Unpaid child support is a serious manner that’s sometimes beyond even the best parent’s control. With that being said, there’s many different ways that the state might try to collect unpaid child support.
One big question that many parents have is if individual retirement accounts can be garnished in order to pay child support.
Can my IRAs be garnished?
Your individual retirement account is meant to support you after you’ve stopped working, either due to natural retirement or a health issue. Some states protect IRA accounts from being garnished.
Most states however make an exemption when it comes to unpaid child support. Since IRAs are not governed by ERISA, they are not exempt from garnishments.
Some states have their own rules when it comes to garnishing retirement accounts in order to pay off unpaid child support. In a lot of cases, even if there is a federal rule that protects your IRA, the state can choose to follow their own rules instead.
What retirement accounts are protected from garnishment?
An IRA cannot be garnished in the event of bankruptcy, as long as the state chooses to follow that rule. There are a limited amount of states that choose to not to garnish IRA accounts in order to pay back child support.
Most other retirement accounts that fall under the Employee Retirement Income Security Act of 1974 – such as 401(k)s – are protected from being garnished at all. This doesn’t mean that the child support can continue to go unpaid.
What do I do if I have unpaid child support?
If you have unpaid child support and the court has to get involved, it could mean your wages are garnished or you lose precious assets. The best thing to do when you have unpaid child support is work out a pay-back plan with the court.