Some Bill Collectors Accessing Seniors' S.S. Benefits
Under pressure from activists seeking to protect senior citizens' Social Security benefits from bill collectors, the Obama administration has promised action to close a loophole in existing law which leaves seniors' bank accounts vulnerable.
According to a recent Associated Press report, lawmakers in Congress from both parties for years have been pressuring the Treasury Department to close the loophole in the law which is supposed to protect Social Security and veterans' benefit payments from creditors.
There are a few exceptions to the protections afforded under the law, mainly child support, alimony, unpaid federal taxes and debts to other federal agencies, according to the AP story. However, creditors have been getting around the law by getting court orders to freeze the bank accounts of some seniors who receive the benefits through direct deposit of their monthly Social Security checks. After freezing the accounts, the creditors then garnishee the funds placed in them.
Senior advocates say the situation has been going on for years, but has worsened now that direct deposits are widely used. The advocates point out that once the bank assets are frozen, the account holder cannot access the funds in order to get a lawyer to fight the garnishee.
The story says that during a 12-month period in 2006- 07, an estimated $178 million that included S.S. benefits was tied up and garnisheed from bank accounts, according to the Social Security Administration inspector general.
Senator Herb Kohl (D- Wisconsin), chairman of the Senate Special Committee on Aging is quoted in the article: "Some banks are doing the right thing to protect their customers by denying creditors' requests to freeze and garnish accounts with Social Security funds, but too many banks are not."
COLD WAR VETS' TAX BREAK: The state senate last week passed a bill which would allow local municipalities to increase the level of tax benefits available to veterans of the Cold War.
The senate's action would bring Cold War veterans' property tax exemptions up to the level offered to veterans of other wars. The exemption applies to veterans who own and live in their homes or co-op units.
"Americans are grateful to our veterans because they put their lives on the line for us, including veterans of the Cold War," state Senator Joseph Addabbo Jr. (D- Howard Beach), said. "As a body, the senate felt it was important to honor the commitment of these veterans and ensure equal access to this program under the law."
The bill now goes to the Assembly's Ways and Means Committee for consideration.
MORE SENIORS QUALIFY FOR RENT INCREASE EXEMPTION: In another action the senate approved a bill which would deduct the amount of any unreimbursed out-of-pocket expenses from seniors' annual income calculation when they apply for Senior Citizen Rent Increase Exemptions (SCRIE).
The bill has already been approved by the Assembly and now goes to Gov. David Paterson for consideration.
Commenting on the senate's action, Senator Toby Ann Stavisky (D- Whitestone) stated: "For so many senior citizens, the sharply rising cost of prescription drugs and medical expenses that insurance does not cover take a bigger and bigger bite out of their finances and standard of living every year. For vulnerable New Yorkers, where returning to work may not be an option, it is especially important that we do everything possible to offset this financial burden. To this end—because choosing between paying for medications or affording rent should not be a decision anyone has to make—we intend to provide help by making more senior citizens eligible for this coverage."