory
continuing airworthiness information
(MCAI) originated by an aviation
authority of another country to identify
and correct an unsafe condition on an
aviation product. The MCAI describes
the unsafe condition as engine shaft
failure and consequent propeller
detachment. We are issuing this
proposed AD to require actions to
address the unsafe condition on these
products.
SUMMARY:
We must receive comments on
this proposed AD by August 11, 2014.
ADDRESSES: You may send comments by
any of the following methods:
• Federal eRulemaking Portal: Go to
https://www.regulations.gov. Follow the
instructions for submitting comments.
• Fax: (202) 493–2251.
• Mail: U.S. Department of
Transportation, Docket Operations, M–
30, West Building Ground Floor, Room
W12–140, 1200 New Jersey Avenue SE.,
Washington, DC 20590.
• Hand Delivery: U.S. Department of
Transportation, Docket Operations,
M–30, West Building Ground Floor,
Room W12–140, 1200 New Jersey
Avenue SE., Washington, DC 20590,
between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
For service information identified in
this proposed AD, contact Solo
Kleinmotoren GmbH, Postfach 60 01 52,
D 71050 Sindelfingen, Germany;
telephone: +49 07031–301–0; fax: +49
07031–301–136; email: aircraft@sologermany.com; Internet: https://
aircraft.solo-online.com/. You may view
this referenced service information at
the FAA, Small Airplane Directorate,
901 Locust, Kansas City, Missouri
64106. For information on the
DATES:
PO 00000
Frm 00003
Fmt 4702
Sfmt 4702
availability of this material at the FAA,
call (816) 329–4148.
Examining the AD Docket
You may examine the AD docket on
the Internet at https://
www.regulations.gov by searching for
and locating Docket No. FAA–2013–
0929; or in person at the Docket
Management Facility between 9 a.m.
and 5 p.m., Monday through Friday,
except Federal holidays. The AD docket
contains this proposed AD, the
regulatory evaluation, any comments
received, and other information. The
street address for the Docket Office
(telephone (800) 647–5527) is in the
ADDRESSES section. Comments will be
available in the AD docket shortly after
receipt.
FOR FURTHER INFORMATION CONTACT: Jim
Rutherford, Aerospace Engineer, FAA,
Small Airplane Directorate, 901 Locust,
Room 301, Kansas City, Missouri 64106;
telephone: (816) 329–4165; fax: (816)
329–4090; email: jim.rutherford@
faa.gov.
SUPPLEMENTARY INFORMATION:
Comments Invited
We invite you to send any written
relevant data, views, or arguments about
this proposed AD. Send your comments
to an address listed under the
ADDRESSES section. Include ‘‘Docket No.
FAA–2013–0929; Directorate Identifier
2013–CE–031–AD’’ at the beginning of
your comments. We specifically invite
comments on the overall regulatory,
economic, environmental, and energy
aspects of this proposed AD. We will
consider all comments received by the
closing date and may amend this
proposed AD because of those
comments.
We will post all comments we
receive, without change, to https://www.
regulations.gov, including any personal
information you provide. We will also
post a report summarizing each
substantive verbal contact we receive
about this proposed AD.
Discussion
On October 24, 2013, we issued AD
2013–22–14, Amendment 39–17646 (78
FR 65869, November 4, 2013) (‘‘AD
2013–22–14’’). That AD required actions
intended to address an unsafe condition
on any DG Flugzeugbau GmbH Model
DG–1000T glider equipped with a Solo
Kleinmotoren Model 2350 C engine and
was based on mandatory continuing
airworthiness information (MCAI)
originated by an aviation authority of
another country.
Since we issued AD 2013–22–14, the
manufacturer of the Solo Kleinmotoren
E:\FR\FM\27JNP1.SGM
27JNP1
]]>Agencies
[Federal Register Volume 79, Number 124 (Friday, June 27, 2014)]
[Proposed Rules]
[Pages 36438-36440]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-14937]
========================================================================
Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
========================================================================
Federal Register / Vol. 79, No. 124 / Friday, June 27, 2014 /
Proposed Rules
[[Page 36438]]
FEDERAL RETIREMENT THRIFT INVESTMENT BOARD
5 CFR Part 1653
Legal Process for the Enforcement of a Tax Levy or Criminal
Restitution Order Against a Participant Account
AGENCY: Federal Retirement Thrift Investment Board.
ACTION: Proposed rule with request for comments.
-----------------------------------------------------------------------
SUMMARY: The Federal Retirement Thrift Investment Board (Agency)
proposes to amend its regulations to explain the Board's procedures for
responding to tax levies and criminal restitution orders that comply
with statutory requirements.
DATES: Comments must be received on or before August 26, 2014.
ADDRESSES: You may submit comments using one of the following methods:
Federal Rulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
Mail: Office of General Counsel, Attn: James Petrick,
Federal Retirement Thrift Investment Board, 77 K Street NE., Suite
1000, Washington, DC 20002.
Hand Delivery/Courier: The address for sending comments by
hand delivery or courier is the same as that for submitting comments by
mail.
Facsimile: Comments may be submitted by facsimile at (202)
942-1676.
The most helpful comments explain the reason for any recommended
change and include data, information, and the authority that supports
the recommended change.
FOR FURTHER INFORMATION CONTACT: Erin Graham at 202-942-1605.
SUPPLEMENTARY INFORMATION: The Agency administers the Thrift Savings
Plan (TSP), which was established by the Federal Employees' Retirement
System Act of 1986 (FERSA), Public Law 99-335, 100 Stat. 514. The TSP
provisions of FERSA are codified, as amended, largely at 5 U.S.C. 8351
and 8401-79. The TSP is a tax-deferred retirement savings plan for
Federal civilian employees and members of the uniformed services. The
TSP is similar to cash or deferred arrangements established for
private-sector employees under section 401(k) of the Internal Revenue
Code (26 U.S.C. 401(k)).
Legal Process for the Enforcement of Internal Revenue Service Levies or
Restitution Pursuant to the Mandatory Victims Restitution Act
The TSP's governing statute includes an anti-alienation provision
that protects funds from execution, levy, attachment, garnishment, or
other legal process, except for certain enumerated exceptions that,
until recently, did not include federal tax levies. On January 14, 2013
the President signed into law Public Law 112-267, 126 Stat. 2440
(2013), entitled ``To amend title 5, United States Code, to make clear
that accounts in the Thrift Savings Fund are subject to certain Federal
tax levies.'' The legislation amends 5 U.S.C. 8437(e)(3) to state,
``Moneys due or payable from the Thrift Savings Fund to any individual
and, in the case of an individual who is an employee or Member (or
former employee or Member), the balance in the account of the employee
or Member (or former employee or Member) . . . shall be subject to a
Federal tax levy under section 6331 of the Internal Revenue Code of
1986.'' In enacting the amendment to 5 U.S.C. 8437, Congress placed IRS
levies in a small company of exceptions which include child support
obligations, alimony obligations, and restitution pursuant to the
Mandatory Victims Restitution Act (MVRA). Congress has deemed these
instances as the only permissible reasons for funds to be diverted from
a participant's account. The Agency has previously promulgated
regulations governing the payments from accounts in each of these
situations. The proposed regulations for levies and criminal
restitution will be similar to those previously issued.
The Agency proposes to add a new section, Subpart D, to Part 1653,
to explain the Agency's procedures for responding to legal process for
the enforcement of a participant's levy or criminal restitution order.
Regulatory Flexibility Act
I certify that this regulation will not have a significant economic
impact on a substantial number of small entities. This regulation will
affect Federal employees, members of the uniformed services who
participate in the Thrift Savings Plan, and their beneficiaries. The
TSP is a Federal defined contribution retirement savings plan created
FERSA and is administered by the Agency.
Paperwork Reduction Act
I certify that these regulations do not require additional
reporting under the Paperwork Reduction Act.
Unfunded Mandates Reform Act of 1995
Pursuant to the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 602,
632, 653, 1501-1571, the effects of this regulation on state, local,
and tribal governments and the private sector have been assessed. This
regulation will not compel the expenditure in any one year of $100
million or more by state, local, and tribal governments, in the
aggregate, or by the private sector. Therefore, a statement under Sec.
1532 is not required.
List of Subjects in 5 CFR Part 1653
Taxes, Claims, Government employees, Pensions, Retirement.
Gregory T. Long,
Executive Director, Federal Retirement Thrift Investment Board.
For the reasons stated in the preamble, the Agency proposes to
amend 5 CFR part 1653 as follows:
PART 1653--COURT ORDERS AND LEGAL PROCESSES AFFECTING THRIFT
SAVINGS PLAN ACCOUNT
0
1. The authority citation for part 1653 continues to read as follows:
Authority: 5 U.S.C. 8432d, 8435, 8436(b), 8437(e), 8439(a)(3),
8467, 8474(b)(5) and 8474(c)(1).
0
2. Subpart D is added to read as follows:
Subpart D--Process for the Enforcement of a Participant's Legal
Obligation To Pay a Federal Tax Levy or Criminal Restitution Order
Sec.
1653.31 Definitions.
1653.32 Qualifying Federal tax levy.
1653.33 Qualifying criminal restitution order.
1653.34 Processing Federal tax levies and criminal restitution
orders.
[[Page 36439]]
1653.35 Calculating entitlement.
1653.36 Payment.
Subpart D--Process for the Enforcement of a Participant's Legal
Obligation To Pay a Federal Tax Levy or Criminal Restitution Order
Sec. 1653.31 Definitions.
(a) Definitions generally applicable to the Thrift Savings Plan are
set forth at 5 CFR 1690.1
(b) As used in this subpart:
Criminal restitution order means a complete copy of the judgment in
a criminal case issued by a federal court ordering restitution for a
crime described in 18 U.S.C. 3663A.
Tax levy means a signed form 668-A served by the IRS for the
satisfaction of a federal tax debt.
Sec. 1653.32 Qualifying Federal tax levy.
(a) The TSP will only honor the terms of a tax levy that is
qualifying under paragraph (b) of this section.
(b) A tax levy must meet each of the following requirements to be
considered qualifying:
(1) The Internal Revenue Service issued the levy.
(2) The levy includes a signature certifying that it attaches to a
retirement plan.
(3) The levy requires the TSP to pay a stated dollar amount from a
TSP participant's account.
(4) The levy is dated no earlier than thirty (30) days before
receipt.
(5) The levy is issued in the name of the participant only.
(6) The levy expressly refers to the ``Thrift Savings Plan'' or
describes the TSP in such a way that it cannot be confused with other
Federal Government retirement benefits or non-Federal retirement
benefits.
(c) The following levies will not be considered qualifying:
(1) A levy relating to a TSP account with a zero dollar account
balance;
(2) A levy relating to a TSP account that contains only nonvested
money, unless the money will become vested within 30 days of the date
the TSP receives the order if the participant were to remain in
Government service;
(3) A levy requiring the TSP to make a payment at a specified date
in the future;
(4) A levy that does not contain a signature certifying that it
applies to retirement plans;
(5) A levy requiring a series of payments;
(6) A levy that designates the specific TSP Fund, source of
contributions, or balance from which the payment or portions of the
payment shall be made.
Sec. 1653.33 Qualifying criminal restitution order.
(a) The TSP will only honor the terms of a criminal restitution
order that is qualifying under paragraph (b) of this section.
(b) A criminal restitution order must meet each of the following
requirements to be considered qualifying:
(1) The restitution must be ordered in the sentencing of the
participant as required by 18 U.S.C. 3663A and 18 U.S.C. 3664.
(2) The restitution order and accompanying documentation must
require the TSP to:
(i) Pay a stated dollar amount from a participant's TSP account; or
(ii) Freeze the participant's TSP account in anticipation of an
order to pay from the account.
(c) The following orders will not be considered qualifying:
(1) A restitution order relating to a TSP account with a zero
dollar account balance;
(2) A restitution order relating to a TSP account that contains
only nonvested money, unless the money will become vested within 30
days of the date the TSP receives the order if the participant were to
remain in Government service;
(3) A restitution order requiring the TSP to make a payment in the
future;
(4) A forfeiture order related to a monetary garnishment of funds;
(5) A restitution order requiring a series of payments from the TSP
account;
(6) A restitution order that designates the specific TSP Fund,
source of contributions, or balance from which the payment or portions
of the payment shall be made.
Sec. 1653.34 Processing tax levies and criminal restitution orders.
(a) The payment of tax levies and criminal restitution orders from
the TSP is governed solely by the Federal Employees' Retirement Systems
Act, 5 U.S.C. chapter 84, and by the terms of this subpart. Although
the TSP will honor tax levies or criminal restitution orders properly
issued, those entities have no jurisdiction over the TSP and the TSP
cannot be made a party to the underlying proceedings.
(b) The TSP will review a tax levy or criminal restitution order to
determine whether it is enforceable against the TSP only after it has
received a complete copy of the document. Receipt by an employing
agency or any other agency of the Government does not constitute
receipt by the TSP. Tax levies and criminal restitution orders should
be submitted to the TSP record keeper at the current address as
provided at https://www.tsp.gov. Receipt by the TSP record keeper is
considered receipt by the TSP. To be complete, a tax levy or criminal
restitution order must meet all the requirements of Sec. 1653.32 or
Sec. 1653.33; it must also provide (or be accompanied by a document
that provides):
(1) The participant's TSP account number or Social Security number
(SSN); and
(2) The name and mailing address of the payee.
(c) As soon as practicable after the TSP receives a document that
purports to be a qualifying tax levy or criminal restitution order, the
participant's account will be frozen. After the participant's account
is frozen, no withdrawal or loan disbursements will be allowed until
the account is unfrozen. All other account activity will be permitted,
including contributions, loan repayments, adjustments, contribution
allocations and interfund transfers. Once a disbursement from the
account is made in accordance with the restitution order or levy, the
hold will be removed from the participant's account.
(d) As soon as practicable after receipt of a complete copy of a
tax levy or criminal restitution order, the TSP will review it to
determine whether it is qualifying as described in Sec. 1653.32 or
Sec. 1653.33. The TSP will mail a decision letter to all parties
containing the following information:
(1) A determination regarding whether the restitution order or levy
is qualifying;
(2) A statement of the applicable statutes and regulations;
(3) An explanation of the effect the restitution order or levy has
on the participant's TSP account; and
(4) If the qualifying restitution order or levy requires payment,
the letter will provide:
(i) An explanation of how the payment will be calculated and an
estimated amount of payment;
(ii) The anticipated date of payment.
(e) The TSP decision letter is final. There is no administrative
appeal from the TSP decision.
Sec. 1653.35 Calculating entitlement.
(a) A levy or criminal restitution order can only require the
payment of a specified dollar amount from the TSP.
(b) If the restitution order or levy awards a specific dollar
amount, the payee's entitlement will be the lesser of:
(1) The dollar amount stated in the levy or restitution order; or
(2) The vested account balance on the date of disbursement, minus
any outstanding loan balance.
[[Page 36440]]
Sec. 1653.36 Payment.
(a) Payment pursuant to a qualifying levy or criminal restitution
order will be made 30 days after the TSP decision letter.
(b) In no case will payment exceed the participant's calculated
entitlement.
(c) The entire amount of a restitution order or levy entitlement
must be disbursed at one time. A series of payments will not be made. A
payment pursuant to a restitution order or levy extinguishes all rights
to any further payment under that order or levy, even if the entire
amount of the entitlement cannot be paid. Any further award must be
contained in a separate restitution order or levy.
(d) If a participant has funds in more than one type of account,
payment will be made from each account in the following order, until
the amount of the levy or restitution order is reached:
(1) Civilian account;
(2) Uniformed services account;
(3) Beneficiary participant account.
(e) Payment will be made pro rata from the participant's
traditional and Roth balances. The distribution from the traditional
balance will be further pro-rated between the tax-deferred balance and
tax-exempt balance. The payment from the Roth balance will be further
pro-rated between contributions in the Roth balance and earnings in the
Roth balance. In addition, all payments will be distributed pro rata
from all TSP Funds in which the participant's account is invested. All
pro-rated amounts will be based on the balances in each fund or source
of contributions on the day the disbursement is made.
(f) The payment is taxable to the participant and is subject to ten
percent Federal income tax withholding. The tax withholding will be
taken from the payee's entitlement and the gross amount of the payment
(i.e., the net payment distributed to the payee plus the amount
withheld from the payment for taxes) will be reported to the IRS as
income to the participant.
(g) A properly paid levy or restitution order cannot be returned to
the TSP.
[FR Doc. 2014-14937 Filed 6-26-14; 8:45 am]
BILLING CODE 6760-01-P
