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In a perfect
world, Social Security funds in your bank account should be immune to
garnishment for any unpaid debts. Federal law says so. But in the real
world, it happens. A lot.
National Consumer Law Center estimates that about one million
receipients of federal benefits have their benefits frozen by banks each
year. When this occurs, seniors have to spend time and money - both of
which may be in very short supply - to try to regain access to those
funds in their account. This can result in a very desperate situation
for those depending on those benefits.
To address the problem, the US
Treasury Department has just instituted a new rule that will provide
seniors a measure of protection in this situation. As of May 1, when
banks receive a garnishment order, they cannot just freeze a depositor's
entire account. They must research whether Social Security benefits
have been automatically deposited into the account. If so, the bank is
required to leave untouched and protected the last two months of Social
Security deposits. This world of ours just got a little less
Attorney Joseph S. Karp is a
Florida Bar Certified and Nationally Certified Elder Law Attorney focusing on
Elder Law, Probate, Estate Planning, Asset Protection, Special Needs Planning
and Estate Litigation. He is AV rated by Martindale Hubbell. Mr. Karp is the
founder of The Karp Law Firm, a South Florida law firm with offices in Palm
Beach Gardens, Boynton Beach and St. Lucie, Florida. Mr. Karp was named a
2011 SuperLawyer by SuperLawyer Magazine and a member of the 2011
Florida Legal Elite by Florida Trend Magazine. He is admitted to
practice law in New York as well as Florida. Visit Mr. Karp's Florida Elder Law and Estate Planning
. . . .
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