Along with concerns about retirement plans, Colorado residents struggling with debt often wonder how filing for bankruptcy protection will impact their social security benefits. The Denver bankruptcy lawyers at George T. Carlson & Associates want you to rest assured: Social Security benefits are protected from seizure or garnishment as a result of a Chapter 7 or Chapter 13 bankruptcy filing.
For many seniors, their home was their biggest asset. The Great Recession wiped out billions of dollars worth of homeowner equity in Colorado and elsewhere in the nation. Municipalities continue to turn to higher taxes to make up the shortfall. The result is a squeeze on homeowners – particularly older homeowners who are living on a fixed income.
Too often they turn to reverse mortgages or credit cards, to make ends meet. In other cases, they fall for outright scams. In still other cases, a health crisis threatens to wipe out a lifetime of savings and can endanger a retired couple’s quality of life.
Bad Debt and Social Security Benefits in Colorado
Section 207 of the Social Security Act guarantees your pension benefits are protected from seizure:
- “Your rights shall not be transferable or assignable. None of the moneys … shall be subject to execution, levy, attachment, garnishment or other legal process, or to the operation of any bankruptcy or insolvency law.”
- “No other provision of law ….(shall) otherwise modify the provisions.”
- A Colorado bankruptcy attorney would also argue that the section prohibits seizure of bank accounts comprised of Social Security benefits.
There are a few exceptions (aren’t there always)! These may include past due taxes, overpayment of Social Security, debts owed to another federal agency, and debts incurred via child support or student loans. Consulting an experienced law firm is the first step toward protecting your rights, securing your retirement, and ensuring your long-term financial well-being.
Using Bankruptcy to Protect Retirement in Denver
Like Social Security benefits, many other exemptions protect funds meant to ensure a person’s welfare in retirement, including:
- 401k and IRA funds
- Pension funds
- Life Insurance proceeds (with limitations)
- Disability benefits
- Proceeds from a personal injury lawsuit
Contact a Colorado Bankruptcy Attorney Today
If you need bankruptcy assistance in Denver or would like more information, call George T. Carlson & Associates today at 303-789-1313 for a free consultation or contact us online. We are a debt relief agency. We help people file for bankruptcy under the Bankruptcy Code. Serving clients in Denver and throughout Colorado, including Aurora, Englewood, Lakewood and Boulder.
Denver Bankruptcy Help – 303-789-1313 – Free Consultation
