More states should take advantage of a provision in federal law that allows them to distribute more owed child support payments directly to custodial parents. Such a move could help more low-income families become self sufficient and would provide much-needed income to families in this tough economic climate.
Currently, most states retain child support payments owed to parents receiving Temporary Assistance for Needy Families (TANF) benefits. The federal and state governments then split these child support payments based on the state's Medicaid matching rate. This policy was put in place to reimburse government spending on TANF. However, one of the changes in the law in early 2006 allows states to pay, or "pass through," a portion of child support revenues directly to TANF recipients without the federal government taking any share of the "passed through" revenue, as long as these payments are not counted or "disregarded" when calculating TANF benefits.
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