[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 823 Introduced in Senate (IS)]
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117th CONGRESS
1st Session
S. 823
To amend the American Rescue Plan Act of 2021 to provide for protection
of recovery rebates.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 18, 2021
Mr. Brown (for himself, Mr. Wyden, Mr. Menendez, and Mr. Van Hollen)
introduced the following bill; which was read twice and referred to the
Committee on Finance
_______________________________________________________________________
A BILL
To amend the American Rescue Plan Act of 2021 to provide for protection
of recovery rebates.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. PROTECTION OF 2021 RECOVERY REBATES.
(a) In General.--Subsection (c) of section 9601 of the American
Rescue Plan Act of 2021 (Public Law 117-2) is amended--
(1) in paragraph (2), by striking subparagraphs (A) and (B)
and inserting the following:
``(A) subject to reduction or offset pursuant to
section 3716 or 3720A of title 31, United States Code,
or similar authority permitting offset,
``(B) subject to reduction or offset pursuant to
subsection (c), (d), (e), or (f) of section 6402 of the
Internal Revenue Code of 1986, or
``(C) reduced or offset by other assessed Federal
taxes that would otherwise be subject to levy or
collection.'', and
(2) by adding at the end the following new paragraph:
``(4) Assignment of benefits.--
``(A) In general.--The right of any person to any
applicable payment shall not be transferable or
assignable, at law or in equity, and no applicable
payment shall be subject to, execution, levy,
attachment, garnishment, or other legal process, or the
operation of any bankruptcy or insolvency law.
``(B) Encoding of payments.--In the case of an
applicable payment described in subparagraph
(E)(iii)(I) that is certified for payment after the
date of the enactment of this paragraph under section
3528 of title 31, United States Code, and that is paid
electronically by direct deposit through the Automated
Clearing House (ACH) network, the Secretary of the
Treasury (or the Secretary's delegate) shall--
``(i) issue the payment using a unique
identifier that is reasonably sufficient to
allow a financial institution to identify the
payment as an applicable payment, and
``(ii) further encode the payment pursuant
to the same specifications as required for a
benefit payment defined in section 212.3 of
title 31, Code of Federal Regulations.
``(C) Garnishment.--
``(i) Encoded payments.--In the case of a
garnishment order that applies to an account
that has received an applicable payment that is
encoded as provided in subparagraph (B), a
financial institution shall follow the
requirements and procedures set forth in part
212 of title 31, Code of Federal Regulations,
except--
``(I) notwithstanding section 212.4
of title 31, Code of Federal
Regulations (and except as provided in
subclause (II)), a financial
institution shall not fail to follow
the procedures of sections 212.5 and
212.6 of such title with respect to a
garnishment order merely because such
order has attached, or includes, a
notice of right to garnish Federal
benefits issued by a State child
support enforcement agency, and
``(II) a financial institution
shall not, with regard to any
applicable payment, be required to
provide the notice referenced in
sections 212.6 and 212.7 of title 31,
Code of Federal Regulations.
``(ii) Other payments.--In the case of a
garnishment order (other than an order that has
been served by the United States) that has been
received by a financial institution and that
applies to an account into which an applicable
payment that has not been encoded as provided
in subparagraph (B) has been deposited
electronically on any date during the lookback
period or into which an applicable payment that
has been deposited by check on any date in the
lookback period, the financial institution,
upon the request of the account holder, shall
treat the amount of the funds in the account at
the time of the request, up to the amount of
the applicable payment (in addition to any
amounts otherwise protected under part 212 of
title 31, Code of Federal Regulations), as
exempt from a garnishment order without
requiring the consent of the party serving the
garnishment order or the judgment creditor.
``(iii) Liability.--A financial institution
that acts in good faith in reliance on clauses
(i) or (ii) shall not be subject to liability
or regulatory action under any Federal or State
law, regulation, court or other order, or
regulatory interpretation for actions
concerning any applicable payments.
``(D) No reclamation rights.--This paragraph shall
not alter the status of applicable payments as tax
refunds or other nonbenefit payments for purpose of any
reclamation rights of the Department of the Treasury or
the Internal Revenue Service as per part 210 of title
31, Code of Federal Regulations.
``(E) Definitions.--For purposes of this
paragraph--
``(i) Account holder.--The term `account
holder' means a natural person whose name
appears in a financial institution's records as
the direct or beneficial owner of an account.
``(ii) Account review.--The term `account
review' means the process of examining deposits
in an account to determine if an applicable
payment has been deposited into the account
during the lookback period. The financial
institution shall perform the account review
following the procedures outlined in section
212.5 of title 31, Code of Federal Regulations
and in accordance with the requirements of
section 212.6 of title 31, Code of Federal
Regulations.
``(iii) Applicable payment.--The term
`applicable payment' means--
``(I) any advance refund amount
paid pursuant to section 6428B(g) of
the Internal Revenue Code of 1986,
``(II) any payment made by a
possession of the United States with a
mirror code tax system (as defined in
subsection (b) of this section)
pursuant to such subsection which
corresponds to a payment described in
subclause (I), and
``(III) any payment made by a
possession of the United States without
a mirror code tax system (as so
defined) pursuant to subsection (b) of
this section.
``(iv) Garnishment.--The term `garnishment'
means execution, levy, attachment, garnishment,
or other legal process.
``(v) Garnishment order.--The term
`garnishment order' means a writ, order,
notice, summons, judgment, levy, or similar
written instruction issued by a court, a State
or State agency, a municipality or municipal
corporation, or a State child support
enforcement agency, including a lien arising by
operation of law for overdue child support or
an order to freeze the assets in an account, to
effect a garnishment against a debtor.
``(vi) Lookback period.--The term `lookback
period' means the two-month period that begins
on the date preceding the date of account
review and ends on the corresponding date of
the month two months earlier, or on the last
date of the month two months earlier if the
corresponding date does not exist.''.
(b) Effective Date.--The amendment made by this section shall take
effect on the date of the enactment of this Act.
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