Can the IRS Garnish My SSDI Benefits?

If you receive benefits from Social Security disability insurance, they are typically exempt from most types of garnishment. However, if you owe unpaid taxes to the Internal Revenue Service, it may be able to take a portion of your monthly payments to satisfy the debt under the Federal Payment Levy Program.

Federal Payment Levy Program

Under the Federal Payment Levy Program, the IRS electronically garnishes certain federal benefits, including SSDI, before you receive them. At the time of publication, the IRS takes 15 percent of your monthly benefit to satisfy the tax you owe. If you owe less than 15 percent, the IRS takes the exact amount you owe from one monthly payment. The Federal Payment Levy Program also garnishes other Title II Social Security benefits, including Social Security retirement and survivor benefits.

Notice

Prior to garnishing your SSDI benefits, the IRS must send you two written notices. After the final notice, you have 30 days to enter into a payment agreement before the IRS begins garnishing your benefits. If the IRS levies your benefits before it sends you these notices or before it allows you sufficient time to establish an agreement to pay your debt, it must release the levy.

Exclusions

The IRS can't establish a levy on your SSDI benefits if you have filed bankruptcy and your automatic stay is active. It also can't garnish your benefits if you have entered into an installment agreement, or if it is still considering a proposal you made to enter into such an agreement. The IRS may release an established levy if it determines that the levy is causing you financial hardship or if you propose an acceptable installment agreement.

Considerations

Your SSDI benefits may be subject to garnishment if you owe alimony or child support, or if you owe non-tax debt to the federal government. SSDI beneficiaries also have the option of requesting Social Security to garnish a portion of their monthly benefits to satisfy the current year's tax liability. Though SSDI recipients or other disabled individuals may receive Supplemental Security Income, it isn't subject to garnishment by the IRS or any other entity.