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A loop hole! Really! Why am I not surprised? I'm only happy that this doesn't affect me but sad for those who will be affected.
https://www.cnn.com/2020/04/15/politics/stimulus-payments-debt-collectors/index.html
Ridiculous 😞
At one point I owed back taxes and was on a repayment and had a 5k refund coming to me.. Guess who intercepted it, was the IRS.. Kinda the same thing.. I understand some people could be upset but also 15 years ago lost a refund to student loans as well when at that time was behind on them. Diifferent, but somewhat the same..
"The $2.2 trillion congressional coronavirus relief plan passed in March did not shield the stimulus payments from certain private debt collectors, though it specifically protected the money from being taken to cover unpaid taxes or federal student loan payments. (The law does allow the money to be garnished for child support payments.)"
..and...
"Some states and local governments -- including Massachusetts, Ohio, Illinois and Washington, DC -- have issued their own orders to shield the stimulus payments from private debt collectors. "
I have to agree that this is all absurd. Money being funneled to the bottom to be fed all the way back up to the people that don't need it right now.
@Anonymous wrote:"The $2.2 trillion congressional coronavirus relief plan passed in March did not shield the stimulus payments from certain private debt collectors, though it specifically protected the money from being taken to cover unpaid taxes or federal student loan payments. (The law does allow the money to be garnished for child support payments.)"
..and...
"Some states and local governments -- including Massachusetts, Ohio, Illinois and Washington, DC -- have issued their own orders to shield the stimulus payments from private debt collectors. "
I have to agree that this is all absurd. Money being funneled to the bottom to be fed all the way back up to the people that don't need it right now.
+100
Someone just told me about this yesterday. I kind of understand the government recouping government funds no matter where originated (although in this case the stated purposed is to stimulate the economy). But the story I was told is that CC companies were taking from checking accounts to pay debts. Sounds wrong in my opinion. Not only is it a private company, but if they didn't deduct from checking accounts before, what makes it okay to do it now?
I work in healthcare (financial). I've been following the stimulus for SSA and SSI recipients because it could make several Medicaid residents no longer eligible for Medicaid benefits (but not technically able to pay privately). Just the other day we found that in the states we operate that those funds are exempt for 12 months for the "over resource" disqualifier for Medicaid coverage. Supports my argument to my team while waiting for clarification that it would be ridiculous to provide the funds for the stated purpose then recoup through the state (which is federally funded).
Won't affect me but sad to hear if the stated purpose was genuine.
@Trudy Thank you for answering a question I was wondering about myself. As someone on a CMHS HCBS waiver, I was curious. Your post prompted me to look it up and it seems like this stems from SSI saying they won't count it for 12 months and SSI recipients all get Medicaid so it automatically trickles down to anyone who gets Medicaid.
As for the article in question, nobody can take money from anyone's bank account without a pre-existing judgment with a garnishment order. Banks aren't going to leave themselves open to liability by doing something that they aren't legally allowed to do. People who have garnishment orders know they have one and will most likely pull the money ASAP anyway.
@Anonymous wrote:@Trudy Thank you for answering a question I was wondering about myself. As someone on a CMHS HCBS waiver, I was curious. Your post prompted me to look it up and it seems like this stems from SSI saying they won't count it for 12 months and SSI recipients all get Medicaid so it automatically trickles down to anyone who gets Medicaid.
As for the article in question, nobody can take money from anyone's bank account without a pre-existing judgment with a garnishment order. Banks aren't going to leave themselves open to liability by doing something that they aren't legally allowed to do. People who have garnishment orders know they have one and will most likely pull the money ASAP anyway.
Pretty much this. As an example if you're living with a federal tax lien you get used to putting your money in accounts (think big banks) that generate virtually zero interest so never reported to IRS /shrug. And if you're ever forced to cough up the account information, free country, there's no laws against opening another bank account and shuffling it to there.
Many years ago (25+) .. I once had the IRS freeze my WF savings account, because I had failed to file a tax return.
It put undue hardship on me. I called and said if they did not release part of my money to eat on ..they would be sued.
Within 48 hours they lifted the freeze on about $8K out of around $33KIIRC
Filed the return within about 3-5 days or so, they lifted the freeze on all my monies.
I did not owe them a red cent!
Was told by a friend, it would be a lot harder for someone to levy or get monies from a brokerage account.
He said; .. "Many more hoops to jump through" ..
FWIW
@Anonymous wrote:@Trudy Thank you for answering a question I was wondering about myself. As someone on a CMHS HCBS waiver, I was curious. Your post prompted me to look it up and it seems like this stems from SSI saying they won't count it for 12 months and SSI recipients all get Medicaid so it automatically trickles down to anyone who gets Medicaid.
As for the article in question, nobody can take money from anyone's bank account without a pre-existing judgment with a garnishment order. Banks aren't going to leave themselves open to liability by doing something that they aren't legally allowed to do. People who have garnishment orders know they have one and will most likely pull the money ASAP anyway.
A number of banks beg to differ - (NY Post)
- USAA kept $2,400 from a Minneapolis woman and her disabled veteran husband because they had an overdrawn account, according to the paper. The woman was reportedly planning to use the money to pay rent and buy formula for her infant daughter.
- Benji Pedro of South Carolina told the Times that Safe Federal Credit Union kept his entire $1,200 stimulus payment to help pay back an account that was overdrawn by $2,650 because he had forgotten to cancel a pair of music subscriptions.
- Another woman had to battle with Digital Credit Union in Massachusetts to keep all of the $2,400 that she and her husband were due to receive, the Times reported. The credit union reportedly kept $1,000 at first because of an overdrawn account
The USAA story was pretty big, I saw it several times in my FB and Google News feeds. The disabled veteran husband claimed his account was overdrawn last year due to fraudulent activity but USAA denied their fraud claim. After the publicity of the story suspended all collection of overdrawn account retroactively. And DCU also relented after publicity. Yes, an overdrawn account is money owed, but these are extraordinarily difficult times for many, be extraordinary.