Finance

Senators urge Treasury to protect coronavirus checks from private debt collectors

Bonnie Cash

Sens. Sherrod Brown (D-Ohio) and Josh Hawley (R-Mo.) are asking the Treasury Department to ensure that the coronavirus recovery checks are protected from private debt collectors.

“To carry out Congress’s intent and ensure that American families receive the help they need, we ask that you immediately exercise your authority to protect these payments from private debt collectors,” the senators wrote in a letter to Treasury Secretary Steven Mnuchin on Thursday.

President Trump late last month signed a $2 trillion coronavirus relief package, known as the CARES Act, under which most Americans will receive one-time direct payments of up to $1,200 per adult and $500 per child. People who have already provided the IRS with their direct-deposit information could start to receive their payments as soon as next week.

The payments cannot be reduced if people owe back taxes or are behind on making other payments to federal or state agencies. They can only be reduced in cases where people are behind on child-support payments, according to a frequently asked questions document from the office of Senate Finance Committee Chairman Chuck Grassley (R-Iowa).

Brown and Hawley urged the Treasury Department to use its authority to also prevent the direct payments from being seized for private debts, outside of child support payments.

The senators said that existing Treasury rules already prevent two months of Social Security and other federal payments from being garnished by private-debt collectors, and that Treasury could apply those rules or issue new guidance to protect the coronavirus payments from being seized as well.

“If Treasury fails to take action, the CARES Act direct payments are at risk of being seized by debt collectors,” the senators wrote. “That is not what Congress intended. We came together to pass the CARES Act to help American families pay for food, medicine, and other basic necessities during this crisis.”

Brown, the top Democrat on the Senate Banking Committee, also sent a similar letter to Mnuchin earlier this month with Sens. Ron Wyden (D-Ore.) and Elizabeth Warren (D-Mass.).

Tags Chuck Grassley Donald Trump Elizabeth Warren Josh Hawley Ron Wyden Sherrod Brown Steven Mnuchin

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