Phone lines burning up because of creditors calling to collect? Mailbox overstuffed with notices of past dues and final warnings? Concerned that your Social Security could be in danger thanks to debt? A recent article on Bankrate.com, a site dedicated to publishing financial information, says that while your Social Security benefits are off limits from the likes of creditors and debt collectors, the government faces no such restrictions.
The federal government is able to garnish your benefits for a variety of debts including federal income taxes, federal student loans, child support payments, debt (other than taxes) owed to other federal agencies, defaulted federal home loans and certain civil penalties. The Internal Revenue Service possesses the most authority of all government entities as Social Security benefits are subject to a 15 percent levy to pay delinquent taxes. Other agencies may not touch the first $750 of these benefits when collecting on a non-tax debt; the IRS is not bound by this limit and can take its 15 percent without regard to how little you are left with.
Before withdrawals begin from your benefits, three notices will be issued, the final one allowing 30 days to make some sort of payment arrangement.
Please see www.Bankrate.com for more information.