Can Social Security Benefits Be Garnished to Pay Debts?

If you don't pay your debts, creditors can get a court order to garnish your wages, but what if your income comes from Social Security? The answer is that it depends on the kind of debt.

For most types of debt, including credit cards, medical bills, and personal loans, Social Security cannot be garnished to pay the debt. If you owe money to a creditor, the creditor can go to court and get an order to take money from your bank account. If your Social Security check is directly deposited in the bank, the bank is required to protect Social Security benefits from garnishment. When a creditor tries to freeze a debtor's bank account, the bank is required to look at the debtor's previous two months of transactions to determine if the debtor received any Social Security benefits by direct deposit. For example, if you receive $1,500 a month in Social Security, the bank is required to allow you to use up to $3,000 in your account.

If you receive a Social Security check and deposit it in the bank yourself, the bank can freeze the entire amount in the account. You would be required to go to court and prove the money in the account came from Social Security.

There are certain debts, however, that Social Security can be garnished to pay for. Those debts include federal taxes, federal student loans, child support and alimony, victim restitution, and other federal debts. If you owe federal taxes, 15 percent of your Social Security check can be used to pay your debt, no matter how much money is left.

For student loans and other non-tax debts, the government can take 15 percent of your Social Security check as long as the remaining balance doesn't drop below $750. There is no statute of limitations on student loan debt, so it doesn't matter how long ago the debt occurred. (In fact, student loan debt may be the next crisis facing elderly Americans. In 2015, bills were introduced in the House and Senate, HR 3967 and S 2387, to stop the government from garnishing the wages of elderly and disabled Social Security recipients.)

The rules for child support and alimony vary depending on the law in your state. The maximum amount that can be garnished is 50 percent of your Social Security benefit if you support another child, 60 percent if you don't support another child, or 65 percent if the support is more than 12 weeks in arrears.

These rules do not apply to Supplemental Security Income (SSI). SSI is protected from garnishment even if the creditor can garnish regular Social Security. Social Security Disability Insurance can be garnished in the same way that Social Security is garnished.

Filial Responsibility Laws

Within recent years, states have been taking a better look at filial responsibility laws. Filial responsibility laws require adult children ranging from 18 to 55 to take care of their indigent parents. Although there is no federal statute, twenty-nine out of fifty states have key principals that all of their statutes have been based upon.

Filial responsibility laws have been predetermined by the model of England’s Elizabethan Poor Relief Act of 1601. This states that any father or grandfather, mother or grandmother, or children of the poor, blind, lame, and impotent person are responsible to support any blood related individual to the extent of their ability. If you could not support them, the individuals had the right to public assistance.

Many states have currently do not have these laws because they were repealed once Medicaid was established. Another reason is because the moral duty of care of parents was receded through society evolving and family life changing. However, states are looking back into these issues because less money is being put into Medicare. “In the 1900s, the average number of children per household was 3.9, which that number has dropped to 1.8 as of the mid-1900s. Today, over sixteen percent of thirty eight million Americans over age 65 already need financial assistance. The current formula is now under a realistic incontinence and needs to be revised. These demographics associated with the aging of citizens and the increasing costs of long term health care costs due to the Deficit Reduction Act (2005), making it harder for senior to qualify for Medicaid, and economic recession that began in 2008. These combined are causing people to think of new ways to finance age related care, because many elders have not been able to pay for nursing home costs, and for some policy makers this includes filial responsibility laws. And due to these different factors there is an increase in new filial laws making it the adult children’s responsibility to pay for these costs.

For example, in September 2007, Health Care and Retirement Corporation of American, D/B/A Liberty Nursing and Rehabilitation Center sued John Pittas for $92,943.41 after his mother had been put into a skilled nursing home and treatment center because she had a car accident. When the Pittas’ mother relocated and the bill was left unpaid, John was looked at to pay the bill. In conclusion, John Pittas was forced to pay back that $92,943.41 to the rehabilitation center because his mother was found to be indigent. This case occurred in Pennsylvania.

Once this case had occurred, the New Jersey Law Revision Commission of September 2012 posted a memorandum concerning the laws of filial responsibility asking the state for it to be revised. However, questions that are still at a standstill are: If a parent deserts a child, is that child still responsible for that parents, or If a child is adopted is that child still reliable for their biological parent?

In conclusion, filial responsibility laws originating in 1601 could become the new way companies get their money. These laws are being considered because without them Medicare will crash. In addition, New Jersey is looking at revising these laws. So could adult children become responsible for their indigent parents once again? After the Pennsylvania case, perhaps so.


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