What is exempt income?

Exempt income is a type of income that can’t be garnished, or attached by a court, even if you owe a debt, even if a that debt collector sues you, and wins. For example, Social Security benefits cannot be garnished. In the state of Florida, disability benefits cannot be garnished either. There are multiple kinds of exempt income: Social Security, disability, Veterans Benefits, pensions, IRAs, 401(k)s. If you provide more than half of the support for a child or other dependent and you’re claiming them on your tax return, you are the head of household and that income is exempt as well. Generally speaking, you don’t need to do anything special to protect it. However, if someone has a judgment against you, and they’re attempting to garnish you, you need to inform the court right away that your income is protected. In some circumstances, if you don’t inform the court immediately or within a short period of time that your income is protected, you may lose your rights.

For example, Social Security income is protected, but if the court doesn’t know that the money in your bank account comes from Social Security, the court doesn’t have any cause to protect that income. In order to protect your income, you should put your creditors on notice immediately, or have your lawyer put your creditors on notice that your income is protected. If the case does go to court, you should have your lawyer put the bank on notice immediately that your income is protected.