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Exempt Income Protection Act
I currently receive workers' compensation. The Exempt Income Protection Act in NY protects accounts with less than $2,500. What if I have more than $2,500 in exempt funds in the account? Can the creditors freeze the excess? If I had $5000 dollars in exempt funds in the account, can the creditors freeze the extra $2500 dollars?
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 We are not well-versed in New York State's Exempt Income Protection Act. However, research suggests that only the first $2,500 of your bank account consisting of exempt funds is immune from restraint. If your bank receives a debt collector's restraining order and the required accompanying documents, your bank must leave the first $2,500 unrestrained if it is aware that the funds are from an exempt income source, restrain the balance over $2,500, and mail you paperwork and instructions that you can use to request the release from restraint of your additional funds. For further clarification of your rights under the EIPA, contact a New York legal services attorney.
Published on BankingQuestions.com 7/30/09
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