II 

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. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. PROTECTION OF 2021 RECOVERY REBATES. 

4 (a) IN GENERAL.—Subsection (c) of section 9601 of 

5 the American Rescue Plan Act of 2021 (Public Law 117– 

6 2) is amended— 

7 (1) in paragraph (2), by striking subparagraphs 

8 (A) and (B) and inserting the following: 

9 ‘‘(A) subject to reduction or offset pursu10 ant to section 3716 or 3720A of title 31, 


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1 United States Code, or similar authority per2 mitting offset, 

3 ‘‘(B) subject to reduction or offset pursu4 ant to subsection (c), (d), (e), or (f) of section 

5 6402 of the Internal Revenue Code of 1986, or 

6 ‘‘(C) reduced or offset by other assessed 

7 Federal taxes that would otherwise be subject 

8 to levy or collection.’’, and 

9 (2) by adding at the end the following new 

10 paragraph: 

11 ‘‘(4) ASSIGNMENT OF BENEFITS.— 

12 ‘‘(A) IN GENERAL.—The right of any per13 son to any applicable payment shall not be 

14 transferable or assignable, at law or in equity, 

15 and no applicable payment shall be subject to, 

16 execution, levy, attachment, garnishment, or 

17 other legal process, or the operation of any 

18 bankruptcy or insolvency law. 

19 ‘‘(B) ENCODING OF PAYMENTS.—In the 

20 case of an applicable payment described in sub21 paragraph (E)(iii)(I) that is certified for pay22 ment after the date of the enactment of this 

23 paragraph under section 3528 of title 31, 

24 United States Code, and that is paid electroni25 cally by direct deposit through the Automated 


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1 Clearing House (ACH) network, the Secretary 

2 of the Treasury (or the Secretary’s delegate) 

3 shall— 

4 ‘‘(i) issue the payment using a unique 

5 identifier that is reasonably sufficient to 

6 allow a financial institution to identify the 

7 payment as an applicable payment, and 

8 ‘‘(ii) further encode the payment pur9 suant to the same specifications as re10 quired for a benefit payment defined in 

11 section 212.3 of title 31, Code of Federal 

12 Regulations. 

13 ‘‘(C) GARNISHMENT.— 

14 ‘‘(i) ENCODED PAYMENTS.—In the 

15 case of a garnishment order that applies to 

16 an account that has received an applicable 

17 payment that is encoded as provided in 

18 subparagraph (B), a financial institution 

19 shall follow the requirements and proce20 dures set forth in part 212 of title 31, 

21 Code of Federal Regulations, except— 

22 ‘‘(I) notwithstanding section 

23 212.4 of title 31, Code of Federal 

24 Regulations (and except as provided 

25 in subclause (II)), a financial instituVerDate Sep 11 2014 15:44 Apr 10, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S823.IS S823

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1 tion shall not fail to follow the proce2 dures of sections 212.5 and 212.6 of 

3 such title with respect to a garnish4 ment order merely because such order 

5 has attached, or includes, a notice of 

6 right to garnish Federal benefits 

7 issued by a State child support en8 forcement agency, and 

9 ‘‘(II) a financial institution shall 

10 not, with regard to any applicable 

11 payment, be required to provide the 

12 notice referenced in sections 212.6 

13 and 212.7 of title 31, Code of Federal 

14 Regulations. 

15 ‘‘(ii) OTHER PAYMENTS.—In the case 

16 of a garnishment order (other than an 

17 order that has been served by the United 

18 States) that has been received by a finan19 cial institution and that applies to an ac20 count into which an applicable payment 

21 that has not been encoded as provided in 

22 subparagraph (B) has been deposited elec23 tronically on any date during the lookback 

24 period or into which an applicable payment 

25 that has been deposited by check on any 


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1 date in the lookback period, the financial 

2 institution, upon the request of the account 

3 holder, shall treat the amount of the funds 

4 in the account at the time of the request, 

5 up to the amount of the applicable pay6 ment (in addition to any amounts other7 wise protected under part 212 of title 31, 

8 Code of Federal Regulations), as exempt 

9 from a garnishment order without requir10 ing the consent of the party serving the 

11 garnishment order or the judgment cred12 itor. 

13 ‘‘(iii) LIABILITY.—A financial institu14 tion that acts in good faith in reliance on 

15 clauses (i) or (ii) shall not be subject to li16 ability or regulatory action under any Fed17 eral or State law, regulation, court or other 

18 order, or regulatory interpretation for ac19 tions concerning any applicable payments. 

20 ‘‘(D) NO RECLAMATION RIGHTS.—This 

21 paragraph shall not alter the status of applica22 ble payments as tax refunds or other nonbenefit 

23 payments for purpose of any reclamation rights 

24 of the Department of the Treasury or the InterVerDate Sep 11 2014 15:44 Apr 10, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S823.IS S823

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1 nal Revenue Service as per part 210 of title 31, 

2 Code of Federal Regulations. 

3 ‘‘(E) DEFINITIONS.—For purposes of this 

4 paragraph— 

5 ‘‘(i) ACCOUNT HOLDER.—The term 

6 ‘account holder’ means a natural person 

7 whose name appears in a financial institu8 tion’s records as the direct or beneficial 

9 owner of an account. 

10 ‘‘(ii) ACCOUNT REVIEW.—The term 

11 ‘account review’ means the process of ex12 amining deposits in an account to deter13 mine if an applicable payment has been de14 posited into the account during the 

15 lookback period. The financial institution 

16 shall perform the account review following 

17 the procedures outlined in section 212.5 of 

18 title 31, Code of Federal Regulations and 

19 in accordance with the requirements of sec20 tion 212.6 of title 31, Code of Federal 

21 Regulations. 

22 ‘‘(iii) APPLICABLE PAYMENT.—The 

23 term ‘applicable payment’ means— 


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1 ‘‘(I) any advance refund amount 

2 paid pursuant to section 6428B(g) of 

3 the Internal Revenue Code of 1986, 

4 ‘‘(II) any payment made by a 

5 possession of the United States with a 

6 mirror code tax system (as defined in 

7 subsection (b) of this section) pursu8 ant to such subsection which cor9 responds to a payment described in 

10 subclause (I), and 

11 ‘‘(III) any payment made by a 

12 possession of the United States with13 out a mirror code tax system (as so 

14 defined) pursuant to subsection (b) of 

15 this section. 

16 ‘‘(iv) GARNISHMENT.—The term ‘gar17 nishment’ means execution, levy, attach18 ment, garnishment, or other legal process. 

19 ‘‘(v) GARNISHMENT ORDER.—The 

20 term ‘garnishment order’ means a writ, 

21 order, notice, summons, judgment, levy, or 

22 similar written instruction issued by a 

23 court, a State or State agency, a munici24 pality or municipal corporation, or a State 

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1 ing a lien arising by operation of law for 

2 overdue child support or an order to freeze 

3 the assets in an account, to effect a gar4 nishment against a debtor. 

5 ‘‘(vi) LOOKBACK PERIOD.—The term 

6 ‘lookback period’ means the two-month pe7 riod that begins on the date preceding the 

8 date of account review and ends on the 

9 corresponding date of the month two 

10 months earlier, or on the last date of the 

11 month two months earlier if the cor12 responding date does not exist.’’. 

13 (b) EFFECTIVE DATE.—The amendment made by 

14 this section shall take effect on the date of the enactment 

15 of this Act. 

Æ 


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