The answer is both yes and no. Let us explain.

First, there is no special federal protection for bank account garnishment for the Child Tax Credit payments. [These payments began on July 15, 2021.] The third stimulus payment and the Child Tax Credit payments were approved during the March 2021 legislation. These did not include any protections from garnishment during this approval. 

Then, in some instances, the Child Tax credit may be protected through your bank. A child tax credit deposited into a bank account may be protected from garnishment. The money, once frozen, will not be turned over to the judgment creditor. But it would be best if you acted fast to contest the garnishment.  In certain instances, federal protections will prevent the funds from being frozen, even if only briefly.

Lastly, you must file an objection to the writ of garnishment within 20 days of being served. If you don't, then the funds will be turned over to the judgment creditor. An account holder believing that the funds should not be garnished must persuade a court. They must convince them that frozen amounts in the bank account are exempt from being taken. They must also convince them that the funds should not be turned over to the judgment creditor. Instead, the funds should be unfrozen and released to the account holder.

Contact the Center for Arkansas Legal Services for assistance if you receive a writ of garnishment. The sooner you act, the better. You can apply online or call our Helpline at 501-376-3423, Monday-Friday, 9-11 am and 1-4 pm.

AUTHOR: CECILLE DOAN, STAFF ATTORNEY FOR THE CENTER FOR ARKANSAS LEGAL SERVICES