If you are facing significantly overdue debts, you’re not alone. Many disabled persons face these kinds of financial hardships, especially during the period between claiming Social Security disability benefits and being approved for SSDI or SSI.
If you are seriously in debt and facing garnishment, there is some good news: your federal Social Security disability benefits are exempt from garnishment. No creditor can take any of your Social Security disability benefits, even if the courts have issued a Writ of Garnishment.
You need to fill out an MC-49 Objections to Garnishment form and file it with the court which issued the Writ of Garnishment. The form itself is easy to fill out. Contact your lawyer or the court in question regarding where you can obtain an MC-49 form. Some states even have these forms available online. When filling out the MC-49 form, make sure you check the box indicating that you object on the basis that the funds to be garnished are exempt from garnishment under federal law. You will want to send the form in to the court using a secure, verifiable delivery system. Better yet, you could deliver the document to the court in person.
If anyone actually attempts to garnish your Social Security disability benefit, or even threatens to in the attempt to collect a debt, they have broken a federal law, and you have a justifiable complaint against them. Report such activity to the SSA. You may also consider consulting a lawyer regarding whether you may be entitled to damages.
It’s important to note that, while your Social Security Disability benefit payments are exempt from garnishment, any other income or property which you have may not be. You might want to consider consulting a lawyer regarding which assets and income are or are not protected and how you can go about minimizing the impact of a garnishment on your livelihood and property.
Generally speaking, the funds in your bank accounts are safe if you can prove you received them through Social Security Disability programs such as SSDI and SSI. If any funds are garnished which you can prove were received from your Social Security disability, benefits, the organization which garnished your assets will be required to return them.
There is one exception to the rule that creditors cannot garnish your Social Security Disability benefits. As you might have guessed, that exception is the federal government. If you owe the federal government money, whether it is for prior overpayment of benefits or some other cause, they can garnish up to 15% of your Social Security disability benefits.
Before the federal government begins garnishing your Social Security benefits, however, they will notify you of your debt and give you an opportunity to make satisfactory payment arrangements. In most cases, as long as you communicate with them and make a reasonable effort to repay your debt to the federal government, you will not need to worry about your Social Security Disability benefit payments being garnished. If you are completely unable to repay your debt to the federal government, and can prove it to the IRS’ satisfaction, you may even be exempted from having to repay the debt at all.
If you believe your assets have been or will be garnished, it is in your best interest to fill out your MC-49 and return it as quickly as possible to the appropriate court. It’s generally easier to protect your assets from garnishment up front than it is to prove that the assets garnished were exempt after the fact. If you need assistance protecting your assets received from Social Security Disability programs, consult a lawyer who is knowledgeable in Social Security programs and garnishment.