A Lifeline for Those Living on Social Security

Living paycheck to paycheck on Social Security income can feel overwhelming, especially when creditors start calling. You might wonder, Can they take my Social Security?

The good news is that Social Security income is protected by law from creditors. But to ensure this protection, it’s essential to follow certain steps and understand how to safeguard your benefits. Here’s everything you need to know to keep your Social Security income safe from creditors.

1. Can Creditors Garnish Your Social Security Income?

The Law Protecting Social Security Income

Social Security benefits, including Old Age, Survivor, and Disability Insurance (OASDI), are protected under federal law, specifically 42 USC §407(a), which states:

  • Social Security funds are not transferable or assignable.
  • They are exempt from garnishment, levy, attachment, or other legal processes.

In short, creditors cannot directly take your Social Security check or garnish it from your bank account—if it is properly protected.

2. How to Protect Your Social Security Income

Steps to Safeguard Your Benefits:

To ensure your Social Security income remains untouchable:

  1. Use a Dedicated Bank Account:
    • Only deposit Social Security funds into this account.
    • Have your Social Security check auto deposited.
    • Do not mix (“comingle”) other income or deposits with your Social Security funds.
    • Keep the bank balance under the total of two months checks.
  2. Keep the Funds in the Deposit Account:
    • Be cautious when moving your Social Security deposit to another bank account, it loses its protected status once it is removed from the account.
  3. Provide Proof of Exemption:
    • If creditors challenge your account, you’ll need to prove that the funds are solely from Social Security.

3. What to Do If Creditors File a Lawsuit

Responding to Court Orders and Judgments

Even though Social Security is protected, creditors may still sue you or attempt to collect. Here’s how to defend your funds:

  1. Attend Hearings:
    • If summoned for a hearing, let the court and creditors know your income is from Social Security.
  2. File an Affidavit:
    • If a judgment is entered or your bank account is frozen:
      • File an affidavit with the court.
      • Provide the creditor with a notarized statement explaining why your funds are exempt.
      • Specify the amount of protected funds in your account.
    • The court should release all exempt funds immediately upon receiving your affidavit.
  3. Act Quickly:
    • This protection can apply to up to two months of Social Security funds already in your account.

4. Can Bankruptcy Help Protect Your Peace of Mind?

Stopping Creditor Calls and Judgments

If you’re tired of dealing with relentless phone calls, lawsuits, and collection efforts, bankruptcy may be the solution.

  • Filing for bankruptcy stops all collection actions immediately.
  • Most debts, including judgments, can be discharged.
  • Bankruptcy provides a fresh start and ensures your Social Security income remains untouched.

5. Finding Peace of Mind

What You Can Expect:

Even with legal protections, creditors may continue to send letters or make calls. Each new lawsuit will require you to assert your exemption again.

If you want to eliminate the stress of dealing with creditors, contacting an experienced bankruptcy attorney can make all the difference. They’ll ensure your rights are protected and help you explore options, including bankruptcy, to regain control of your finances.

  • Have you had difficulty protecting your Social Security income from creditors?
  • Are you considering bankruptcy to stop creditor calls?

 

Take Control of Your Financial Future

Are creditor calls keeping you up at night? Protect your Social Security income and reclaim your peace of mind. Contact our knowledgeable bankruptcy attorneys today for a free consultation. We’ll walk you through your options and help you safeguard what matters most.

Don’t wait—schedule your consultation now and take the first step toward financial freedom!