(a) The commission shall withhold from the benefits payable to an individual that owes a child support obligation an amount equal to:
(1) any amount required to be withheld under legal process properly served on the commission;
(2) if Subdivision (1) does not apply, the amount determined under an agreement submitted to the commission under Section 454(19)(B)(i) of the Social Security Act (42 U.S.C. Section 654) by the state or local child support enforcement agency; or
(3) if neither Subdivision (1) or (2) applies, the amount the individual specifies to the commission to be withheld.
(b) The commission shall pay the amount withheld under Subsection (a) to the appropriate state or local child support enforcement agency. The amount withheld shall be treated for all purposes as if it were benefits paid to the individual and paid by the individual to the state or local child support enforcement agency in satisfaction of the individual's child support obligation.
(c) This section applies only if appropriate arrangements have been made for reimbursement to the commission by a state or local child support enforcement agency for the administrative costs incurred by the commission under this subchapter that are attributable to the enforcement of child support obligations by the state or local child support enforcement agency.
(d) In this section, "legal process" has the meaning assigned by Section 459(i)(5) of the Social Security Act (42 U.S.C. Section 659).