Can A Retirement Pension Be Garnished  

Garnishment is a legal process to attach one’s assets. That is to take one’s money, for example, from one’s bank account or one’s wages.

However, garnishment is not allowed until a court judgment has been obtained that money is owed to the creditor. Usually, garnishment is done in order to recover debts.There are various types of income that are exempt from garnishment. These include Social Security, aid to families with dependent children, general assistance, unemployment compensation, and workers' compensation benefits.

Garnishment of pension income is dependent on the type of pension and the exemption laws that apply in the pensioner’s federal state. Some pensions are totally exempt from garnishment for commercial debt, but they could be garnished for child support or alimony. Many states exempt certain pensions or a part of the pension from garnishment just as federal law protects Social Security benefits, military retirement benefits, and veterans' benefits from garnishment for commercial debt.

Federal law (15 USC 1671 et seq.) restricts garnishment of earnings, including payments from a pension plan or retirement program, to 25 percent of disposable earnings per week or, thirty times the federal minimum wage, whichever is less.

However, if the pension amount is not exempt as per state law (due to some reason), then pension amount cannot be garnished before they are paid to the pensioner. But, once the pension payment has been deposited in the bank account, it can be garnished, irrespective of the source of funds. However, for child support or alimony, the pension amount can be reduced or garnished before it is paid to the pensioner.

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Can A Retirement Pension Be Garnished
 

How-Does-Pension-Plan-Work      A pension is a method of financing employees after their retirement. During the period of employment, the employees pay a part of their monthly salary towards the pension fund. This percentage can vary anywhere from three percent to five percent per paycheck. More..

 


 

 

 
   
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