When an employer is delinquent, a Notice of Freeze may be issued on assets at any known bank, credit union, savings and loan institution, or entity in control of an employer’s assets. The Notice of Freeze/Levy is provided for in Section 213.059 of the Texas Unemployment Compensation Act, Texas Labor Code.

Notices of Freeze requests come to the attention of the Administrative Actions Unit (AAU) in several ways:

• On Day 49 of ACAP tax lien files are reviewed by an AAU Accounts Examiner to determine if there is a record of payments received on the cash journal. If so, the Accounts Examiner orders a copy of the employer's most recent check (pc) off of the Cash Journal. Those accounts without a personal check reflected on the cash journal are reviewed by an Accounts Examiner performing bank freezes to determine the feasibility of a freeze.
  
  
• After judgment or after assessment, a Civil Actions Unit (CAU) Examiner may request a freeze if the cash journal reflects a recent payment or if the CAU Examiner has performed a credit check or banking information is determined from a review of the file. The request will be reviewed by AAU confirming the feasibility of a bank freeze.
  
  
• Field Tax Examiners may request freeze/levy action via a collection action request. They may request freezes on ACAP and non-ACAP accounts with past-due balances.
  
  
• Requests may originate from the Special Actions Unit (SAU) when a bankruptcy is closed, dismissed or any other time deemed appropriate by SAU.
  
  
• Any State Office Tax Collection Examiner, upon review of an account, may request freeze action if banking information is obtained via a credit check or available based on a file review.
  

AAU Examiners obtain copy(ies) of employer's check(s) or most recent payment(s) from the Cash Journal.

Accounts are reviewed by Accounts Examiners to determine if a freeze is feasible. An Accounts Examiner must verify the account's proper legal name and any variations of "doing business as" names from sources at their disposal. The styling may be obtained from a C-1, Status Report, employer master files, copy of a check, or letterhead correspondence contained in the folder or the styling of the tax lien. If the freeze is attempted on an individual, partnership or an officer assessed as personally liable; include the social security number of all parties. If the freeze is filed on a corporate account, include the federal identification number in the styling of the freeze. In certain instances the bank account number or redacted number may be required. Accounts that recently had a tax lien filed will automatically be reviewed for bank freeze.

Review the appropriate employer master file screens to determine if freeze action is appropriate.

AAU Examiner completes the review and prepares the request for freeze that includes both banking information and employer information. By issuing a bank freeze prior to Notice of Assessment action, information regarding the freeze should have been received by the time the formal assessment process begins. All non-ACAP freeze requests are worked in the same manner.

A Stop on the account will prevent the freeze from producing. The AAU Examiner must check for recent action pending that may change the delinquent amount.

The AAU Examiner must determine if a recent payment been received since the Examiner worked the account.

The AAU Examiner must review for recent comments that may affect the account. Comments that have been added since the AAU Examiner previously reviewed the account.

If the AAU Examiner determines a bank freeze is still appropriate, the bank freeze is keyed. Accounts in ACAP are keyed at the time as non-ACAP freeze requests.

A freeze request is accomplished by keying information to the appropriate screens.

Freeze/levy documents are processed daily for mailing to banking institutions or other entities in control of assets.

Match Notice of Freeze to file (two copies are produced for each freeze requested per account). Review each freeze for correct spelling, bank name and address as instructed on grids.

Review the following prior to mailing:

• Check current delinquency screen, a Freeze Pending flag should be showing under Additional Flags.
  
  
• The delinquency action history screen should show Freeze(s) issued, the date and the amount requested.
  
  
• When an active stop exists, verify that the stop was not by-passed. If it was not, the AAU Examiner should review the account to determine if the freeze is appropriate.
  
  
• Place the file in the Bank Freeze cabinet.
  

A bank representative should fill in the bottom portion of the freeze showing the date the bank account was frozen, the amount frozen and the bank representative's name and title.

If no account was found or no money is in the account, this should be noted in the bottom portion of the freeze when returned to TWC.

Job name TXDC0630

This is a listing of accounts in account number order in which the freeze issued is less than 21 days old and there has not been a response from the bank.

A listing of accounts with a freeze date at least 28 days old, but less than 42 days old and no response has been received from the bank. If we have not received or keyed a response from the bank twenty-eight (28) days after the freeze is issued, a Notice of Freeze Inquiry produces and is mailed to the bank by regular mail. A copy of the Notice of Freeze is attached (stamp "copy" in red) and a return envelope is enclosed.

If no response is received from the bank by the 42nd day after the freeze is issued, forward a Notice of Levy to the bank.

Part of the daily output is a list of accounts that reflects responses from the banks. The report provides the date the bank implemented the freeze on the account, the response type [(H)old, (C)losed], amount captured in account, date the levy was issued, and the amount of the levy. Review the list to determine which accounts need to be levied:

• If the bank is holding at least half up to the full amount, levy immediately.
  
  
• If the bank is holding less than half of the full amount, levy at day 42.
  
  
• How many active freezes are on the account?
  
  
• If more than one active freeze, determine how much money is being held between all the banks. If one bank is holding the full amount requested, then issue a Notice of Freeze Release to the other banks.
  
  
• If more than one bank is holding money, but none of them is holding the full amount requested on the freeze, review to see how much is being held and levy only up to the amount requested on the freeze. It may be necessary to levy for less than a bank is holding if the cumulative amount held between all the banks exceeds the amount requested on the freeze. A Notice of Freeze Release for the amount not levied on may be in order.
  
  
• Determine if payments have been received since the freeze was issued.
  
  
• If full payment has been received and paid by cash, Cashier's Check, or U.S. Postal Money Order, issue a freeze withdrawal.
  
  
• If payment has been remitted in the form of a personal or company check, request that the employer provide a copy of the front and back of the check indicating the check has cleared the bank. If the payment has cleared the bank, issuance of a Notice of Freeze Release may be appropriate if payment is for the full amount of the freeze. A levy for a lesser amount than the bank is holding may be in order in this situation.

The listing is also useful in determining if a bank has not responded to a levy. If we have not received the funds from a bank within 15 days after the Levy was issued the AAU Examiner should contact the bank.

If no bank account was found by that bank, then closing the freeze record is in order.

Send the closed bank freeze documents to be imaged. Forward the file to CAU if appropriate; otherwise destroy all non-original contents of the file.

If the bank is holding money, then update the freeze record. Bring up the appropriate record as stated above. The date the bank freezes the employer's account is the Bank Freeze Date.

• Key the Bank Freeze date.
  
  
• Key a "Y" on the Money Being Held line.
  
  
• Key in the dollar amount on the Amount Held line.
  
  
• Press enter.
  
  
• Enter a comment indicating how much is being held and the name of the bank holding the money.
  
  
• Place a Stop on the account if at least 15% of the delinquency has been frozen.
  

A levy will be issued on all freezes except those in which the bank advises there is no account or the account is closed.

• Key the account number.
  
  
• Key the freeze IID.
  
  
• Key "2" for the notice type.
  
  
• Press Enter.
  

When the output is received, mail one copy of the levy to the bank by Certificate of Mailing. Attach the remaining copies to the file. Return the folder to the Bank Freeze cabinet.

When the levy is returned with funds, forward to the appropriate AAU Examiner for disposition. The funds are logged in for transit to Revenue and Trust Management.

If the amount received is substantially less than the bank previously indicated they were holding; a phone call is made to the bank to discuss the difference.

In most instances the standard algorithm is used for allocation of the funds. However, the AAU Examiner may determine the proper allocation of the payment. If such a determination is made, notice will be sent to the appropriate Accounts examiner to allocate the funds.