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Worker's Comp Settlement Exempt from Levies?

Question: 
If a customer receives a Worker's Comp settlement, is that exempt from levies (either consumer or IRS)?
Answer: 

Answer from Ken: Any exemption from levy or garnishment would be a function of the law of your state. You'll need to check with your attorney on this one.

Answer: 

Answer from Andy: Some exemptions are common in many states. As Ken noted, you need to verify if this applies to you and it may depend on where the levy is from, but I am aware of three common types of exempt funds.

  • Public benefits such as Social Security, veterans, welfare, unemployment, and workers' compensation benefits.
  • Retirement plans including IRAs and Keoghs.
  • Insurance proceeds for disability and health insurance benefits, life insurance proceeds and the loan value of most life insurance policies.


First published on BankersOnline.com 1/31/11

First published on 01/31/2011

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