Are Social Security Payments Safe from Collection by Creditors?

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Written by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

UPDATED: Jun 29, 2022

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A creditor only has the right to seize a debtor’s property once the creditor has obtained a judgment. A judgment is the official decision of a court upon completion of a lawsuit. The judgment will list any amounts that are eligible for collection by a creditor from a debtor. Once a creditor obtains a judgment against a debtor, they have the legal right to seize certain assets of a debtor such as bank accounts or a portion of the debtor’s wages. Fortunately, some assets are exempt from collection. This means the creditor cannot seize certain assets such as a social security check.

While a creditor cannot garnish a social security check, if the check is directly deposited into a checking account, and a creditor seizes that account, all money in it, up to the amount that will satisfy the judgment, can be taken. A seized account is “frozen.” This means, the debtor cannot withdraw any money from the account. After a set period of time, typically 60-90 days, the money is paid to the creditor.

Unfortunately, banks are not responsible for determining whether your account contains exempt or non-exempt funds. If you feel your social security benefits may be affected by a judgment, you must file an objection with the court having jurisdiction over the judgment, within the time allowed by law. This time period is usually 60-90 days. You must complete and file special forms with the court. Once the courts have obtained proof that your social security benefits are exempt from collection action, the funds will be separated from all collection actions.

A copy of your social security award letter, and a copy of a social security check or similar document should be enough evidence to prove your case. It is important to note that if your checking account is frozen resulting from a judgment and any non-exempt funds are in your checking account at the time your social security benefits are wrongly seized, the non-exempt funds will still be turned over to the creditor to pay the judgment.

The specific requirements for the release of money from a frozen account differ from jurisdiction-to-jurisdiction. To make sure you understand your rights, the procedures involved, and increase your chances of protecting your social security benefits from collection attempts, contact an attorney specializing in social security or disability law.

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