Federally Protected Income
Certain types of income are protected from garnishment by federal law, even without filing bankruptcy:
- Social Security benefits -- Protected under 42 U.S.C. Section 407
- Social Security Disability (SSDI) -- Same protection as regular Social Security
- SSI (Supplemental Security Income) -- Fully exempt
- Veterans' benefits -- Protected under 38 U.S.C. Section 5301
- Federal employee retirement (CSRS/FERS) -- Protected under 5 U.S.C. Section 8346
- Railroad Retirement benefits -- Protected under 45 U.S.C. Section 231m
Exceptions: Federal taxes, child support, alimony, and certain government debts can still be garnished from otherwise protected income. Student loan garnishment of Social Security was recently restricted.
State Exemptions
Each state has its own exemption laws that may protect additional income and assets from garnishment:
- Wages -- Federal law limits garnishment to 25% of disposable earnings. Many states impose lower limits.
- Head of household -- Several states (notably Florida) provide 100% wage protection for heads of household
- Workers' compensation -- Most states exempt workers' comp benefits
- Unemployment benefits -- Generally exempt under state law
- Public assistance -- Welfare, food assistance, and similar benefits are typically exempt
How Bankruptcy Adds Protection
Filing bankruptcy provides additional layers of protection beyond what exemption law alone offers:
- The automatic stay stops all garnishment immediately -- including garnishments on non-exempt income
- Bankruptcy exemptions protect property and income from the bankruptcy estate
- Discharge eliminates the underlying debt, making future garnishment impossible
Even if your income is partially exempt from garnishment under state law, bankruptcy can eliminate the debt entirely -- providing permanent protection rather than partial protection.
Related: Head of household exemption | Chapter 7 vs. Chapter 13
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