Can Debt Collectors Garnish Disability Benefits?

If you receive disability benefits from the Social Security Administration, it’s understandable that you probably want to do all you can to protect those benefits. After all, these benefits can be an essential source of financial support and stability when you’re unable to work.

In most cases, debt collectors cannot garnish disability payments that you receive from the Social Security Administration – although there are exceptions for certain debts, depending upon the type of disability benefit you receive and the type of debt that is being collected.

What Types of Disability Benefits Are Subject to Collection?

The Social Security Administration offers two types of disability benefits. These include Social Security Disability Income (SSDI) benefits and Supplemental Security Income (SSI) benefits.

In order to receive either type of benefit, the applicant will have to prove that they have a qualifying medical disability that has rendered them unable to work for a period of at least one continuous calendar year or more.

Typically, the Social Security Administration will determine if a condition qualifies as a disability by consulting its listing of impairments, otherwise known as the Blue Book. This guide contains a variety of qualifying conditions and their accompanying symptoms. If your condition is not listed in the Blue Book, this does not necessarily mean that your claim will be denied, although it does mean that additional medical proof may be needed.

SSDI benefits and SSI benefits do differ in some ways. One primary difference is that SSDI benefits are intended for "insured" individuals. To be "insured," a recipient must have worked a job for a sufficient length of time through which they regularly paid a portion of their salary into the Social Security system. In order to receive SSI benefits, however, an individual does not need to be "insured." Instead, he or she must have income and resources below a certain limit established by the Social Security Administration.

As a general rule, debt collectors cannot garnish SSI benefits. SSDI benefits, by contrast, may be garnished in certain situations for particular debts.

What Debts Allow Collectors to Garnish Those Benefits?

As a general rule, debt collectors cannot garnish all of your disability payments – although certain debts are excepted from this rule. These typically include debts owed to the government or as a result of a court verdict.

Some examples of debts for which SSDI payments may be garnished include:

• Federal student loans
• Back taxes owed to the federal government
• Unpaid child support and/or alimony
• Money owed as restitution following a criminal conviction
• Any other debts owed to the federal government.

These are a few examples – although there may be more situations in which a debt is owed as a result of a court proceeding or other situation. As a result, consulting with an attorney regarding your unique circumstances is always advised.

While SSDI payments can be garnished for the foregoing reasons, as a general rule, SSI payments are typically not garnished. If a creditor attempts to demand payment from your SSI benefits, you should contact an attorney as soon as possible.

What Steps Can You Take to Protect Yourself?

As a general rule, it's essential to remember that federal regulations require all United States banks to protect your disability payments from creditors if one of the foregoing exceptions does not apply. While debts to the government may be garnished at a 100% rate insofar as SSDI benefits are concerned, any debts for private creditors cannot be garnished in this manner.

As a general rule, if a private creditor contacts your bank and attempts to garnish your wages, the bank must look at the account to be garnished and see how much money was received in the form of SSDI payments over the preceding two months. Once that amount has been determined, it should be protected from garnishments. As an example – if an individual receives $1,000 each month in the form of SSDI benefits, the bank should protect up to $2,000 in the account.

Understandably, all of these rules can seem complex and confusing. Instead of worrying, however, you’ll want to contact a knowledgeable and experienced legal team who can discuss your particular circumstances and provide the advice and guidance you need. Doing so will relieve stress and help you ensure you're doing all you can to protect your rights. At Disability Experts, we're here to help.

Disability Experts - Here For You

At Disability Experts, we understand that disability benefits are a vital source of financial support for our clients. When you are struggling with a disability and unable to work, you don’t want to worry about having your benefits taken away or garnished unexpectedly. Instead, you should contact us. We understand every aspect of the law pertaining to disability benefits, and we will always pursue the best legal strategies on your behalf. You need and deserve a team who will fight for you every step of the way. We are that team. Give us a call today. We look forward to speaking with you soon.