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A BILL TO BE ENTITLED
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AN ACT
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relating to the designation of a child support obligee as an |
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alternate payee under a qualified domestic relations order. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 804.001, Government Code, is amended by |
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amending Subdivisions (1) and (2) and adding Subdivisions (1-a), |
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(2-a), and (6) to read as follows: |
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(1) "Alternate payee" means a spouse, former spouse, |
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child support obligee, child, or other dependent of a member or |
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retiree who is recognized by a domestic relations order as having a |
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right to receive all or a portion of the benefits payable by a |
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public retirement system with respect to such member or retiree. |
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(1-a) "Child support obligee" has the meaning assigned |
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to "obligee" by Section 101.021, Family Code. |
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(2) "Domestic relations order" means any judgment, |
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decree, or order, including approval of a property settlement |
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agreement, which relates to the provision of child support, alimony |
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payments, or marital property rights to a spouse, former spouse, |
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child support obligee, child, or other dependent of a member or |
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retiree, and is made pursuant to a domestic relations law, |
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including a community property law of the State of Texas or of |
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another state. |
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(2-a) "Obligor" has the meaning assigned by Section |
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101.022, Family Code. |
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(6) "Title IV-D agency" has the meaning assigned by |
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Section 101.033, Family Code. |
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SECTION 2. Section 804.003, Government Code, is amended by |
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adding Subsection (p) to read as follows: |
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(p) Benefits paid to a child support obligee as an alternate |
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payee are considered, for federal tax purposes, as benefits payable |
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to the child and shall be reported as taxable income of the retiree |
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who is the obligor under Section 402(a), Internal Revenue Code of |
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1986. |
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SECTION 3. Subchapter A, Chapter 804, Government Code, is |
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amended by adding Section 804.006 to read as follows: |
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Sec. 804.006. INCOME WITHHOLDING ORDER OR WRIT CONSIDERED |
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QUALIFIED DOMESTIC RELATIONS ORDER. (a) An order or writ issued by |
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a court of this state or the Title IV-D agency and received by a |
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public retirement system to withhold income for child support from |
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a retiree receiving benefits from the retirement system is |
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considered a qualified domestic relations order. |
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(b) The child support obligee named in an order or writ |
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under Subsection (a) is considered an alternate payee. |
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(c) Except as provided by Subsections (e) and (f), the |
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public retirement system shall remit payments in accordance with |
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the instructions in the order or writ under Subsection (a). |
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(d) The public retirement system shall pay the lesser of: |
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(1) the sum of amounts stated in the order or writ for |
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current child support, past due child support, current medical |
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support, and past due medical support; or |
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(2) 55 percent of the amount otherwise payable to the |
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retiree. |
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(e) Under an order or writ described by Subsection (a), the |
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public retirement system shall execute only those withholding |
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instructions in the order or writ that relate to current child |
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support, past due child support, current medical support, and past |
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due medical support. |
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(f) If the payment frequency in the order or writ differs |
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from the frequency of the retirement plan distributions, the public |
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retirement system shall adjust the payment amount stated in the |
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order or writ to reflect the frequency of retirement plan |
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distributions. |
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(g) A retiree subject to this section is entitled to the due |
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process provisions under Chapter 158, Family Code, accorded a child |
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support obligor whose employer receives a withholding order. |
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(h) If a member has not begun receiving retirement benefits |
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under the plan administered by the public retirement system when |
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the public retirement system receives an order or writ to withhold |
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child support, the order or writ is considered unqualified and no |
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response by the public retirement system to the submitter of the |
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order is required. In response to inquiries about an unqualified |
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order or writ under this subsection, the public retirement system |
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shall provide the reason why the order or writ is considered |
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unqualified. |
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(i) If a public retirement system receives under Subsection |
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(a) more than one order or writ with regard to the same child |
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support obligee for the same suit affecting the parent-child |
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relationship, the retirement system shall comply with the |
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requirements of the most recently received order or writ. For |
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purposes of determining the priority of competing qualified |
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domestic relations orders, the retirement system shall consider the |
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date of the most recently received order or writ to be the date on |
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which the retirement system received the first order or writ for the |
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same child support obligee for the same suit affecting the |
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parent-child relationship. |
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(j) An order or writ is terminated on the date that the |
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public retirement system receives: |
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(1) a subsequent order or writ that orders zero |
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dollars withheld; |
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(2) an order from the court stating that the original |
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order or writ is terminated; or |
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(3) a notice from the Title IV-D agency stating that |
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the order or writ is terminated. |
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SECTION 4. The change in law made by this Act applies to an |
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order or writ for withholding child support received by a public |
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retirement system on or after the effective date of this Act. An |
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order or writ for withholding child support received before the |
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effective date of this Act is governed by the law in effect on the |
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date the order or writ was received, and that law is continued in |
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effect for that purpose. |
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SECTION 5. This Act takes effect September 1, 2007. |