April 19, 2021
Assembly Passes Legislation to Exempt COVID-19 Stimulus Relief from Money Judgments
Speaker Carl Heastie and Ways and Means Committee Chair Helene E. Weinstein today announced the Assembly has passed legislation that would exempt COVID-19 stimulus relief for individuals and families with children from seizure to satisfy money judgments (A.6617-A, Weinstein.)
“The COVID-19 pandemic has had a devastating effect on families and we must ensure that they are able to use federal relief to help alleviate that burden,” said Speaker Heastie. “It would be counterproductive and cruel to take away that relief to satisfy a money judgment when it is so desperately needed by families.”
“Federal relief payments were intended to help families that are struggling to make ends meet during this unprecedented time,” said Assemblymember Weinstein. “Allowing these funds to be taken by debt collectors deprives families of the ability to provide their children with basic needs such as food and shelter and is absolutely contrary to Congress’ intent in providing these funds. This legislation ensures families are able to use this safety-net funding as it was originally intended.”
The federal laws that authorized stimulus relief payments did not consistently include explicit language designating the relief payments as protected from seizure to satisfy judgments, from set-off, or from transfer or assignment. Today’s legislation would exempt COVID-19 stimulus relief for individuals and families with children from these forms of garnishment to ensure such funds are used to assist families and stimulate the economy.
Under current state and federal law, certain funds of an individual are considered exempt and therefore cannot be taken from an individual’s bank account to pay a judgment. Examples of exempt funds include, but are not limited to, social security, social security disability, public assistance, veterans’ benefits, unemployment insurance and child support.