Question: I had to stop working due to a disability and am having trouble meeting my child support obligations and paying off old credit card bills. My only income now is a Social Security disability check each month. Can Social Security disability payments be seized to pay child support? What about past due credit card bills?
Answer: Disability benefits from the Social Security Administration cannot be taken to pay off regular debts like credit card bills, defaulted loans, or medical bills, whether you are receiving Social Security disability insurance (SSDI) or SSI disability payments. This applies to ongoing disability payments as well as lump-sum back payments.
There are, however, a few special cases where SSDI payments can be seized to pay off certain debts. SSDI payments can be taken to pay past due or current child support, and the federal government can garnish your SSDI check to collect unpaid back taxes or student loans that were defaulted on.
You can, however, ask the court for a modification to your child support order due to your changed circumstances. Don’t stop paying your child support until you can get a modification. Also, you should apply for Social Security dependent benefits for your child.
SSI disability benefits, on the other hand, can never be taken to pay any type of debt, since they are intended to pay for subsistence-level food and shelter for the recipient. Even a lump-sum SSI check for back payments or accumulated SSI benefits in a savings account may not legally be garnished or seized. In the past, this rule was ignored by banks more often than it was honored, but a new law and direct deposit provide more protection for these funds. (To make sure the funds in your bank account are protected from being garnished illegally, you may want to read Nolo’s article on Protections for Social Security Funds in Bank Accounts.)
In case you’re thinking of filing bankruptcy, the same rule applies to SSI payments: they are exempt from being taken by the bankruptcy trustee to pay off your debts. As to SSDI benefits, they are supposed to be exempt from being taken in bankruptcy (according to the United States Code, Section 42 U.S.C. §407), but certain bankruptcy courts will exempt only the amount you need for your “care and maintenance.” So if you’ve saved some SSDI in a savings account or you receive a lump-sum back payment before you file Chapter 7 bankruptcy, in some states these monies could be taken to pay off your debts.