How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask xavierjd Your Own Question

xavierjd
xavierjd, Attorney
Category: Legal
Satisfied Customers: 3400
Experience:  20+ yrs in criminal, landlord/tenant, family, & small claims
Type Your Legal Question Here...
xavierjd is online now
A new question is answered every 9 seconds

There is a judgement against me in Texas. I am now being paid

Customer Question

There is a judgement against me in Texas. I am now being paid in cash as an independant contractor. Can I keep the money safe on a pre-paid debit card, in a foreign bank, and if I wanted to invest money, even in a U.S. company, how would I do that? I need to keep the money safe until I settle on the judgement.
Submitted: 1 year ago.
Category: Legal
Expert:  xavierjd replied 1 year ago.
Thanks for using JustAnswer.com It will be my pleasure to assist you today.

How much is the judgment that is against you?

Have you entered into any type of payment plan?

Do you get 1099'd at the end of the year for tax purposes?

Thanks
Customer: replied 1 year ago.

The amount is $8693.98, and no payment plan has been entered. I am currently not 1099'd, but I might be in the future.

Expert:  xavierjd replied 1 year ago.
Hi,

I APOLOGIZE SO MUCH for the delay. My main computer absolutely froze up. I am now using a notebook.

I will recreate my answer to you and you will have it shortly.

Thank you SO much for your patience.
Expert:  xavierjd replied 1 year ago.
Hi,

Texas is a state that is favorable to debtors when it comes to a creditor trying to collect a judgment. It is unconstitutional to garnish wages in Texas, and a person’s home and vehicles are usually beyond reach. Unless a judgment debtor has a going business with valuable inventory or cash flow, rental property, or cash in the bank, collecting on a judgment is going to be problematic.

Sec. 41.001(5)(c) that “The homestead claimant’s proceeds of a sale of a homestead are not subject to seizure for a creditor’s claim for six months after the date of sale.” This expressly permits homestead protections to be rolled over from one homestead to the next

Certain personal property is also exempt under Chapter 42 of the Property Code. Personal property valued at $60,000 for a family or $30,000 for a single adult (exclusive of liens) is exempt from garnishment, attachment, execution or other seizure so long as it is on the following list:

 

(1) home furnishings, including family heirlooms;
(2) provisions for consumption;
(3) farming or ranching vehicles and implements;
(4) tools, equipment, books, and apparatus, including boats and motor vehicles used in a trade or profession;
(5) wearing apparel;
(6) jewelry not to exceed 25 percent of the aggregate limitations prescribed by Section 42.001(a);
(7) two firearms;
(8) athletic and sporting equipment, including bicycles;
(9) a two-wheeled, three-wheeled, or four-wheeled, motor vehicle for each member of a family or single adult who holds a driver’s license or who does not hold a driver’s license but who relies on another person to operate the vehicle for the benefit of the non licensed person;
(10) the following animals and forage on hand for their consumption:
(A) Two horses, mules, or donkeys and a saddle, blanket, and bridle for each;
(B) 12 head of cattle;
(C) 60 head of other types of livestock; and
(D) 120 fowl; and
(11) household pets.

Retirement plans (IRA’s and 401k’s) are exempted under Sec. 42.0021 so long as contributions do not exceed the amount that is deductible under current law. Rollover proceeds are exempt for sixty days.

A creditor CAN try to collect the judgment by requesting that you answer interrogatories (written questions that you must answer under oath) and/or a deposition ( an oral question and answer performed by the creditor with a court reporter present. Your answers are under oath.

But, if you don't have anything that can be collected, then the judgment can't be collected.

It is normal that the coeditor for the creditor to request an abstract of judgment from the clerk and then file the abstract in the real property records (judgment records and real property records are often found in different computers). It stays on file for 10 years, but may be re-filed. Filing such an abstract puts the public on notice that the judgment exists and attaches to real property of the debtor. Therefore, if you try to sell your property, the lien for the amount of the debt may have to be paid to clear the title.

And, until you pay the judgment, a "negative" will appear on your credit reports. Once the judgment is paid, then the creditor needs to file a Satisfaction of Judgment with the court. You should be sent a copy of the Satisfaction. Then, you should make a copy and send it to the credit reporting agencies so that the judgment will show that it is paid. You should follow up with the credit reporting agencies to make sure that the reports reflect that you paid the judgment.

But....in the end, if you don't have a bank account, then monies can't be taken from it to pay the judgment. If your wages are put directly into a pre-paid credit card, your money should be protected. Remember, any wages CANNOT be garnished!

You always have the opportunity to contact an attorney who specializes in debtor/creditor law. You can discuss the specific facts of your case, evaluate your options and decide if you need to do anything different than you are doing now.

I hope you find this information useful.

If you are satisfied with my answer, PLEASE RATE IT AS EXCELLENT OR IN ANOTHER POSITIVE MANNER. If you have any follow up questions, please ask and I will assist you. Please do NOT rate my answer until you are satisfied.

Thanks for your business!

Xavierjd
Customer: replied 1 year ago.


My question: I want to store and use my money. How can I store money so that I can use it in the form of a card I can use for purchases, and to invest. Where can I store my money so that a debtor, bound to Texas and U.S. law, doesn't have access to it?

Expert:  xavierjd replied 1 year ago.
Hi Martha,

You can purchase a pre-paid credit card and add money to it as you need to. You can also invest money into an IRA, or 401k.

I don't know how much money that you want to "store," but I can't advise you to do anything illegal.

However, as I indicated in my previous answer, your wages can NOT be garnished, and the creditor can't come after any Social Security, or retirement accounts. You may wish to speak to a financial advisor to ensure that any investments that you wish to make cannot be garnished.

I hope you find this information useful.

If you are satisfied with my answer, PLEASE RATE IT AS EXCELLENT OR IN ANOTHER POSITIVE MANNER. If you have any follow up questions, please ask and I will assist you. Please do NOT rate my answer until you are satisfied.

Thanks for your business!

Xavierjd
Customer: replied 1 year ago.


OK so wages cannot be garnished, but what about income as an independent contractor which is reported by a 1099. Or what about student loan proceeds or pell grant money? Are these sources of income subject to the judgment?

Expert:  xavierjd replied 1 year ago.
Hi,

Even if you were to put your monies made as an independent contractor into an account, they are still considered wages. When you get a 1099 at the end of the year, you must pay your own taxes on the wages, rather than having your employer take them out of a check if you were an employee. So, even if you had a bank account, and the only monies deposited were your wages, the bank account can NOT be garnished. Remember, wages CANNOT be garnished to satisfy a judgment (except in cases of back child support or other domestic judgments, defaulted student loans, IRS taxes that are owed)

Texas, does not allow income to be garnished for most consumer debts and judgments. Although state laws may allow additional protections for debtors, federal law protects certain types of federal benefits from garnishment in all states. Among those benefits generally protected against garnishment are Social Security benefits, Veterans' benefits and federal educational assistance. That includes any refunds to you from pell grants.

Usually, after your expenses are deducted, the school deposits any left over balance into your bank account. So, I don't know how else a refund for any left over monies could be distributed to you. Again, if you open a bank account and can prove that the only monies deposited into the account are your wages (that end up being 1099'd) and any pell grant refund, then those monies can't be garnished for any type of consumer or other debts (except child support, federal student loans that have defaulted, IRS taxes owed, or any other domestic related support order)

Regarding proceeds from student loans that are private in nature (not federally backed), if you have left over monies, the law is less clear. It is possible (but not necessarily probable) that those monies could be used to pay off your judgment. Again, there are MANY exemptions to the collection of judgments in Texas (as I have described earlier). If you can fit the private loan proceeds into one of those categories, then the money can't be garnished.

You may wish to speak to a lawyer who specializes in debtor/creditor law. There is a minimal fee for a 1/2 hour consultation. You can show the lawyer all of your paperwork, including the judgment, and ensure that your monies are "judgment proof."

From your posts, it sounds like you are "judgment proof," BUT you may wish to confirm each individual grant/loan with the attorney.

Below is a link to the Texas Bar Association Attorney Referral Page.

http://www.texasbar.com/Content/NavigationMenu/ForThePublic/DoYouNeedaLawyer/Certified_Lawyer_Referral_Services/default.htm


I hope you find this information useful.

My goal is to provide you with excellent service! If you are satisfied with my answer, PLEASE RATE IT AS EXCELLENT OR IN ANOTHER POSITIVE MANNER. If you have any follow up questions, please ask and I will assist you so that you have a positive experience with JustAnswer.

Thanks for your business!

Xavierjd

Customer: replied 1 year ago.

I really need to know how i can invest the money and not have it seized. Do I need to prove that the invested money is from a student loan or wage and does that matter once it's invested? Can I invest through a foreign bank, such as Royal Bank of Canada or something off-shore? What is the best way to invest money and keep it safe from seizure? My question about pre-paid debit cards being safe was never addressed either.

Expert:  xavierjd replied 1 year ago.
Hi,

I cannot give you advice regarding investing and off shore bank accounts. Those may be illegal and considered fraudulent transfers to avoid paying a judgment. Moreover, if the creditor does interrogatories or requests a deposition of you, you are REQUIRED UNDER PENALTY OF PERJURY to answer any questions about ANY accounts you may have. While wages cannot be garnished, it is possible that investment accounts and/or dividends may be garnished.

Moreover, I did answer your question regarding pre-paid debit cards. So long as the monies being put into the card are ONLY from wages, then the account may NOT be garnished. You are safe to open a bank account if the only funds going into and being withdrawn are from your wages that will be 1099'd. Again, wages CANNOT be garnished. You must keep a good paper trail of what monies are put onto a debit card and where they came from. The same holds true if you open a bank account for purposes of putting only wages in and withdrawing only those wages.

Again, you may wish to contact a debtor/creditor attorney and/or a financial advisor to determine whether off shore accounts or investments are allowed. Also, retirement accounts (401k's, SARSEP (if you are a sole business person) or IRA's can't be seized. You may wish to speak to your accountant, financial advisor or creditor/debtor attorney regarding which of these investments are protected, and how much you may put into the accounts each year..

I hope you find this information useful.

My goal is to provide you with excellent service! If you are satisfied with my answer, PLEASE RATE IT AS EXCELLENT OR IN ANOTHER POSITIVE MANNER. If you have any follow up questions, please ask and I will assist you so that you have a positive experience with Just answer.

Thanks for your business!

Xavierjd
xavierjd, Attorney
Category: Legal
Satisfied Customers: 3400
Experience: 20+ yrs in criminal, landlord/tenant, family, & small claims
xavierjd and 10 other Legal Specialists are ready to help you
Expert:  xavierjd replied 1 year ago.
Hi Martha,

Thank you so much for the "good service" rating. I greatly appreciate it.

If you have future questions, you can specifically request me as the expert.

Thanks again,

Xavierjd

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • Mr. Kaplun clearly had an exceptional understanding of the issue and was able to explain it concisely. I would recommend JustAnswer to anyone. Great service that lives up to its promises! Gary B. Edmond, OK
< Last | Next >
  • Mr. Kaplun clearly had an exceptional understanding of the issue and was able to explain it concisely. I would recommend JustAnswer to anyone. Great service that lives up to its promises! Gary B. Edmond, OK
  • My Expert was fast and seemed to have the answer to my taser question at the tips of her fingers. Communication was excellent. I left feeling confident in her answer. Eric Redwood City, CA
  • I am very pleased with JustAnswer as a place to go for divorce or criminal law knowledge and insight. Michael Wichita, KS
  • PaulMJD helped me with questions I had regarding an urgent legal matter. His answers were excellent. Three H. Houston, TX
  • Anne was extremely helpful. Her information put me in the right direction for action that kept me legal, possible saving me a ton of money in the future. Thank you again, Anne!! Elaine Atlanta, GA
  • It worked great. I had the facts and I presented them to my ex-landlord and she folded and returned my deposit. The 50 bucks I spent with you solved my problem. Tony Apopka, FL
  • Not only did he answer my Michigan divorce question but was also able to help me out with it, too. I have since won my legal case on this matter and thank you so much for it. Lee Michigan
 
 
 

Meet The Experts:

 
 
 
  • Tina

    Lawyer

    Satisfied Customers:

    8436
    JD, BBA Over 25 years legal and business experience.
< Last | Next >
  • http://ww2.justanswer.com/uploads/MU/multistatelaw/2011-11-27_173951_Tinaglamourshotworkglow102011.64x64.jpg Tina's Avatar

    Tina

    Lawyer

    Satisfied Customers:

    8436
    JD, BBA Over 25 years legal and business experience.
  • http://ww2.justanswer.com/uploads/RA/ratioscripta/2012-6-13_2955_foto3.64x64.jpg Ely's Avatar

    Ely

    Counselor at Law

    Satisfied Customers:

    19941
    Private practice with focus on family, criminal, PI, consumer protection, and business consultation.
  • http://ww2.justanswer.com/uploads/FL/FLAandNYLawyer/2012-1-27_14349_3Fotolia25855429M.64x64.jpg FiveStarLaw's Avatar

    FiveStarLaw

    Attorney

    Satisfied Customers:

    8189
    25 years of experience helping people like you.
  • http://ww2.justanswer.com/uploads/jespoag/2008-12-17_222355_jessepic.jpg JPEsq's Avatar

    JPEsq

    Attorney

    Satisfied Customers:

    2132
    Experience as general attorney, in house counsel, SSDI, Family Law attorney, and law professor
  • http://ww2.justanswer.com/uploads/gsenmartin/2008-04-22_214950_me1.jpg Guillermo J. Senmartin, Esq.'s Avatar

    Guillermo J. Senmartin, Esq.

    Attorney

    Satisfied Customers:

    110
    7+ years of experience handling various legal matters.
  • http://ww2.justanswer.com/uploads/PA/PaulmoJD/2013-10-10_195858_JAImage.64x64.jpg Law Educator, Esq.'s Avatar

    Law Educator, Esq.

    Attorney

    Satisfied Customers:

    31621
    JA Mentor -Attorney Labor/employment, corporate, sports law, admiralty/maritime and civil rights law
  • http://ww2.justanswer.com/uploads/dkaplun/2009-05-17_173121_headshot_1_2.jpg Dimitry K., Esq.'s Avatar

    Dimitry K., Esq.

    Attorney

    Satisfied Customers:

    15975
    Multiple jurisdictions, specialize in business/contract disputes, estate creation and administration.