I am permanently disabled due to service in Vietnam. I learned to cope, got married and started a business. In 1990, we sold our CA home and moved to WA St. A year later we were injured in an auto accident caused by a drunk driver. The accident took away my coping skills and the ability to run a business, earn an income and to purchase a replacement home as required by law. We filed for bankruptcy and in 1993, the IRS and the FTB placed liens on us. The IRS canceled our debt when their lien expired, because it was due to extreme hardship, while CA FTB turned our debt over to collections after their lien expired in 2006. On March 20, 2012 FTB emptied our accounts. I'm 69 and disabled and my wife is 66 and still lives with pain from the auto accident, and the FTB is $35,000 richer.
I agree with the previous answer and in Washington pension and disability payments are exempt. You need to designate the funds as excempt under RCW 6.15.020 and let the bank know today. There is a 10 day window, do it today.
You will need to consult with a consumer protection or bankruptcy lawyer locally at once for private and specific advice on your particular issues.
Many lawyers on this site offer a free consultation and you should find one near you, make an appointment for specific legal counseling, and take all your paperwork and perhaps a written chronological summary.
1. Start keeping a detailed log of all calls and letters and a paper file of all information. Because persistent violations of the FDPCA are punishable by statutory fines and attorney’s fees under federal law, but you need hard evidence.
2. Make a written demand that all further communications from creditors is in writing under 15 USC 1692 (c).
The letter should also contain a dispute of the validity of the charges and include a demand for a complete accounting with signatures, and all contents of their file.
The creditor then has 30 days to reply and they may not take any action until you have been sent the validation. Bear in mind that this may be motivation for the collector to work your account when the file comes to them from the original creditor with new information.
3. Do not give them any personal information because that is how collectors decide on which accounts to recommend suing. Remember they may not tell the truth and will say just about anything to get a payment from you and that payment reaffirms the debt, gives them information about you and your bank and ability to pay.
4. If you are going to make payments use money orders only and not personal checks, wire transfers, money grams, or “check by phone” because if the collector finds a bank account the collector will be more likely recommend a lawsuit to their legal department.
5. All collections are negotiable; the original creditor has given up and is losing up to 50% on the face value already either by splitting any return or selling at a huge discount. In addition, the costs of a lawsuit although discounted still are a factor in the decision to settle with you.
If you are going to settle mark the check “settled-in-full” at the very top back of the check and include a letter explaining you are offering a settlement, keep copies of everything.
6. Get written confirmation of any payment plan the agency will accept before making a payment.
7. Specify in writing that all payments will be applied to principle first.
If you are ready to throw in the towel, go see a local bankruptcy attorney and explore your options for federal protection. The protection will even look back 90 days from filing and get back money taken by the collectors and apply it fairly.
If your debt is with the government like the IRS or a State agency or for Child Support or taxes, the rules will be different and you will need a local lawyer at once.
DO NOT use a paid debt settlement service; most of them are scammers.
I have pasted a link to the FDPCA to help you with your state federal rights;
Washington collection agency complaint form: http://www.dol.wa.gov/forms/600006E.pdf
Washington statute regulating collection agencies: http://apps.leg.wa.gov/rcw/default.aspx?cite=19.16
Consumer rights in Washington: http://www.dol.wa.gov/business/collectionagency...
Look for a qualified consumer protection attorney for a low cost or free consultation here:
You should read the FDPCA from the links above and become informed about your rights; this will help you and your lawyer.
I hope this information and generic advice is helpful and If you found this helpful, please click the link for a good answer. Thanks.
Banks are not supposed to permit levy/garnishment of social security disability payments and I seem to remember seeing a fresh directive to banks, but I can't seem to locate it. Comingling is always a problem and banks aren't happy making this judgement call. If the balance is a couple of multiples of periodic deposits banks are more likely to block based upon a judgment. But if they see deposits many times the normal disability, they may likely allow it.
FTB, EDD, and California tax authorities have always been aggressive. You can fight it, but if you are in Washington it will be even tougher.
What bothers me the most about your bankruptcy in 1993 is that you were unable to get the taxes discharged.
Try an approach to some of the legal aid outfits in Washington and see if they have much of a track record with FTB. What I'm trying to say is that if they are hard nosed toward a California citizen, they might be even moreso toward a Washington citizen.
This may be a wild idea and it may not work, but have you considered filing bankruptcy again? The bankruptcy trustee might make FTB them it back.
Now, I don't know your situation, home owner or not, other assets or not, but if this wipes you out, and if you have exemptions in washington that are large enough AND if you have a creditor damaged by FTB's "grab", the trustee might be able to reverse it if you act NOW.
I suggest that you see a bankruptcy attorney and see what can be done. ALSO, have him check on WHY the FTB and IRS was not discharged in 1993. (my guess is that you jumped the gun, but other reasons might exist, such as trust fund taxes, or a derivative sales tax liabilty or something else. Its been over 7 years since your discharge and now might be an opportune time to revisit bankruptcy.
In California, we live in FTB's powerful shadow. The bankruptcy courts in many cases are the only leverage that can be had.
You need a complete analysis by a local attorney with an eye to creating a situation where the trustee can force FTB to give the money back.
Its just an idea, you may have aspects of your past that may not allow it to work.
Please remember to designate your question's BEST ANSWER.
Federal law says that many Federal benefit payments like Social Security benefits, Supplemental Security Income benefits, Veteran’s benefits, Railroad Retirement benefits, and benefits from the Office of Personnel Management are not subject to garnishment in most cases. This means that these funds are exempt.
Your bank may be required to automatically protect some of your Federal benefits if they are direct deposited into your bank account and you may be able to stop your creditors from taking other exempt funds from your bank account.
Effective May 1, 2011, a new Federal regulation requires that banks which receive a garnishment order for an account into which Social Security, VA, Railroad Retirement, or Federal pensions have been deposited, must look more closely before honoring the garnishment order. The bank has to figure out the sum of such Federal benefit payments that have been deposited to the account during a two month period, and must ensure that the account holder has access to an amount equal to that sum or to the current balance of the account, whichever is lower.
Under this new regulation, you do not forfeit your protection from garnishment by mingling your Federal checks with other money -- but there are limits on the amount of money in your account that's protected from garnishment. Only 2 months worth of benefits are protected. Additionally, don't transfer benefits to another account or else the protection is void.
However, there are some exceptions. For example, your Veteran’s benefits, Social Security, or other government benefits may be garnished to pay delinquent child support or federal taxes.
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