Social Security disability benefits are important when you’re disabled and can no longer work to earn a steady income. However, disability can be garnished, and this can reduce your monthly benefit payment if you owe money to the federal government for tax debt, creditors for student loan debt, or courts for alimony and child support.
Social Security Disability Benefits
The Social Security disability insurance (SSDI) and Supplemental Security Income (SSI) programs provide assistance to individuals who meet the requirements for disability. Although there are differences between the requirements in the two programs, approval for disability benefits will have a big impact on the recipient’s lifestyle and finances.
Social Security Disability Insurance (SSDI)
SSDI pays disability benefits to workers and their family members when the worker has accumulated a sufficient number of work credits and has worked long enough to pay Social Security taxes. This program is financed with Social Security taxes paid by workers, employers, and self-employed individuals.
To be eligible for SSDI benefits, a worker must earn sufficient credits based on his or her taxable work history to be “insured” for Social Security purposes. If SSDI benefits are approved, they are payable to:
- disabled or blind workers under 65 years old,
- their spouse or widower,
- their children, and
- adults disabled since childhood.
The amount of monthly disability benefits is based on the Social Security earnings record of the insured worker. After receiving disability insurance benefits for two years, the worker will automatically get Medicare coverage.
Supplemental Security Income (SSI)
Supplemental Security Income (SSI) is based on financial need, rather than prior work history. SSI benefits are available to low-income individuals who have a prior work history or who have no work history at all. This program is financed through general tax revenues and does not relate to work credits.
To be eligible for SSI benefits, a person must be a United States citizen or national and have limited income and resources for living requirements. Benefits are payable to people who meet these conditions and are:
- adults who are 65 years old or older,
- adults who are disabled or blind, and
- children who are disabled or blind.
The monthly benefit payment varies up to the maximum federal benefit rate, which may be supplemented by the state. In most states, beneficiaries are also automatically eligible for Medicaid.
When asking if disability can be garnished, the answer depends on whether you have SSDI or SSI benefits. Generally, SSI disability benefits can not be garnished, but SSDI benefits can be garnished for unpaid federal taxes, defaulted student loans backed by the federal government, unpaid alimony or unpaid child support, and court-ordered restitution to crime victims. SSDI benefits are protected with regard to consumer debts such as medical debt, credit card debt, and car loans, and SSI benefits are protected with regard to all to private debt.
Types of Creditors That Can Garnish SSDI
SSDI garnishment is typically related to federal back taxes, federally backed loans, and unpaid court-ordered alimony and child support payments. Private unpaid debts for medical expenses, credit cards, and car loans are protected against garnishment of SSDI disability benefits. Private creditors can get a court order to garnish money from your employment paychecks or bank accounts, but federal law prevents private creditors from touching your SSDI benefits.
Although federal back taxes, federally backed student loan debts, and court-ordered alimony and child support payments can be garnished by withholding SSDI benefits, there are limits on how much can be garnished and what percentage of your monthly benefits are affected.
- Federal Income Taxes – If you are in arrears on what you owe for federal income taxes, the Internal Revenue Service (IRS) can garnish your SSDI benefits, however, in most cases, they can’t take more than 15% of your monthly SSDI benefit payment.
- Student Loan Debts – If you default on a student loan debt backed by the federal government, you can be garnished up to 15% of your monthly SSDI benefit payment to repay the debt. However, unlike garnishment for back federal taxes, garnishment for student loan defaults can not leave you with less than $750 in benefits each month.
Withholding benefits to repay defaulted student loans has been on hold for most borrowers since March 2020, when the U.S. Department of Education instituted a pandemic pause on most student loan repayments. The moratorium has been extended several times since, most recently until June 30, or until the resolution of litigation over the Biden administration’s student loan forgiveness plan, whichever comes first. Depending on the type of loan, garnishment of SSDI benefits for student debt would not resume until six months to a year after the moratorium ends.
- Court-Ordered Alimony or Child Support – If you have a court-ordered alimony or child support obligation, the federal Consumer Credit Protection Act (CCPA) allows garnishment of up to 60% of your SSDI benefits. If you are supporting a spouse or child apart from a mandated court order, garnishment of SSDI benefits can be up to 50%, In either situation, if you are 12 or more weeks in arrears on your payments, an additional 5% can be tacked on to your monthly payments.
In cases that involve alimony or child support, most states follow the CCPA regulations for Social Security disability garnishment, but some states have their own regulations on what percentage of SSDI monthly benefits can be garnished. In Illinois, child support is typically based on the noncustodial parent’s income, and child support payments are based on income and how many children receive benefits. For one child, SSDI garnishment is 20%; for two children it’s 28%; for three children it’s 32%; for four children it’s 40%; for five children it’s 45%; and for six or more children, it’s 50%.
How SSDI Is Impacted by Child Support
If you are a noncustodial parent and have been ordered to make monthly child support payments to the custodial parent, your SSDI disability benefits can be garnished if you don’t fulfill your obligation. If problems with payments arise due to loss of income, health conditions, or any other reason that would make you default on your child support, you should talk to a Social Security disability attorney who can help you with legal matters. Defaulting on a court order to pay alimony or child support can have serious consequences.
What Happens if the Noncustodial Parent Becomes Disabled?
If the noncustodial parent becomes disabled, can disability be garnished? When the noncustodial parent has minor children and becomes disabled, the Social Security Administration provides for what is known as a “dependent disability allowance.” Under this allowance, the monthly benefit is paid each month to the custodial parent.
In 1993, the Illinois Supreme Court decided that payment of this Social Security “dependent disability allowance” fulfills the noncustodial parent’s obligation to pay child support. In other words, this payment made by Social Security takes the place of the noncustodial parent’s child support obligation and he or she does not have to make any other child support payments.
Because the dependent disability allowance is an extra benefit above and beyond what the disabled parent receives from SSDI, there is no need to garnish SSDI benefits. To secure the dependent disability allowance, both parents of the child must provide the Social Security Administration with proof of which parent is the custodial parent and the address of the custodial parent where the dependent allowance should be mailed.
What Happens if the Non-Custodial Parent is in Arrears?
If the disabled parent was in arrears on child support payments prior to receiving SSDI benefits, disability can be garnished. For instance, if the noncustodial parent receiving SSDI benefits was ordered to pay $500.00 each month for child support and missed 10 payments, the custodial parent would be owed $5,000.00.
If the Social Security “dependent disability allowance” pays $1,000.00 per month, the parent in arrears may still owe the $5,000.00. Under certain laws, a child’s Social Security disability dependency benefits can’t be credited against the arrears of the noncustodial parent, when the arrears accrued prior to the parent becoming disabled. When there are unpaid child support arrearages, federal law does allow for garnishment of SSDI benefits.
When Should You Get an SSDI Attorney?
If you’re disabled and can no longer work or depend on a steady income from employment, it can be challenging to obtain SSDI benefits. Even if you are approved for benefits, they may not be sufficient to provide you with a comfortable lifestyle and pay all of your monthly expenses.
Matters can get even more complicated if you owe money for federal back taxes, student loan debts, or alimony and child support. If you’re disabled and need to rely on SSDI benefits, the last thing you should have to worry about is if disability can be garnished or how recipients lost their Social Security benefits due to misuse of SSA regulations. Whether you’re filing for SSDI benefits or worried about your current benefits being garnished, a Social Security disability attorney can guide you through the process and help you resolve important matters that may impact your benefits.
The Social Security Administration has strict guidelines related to receiving SSDI disability benefits. When you’re applying for SSDI benefits, the process begins with an application that requires personal information, medical evidence to support your disability, and a disability that’s listed in the SSA Blue Book. The Blue Book outlines a variety of medical conditions that qualify as disabilities under SSA guidelines. If your medical condition is not on the list of acceptable disabilities, SSA will compare your condition to similar medical conditions that are listed in the Blue Book.
If you’re disabled and need SSDI benefits, the SSA looks at several factors that can impact your approval for benefits:
How Long Will You Be Out of Work?
To get approved for SSDI benefits, you must be out of work or expected to be out of work for one full year. If you are currently working and your gross earnings average more than $1,040 each month, your SSDI benefits may be denied.
How Does Your Disability Impact Your Ability to Work?
For approval of SSDI benefits, your disability or medical condition must be severe enough to limit your ability to do routine work activities. This decision is usually based on your level of difficulty in performing certain tasks such as standing, stooping, walking, sitting, reaching above your head, and lifting heavy objects.
Can You Perform Your Prior Work Duties?
To receive SSDI benefits, your disability or medical condition must prevent you from performing your prior work duties that you had before your disability or medical condition occurred. If it does not, you will not be eligible for SSDI benefits.
Can You Perform Other Types of Work Duties?
To determine if you can perform any other types of work duties, the SSA will review your age, education, work skills, prior work experience, and medical condition. If you are being treated by a licensed physician and you are not capable of performing any other types of work duties, you will likely be considered disabled and eligible for SSDI benefits.
If you’re disabled and over the age of 55, you will generally have an easier time getting SSDI benefits, because the SSA recognizes that it’s much more difficult for older disabled workers to transition to a new job or work skill. Making a vocational adjustment after age 55 is difficult for most workers, but even more difficult for workers who are disabled. The SSA sets the requirements for obtaining SSDI benefits at a lower level for older workers than for younger disabled workers. Approval for SSDI benefits is based on both medical and vocational guidelines, which consider age first.
