Can someone who has a judgment awarded collect from you when you are on Social Security disability?

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Can someone who has a judgment awarded collect from you when you are on Social Security disability?

Asked on September 10, 2011 under Bankruptcy Law, Minnesota

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

SSD payments are what "exempt" funds. What this means is that they cannot be garnished by a judgement creditor. Formally such a creditor could freeze a bank account in an attempt to get this money. If the debtor did not object within a specified timeframe, then the money would be paid over by their bank even though the funds were otherwise exempt. 

Fortunately this is no longer the case. If exempt funds are paid into an account via direct deposit, they cannot be frozen (although other non-exempt money can be). So as long as SSD is directly deposited, that is not deposited by check, a creditor cannot garnish these payments.

Note: Only 2 months worth of benefits are protected. Also, don't transfer benefits to another account since they will then lose their protection.


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