Can Social Security Be Garnished? What You Need to Know

Social Security benefits support millions of Americans. Roughly 90% of people age 65 and older receive these monthly payments. Federal and state laws protect your benefits from creditors in most cases. Some exceptions exist.

You need to know when your Social Security income faces risk. You also need to understand how to shield your benefits from collection.

How Creditors Collect Debts Through Garnishments and Levies

Creditors can sue you when you don’t pay a debt. A court judgment gives them legal power to collect. Garnishments and levies are common collection tools.

Garnishment means taking money before you receive it. A levy takes money already in your account. Both methods let creditors seize funds without your permission.

Most creditors need a judgment first. Some exceptions exist. Past-due child support and delinquent taxes don’t require a judgment.

Four Types of Social Security Benefits

The Social Security Administration distributes four main benefit types:

• Retirement income: Payments for workers age 62 or older. Amount depends on age, prior salary, and years worked.
• Social Security Disability Income (SSDI): Benefits for qualified workers unable to work due to disability.
• Supplemental Security Income (SSI): Payments for people who can’t earn due to age or disability.
• Survivors’ benefits: Payments to surviving children and spouses of deceased workers.

Social Security benefits get stronger legal protection than regular wages. Creditors can still take your income in specific situations.

When Creditors Can Garnish Your Benefits Before You Receive Them

Federal laws prohibit most creditors from garnishing Social Security before you get it. Banks and credit card companies can’t touch these funds. SSI benefits receive maximum protection. Only the Social Security Administration can garnish SSI, and only for overpayments.

Other Social Security types can be garnished for specific debts only:

• Past-due criminal restitution: Up to 25% of your benefits can be withheld.
• Delinquent alimony or child support: Up to 60% of benefits can be garnished. Behind more than 12 weeks? The cap increases to 65%.
• Past-due federal taxes: Up to 15% of your total benefit faces garnishment.
• Delinquent federal agency debts: Includes defaulted federal student loans. The government can take up to 15%, but can’t reduce payments below $750.

Bank Levies: When Creditors Take Benefits From Your Account

Your benefits keep protection even after deposit. The rules get more complex once money hits your bank account.

Automatic Protection for Your Benefits

Banks must check for Social Security deposits before levying your account. Direct deposits from the past two months receive automatic protection. The total amount of all federal benefit payments during this period stays safe.

No limit exists on the protected amount. Protection applies to joint accounts too. Money from other sources in the same account doesn’t affect this protection.

Automatic protection has restrictions:

• Only direct deposits qualify. Transfers from another account don’t count.
• Benefits older than two months lose protection.
• Only the protected amount (two months of deposits) qualifies. Extra money can be levied.

State Law Protection for Your Benefits

Your state’s exemption laws might protect benefits not covered automatically. Most states offer some Social Security protection. You must take action to enforce these protections.

Notify the court about your exempt funds first. Then present evidence proving your account qualifies for protection. Act quickly to prevent funds going to the creditor.

Your account might freeze during court review. Mixed accounts with various income sources create proof problems. Keep Social Security income in a separate, designated account. Our partner Solo can help you respond to collection actions and protect your benefits.

Benefits Without Bank Levy Protection

Creditors who can garnish pre-deposit benefits can also levy your bank account. They can take Social Security for delinquent child support, alimony, criminal restitution, and federal debts. Automatic protection rules don’t apply. Most state exemption laws won’t help either.

SSI benefits are different. No creditor can take SSI from your bank account without consent. Not even the Social Security Administration. You may need to prove the money is SSI income.

Bankruptcy Can Protect Your Social Security Income

Bankruptcy might shield benefits not covered by other protections. The automatic stay stops all collection actions immediately. Garnishments and bank levies must cease when you file.

You might discharge (eliminate) your debt through bankruptcy. Some debts like child support can’t be discharged. Filing still gives you time to arrange payments and avoid levies. Speaking with a bankruptcy attorney for free can help you explore your options.

Key Points About Social Security and Garnishment

Private creditors can’t garnish Social Security before you receive it. Your benefits face garnishment only for specific debts. These include alimony, child support, criminal restitution, federal taxes, and federal agency debts.

Social Security in your bank account stays protected from most creditors. Protection is sometimes automatic, sometimes requires court action. Keep benefits in a separate account for easier proof.

Bankruptcy offers an alternative shield for unprotected benefits. The automatic stay stops collection immediately. You gain time to address debts without losing your income.