A government agency benefit payment that is exempt from the Garnishment Rules will have ________ encoded in Positions 54 and 55 of the "Company Entry Description" Field of the Batch Header Record.

A government agency benefit payment that is exempt from the Garnishment Rules will have ________ encoded in Positions 54 and 55 of the "Company Entry Description" Field of the Batch Header Record.

• A. XX
• B. YY
• C. ZZ
• D. WW

Answer: (A)

The correct response is based on the guidelines set by the NACHA Operating Rules, which specify that government agency benefit payments that are exempt from garnishment must be coded in a specific way in the batch header record. Specifically, the coding "XX" is used to indicate that the payment is a government benefit and is not subject to garnishment. This ensures that these payments are treated correctly and protected from legal garnishment actions that might apply to other types of payments. The use of the "XX" code helps financial institutions and processors easily identify and manage these types of transactions by clearly differentiating them from others that may be subject to garnishment. Understanding this coding is crucial in maintaining compliance with NACHA rules and ensuring the proper processing of payments.

The correct response is based on the guidelines set by the NACHA Operating Rules, which specify that government agency benefit payments that are exempt from garnishment must be coded in a specific way in the batch header record. Specifically, the coding "XX" is used to indicate that the payment is a government benefit and is not subject to garnishment. This ensures that these payments are treated correctly and protected from legal garnishment actions that might apply to other types of payments.

The use of the "XX" code helps financial institutions and processors easily identify and manage these types of transactions by clearly differentiating them from others that may be subject to garnishment. Understanding this coding is crucial in maintaining compliance with NACHA rules and ensuring the proper processing of payments.