A person who has fallen behind on debt repayment may be subject to garnishment if a creditor receives a judgment from the court. This money may be taken directly from the debtor’s paycheck, or from his or her bank account. However, for those who receive Social Security benefits, there are specific conditions regarding which creditors or agencies can garnish money from their accounts, and how.
According to Bankrate.com, if money is owed to the government, a certain percentage may be garnished from a person’s Social Security check, depending on what kind of debt it is. For example, a person who owes child support in Oregon can have up to 50 percent of the check garnished. Most delinquent payments to a federal government debt will only result in up to a 15 percent garnishment, although $750 would always be left in the account. However, when back taxes are owed to the IRS, that agency is not bound to leave a certain amount of money in the account when collecting its 15 percent.
Information from the U.S. Consumer Financial Protection Bureau states that a private creditor can win a judgment to have a bank account garnished. A person’s Social Security benefits are protected to some extent, but there are still conditions that must be met. The bank has a responsibility to protect two months’ worth of any Social Security benefits that are deposited directly into a person’s account, but any amount over that is subject to garnishment.
A bank is not required to protect money deposited into an account as a check unless the debtor can prove that the funds come from the Social Security Administration. While bankruptcy typically cannot provide relief from federal debt such as taxes or student loans, it may be a solution for those who have a high amount of credit card debt.