Money and property protected from collection

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Greater Boston Legal Services

Your creditors cannot take everything you own. The law protects certain income and property from creditors. If a creditor wins a case against you in court, you are responsible for the debt, but you can keep income and property that is "protected." 

My small claims hearing is over. Now what?

After your small claims hearing, you get the court’s decision about who won your case within a few weeks. The decision comes in the mail. Open all mail from the court immediately!

The court’s decision about the outcome of a lawsuit is called a judgment. In a debt collection lawsuit, the court decides if you owe the debt and, if so, how much you must pay.

  • If the decision is Judgment for Defendant, you won and do not need to pay the debt. 
  • If the decision is Judgment for Plaintiff, you lost and may need to make payments. 

If a creditor wins a judgment against you, the judgment is valid for 20 years. This means they can try to collect your income or property any time during that 20-year period. Interest also goes up by 12% each year on the debt. 

To learn more, see What happens if I lose my debt collection case?

What types of income are protected?

There are 3 types of protected, or “exempt,” income:

  1. Completely protected - Some kinds of income, like SSI or public benefits, are completely exempt. None of it can be taken to pay a debt.
  2. Protected up to a certain amount - A certain amount of your other income is protected from creditors. 
  3. Special purpose protection - Money that you set aside for rent, groceries, utilities, or savings is also exempt up to a certain amount.

For example:

Exemptions do not apply if you owe child support, taxes, alimony or criminal fines.

Income that is completely protected from creditors

The creditor can’t take any money from these sources of income:

  • Unemployment Benefits (G.L. c. 151A, § 36)
  • Social Security Benefits (42 U.S.C. § 401)
  • Federal Old-Age, Survivors & Disability Insurance Benefits (42 U.S.C. § 407)
  • Supplementary Security Income (SSI) for Aged, Blind & Disabled (42 U.S.C. § 1383[d][1])
  • Other Disability Insurance Benefits up to $400 weekly (G.L. c. 175, § 110A)
  • Emergency Aid for Elderly & Disabled (G.L. c. 117A)
  • Veterans' Benefits
    • Federal Veterans Benefits (38 U.S.C. § 5301[a])
    • Special Benefits for Certain WW II Veterans (42 U.S.C. § 1001)
    • Medal of Honor Veterans Benefits (38 U.S.C. § 1562)
    • State Veterans Benefits (G.L. c. 115, § 5)
  • Transitional Aid to Families with Dependent Children (TAFDC) Benefits (G.L. c. 118, § 10)
  • Maternal Child Health Services Block Grant Benefits (42 U.S.C. § 701)
  • Other public assistance benefits (G.L. c. 235, § 34, cl. Fifteenth)
  • Payouts from certain Massachusetts employee pension plans (G.L. c. 32, § 19)
  • Workers’ Compensation benefits (G.L. c. 152, § 47)*

* Workers’ compensation income is not always protected. In certain circumstances, the Veterans Administration and Department of Transitional Assistance can make a claim for reimbursement.

Income that is protected up to a certain amount from creditors

The money you earn from a job is protected from creditors up to a certain amount. If your income is low enough, everything you earn may be protected from creditors.

Federal laws and Massachusetts state laws protect different amounts of money. Figure out which law protects more money for you. Tell the judge that amount when you go to court for your Payment Review Hearing.

Federal law:

  • If you are employed, you can keep the highest amount of either:
    • $217.50 each week after taxes, or
    • 75% of your wages after taxes.

Massachusetts law:

  • If you are employed, you can keep either:
    • the first 85% of your earned wages before taxes, or
    • the amount that is 50 times the minimum wage. As of January 2023, the Massachusetts minimum wage is $15.00/hour so the amount protected is $750.00/week.

Money that has special purpose protection

If you can show you have saved money for certain purposes defined by law, you can ask to keep this money plus the amount that is already protected. See the example below.

How much of my expenses and assets are protected for special purposes? 

As of October 2023, you can protect up to this amount each month for each of the listed expenses:

Expenses & AssetsAmount Protected
Provisions (like groceries) for household$600
Cash or savings$2,500

If you go back to court for a Supplemental Process case, look carefully at the list. Write down how much you spend on each of these expenses. Tell the judge, “The amount I spend for each of these expenses should be exempt in addition to my other exempt income.” 

For example:

  • Meg earns $1,000 per week before taxes.
  • $850 of her income is protected from garnishment since the first 85% is protected under Massachusetts law. This means $150 is left to go to the creditor.
  • But, Meg pays $200 per month to heat her home.  There are 4.3 weeks in a month. $200 divided by 4.3 = $46.51 per week
  • So Meg can subtract $46.51 from the $150 the creditor can garnish. This leaves $103.49 for the creditor.
  • But, Meg also pays $750 per month for rent. There are 4.3 weeks in a month. $750 divided by 4.3 = $174.42 per week.
  • Meg can also subtract the rent amount from the $103.49 going to the creditor. $103.49 - $174.42 = less than 0. Subtracting Meg’s heat bill and rent from 85% of her income leaves nothing for the creditor to collect.

If Meg shows copies of her heat bill and rent payment to the judge, the judge will not order any money to be taken out of Meg’s paycheck to pay the creditor.

What should I bring to court with me to show I need money to pay for my expenses?

You can bring:

  • Rent receipts,
  • Grocery store/food receipts,
  • Utility bills (heat, water, gas), and
  • Bank statements.
How do I keep creditors away from my protected income?

If some or all of your income is exempt, do these things to keep it protected from creditors:

  • Keep it in a bank account separate from your income that is not protected. If you have direct deposit set up, it helps to only have exempt income direct deposits go to this account. This helps make it clear that the creditor can’t take the protected money. It also lets you easily show the court that the account holds only protected income.
  • Write a letter to the bank. Make sure they know that account holds only protected income. Once you write to them, the bank should not freeze the account, even if your creditor gets a judgment against you. You can use this sample letter to write to your bank about exempt accounts (Word document). 
What items and property are protected from collection?
For Example

Carol has a car worth $10,000.  She does not have a car loan. The exemption amount for cars is $7,500. A creditor took her to court and got a judgment against her for $4,000. The creditor can take the car, sell it for $10,000 and give Carol $7,500, her exemption amount. The creditor keeps $2,500 to go towards paying off her debt. Carol can use the $7,500 to buy a new car and her debt is down to $1,500.

After a creditor gets a judgment against you, they can sell some of your stuff to pay off the debt you owe. Usually, creditors are only interested in your personal belongings if you have something that is worth a lot of money. But, there are rules about some property that help protect it from creditors.

Many things are protected up to a certain amount of money. This amount is an exemption amount set by law. If an item is worth less than the exemption amount, the creditor can’t take the item to pay the debt.  

But, if the item is worth more than the exemption amount, then the creditor might be able to take the item, sell it and keep any money that is over the protected amount. You would get the exemption amount in cash.

Exemption amounts for personal items (October 2023)
ItemCurrent Exemption
Stock in trade$5,000
Fishing equipment$1,500
Sewing machine$300
One computer & one TVNo dollar limit stated
Cash or savings$2,500 on any day
Car$7,500 wholesale
$15,000 for disabled or elderly
Personal property$1,000 to $6,000
Bank account (trustee process)$2,500
What if all my income and property is protected from collection?

If all of your income or assets are protected from most creditors, you are “collection-proof.” Another term you might hear is “judgment proof” or "execution proof."

All of these terms mean that most creditors can’t take, “seize,” or “garnish” your protected income or property—no matter how much you owe. Garnishment is the word for creditors taking money directly out of your paycheck or your bank account.

Only a priority creditor can take exempt income or property. Priority creditors include those collecting money you owe to:

  • the government (like taxes),
  • child support,
  • alimony, or
  • fines or restitution in criminal cases.


If your debts are related to taxes or child support, your income and property are probably not protected.  

If you are collection-proof, write a letter to the debt collector using the collection-proof letter template. This letter tells collectors it is not worth taking you to court. The letter also reminds the debt collector to not harass you.

Never ignore a lawsuit or court appearance notice just because you have no money or assets! If you ignore a lawsuit, the judge doesn’t know you have protected income and might let the creditor take your money, even if they aren’t supposed to.

Agreements when you don’t have money to pay the debt

Even if you are collection-proof, the creditor and judge will probably ask you again and again if you can pay anything toward the debt. They will probably also ask if you are willing to enter into a repayment plan.

A repayment plan is an agreement with the creditor that you will pay back the debt by paying a set amount every month. The repayment plan may be part of a court order called an “agreement for judgment.”


Only agree to a repayment plan if you think you can really handle it. If you don’t agree with the amount stated or the monthly payment is too much, don’t agree to a repayment plan.

If you are collection-proof, the court can’t order you to pay back the debt using your protected income. But if you agree in a repayment plan to pay a sum out of the protected income, the court can make you pay from your protected income. You must tell the judge that you have collection-proof income before you enter a repayment plan.

If the agreement is made into a court order and you don’t pay back the amount you agreed to pay, you could be in violation of the court order.

Am I collection-proof if I am over 60 or disabled?

If you are:

  • over 60 or “handicapped,” and
  • have only exempt income and property,

then, by law the court has to:

  • dismiss the case against you and
  • suspend the order so that you don’t have to go back to court to show you can’t pay the debt.

The court counts you as “handicapped” if:

  • you have a physical or mental problem. The problem must severely limit you or prevent you from participating in at least one major life area, or
  • you get state or federal disability benefits.

Show the judge proof

If you are handicapped or over 60, bring proof to show the judge. This could be a disability medical letter from your doctor or your benefit verification letter. You may also want to send the proof to the Plaintiff’s lawyer. The Plaintiff (creditor or debt collector) may agree to dismiss the case so you don’t have to go to court.

If the Plaintiff agrees to dismiss the case, call the court to make sure the hearing is canceled before you decide not to go. Don’t miss your hearing.


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