Can creditors garnish personal injury settlements?
Money awarded in personal injury settlements in California is exempt under the law from garnishment under the law protecting it from creditors seizing it. That means creditors can’t legally take settlement money from your bank account and use it to pay off your old debts.
Are workers’ compensation settlements exempt from garnishment?
In most cases, workers’ comp settlements are exempt from garnishment as are other settlement types. Debt collectors cannot garnish them, with the exception of certain government agencies. For example, the KC government might be able to garnish a settlement received from workers’ compensation if you fail to pay spousal or child support.
How can I protect my settlement from garnishment?
Segregating your settlement earnings instead of what the bank calls “commingling funds” protects its exemption from garnishment. Mixing your settlement money with your other income, on the other hand, removes the settlement’s inherent protection from garnishment.
Are injury settlements protected from garnishment in Kansas City?
In Kansas City, as in most places in the country, injury settlements are exempt from garnishment and from bankruptcy cases. Parties cannot take part or all of your settlement as payment for your debts. However, you might have to take certain steps to ensure your settlement’s protection from garnishment.