If the funds wwere already spent there is no exemption because the property no longer exists. Generally money from SS is exempt.
The chapter 7 Trustee may be able to go after the creditor to hom you paid the money however.
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SSDI and its proceeds are protected from creditors, even lump sum payments. Once you pay it to someone, it may not be especially if that payment is considered a preference.
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Generally, those proceeds are exempt. Once they are in your account, they may not be. If you spent the proceeds on everyday normal living expenses, and did not pay them to a creditor, you will probably be fine as long as you can prove that you spent those proceeds on normal everyday living expenses. If you paid a creditor, then it is a preference to that creditor and the Trustee is entitled to disgorge that money from the creditor and disburse it amongst all creditors.
Typically, SSDI funds are exempt from creditors. However, if the funds are already spent, there is nothing to claim as exempt on your bankruptcy petition.
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