What Is Wage Garnishment? How It Works and How To Protect Yourself
If you’re far behind on debt payments, you could face wage garnishment. Wage garnishment is a legal process that allows your creditor to take out what you owe directly from your paycheck.
It is stressful losing part of your wages, but learning more about the garnishment process (and what you can do about it) can help.
Key takeaways
- In most cases, your creditor must sue you before it can garnish your wages.
- As of this writing, if your weekly disposable earnings are $217.50 or less, your wages can’t be garnished over credit cards and personal loans. Disposable earnings are what’s left after legally required deductions.
- It’s possible to stop wage garnishment by claiming exemptions, filing for bankruptcy or negotiating with creditors.
- Wage garnishments are complicated and subject to state and federal law. You may want to speak with a lawyer.
What is wage garnishment?
Wage garnishment legally lets creditors take part of your check to pay for your defaulted debt. How much the creditor can garnish depends on the type of debt you owe and how much disposable earnings you have (more on that later).
In some cases, the creditor can take money out of your bank account. This is called a bank account garnishment or bank levy. While federal laws limit how much of your wages can be taken, there’s no federally mandated limit to how much can be garnished from your bank account. Limits on bank garnishments vary by state.
If the court grants a bank levy against you, your bank will freeze your account. While your account is frozen, the bank will review how much money is allowed to be garnished.
Your creditor usually won’t notify you before it freezes your account. Your bank must notify you, but by the time you get the notification, your account will probably already be frozen.
Are all wages garnishable?
Not all wages are garnishable.
To make sure that you have enough money to get by, debt collectors can only garnish a percentage of your disposable earnings per pay period. Your disposable earnings are what’s left after mandatory deductions, like taxes and Social Security.
You can use a wage garnishment calculator to get an idea of how much of your paycheck is considered disposable earnings.
In addition, federal benefits you’ve already received (like Social Security and veterans’ benefits) are typically not garnishable — but only if you get them by direct deposit. Your benefits may also be garnished for back child support, unpaid taxes and unpaid federal student loans.
How wage garnishments work
- Your creditor sues you for your debt. Usually, you must be sued by debt collectors before you can be garnished, with some exceptions for government agencies. (For instance, if you have unpaid taxes, the IRS can garnish your wages without suing you — but it does have to give you prior notice.)
- The court issues a judgment against you. If you ignore your debt lawsuit or don’t work out a payment plan with your creditor, the court will likely place a money judgment against you. A money judgment is a court order that lets your creditor take steps to recover what you owe.
- Your creditor petitions the court for a wage garnishment order. If you ignore your judgment and fail to pay your debt, your creditor will ask the court to issue a wage garnishment order.
- The court sends a notice of garnishment to your employer. Once the court approves the wage garnishment order, it’ll send the order to your employer. Your employer will then calculate how much to withhold from your check, based on your disposable income.
- The wage garnishment begins. Typically, your employer must start garnishing your wages as soon as the court notifies them. Your employer will send the garnishment directly to the court or debt collection agency, and the garnishment will generally continue until the judgment is paid in full.
Wage garnishment protections and limits
You have certain wage garnishment protections through the federal government. Depending on where you live, you could be covered under state law, too.
Federal wage garnishment protections under the CCPA
The wage garnishment provisions of the Consumer Credit Protection Act (CCPA) apply nationwide to everyone who gets a paycheck, pension or retirement benefits. The CCPA can protect your job, and it limits how much of your wages can be garnished.
CCPA job protection
- Your employer can’t fire you because of one wage garnishment.
- Your employer can fire you because you have multiple garnishments with multiple creditors.
CCPA wage garnishment limits
The CCPA also restricts how much of your paycheck can be garnished for certain types of debt. However, these limits don’t apply to unpaid federal and state taxes and some bankruptcy court orders.
| Type of debt | Federal garnishment limit |
| Child support and alimony |
|
| Consumer debt (e.g., credit cards and personal loans ) | Whichever is less between
|
| Federal student loans |
|
For more information, please see the Department of Labor’s wage garnishment fact sheet.
State wage garnishment protections
Everyone who gets personal earnings is protected by the CCPA. In addition, some states take it a step further by offering their own protections. Whichever protection lets you keep more of your disposable earnings is the one that will apply.
For instance, North Carolina, Pennsylvania, South Carolina and Texas outlaw wage garnishments for consumer debts. Even more have a higher garnishment limit, allowing you to keep a larger chunk of your disposable earnings.
Wage garnishment laws vary state by state, so research yours for more information.
How to stop wage garnishment
You may have some options to stop wage garnishment.
- Talk to a lawyer: If your wages are being garnished or you have a bank levy, contact a lawyer. Between federal and state law, garnishments can be confusing. Most lawyers give free consultations. You can also look for low-cost legal aid in your area.
- File a claim of exemption: Some states allow exemptions for certain debtors. For instance, Florida law prevents wage garnishment if you are the head of a household, make less than $750 per week and have a dependent.
- Negotiate with creditors: In most states, creditors are required to notify you before wage garnishment begins — this notification is called a demand letter. If you get a demand letter, call your creditor and see if they’re open to settle for a lower amount or if you can work out a payment plan.
- Challenge the garnishment: If you think your earnings are exempt, challenge your wage garnishment. Instructions on how to challenge (or object to) the garnishment should be included in your demand letter. You could only have a few days to challenge your garnishment, so act fast.
- Consider credit counseling: Credit counseling is a good option if you’re ready to revamp your spending habits. Here, a professional can review your budget, and could even attempt to negotiate with your creditors or develop a debt management plan for you.
- Hire a debt relief company: You could pay a debt relief company to negotiate on your behalf. However, there’s no guarantee that your creditor will be willing to work with the company, and debt relief companies can charge expensive fees.
- File for bankruptcy: Filing for bankruptcy can stop wage garnishment, sometimes temporarily and sometimes permanently. Bankruptcy is complicated and not a decision to take lightly — but it could be a much-needed lifeline. Before filing, talk to a lawyer.