Most creditors cannot garnish your Social Security payments. However, there are certain situations where the federal government can garnish your Social Security benefits in order to pay delinquent federal debts such as federal income taxes or federal student loans.
The IRS is able to garnish 15% of your Social Security benefits for back taxes under the Federal Payment Levy Program. Additionally, the federal government can garnish 15% for the purposes of repayment of delinquent federal student loans.
Before the Federal Payment Levy Program, the government was restricted from garnishing the first $750 of monthly Social Security payments to satisfy non-tax debts; however, because the Federal Payment Levy Program is used to satisfy delinquent tax debts, the restriction protecting the first $750 does not apply.
Federal payments such as Social Security benefits will not be garnished in certain circumstances, such as if you are in bankruptcy.
If you are facing garnishment of federal payments such as social security, it may be beneficial to speak with an experienced bankruptcy attorney, because bankruptcy may be able to remove the garnishment and reduce or eliminate your delinquent federal debts. It’s important to talk with a bankruptcy attorney to determine if bankruptcy is an appropriate option for your situation.
Other types of federal payments that fall under the Federal Payment Levy Program are:
- federal employee retirement annuities
- federal payments made to you as a contractor/vendor doing business with the government (such as a Defense contract)
- federal employee travel advances or reimbursements
- certain Social Security benefits paid to you
- some federal salaries
- Medicare provider and supplier payments
- Railroad Retirement Board benefits paid to you
If your debts are medical bills, credit card bills, payday loans, etc., then the creditors cannot garnish your Social Security benefits.