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Can My Disability Benefits Be Garnished in a Debt Lawsuit?

Many people who owe the government or other third parties a lot of debt worry about whether this will affect their disability benefits. Debts can be difficult for most people to escape, especially with so many financial obligations at once. At some point, your debt collectors may sue you and garnishment can be used to freeze your financial assets. It is only natural to worry about whether garnishment will impact your ability to continue receiving disability insurance. To find out what you can do to combat this, be sure to talk to a Philadelphia denied benefits appeal lawyer for guidance. 

Debt Collector Power Over Disability Benefits

Debt collectors may have the power to sue you and instate garnishment to freeze your financial assets, but there are certain limitations on what they can do with your disability benefits. Garnishment is used to take money from your bank accounts and a certain percentage of your current income. Knowing this, you may be wondering whether they can do the same with your monthly disability benefits. 

Creditors themselves cannot legally take money from your social security disability benefits nor can they threaten to do this. Doing so would be against the law. If any money was taken from your Can My Disability Benefits Be Garnished in a Debt Lawsuit?disability benefits by your creditors, you can legally have them return this money. Sometimes, creditors may take a significant amount of money from your bank account that includes your disability funds. Be sure to keep an eye on this.

However, certain situations will allow your disability benefits to be garnished. If you owe the Federal Government money, then the IRS can legally garnish your disability benefits. This is usually done after a person has failed to respond to previous IRS requests for payment. The IRS can garnish up to 15% of your disability income. Another exception is to pay back child support, but this can only be done to your SSDI benefits. SSI is not affected. 

Ways to Appeal Disability Benefits Garnishment

There are some ways to appeal garnishment of your disability benefits. First, you can file a request to review your debt and the garnishment action. This will give you more time to figure out what next steps to take because this will stop all pending garnishment. 

You can also make a case by proving the garnishment will lead to a significant financial hardship for you. This must be proven to the Social Security Administration (SSA). Talking to a lawyer about how to do this can be helpful and may save you money in the long-run. 

Denied Benefits Appeal Lawyer in Philadelphia 

Filing an appeal to avoid garnishment of your disability benefits can a difficult process to take on alone. You will be heavily scrutinized and judged on whether you are making a genuine appeal. Try talking with a Philadelphia individual disability insurance lawyer if you have any questions about the appeals process or about the state of your disability benefits. Contact Edelstein & Nelson at 1-800-300-0909 for a consultation today. We will work with you to investigate your situation and build a strong defense to protect your assets.