When the United States freezes the assets of another country, such as Iran, it simply prohibits the transfer or use of property. The freeze doesn't involve seizure or confiscation.

For example, if the Iranian government has a deposit in a New York bank, the freeze order blocks the Iranian government from writing a check to take the money out. It also bars the bank from transferring or moving the money in any way. The money must stay where it is.

Similarly, other Iranian government property is frozen in a sort of standstill status. Buildings, airplanes or other property cannot be used or moved unless special licenses are obtained from the Treasury Department, Government officials said yesterday that they would permit Iran Air to fly its aircraft home. In some other cases, assets could be "unfrozen" on application to the U.S. government.

Utimately, as has been the case in other freeze situations (one with the People's Republic of China was recently settled), the assets could be used to liquidate claims Americans may later make for property seized by Iran.

The freeze does not affect the assets or properties of private Iranian citizens. This means that thousands of Iranians in the Washington area can conduct their banking business as usual.

The Treasury also said it will issue a special license to the Iranian Embassy so it can write checks, from its frozen bank account, for operating expenses.

The embassy also asked for permission to continue making payments to Iranian students here. The United States has asked for more details, but it appears unlikely that such payments will be allowed.

President Carter took the freeze action under a 1977 law giving him emergency economic powers, incorporating provisions of the former trading-with-the-enemy act. Similar freezes have been placed on the assets of Vietnam and Cuba.

The Iranian government apparently does its banking business in Washington with Riggs National Bank.

Riggs Senior Vice President Melvin Chrisman said a copy of Carter's executive order was delivered to the bank yesterday.

Chrisman said Riggs, as a matter of policy, does not discuss individual. accounts.