If you receive an injury and have to go on disability in Connecticut, you may suffer a significant decrease in income. If you have no other source of funds to pay your bills, you may fall behind in some of your payments. Creditors such as credit card companies may eventually end up suing you for payment if your delinquency becomes significant. Fortunately, Connecticut typically protects disability income from creditors.
Collections Process
No creditor can simply decide to garnish your wages in Connecticut. The legal process that leads to garnishment can be lengthy and expensive, and most creditors will attempt other methods of collection, such as phone calls and letters, before they file a lawsuit. If your credit card company can prove to the court that you owe them money, the court will usually rule in favor of your creditor and issue a judgment against you. A judgment is a legal step that asserts the creditor's right to collect and paves the way for them to begin wage garnishment.
Wage Garnishment in Connecticut
If a creditor wins a judgment against you in Connecticut, you may have to face garnishment of your regular wages. Connecticut follows a wage garnishment scheme that is slightly different than federal government standards. In Connecticut, you may face wage garnishment of the lower amount of either 25 percent of your disposable earnings or 40 times the federal minimum wage.
Connecticut Garnishment Exemptions
Fortunately, Connecticut offers special exemptions from garnishment for certain types of income. Most retirement or pension income, insurance payments and public benefits are shielded from wage garnishment in Connecticut. Disability payments, whether part of a retirement package or not, are included in the exempt category. Thus, if you receive disability retirement payments in Connecticut, they are not normally subject to seizure by a credit card company, even one with a judgment in hand.
Commingling of Funds
If your credit card company does not succeed at garnishing your wages, it may attempt to seize some or all of your funds in a bank account. If you commingle your exempt disability wages with other income, distinguishing your exempt wages from your non-exempt assets may be difficult. Although you have the legal right to protect your disability funds in your bank account, it is your responsibility to demonstrate to the court that at least some of your commingled funds should be protected.
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