Is a personal injury settlement considered personal earnings?
Posted by MarkApr 12
I received a notice of wage garnishment. I’m no longer employed because I am on disability. Can the creditor garnish the money out of my Settlement from a work related injury case?
NO, it is considered unearned income. As to the garnishment that would depend upon what your state statutes are. Some do allow for garnishment and some do not.
The wage garnishment could be waived as you are considered "judgment proof" if you are unemployed. The creditor would then have to refile to seize the funds from your bank accounts and that is only if permitted in your state.
If you are receiving SSDI then they can not touch those funds at all except for back taxes, child support or criminal fines owed.
You might want to call the court that issued the judgment and speak to them to find out for sure.
Hope this helps answer your question.
No, they are not considered earnings. However, you should have showed up to court at the hearing to garnish your wages and/or bank accounts and notified the judge of your situation. This would have prevented a lot of headaches. You need to consult with a lawyer and try to get back into court to settle the situation, possibly.