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Federal Retirement Thrift Investment Board Seeks Comments on Legal Process for Tax Levy Enforcement Order Against Participant Account

June 27, 2014

Targeted News Service

WASHINGTON, June 27 -- The Federal Retirement Thrift Investment Board published the following proposed rule in the Federal Register:

Legal Process for the Enforcement of a Tax Levy or Criminal Restitution Order Against a Participant Account

A Proposed Rule by the Federal Retirement Thrift Investment Board on 06/27/2014

Publication Date: Friday, June 27, 2014

Agency: Federal Retirement Thrift Investment Board

Dates: Comments must be received on or before August 26, 2014.

Comments Close: 08/26/2014

Entry Type: Proposed Rule

Action: Proposed rule with request for comments.

Document Citation: 79 FR 36438

Page: 36438 -36440 (3 pages)

CFR: 5 CFR 1653

Document Number: 2014-14937

Shorter URL:


Proposed Rule With Request For Comments.


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.


Comments must be received on or before August 26, 2014.


You may submit comments using one of the following methods:

Federal Rulemaking Portal: 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.


Erin Graham at 202-942-1605.


The Agency administers the Thrift Savings Plan (TSP), which was established by the Federal Employees' Retirement System Act of 1986 (FERSA), 99, 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.

[*Federal RegisterVJ 2014-06-27]

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