A Guide to Disability Claims and Wage Offsets
Administrative offsets is a fancy term for wage garnishment. Unfortunately, disability payments are not immune from garnishment if it comes from one of the three following sources. A percentage of your monthly disability payment will go first to pay the offset, with the remainder paid out to you, until the debt is repaid. This can put stress on your finances, especially if your disability claim is your only form of income.
Child support is a common offset that leads to disability garnishment. If you owe back child support, then your disability payment can legally be garnished. Back child support typically has the highest allowed garnishment percentage compared to the other offsets, and it can be the most difficult to reduce. Your best option is to return to court and demonstrate that the current garnishment percentage imposes a hardship. You may be able to work out a reduced payment or garnishment percentage.
Old student loan debt can plague you for the rest of your life. If these are government-backed federal loans, then your disability payment can be reduced by an offset percentage until the loans are repaid. Fortunately, student loan debt is one of the simpler offsets to negotiate. There are low-income repayment programs that you may be eligible for. A lawyer can help you negotiate these options so that you can secure a reduced payment or a long deferral, thus eliminating the offset and disability payment garnishment.
There are various forms of government debt that can be owed, but the most common are tax debts and debt from overpayment of government benefits, such as from food stamps. These repayments are rarely referred to as garnishment, instead always being referred to as offsets. Regardless of the name, the effect is the same -- a percentage of your disability payment is taken in order to repay the debt. In some cases, your lawyer may be able to work out a lower repayment plan, particularly if the offset amount is leaving you with too little to live upon and your disability prevents you from seeking additional income. Further, if you receive income-based disability via SSI, your lawyer may be able to eliminate all offsets until you are financially more stable. Otherwise, a reduced offset is possible so that you can keep more of your disability payments.
Contact a disability claim attorney if you need more help with navigating the garnishment clauses that affecting your disability claim and monthly payments.