No, private debtors cannot garnish disability benefits in Georgia. Federal law protects Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) from garnishment by private creditors, including credit card companies and medical providers. However, if these benefits are deposited into a bank account and mixed with non-exempt funds, creditors may attempt to seize them. To safeguard your disability payments, keep them in a separate account, ensuring they remain protected under both federal and Georgia state laws.

When individuals face financial hardship, one of their biggest concerns is whether their income—particularly disability benefits—can be garnished by private creditors. In Georgia, the rules about wage garnishment and protecting disability benefits are complex and shaped by federal and state laws.

If you’re worried about how garnishment might affect your Social Security disability benefits or other disability income, getting advice and counsel from a knowledgeable wage garnishments lawyer in Georgia is critical. However, this overview will break down everything you need to know about the garnishment of disability benefits and what steps to take to protect your finances.

 

Creditors Can Collect Debts With Garnishment

Private creditors, such as credit card companies, medical providers, and lenders, can use garnishment to collect debts once they’ve secured a court judgment against you. In Georgia, wage garnishment is a common method used to recover unpaid debts. Once a creditor obtains a court order, they can garnish your wages, meaning they legally have the right to take a portion of your income directly from your paycheck. Creditors can even implement a garnishment against amounts owed to you from the Internal Revenue Service (IRS) as a tax refund.

However, the rules for garnishing disability benefits are different. Federal law generally protects certain types of income, such as Social Security Disability Insurance (SSDI), from garnishment by private creditors. That said, private creditors can attempt to garnish other assets, such as your bank accounts, which may contain a mixture of disability benefits and other funds. Knowing the limitations and protections offered by both federal and Georgia state law is crucial in safeguarding your disability payments.

 

 

Federal Regulations Usually Protect Disability Payments from Creditors

Under federal law, Social Security Disability (SSD) benefits are protected from garnishment by private creditors. This protection is a part of the Social Security Act, which states that SSD payments cannot be seized or garnished by most private entities to collect on outstanding debts like credit cards, personal loans, or medical bills. If a creditor attempts to garnish your SSD benefits directly, they are in violation of federal law.

However, these protections primarily apply to the funds before they are deposited into your bank account. Once the benefits are deposited, especially if they are mixed with other income, creditors may attempt to garnish the funds. For these reasons, it’s important to keep your SSD payments easily identifiable and distinct, such as by keeping them in a separate bank account. This helps prevent confusion and protects your funds from wrongful garnishment.

In addition, you should note that it is possible for private disability payments to be garnished in some cases. For instance, if you receive benefits through your employer, these amounts could be subject to garnishment.

 

Other Federal Restrictions on Garnishment

Although private creditors cannot garnish your SSDI benefits, there are some exceptions to this rule. Certain types of debts, such as federal tax obligations, child support, and alimony, are not subject to the same protections. Under federal law, government agencies can garnish disability benefits to collect on these specific debts.

In addition, Supplemental Security Income (SSI) benefits—which are intended to help low-income individuals—are entirely exempt from garnishment, even for federal debts. Knowing the type of disability benefits you receive is important because it impacts the level of protection you have against garnishment efforts.

 

Protection Under State Exemptions in Georgia

The Georgia wage garnishment statute also offers certain protections, particularly for disability benefits. Georgia’s garnishment laws typically follow federal guidelines, meaning that private creditors cannot garnish SSD or SSI benefits. However, creditors may still seek garnishment of bank accounts if they can argue that non-exempt funds are commingled with exempt disability benefits.

Georgia’s exemption laws may protect other forms of income as well, such as workers’ compensation or unemployment benefits. By applying for these exemptions through the courts, debtors can stop garnishments or recover wrongfully garnished funds. If your disability benefits are at risk of being garnished in Georgia, speaking with an experienced bankruptcy attorney can help you with the state’s exemption laws.

 

Disability Benefits and Bank Levies

One of the most concerning issues for individuals receiving disability benefits is the threat of a bank levy. A bank levy occurs when a creditor, having obtained a judgment, seizes funds directly from your bank account. While SSD and SSI benefits are protected from garnishment, if they are deposited into a bank account that also contains non-exempt funds, creditors may levy the entire account.

To prevent this, it’s essential to keep your disability benefits in a separate account. Federal law requires banks to automatically protect two months’ worth of disability benefits from garnishment in such cases, but additional funds could be at risk. If a levy freezes your account, you may need to prove that the funds are exempt by providing documentation to the bank or court.

 

 

Exceptions for Debt to Federal or State Government Agencies

While private creditors cannot garnish your disability benefits, federal agencies and state government bodies are another matter. These agencies can garnish SSD benefits for specific debts. Common exceptions include:

• Unpaid federal taxes: The IRS can garnish a portion of your SSD benefits to satisfy tax debts. The amount garnished depends on how much you owe and your income level.
• Child support and alimony: Court-ordered child support and alimony payments can also be garnished from SSD benefits. The rules for this vary by state, but in Georgia, the obligation to pay child support is given significant priority.
• Student loans: Federal student loan debts may result in garnishment of disability benefits, although certain income-driven repayment plans and forgiveness programs may offer relief.

These government garnishments operate under different rules than private creditor garnishments, and it’s essential to appreciate the difference.

 

Steps to Take If Your Funds are Frozen for Garnishment

If your disability benefits have been frozen or garnished, it’s important to act quickly. Here are some steps to take:

1. Verify the source of the garnishment: Determine whether the garnishment was initiated by a private creditor or a government agency. This will affect how you can challenge it.
2. Prove the funds are exempt: If your SSD or SSI benefits were garnished in error, you’ll need to prove that the funds in your account are exempt. This can be done by showing bank statements and documentation proving the source of the deposits.
3. File a motion to stop garnishment: In Georgia, you can file a motion with the court to stop garnishment if your funds are exempt. This process typically involves submitting paperwork to the court and requesting a hearing.
4. Consult with a bankruptcy attorney: If you’re facing multiple garnishments or are unsure how to protect your disability benefits, a bankruptcy attorney can help you explore legal options, such as filing for bankruptcy or seeking exemptions.

 

Protect Your Disability Benefits with Help from a Georgia Wage Garnishment Lawyer

If you are dealing with wage garnishment or concerns about protecting your disability benefits from creditors, it’s crucial to understand your rights under Georgia and federal law. By keeping your disability benefits in a separate bank account and seeking professional legal advice, you can protect your income and overcome financial challenges with greater confidence.

To learn more about private debtors accessing your disability benefits, please contact Morgan & Morgan to speak with our experienced wage garnishment attorneys. We’re here to help you protect your income and explore debt relief options. You can call us at 706-548-7070 to set up a free no-obligation consultation today.

 

Answers to FAQs About Disability and Garnishment in Georgia

Can debt collectors take money from Social Security disability payments?

No, debt collectors cannot directly take money from Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) benefits. Federal law protects these benefits from being garnished by a private debt collector.

However, if your disability payments are deposited into a bank account and mixed with other funds, they may become vulnerable to garnishment. To best protect your disability income, it’s recommended to keep these funds in a separate account, making it easier to identify them as exempt from garnishment.

What is exempt from garnishment in Georgia?

In Georgia, several types of income and property are free from garnishment besides Social Security benefits. Exemptions include unemployment benefits, workers’ compensation, and certain retirement accounts. Plus, a portion of your wages is fully protected from garnishment by private creditors.

Georgia also allows you to claim exemptions on necessary personal property such as household items, clothing, and a vehicle up to a specific value. These exemptions help protect individuals from losing critical assets while dealing with debt collection.

What happens to your debt when you go on disability?

When you go on disability, your debt doesn’t automatically disappear. However, if you’re receiving Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI), these benefits are protected from garnishment by private creditors. This means creditors cannot seize your disability income to pay off debts like credit cards, medical bills, or personal loans.

That said, you’re still responsible for paying your debts. If you’re struggling, options like debt negotiation, working with nonprofit credit counseling agencies, or filing for bankruptcy in Georgia can help provide financial relief while you’re on disability.

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