A recent client came to me when the bank accounts she shared with her husband and children were all hit by a garnishment summons.
Can they take all of it? Most of the money is from my husband’s paycheck and I’m only on the children’s accounts because they are minors. Can the creditor take all their money too?
Nebraska Statute 30-2722 provides the answer: “During the lifetime of all parties, an account belongs to the parties in proportion to the net contribution of each to the sums on deposit, unless there is clear and convincing evidence of a different intent. As between parties married to each other, in the absence of proof otherwise, the net contribution of each is presumed to be an equal amount.”
To protect the innocent joint account holder, the judgment debtor must do two things:
- Request a Garnishment Hearing.
- Provide the court with documents (typically bank statements and paycheck stubs) showing whose earnings were deposited into the bank account.
Time is of the essence in these matters because if a hearing is not requested in a few days the court will automatically order the bank to send the funds to the creditor.
The basic idea here is to prove who earned or contributed the money on deposit. Bank statements tend to show Direct Deposit information that helps identify the source of the deposit. Paycheck stubs with the name of an employee that correspond to the amount of a deposit also are of great use. If a deposit was in cash then you might need to get a sworn statement to provide additional information about the source of the deposit.
This brings up the next question. What about the money you own in the account? Can you protect it?
Yes, you may protect up to $2,500 of funds on deposit if you request a garnishment hearing and file and then claim the funds as exempt. Read this article to learn more about exempting your bank account.
Image courtesy of Flickr and osseous.