Retirement savings can be garnished, but for most everyday debts they cannot. A credit card company, medical creditor, or other commercial lender generally cannot reach a 401(k), pension, IRA, or Social Security check. The exceptions are narrow but real: the IRS, defaulted federal student loans, and family support orders can pull money from accounts that are otherwise off-limits.
401(k)s, Pensions, and Other Employer Plans
Most private-sector employer plans fall under the Employee Retirement Income Security Act.1Office of the Law Revision Counsel. 29 U.S.C. § 1003 ERISA’s anti-alienation provision blocks commercial creditors from assigning or seizing plan benefits.2Office of the Law Revision Counsel. 29 U.S.C. § 1056 Because the assets sit in trust, they are legally separate from your general property,3Office of the Law Revision Counsel. 29 U.S.C. § 1103 and that separation carries into bankruptcy as well.4Office of the Law Revision Counsel. 11 U.S.C. § 541
ERISA’s protection does not extend to every retirement plan. Government-run plans and certain church-related plans sit outside it, and their treatment depends on other law.
Traditional and Roth IRAs
IRAs work differently. In a civil lawsuit, state law decides how much of your IRA a creditor can touch. Some states shield the entire account; others protect only the amount reasonably necessary for basic support.
In bankruptcy, federal law takes over. The Bankruptcy Code exempts combined IRA assets up to an inflation-adjusted cap of $1,711,975.5Federal Register. Adjusted Dollar Amounts – Section: 11 U.S.C. 522(n) Money rolled into an IRA from a qualified employer plan is not counted against that cap and gets broader protection.6Office of the Law Revision Counsel. 11 U.S.C. § 522
Social Security Payments
Federal law exempts Social Security benefits from execution, levy, attachment, and garnishment.7Office of the Law Revision Counsel. 42 U.S.C. § 407 That protection continues after the money lands in your bank account. When a bank gets a garnishment order, it has to look back two months and identify federal benefit deposits,8Legal Information Institute. 31 C.F.R. § 212.3 then protect an amount equal to those deposits so you can still reach that money while the dispute plays out.9eCFR. 31 C.F.R. § 212.6
Debts That Can Still Reach Retirement Money
The strongest exceptions come from the federal government itself. The IRS can seize retirement accounts to collect unpaid taxes,10Office of the Law Revision Counsel. 26 U.S.C. § 6331 and its guidelines allow levies against both employer-sponsored plans and individual accounts in some situations.11Internal Revenue Service. Internal Revenue Manual § 5.11.6 The federal government can also take up to 15% of a monthly Social Security payment to collect on a defaulted student loan, so long as the remaining benefit does not drop below $750 per month.12Legal Information Institute. 31 C.F.R. § 285.4
Family support is the other major exception. A Qualified Domestic Relations Order lets a court award part of an ERISA-qualified retirement account to a former spouse or a child, which is how alimony and child support can be paid directly out of plan benefits.2Office of the Law Revision Counsel. 29 U.S.C. § 1056
Once the Money Leaves the Account
Protections that apply at the source can weaken once you withdraw funds. Federal law protects money while it sits in a qualified plan or IRA, but after a withdrawal hits your checking account, state exemption rules usually decide what stays safe. Some states let the protection follow the money into the bank; others require you to show the funds are necessary for basic living expenses. Timing matters. Pulling a large distribution while a judgment creditor is active can expose money that would have been untouchable a day earlier, so it is worth checking your state’s exemption rules before moving retirement funds into a general account.