You work hard for your money and those paychecks are all-too-important, especially when you are struggling financially. So what happens when your debts cause a wage garnishment? Do you have any rights? Let’s explore closer what a wage garnishment means to your overall financial wellbeing.
What are Wage Garnishments?
A wage garnishment is when a court issues an order obligating your employer to withhold a certain amount of your paycheck and send it directly to the person or institution to whom you owe money until your debt is paid off. This could happen if you owe child support, student loans, or back taxes, credit card debt or a court judgment has been entered against you. Your employer must inform you of the court decision along with where the payments will be sent. They must also tell you where you can protest again this action.
Beyond informing you of this action there are other rights that the debtor has when it comes to wage garnishments. These include:
- Federal laws place limits on how much judgment creditors can take from your paycheck. The amount that can be garnished is limited to 25% of your disposable earnings (what’s left after mandatory deductions) or the amount by which your weekly wages exceed 30 times the minimum wage, whichever is lower.
- Unless the employee owes child support, back taxes, or student loans, there must be a court order before wage garnishment can commence.
- Debtors can go to court and petition against these garnishments by showing evidence that you need your paycheck to pay your expense or that you have exemptions.
- There are different rules depending upon the type of debt you owe. For example, in the case of child support, up to 50% of your disposable earnings may be garnished to pay child support if you are currently supporting a spouse or a child who isn’t the subject of the order. In the case of a student loan, an employer can garnish up to 15%. And if your debt is to the federal government in the form of back taxes owed, large chunks of your debt can be taken out of your paycheck until the debt is paid off.
Things are not hopeless when it comes to wage garnishment. You can petition the courts to lower the amount. In addition, creditors, like credit card companies will not be told of the garnishment. This means your credit score will not be impacted.
Do you have questions about wage garnishment? Contact the Law Office of Barry R. Levine today by phone at 978-922-8440, or visit our website at http://levinelawoffice.com.