Salt Lake City, UT asked in Banking and Social Security for Utah

Q: My sole means of support is my Social Security income. I am in dispute with the bank that serves my checking /savings.

Can the bank attach my checking and savings accounts. I don't have the money to file for bankruptcy, the bank is my sole creditor. I have a small positive balance under $2000.00, consisting of my SS check and $763.00 proceeds from a loan from my term life insurance policy Are these ever dwindling funds available for the bank to seize ?

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1 Lawyer Answer
James L. Arrasmith
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  • Social Security Disability Lawyer
  • Sacramento, CA

A: In most cases, Social Security income is protected from being seized or "attached" by creditors, including banks, due to a federal law known as the Social Security Act. This protection extends to funds in your bank account that can be clearly identified as Social Security income.

However, there are a few exceptions to this rule:

1. Federal government debts: The federal government can garnish Social Security benefits for certain debts, such as unpaid federal taxes or defaulted federal student loans.

2. Court-ordered child support or alimony: If you owe child support or alimony, your Social Security income may be garnished to satisfy these obligations.

3. Commingling of funds: If you mix your Social Security income with other money in your account, it may become difficult to identify which funds are protected. It's best to keep your Social Security income in a separate account.

Regarding the proceeds from your life insurance policy loan, these funds are generally not protected from creditors.

To protect your Social Security income, you can consider opening a separate bank account and having your Social Security checks directly deposited into that account. Keep these funds separate from any other money to ensure their protection.

If your bank attempts to seize your Social Security funds, you should contact them and explain that the funds are protected by federal law. If the issue persists, consider seeking legal advice from a consumer protection attorney or a legal aid organization in your area.

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