O.J. Simpson was recently granted release via parole from a Nevada prison. He still owes a $33.5 million civil judgment in the wrongful death case involving Nicole Brown and Ronald Goldman. The judgment was renewed in 2015 for an additional ten-year period. What property and assets are shielded from such civil judgments? Some states allow those awarded a judgment to garnish the earnings of individuals. Simpson maintains residency in Florida, which limits garnishments to 25% of earnings. The state also has strong “homestead” laws that protect one's primary home from creditor collection. Simpson's income is largely based on an estimated $20,000 monthly pension from the National Football League.
The Federal Trade Commission (FTC) is the agency for consumer protection that regulates which assets are subject to garnishment from creditors. Typically, federal funds are not eligible for garnishment, which may include:
- Social Security
- Supplemental Security Income
- Veteran benefits
- Federal or civil service benefits
- U.S. military benefits
- Retirement plans for railroad workers.
There are debts that are not shielded from garnishment. Examples include outstanding tax debt, federal student loan debt, or unpaid child support or alimony. Laws and enforcement may vary significantly based on individual state laws. Those owed a debt may pursue garnishment through a state court. Creditors may be approved to “freeze” funds in a banking institution. A freeze prevents the account holder from accessing the account funds. A hearing before a judge would be required to determine the source of the funds, which might only be kept from the creditor if deemed federally protected.
Colorado Asset Protection Law
The state allows protection for some of the following types of assets and income:
- Clothing & apparel under $2,000 in value;
- Jewelry worth up to $2,500;
- Personal items up to $2,000 in value;
- Sites owned for burial (cemetery);
- General household goods up to a $3,000 limit;
- Compensation for military service;
- Personal military equipment owned by National Guard members;
- Supplies, equipment, tools and materials associated with your primary occupation up to $30,000;
- Up to two vehicles up to $7,500 in value;
- Library collections for professional occupations, such as clergy;
- Life insurance policies that have been owned for 48 months up to a $100,000 in value;
- Funds from insurance claims to recoup damages from theft, fire, etc.;
- Awards for damages in personal injury claims;
- Tax refunds associated with earned income or child tax credits;
- Medical aids prescribed by a doctor;
- Retirement or pension assets;
- Plans that qualify under the Employee Retirement Income Security Act of 1974; and
- Disability benefits up to a $4,000 monthly limit.
Lawyer for Wrongful Death Cases
Colorado law allows those who are injured from the negligent actions of a party to seek monetary compensation in civil actions for hardship and losses. The Law Firm of Jeremy Rosenthal has spent years working toward justice on behalf of clients by obtaining significant verdicts and settlements. For a free consultation, contact our Denver office today at (303) 825-2223.