EIPA and Exempt Bank Balances in New York: What Creditors Cannot Touch

What the EIPA Protects

The Exempt Income Protection Act is the single biggest obstacle judgment creditors face when trying to levy a debtor's bank account in New York. Before you serve a restraining notice, you need to understand exactly what it shields — because targeting an account that falls below the EIPA floor wastes your time and filing fees.

The EIPA creates two layers of automatic protection that banks enforce without any action from the debtor.

Layer 1: The Minimum Wage Floor

Banks must protect a baseline cash balance equal to 240 times the applicable state hourly minimum wage. As of 2026:

If the debtor's account balance is at or below this threshold when the bank receives your restraining notice, the bank returns the notice marked "unsatisfied." The account is not frozen. No fees are charged to the debtor. The restraint simply fails.

These floors adjust automatically when the minimum wage increases. Beginning in 2027, New York's minimum wage is indexed to the regional Consumer Price Index, so the EIPA thresholds will rise every January 1 without legislative action.

Layer 2: Direct Deposit Benefit Protection

Accounts that receive direct-deposited government benefits get a separate, additional exemption. If any of the following were deposited within the past 45 days, the bank automatically shields up to $3,425 (adjusted periodically):

• Social Security or SSI
• Veterans' benefits
• Disability payments
• Unemployment Insurance
• Public assistance
• Railroad Retirement
• Federal employee pensions

This protection applies on top of the minimum wage floor when both apply, and it kicks in automatically — the bank's systems flag accounts receiving these deposits without the debtor needing to file paperwork.

The Exemption Claim Process

Even when funds above the EIPA floor are frozen, the debtor is not helpless. Here is the timeline from the debtor's side:

1. Bank receives your restraining notice and freezes non-exempt funds
2. Within 2 business days, bank mails the CPLR 5222-a Exemption Notice and Claim Form to the debtor
3. Debtor has 20 days from mailing to complete and return the Exemption Claim Form asserting that some or all frozen funds are exempt
4. If the debtor claims an exemption, you have 8 days to file a motion with the court challenging that claim
5. If you fail to file within 8 days, the bank must release all claimed funds back to the debtor

That 8-day response window catches creditors off guard. Miss it, and the bank hands everything back — even if the exemption claim was baseless.

What This Means for Your Collection Strategy

The EIPA does not make bank levies impossible. It makes them selective. Here is how to plan around it:

Target accounts with business deposits. The EIPA protections are calibrated around minimum-wage earners and benefit recipients. A debtor running a small business with commercial deposits flowing through a personal account will likely have balances well above the EIPA floor.

Check account balances first. An information subpoena directed to the bank can reveal the account balance before you spend money on a restraining notice and levy. If the balance is hovering near the EIPA floor, the levy will fail.

Consider wage garnishment instead. If the debtor's bank account is EIPA-protected but the debtor has a steady paycheck, an income execution may be more productive than a bank levy. Wage garnishment has its own caps (10% of gross, 25% of disposable, or the amount over 30× minimum wage — whichever is least), but it provides recurring payments rather than a one-time grab at a potentially empty account.

Know the regions. The $240 difference between the Downstate and Upstate thresholds ($4,080 vs. $3,840) matters when account balances are marginal. A debtor in Buffalo with $3,900 in their account has $60 above the floor. The same balance in Brooklyn is still protected.

Common EIPA Mistakes

Assuming the debtor must claim the exemption. The minimum wage floor is automatic — the bank enforces it without any claim from the debtor.

Serving a restraining notice without the CPLR 5222-a forms. The exemption notice and claim form must accompany every restraining notice served on a bank holding a natural person's account. Missing them makes the restraint defective.

Ignoring the 8-day objection deadline. If the debtor files an exemption claim and you do not respond within 8 days, the funds are released. Calendar this immediately upon receiving notice of a claim.

Our New York Judgment Collection Guide maps out the EIPA thresholds alongside a bank levy checklist so you know before serving whether the restraint is likely to reach any funds.

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