Hold Special Circumstances
Payees may assign their right to payment to another party with an assignment agreement, and with approval by the agency’s legal staff. For more information, see Assignments.
The party waiving the right to payment is known as the assignor (payee), while the party receiving the right to payment is known as the assignee. If the assignor is placed on hold for a state debt, all warrants to the payee and assignee will be held. However, the held warrant(s) to the assignee may be released under certain circumstances.
Holds Placed Before Assignment Effective DateIf the assignor’s hold effective date is before the assignment date, the assignee’s warrant must be held.
Example: If ABC Construction Company was placed on hold before the date on the assignment agreement with XYZ Asphalt, payments issued to ABC Construction’s assignee, XYZ Asphalt, may not be released.
Holds Placed After Assignment Effective Date
If the assignor’s hold effective date is after the assignment date, the assignee’s held warrant must be released, unless the assignee is also on hold.
It is the agency’s responsibility to obtain the assignee’s SSN, ITIN or EIN to verify hold status. The assignee may have a hold record in TINS without being set up as a payee.
To release the assignee’s held warrant, submit a Warrant Release or Reinstatement Request form (00-432) (login required) PDF.
Paying agencies are responsible for:
- Obtaining the assignee’s SSN, ITIN or EIN to verify holds status
- Reviewing the mail code to check if the payee has assigned payments to another party
- Reviewing the PYHOLD screen to determine if the payee is on hold and, if so, reviewing the hold effective date
- Reviewing the assignment agreement to determine if the assignment predates the hold effective date
In addition, paying agencies are encouraged to review the TINS 6204: Held Warrant Report for Issuing Agency daily report to determine if payments are being held that should be released to assignees who are not on hold. Submit warrant release requests within 30 days of the payment date to prevent an assignee’s payments from being offset in error.
If the assignee’s held warrant is offset in error against the payee’s debt, the paying agency is responsible for:
- Recovering the funds from the hold source agency
- Reissuing the payment to the assignee and ensuring the held warrant is released before it is offset again in error