Levied Funds

[howdidithappen]

Received a Motion for Turnover of Levied Funds - amount that credit card company got was alimony (only source of income) and Child Support. It is my understanding that Child Support is exempt. What percentage of my income is exempt? In my state only 10% of my income can be garnished so would this hold true with the amount they got from my bank account? Was told by Court to write a letter of objection for motion - any suggestions what should be included in letter?

[treehugger1]

In many states, wages exempt from garnishment remain exempt when placed in a bank account.

As an examlpe, suppose you had $4000.00 in a bank account and records to prove the money was all from wages. If the garnishment is 25%, you are entitled to $3000 as exempt funds. I have heard that the burden of proof lies with the debtor to show the funds are indeed wages. I have no idea what steps you now take, but it sounds as if the court has given you some type of advice.

[treehugger1]

I'll ad that you definitely need to file a claim/motion (whatever your local court uses) for yoru exemptions.

Did you receive an exemption form to fill out after a judgment was filed? In my state, the defendant is supposed to get an exemptions claim form. On such a form, I believe it is wise to reiiterate that 75% (or whatever your state allows) of all wages are exempt and you will claim these. In addition, I would read through all the exemptions listed for my state (houshold belongings, exempt equity in vehicles (id any equity exists), wild card exemptions, tools of the trade exemptions, pension/retirement funds, etc.)

Always better to be proactive. If you are allowed claims of exemption, you probably also want to file this with the court.

JMHO

[howdidithappen]

Thanks for you help and quick reply! The credit card company wants four months of my bank statements - I have no intention of sending them to them at this point! Wouldn't my Property Settlement be enough to show my support amounts? When the account was radied the deposit for the funds had occurred the day prior and there was an additional $22 in the account. Are they entitled to my banking records?

[howdidithappen]

PS to your second post - I did submit a letter of exemption for the bank levy back in November - guess I need to send another but don't know what to include other than my written word at this point - letter must be recieved by the Court TODAY...

[treehugger1]

Unless the request for bank statments is a formal court sanctioned interrogatory or debtor examination, why would you want to share your financial statements?

You might speak with an attorney or legal aid.

Your paychecks probably show any direct deposits to accounts, including routing/account numbers where the direct deposit is sent.

I supose it is possible that a company could subpoena your employer for your paystubs, but this seems pretty extreme. Maybe others can wiegh in here.

It does sound as if you need to get some info to the courts immediately. What information, or how to provide the information is beyond my knowledge.

[howdidithappen]

My only source of income is alimony and child support - I am not "employed". Support payments were direct deposited into my checking account (no longer) on the 1st of the month - that's when the account was raided. Of course, the ex knows NOTHING regarding this - Ex owes me thousand in reimbursments for the children...

[treehugger1]

Got it! I suppose the request for financial (bank) statements is that the CC company or whoever might be looking for any other sources of "income."

I wish I could help you on the details of responding to your court, but I have no experience.

If it were me, I'd at least attach any documentation showing where the funds came from along with the court response.

[jp2861]

Why would you need to provide any proof to the CC company? Or did the request come from the court? They didn't grant the writ on your account, the court did. Child support should be 100% exempt. Not sure about alimony in your state. The issue you may have is having comingled funds in the same account. If alimony isn't 100% exempt also, then you'd need to prove that XX amount of the funds were child support and XX amount was alimony. Your divorce decree should be enough to prove this, provided the amounts match what your account says. However, any mysterious or miscellaneous deposits will make it a little more difficult to prove.

[howdidithappen]

well there are some reimbursement checks from the health insurance company for the children that were deposited

[jp2861]

Once you get it all straightened out, and know exactly what is exempt and what isn't, you may want to use to seperate accounts.

[howdidithappen]

Well I went to Court last Friday the 18th on the Motion to turnover the levied bank funds. I took my Divorce Settlement papers and a page of my bank statement showing the deposit on the same day they raided the bank account. There was an additional $22 in the account on the day they raided the account. The judge told me to show him my statements. I asked why when the amount that had been taken was equal to the support payment plus $22. Judge then agreed I only show what was in the account that day and where it came from. Apparently, although it was never said, only EARNED INCOME is subject to a bank levy in NJ. I knew child support was exempt but apparently so are alimony payments. The bank's lawyer was not very happy. What will happen if I try to set up a payment plan with these people - the debt is $22K - it will take years to pay off. Every lawyer I've seen jumps to the bankruptcy filing routine before I even get to explain things - the judgement will have to be paid off in full - I have too much equity in my house - whether I file bankruptcy or not - so what's the point? Bank's attorney told me they would be looking for assets to pay off the judgement - it's for a credit card - I really don't have any assets - except my house - bought NOTHING new in over 10 years in the house - have a 5 year old car with a car loan. What can they try to take? HOw messy does this get? THANKS!!!

[HHM]

They can put a lien on your home, so if you ever go to sell you home, the debt will have to be paid with all accumulating interest, etc.

[howdidithappen]

Doesn't the judgement already put a lien on my home? If I enter into a payment plan with these people, will the lien then be delayed? Thanks!

[MomIcantFindmy]

So if you have too much equity in your home to BK I don't understand why you can't BK a chapter 13 and pay back a small amount over 3-5 years. Your judgement would get paid what your other creditors are getting paid and at the end the judgement would be wiped away. Even if it is not paid 100% This would seem cheaper than a $22K judgement paid from only child support and allimony payments. This seems like the least painful route to go.

Just wondering........