Last updated 25th Apr 2022
- Last Updated: Friday, 16 October 2020
- Payments associated with child or family support
- Student loans in default
- Unpaid taxes such as federal and state income taxes, or property taxes
- Court fines or monetary judgments associated with lawsuits
- Chapter 13 bankruptcies
Employers and WagesThe process involves a court order directing an employer to withhold money from the debtor's pay. That order will typically be sent to the employer's Human Resources department, and then delivered to the Payroll department to ensure the correct deductions are made from the employee's paycheck. The order will describe both the amount to be withheld each pay period, as well as the total amount of debt to be repaid. Only the issuer of an order has the legal authority to modify these payment terms and / or withdraw the order. Employers can charge nominal administrative fees for carrying out the order. However, under the law no employer can discharge an employee because their earnings have been subjected to garnishment. In other words, the employer does not have the right to terminate the employee just because they're indebted to another party. Court orders may contain a waiting period provision that allows the employee to request alternative arrangements. Once this waiting period has expired, deductions from each paycheck will begin.
Limits under the LawUnder federal law, there are limits to the amount of money that can be garnished in any given pay period. Generally, the limit is the lesser of:
- 25% of the employee's disposable pay, or
- The amount of disposable pay in excess of 30 times the federal minimum hourly wage, or
- 15% of the employee's disposable pay in cases involving student loans
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Garnishment CalculatorThis website has an online calculator that can be used to estimate the amount of wages withheld from a paycheck. That calculator provides results for both the U.S. Department of Labor calculation, as well as the method used by the U.S. Department of Education. A link to that tool is found here: Wage Garnishment Calculator. The calculations performed are limited to the 25% of disposable pay standard, and does not account for individual cases where bankruptcy or child support decisions apply.
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