If you’re struggling to make end meets and living in the shadow of oppressive debt, a bankruptcy attorney can help you get the relief you need. However, despite the enormous advantages of bankruptcy protection, many Social Security recipients worry that filing for debt relief will endanger the benefits they rely on. Fortunately, federal law provides powerful protections for recipients of Social Security Disability or retirement benefits, excluding this income from seizure by the trustee or creditors.

What Social Security Recipients Should Know About Bankruptcy?

Protection From Seizure

Under federal law, both Social Security Disability and Social Security Retirement benefits are specifically exempted from seizure in a chapter 7 bankruptcy. While the court may be able to seize some of your belongings to pay back your creditors, they won’t have access to your Social Security income. In fact, a bankruptcy attorney can help ensure you get every exemption you’re entitled to, giving many people the ability to liquidate their debts without surrendering anything.

Exclusion from the Means Test

Anyone filing for chapter 7 or chapter 13 bankruptcy will have to pass a means test, designed to ensure that you actually need debt relief. To file for chapter 7 bankruptcy, your bankruptcy attorney will have to show that your income and assets are below the average level of your state. The trustee will also use the results of the means test to determine how long your chapter 13 payment plan should be. Fortunately, Social Security income is not counted in the means test, so your benefits won’t impact the outcome of your bankruptcy case in any way.
 

Filing for bankruptcy is complex and confusing, so let the professionals at C. Roland Krueger Attorney and Counselor at Law guide you through the process. For nearly 40 years, this law firm has been helping clients throughout North Carolina’s Davidson, Guilford, Forsyth, Davie, Rowan, and Randolph counties reclaim their lives from unmanageable debt with personalized, in-depth legal advice. Visit their website to start exploring your debt relief options, or call (336) 248-8464 to speak with a bankruptcy attorney and schedule a consultation today.