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? It depends on the kind of debt you have.

What Is Garnishment?

If you have a debt, the creditor may be able to take money from your accounts to collect what they are owed. For example, you may have heard of someone who owes child support being subject to wage garnishment. In this case, the person’s employer would have to withhold a percentage of that person’s wages and submit that amount to the creditor.

Can Social Security Be Garnished for Credit Card Debt?

For most types of debt, including credit cards, medical bills, and personal loans, Social Security can't be garnished to pay the debt.

However, if you owe money to a creditor, the creditor can go to court and get an order to take money from your bank account.

Direct Deposit

If your Social Security check is directly deposited in the bank, the bank is required to protect Social Security benefits from garnishment.

If the creditor tries to freeze your bank account, the bank must look at your previous two months of transactions to determine whether you received any Social Security benefits by direct deposit.

For example, if you receive $1,500 a month in Social Security, the bank must allow you to use up to $3,000 in your account.

However, 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 need to go to court and prove the money in the account came from Social Security.

Can My Social Security Be Garnished for Tax Debt?

Yes, there are certain debts that allow Social Security payments to be garnished. Those debts include:

• Federal taxes
• Federal student loans
• Child support and alimony
• Victim restitution
• 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.

Student Loan Debt

For student loans and other nontax 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. Over the years, bills have been introduced in the House and Senate to stop the government from garnishing the wages of elderly and disabled Social Security recipients. So far, it has been unsuccessful.

Child Support

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.

What About My SSI and SSDI Benefits?

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.

If you feel your Social Security is being improperly garnished, contact a lawyer. Find a qualified elder law attorney near you.

Learn more about Social Security and about some of the best ways to get out of debt before you retire.