Social Security Benefits Not Subject to Division! Yikes!Federal law prohibits the direct division of social security benefits from a spouse in property division hearings. Social security benefits, according to the law, are not ‘transferable or assignable at law or in equity, and none of the monies paid or payable or rights existing under the Social Security Act shall be subject to execution, garnishment or other legal process…” [42 U.S.C. §407].

The Delaware Supreme Court has upheld this premise in Stanley vs. Stanley [956 A.2d 1].  In Stanley, the Family Court equitably divided the parties’ assets. However, the husband decided to apply for SSDI after the property division had been resolved. He obtained a monthly payment that exceeded his share of his pension, and a significant lump-sum payment. This caused the wife’s monthly payment under the same pension to be drastically reduced, and she then owed significant money to the pension plan.

As the Delaware Supreme Court stated, “in short, the husband helped himself at his wife’s expense, and by doing so, he vitiated the parties’ property division agreement.”

The Delaware Supreme Court did, however, revise the Family Court order in one aspect… and that was not to include any social security benefits received by the husband, either monthly or lump-sum, in its direct division.

Click here to read the Stanley case.

In a recent case I had, the wife had assisted the husband in filing for social security benefits years ago. She had filled everything out, mailed it in, followed up with the SSA, etc. The husband did nothing but sign. They divorced. He received a very significant lump-sum payment for retroactive months, to which she could not collect a penny.

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Article provided by Tabatha Castro, The Castro Firm

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