A change in government policy will permit states to take 100 percent of SSD benefits when back child support is owed. Previously, states could seize only 65 percent from parents, primarily men, who owed child support and elected to receive those benefits by paper check.
The change could render as many as 275,000 recipients of SSD benefits destitute and homeless. The change came as a result of the Treasury Department's decision that it would pay all benefits electronically. This includes Social Security Disability benefits, veteran's benefits, and benefits paid to retired workers.
In some cases, the arrears are from many years ago, and the children in question are now grown. Moreover, the debt is often interest and fees, rather than direct support for children. In such cases, the money will go to the states.
Recipients of SSD and other federal benefits will receive their benefits through direct deposit or debit cards. In either case, the states will be able to freeze 100 percent of the amount received. Attorneys and poverty advocates have noted that this change will increase the number of disabled homeless, who will face eviction because they no longer have any income.
By law, states can only take 65 percent of a benefit paid by paper check. However, they can freeze a bank account entirely, making it impossible for a SSD recipient to use the benefits received through direct deposit. Health and Human Services, the federal department that oversees the Social Security Administration, is looking into the matter. The goal behind using direct deposit for all benefits is to save the federal government the expense of sending out checks. It costs only $.10 to deposit money electronically, but $1.00 to write and mail and check.
If you are having trouble obtaining or receiving SSD benefits for any reason, a disability specialist at Binder & Binder®, a national firm of disability advocates, may be able to help.
Source: Washington Post, "Poor who owe child support could lose federal benefits," Feb. 26, 2012.