When a creditor with a court judgment sends a levy to your bank, it does not reach all of your money. Large categories of income are protected — some automatically, and some only if you speak up. Knowing which dollars are off-limits is often the difference between losing your rent money and keeping it. This page is a reference to what is exempt; for the step-by-step on how a freeze unfolds and how to release the money, see why your account is frozen and what to do about it.
Federal benefits the bank protects automatically
The single most powerful protection is one you do not have to ask for. Under the U.S. Treasury garnishment rule, 31 CFR Part 212, when a bank receives a garnishment order it must look back two months and automatically keep accessible an amount equal to the federal benefit payments that were direct-deposited into that account during the look-back window. Those benefits are Social Security, Supplemental Security Income (SSI), Veterans (VA) benefits, federal civil-service retirement, and Railroad Retirement.
This happens without you filing a single form. The bank is required to identify those deposits and may not freeze that protected amount — it stays available for you to spend even while the rest of the account is held. The protection attaches to money that arrived by direct deposit and is traceable to a covered benefit, so paper checks you deposited yourself can be harder to flag.
Older and commingled benefits: exempt, but you must claim it
The automatic two-month window is a floor, not a ceiling. The same benefits remain exempt by federal statute even when they fall outside that window: Social Security and SSI under 42 U.S.C. § 407, and VA benefits under 38 U.S.C. § 5301. These anti-attachment laws say the money keeps its protected character.
The catch is that money older than the look-back window, or benefits that have been commingled — mixed with other funds, or moved into a second account — loses the automatic shield. The dollars are still exempt under the statute, but the bank will not pick them out for you. To get them released you must affirmatively file a court claim of exemption, which is free to do. That is covered on the claim-of-exemption action page. If all of your income is protected this way, you may also be effectively judgment-proof.
State exemptions add more protected categories
On top of federal protections, most states shield additional kinds of money from a private creditor’s levy. Common categories include a wildcard exemption (a set amount of any funds), public assistance and TANF, unemployment compensation, child support you receive, certain wages you have already deposited, and in some states a “head of household” protection for a wage-earner who supports a family.
The exact dollar amounts and rules vary widely by state, so check your own state’s exemption limits rather than relying on a national figure. Many states also impose a short, state-set deadline to file your claim after the levy — missing it can let the bank turn the money over — which is one more reason to act quickly.
What is not protected this way
Exemptions cover the source of money, not your whole balance. Money that is not shielded from an ordinary judgment creditor’s levy includes:
- Ordinary wages once they have been paid out and are sitting as general savings, beyond any state wildcard or wage protection.
- Savings built from non-exempt sources — for example a tax refund (apart from any state rule), gifts, or business income.
- Exempt benefits that you can no longer trace because they were spent and replaced, or so commingled that their source cannot be shown.
This is why proving the source matters: an exemption is only as good as your ability to document where the money came from.
Where the automatic Treasury protection does not fully apply
The 31 CFR Part 212 auto-protection is aimed at private creditors. It does not give the same automatic shield against certain government and family-support claims. The Treasury rule itself carves out orders for child support and alimony, and federal benefits can be reached for some federal debts — an IRS levy or a defaulted federal student loan can reach money that a private creditor cannot. Whether and how much of a specific benefit can be taken in those situations depends on the type of benefit and the type of debt; our page on whether Social Security can be garnished walks through how each kind of creditor is treated.
Practical steps to keep your exemptions intact
You can protect yourself before any levy ever lands:
- Keep exempt benefits in a separate account. Do not commingle Social Security, SSI, or VA money with paychecks or other deposits. A dedicated “benefits only” account makes the protected amount obvious to the bank and to a court.
- Use direct deposit. The automatic two-month protection keys off direct-deposited benefits, so electronic deposit is far easier to trace than a check you cash and re-deposit.
- Keep deposit records. Save benefit award letters and statements that show the source. If you ever need to file a claim of exemption, that paper trail is your proof.
- Act fast on any freeze. Read why your account is frozen to confirm what kind of hold you face, then file your free claim using the action steps before your state’s deadline.
The Fair Debt Collection Practices Act (FDCPA) also limits how collectors may behave while pursuing a debt, but it does not by itself unfreeze exempt money — the claim of exemption is the tool that does that, and it costs nothing to file.