For peace of mind, convenience, or downright lack of trust, many former spouses receiving child support and/or spousal support often elect to receive payments via the Illinois State Disbursement Unit, commonly referred to as “the SDU”.
The SDU is a state agency that sends payments of support to the payee directly from the payor’s employer. To do so, the payor’s employer must first be served with a Notice of Income Withholding and the support order. The employer must withhold the employee’s pay accordingly and send the support amount to the SDU. The SDU then sends the payment to the payee. Once in place, the system can protect both parties as a record of all payments is kept intact by a third party.
When the payor lives and works out of state, out-of-state employers are still obligated to honor a Notice of Income Withholding and must submit payments to the Illinois SDU. A common misconception is that out-of-state employers are not obligated because if the employer resides outside of Illinois, an Illinois court lacks jurisdiction. In other words, the Illinois court lacks the authority to enforce the court order. That is not the case when it comes to child support payments and withholdings.
In fact, employers who fail to comply with notices to withhold income can face significant sanctions and fines. In preparing any settlement agreement with any payor with a questionable ability or commitment to pay, arranging payments through the SDU is typically advisable. Especially when the payor lives out of state, establishing payments through the SDU is almost necessary as well as a provision that requires the payor to always inform the payee of any change of employment.