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Proposed Laws to Stop Debt Collectors from Seizing Social Security Benefits

May 20

Posted by Hal LaPray in Disability News, Retirement, Social Security Disability, Survivors Benefits

APRIL 14, 2010 - Treasury Department announced a series of new laws that would prohibit debt collectors from freezing bank and garnishing bank accounts belonging to recipients of Social Security and disability for the purpose of satisfying a debt. The proposed laws were published in the Federal Register and citizens will be given sixty days in which to voice their support or opposition to the new legislation.

Sen. Herb Kohl (D-Wis) chairman of the Senate Special Committee on Aging praised proposed laws that would prohibit the seizure of Social Security benefits by banks and other entities.

Sen. Herb Kohl (D-Wis) chairman of the Senate Special Committee on Aging praised proposed laws that would prohibit the seizure of Social Security benefits by banks and other entities.

Under a long-standing federal law, Social Security benefits – including those paid to the disabled,  are exempt from being seized by bill collectors. However, once those benefits are deposited into a bank account, there was no law protecting them from debt collectors. Before the new rules were in place, there was no way for banks or creditors to distinguish between different types of assets so any monies that were in the account were subject to being frozen and garnished by creditors. Under the new provisions, banks would have to carefully examine any bank account that had a freeze or garnishment action pending against it to determine whether the account had received any federal benefits within the past 60 days.

“This rule clarification will ensure that banks can no longer stand between seniors and their rightful benefits,” Sen. Herb Kohl, D-Wis., chairman of the Senate Special Committee on Aging, said in a statement. “We’re glad to see this administration prioritize the protection of beneficiaries.”

Presently, more than fifty million Americans receive some type of benefit from the Social Security Administration (SSA). These benefits include retirement benefits, disability benefits, Social Supplemental Income (SSI), and a host of others. In fact, Social Security is the primary income of  sixty four percent of all Americans aged 65 and older. Of those fifty plus million recipients,  eighty percent choose to  have their benefits direct deposited into their bank accounts each month.

"This rule clarification will ensure that banks can no longer stand between seniors and their rightful benefits. We're glad to see this administration prioritize the protection of beneficiaries."

Because most recipients of Social Security benefits are already struggling to budget their households on a fixed income, having what little financial resources they do have tied up in a dispute over a debt can be catastrophic. When an account is frozen, checks may be returned unpaid to the bank. This can lead to charges such as overdraft fees and non-sufficient funds fees being incurred as well as a whole new set of creditors and debt issues to deal with. The only way to fight a garnishment order that has been placed on a bank account is through a lengthy and expensive court process, which most recipients on fixed incomes cannot afford. Those who could have afforded it find themselves unable to because their resources are tied up in the accounts in question.

The SSA estimates that $178 million was seized by creditors from bank accounts funded by Social Security benefits between the years 2006 and 2007, a practice that both politicians and consumer advocates believe should stop.

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Proposed Law to Ensure Social Security Benefits for Same-Sex Couples

Apr 15

Posted by Hal LaPray in Disability News, Retirement, Social Security Articles, Survivors Benefits

Linda Sanchez (D-California) announced this week that she plans to introduce a bill that would ensure equality for same sex couples under Social Security’s benefit programs.  Rep. Judy Chu (D-California) offered to co-author the bill.

Linda Sanchez (D-California), plans to co-sponsor legislation that would help ensure equality in Social Security benefits for same-sex couples.

Linda Sanchez (D-California), plans to co-sponsor legislation that would help ensure equality in Social Security benefits for same-sex couples.

Sanchez made her announcement to a crowd of 700 supporters who had gathered at Hollywood’s Gay and Lesbian Center to kick off a grass-roots movement demanding equal rights for same-sex couples by the Social Security Administration (SSA). The rally, known as “Rock for Equality”, was organized by the center – in conjunction with the National Gay and Lesbian Task Force and the AIDS Community Action Foundation.

"Right now, same-sex marriage couples pay equally into a system that they don't receive equal benefits from in return"

Sanchez is a member of the House Subcommittee on Social Security and believes that same-sex couples are being unjustly and routinely denied Social Security benefits that are given freely to their heterosexual counterparts. Her bill would demand that the SSA recognize same-sex partnerships as they apply to the disbursement of survival benefits that heterosexual couples now receive. As it stands, gay and lesbian couples are not eligible for Social Security’s four main spousal benefits. These include retirement benefits, dependent disability benefits, survivor’s benefits and death benefits.

Research by UCLA’s Williams Institute suggests that there are currently one million same-sex couples in the United States. With the number of gay and lesbian taxpayers paying into the system, but not being eligible for benefits, the research estimates that over the course of the past decade, the gay and lesbian community lost $2 billion in benefits they should have qualified for by paying into a system that doesn’t recognize them. This equates to roughly $5,700 per survivor, per year.

“I don’t think it’s right that Americans should be treated differently by the country they love because of who they love,” Sanchez said. “Right now, same-sex marriage couples pay equally into a system that they don’t receive equal benefits from in return. Shame on this country for allowing that to happen.”

Although Sanchez’s proposed bill has a long way to go before becoming law, there is already a great amount of political support being shown in favor of the bill. California Senator Barbara Boxer attended the rally as well. Last month, the city of Los Angeles announced that it supports Social Security benefits for same-sex couples. Event organizers say that President Obama has voiced his opposition to Social Security discrimination for same-sex couples also. Representative Sanchez plans to seek more co-sponsors of the bill and will attempt to hold a hearing in the Ways and Means Social Security Subcommittee, once the bill has been formally introduced.

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Increasing Claims Puts New Pressures on Social Security

Aug 6

Posted by Hal LaPray in Disability News, Retirement, Social Security Disability

Social Security Filings On The Rise

Social Security Disability Claims On The Rise

Recent efforts by the Social Security Administration to cut through a massive backlog of disability claims is being tempered by a sharp, spiked rise in applications this year.  Experts blame the current economic downturn, and the expansive increase in applications shows no signs of slowing.

Last March, The Social Security Administration revealed that as many as 3 million new applications were expected in 2009, however this week the Associated Press reported that SSA officials are now expecting more than 3.3 million claims to be filed.

As one would expect, the surge in filings has increased the backlog of those waiting to have their disability claim processed by a whopping 30 percent.

The Social Security Disability Program Under Fire

In today’s hostile, polarized political climate, many things are said about the viability and long-term sustainability of the Social Security benefits programs.  News networks, television reports, radio personalities and political pundits take extreme positions on whether the Social Security disability program needs a complete overhaul to avoid total collapse, or whether the program simply needs fine-tuning to stay afloat. Economists and financial experts disagree on most of these matters, indicating that in truth, no one really knows for sure.

Social Security Facts

The Social Security benefits program is a pay-as-you-go service.  In other words, the benefits received by today’s retirees and disabled are paid for by today’s workers.  As more people retire or become disabled, more workers are needed to pay into the program.  As life expectancy increases and as birth rates decline, then the amount of money that’s needed to sustain the program must increase per capita.  Over time, there will be fewer workers to support more disabled and retired persons.

Projections About Social Security’s Future

Based on workforce trends and rate of increasing filings, the Social Security Administration predicts that as soon as 2017 there will not be enough workers to support the number of retirees and disabled benefit recipients.  However, a Social Security trust fund exists (at least on the general ledger) that is supposed to be credited by today’s payroll surpluses, pushing sustainability predictions to 2041.  Many analysts do not believe that the program will remain viable for that long without deep, fundamental changes.  Others claim that the skeptics are merely fear-mongers, trying to stir up controversy and debate for political gain.

Many academic political scientists argue that it is probably safe to simply trust the Social Security Administration’s predictions on the matter.  It has been said that that any federal bureaucracy’s first goal is to remain solvent, and any underestimation of future fiscal needs would only serve to injure the administration’s need for survival.

Ultimately, members of Congress appear to unanimously support the program as a whole, and history shows that legislators tend to work together when it comes to maintaining social programs that benefit all Americans regardless of social class or political affiliation.  And, although the prescription for a long-term solution is uncertain, most agree that the prognosis is good.

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Senate Mulls Social Security Reform Ideas

Jul 14

Posted by Hal LaPray in Disability News, Retirement, Social Security Articles, Social Security Disability

The Senate Aging Committee Discusses Social Security Benefits

The Senate Aging Committee Discusses Social Security Benefits

While no new bills have been presented to either houses of Congress, the U.S. Senate held a Special Committee meeting last month to discuss better ways of implementing the Social Security benefits program for those who need it the most, the fastest.

At issue was the current state of the economy and how the recession has forced more Americans to file for Social Security disability or Retirement benefits in order to pay the bills.

“Social Security was designed in another era. We need to make sure that the most vulnerable in our society are not left behind as we examine ways to strengthen the program”

The Senate Aging Committee discussed the country’s increasing dependence on Social Security in addition to the federal program’s long-term sustainability and it’s efficiency.

The Senate Aging Committee Chairman, Senator Herb Kohl, D-Wisc. was quoted as saying”The impact of the financial downturn provides a stark contrast to the dependability of Social Security, and it is also the reason that the program’s guaranteed, inflation-protected benefits are more vital to Americans now than ever.”

Those present at the hearing debated ways to improve the system in order to bring it more in line with the needs of today’s families.  “… as crucial as the program is today, the fact is that it was designed in another era. We need to make sure that the most vulnerable in our society are not left behind as we examine ways to strengthen the program”, Kohl continued.

Present at the meeting included Leon Burzynski (the president of the Wisconsin Alliance for Retired Americans), former Social Security Administration commissioner, Kenneth Apfel, and Joan Entmacher, of the National Women’s Law Center.

“We need to ask a series of questions — whether Social Security continues to be a benefit people can count on; whether the elderly, disabled and survivors of workers are protected from financial hardship; whether the program is efficient, universal and fair; and whether the program is maintained as a basic public trust,” Apfel stated.  The former commissioner was able to give a detailed overview of the need to efficiently deliver benefits to survivors, disable workers and retirees who rely on Social Security benefits to make ends meet.

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Raising Children While On Social Security

Jul 13

Posted by Hal LaPray in Disability News, Retirement, Social Security Articles, Social Security Disability

Raising children while on Social Security benefits can be challenging.

Raising children while on Social Security benefits can be challenging.

With the advent of medical progress on all fronts, there has been a sharp rise in the median age for women who bear children.  The Centers for Disease Control reports that the median age for mothers at their first live birth rose from as low as 20.3 years in 1970 up to 27.8 years in the year 2000.  As today’s parents mature, there is a higher likelihood of those who are retired and/or disabled may actually be raising minor children in their home.

For those retired or disabled persons who are raising minor children as dependents, it is important to remember that, chances are, those children are also eligible to receive Social Security benefits.  This is the case for parents who are receiving either retirement or Social Security disability benefits.

In order to be eligible to receive such benefit payments, a minor child must have a parent that is disabled or retired, and otherwise entitled to receive Social Security benefits.  Additionally a minor child may also receive benefits if his or her parent has died after sufficient contributions to the Social Security program have been made through payroll withholding.

The child must not be married and younger than the age of eighteen, unless the child is also disabled, wherein benefits may be payable if the child was less than 22 years old when the disability began.

Ultimately, a child may be eligible to receive one half of his or her parent’s retirement or disability benefit payment.  If the parent is deceased, the child may receive up to 75% of the parent’s basic benefit amount.  If more than one child is eligible within a single family, then each child may recieve benefits at that rate (until a maximum amount of 180% of the benefit amount is paid).

In short, it is important to maximize you or your child’s potential Social Security benefit eligibility.  Research, find out, and get help.  Call a qualified Social Security attorney and ask questions. A great source for additional information can be found at the Social Security website. -> Benefits For Children

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