How can a collection agency garnish my wages

For workers ages 35 to 44, the number hit The top reasons were child support; consumer debts and student loans ; and tax levies. In wage garnishment , creditors can legally require your employer to hand over part of your earnings to pay off your debts. In nonwage garnishment , commonly referred to as a bank levy, creditors can tap into your bank account. Garnishment often happens when a creditor sues you for nonpayment of a debt and wins in court.

Sometimes, though, a creditor can force garnishment without a court order, for instance, if you owe child support, back taxes or a balance on federal student loans. The court will send notices to you and your bank or employer, and the garnishment will begin in five to 30 business days, depending on your creditor and state.

The garnishment continues until the debt, potentially including court fees and interest, is paid. Percent of weekly disposable income that can be taken. Credit card and medical bills, personal loans and most other consumer debts. The Internal Revenue Service will determine the amount taken based on standard deductions and the number of dependents you have. Note: State laws around garnishment vary greatly. Your state may have additional protections that shelter more of your income or bank account balance, or it may offer exemptions for situations like being head of household with dependent children.

In most cases, debtors must learn about exemptions and ask for them on their own. Nonwage garnishment, which is less common, is generally less regulated and has fewer restrictions for creditors.

You have to be legally notified of the garnishment. Some forms of income, such as Social Security and veterans benefits, are exempt from garnishment as income.

However, they could be subject to seizure once in your bank account. First, carefully read the judgment to verify that all of the information is accurate. If it is, consider how much money will be taken and what it will mean for your financial situation. All child support orders automatically include a wage withholding order.

If you're ordered to pay child support, your wages can be garnished without additional court action. A wage garnishment order can also be obtained against you if you fall behind on your child support or alimony obligations. Wage garnishment limits for child support and alimony are much higher than for other types of debts.

If you owe back taxes to the IRS , the federal government can garnish your wages without having to get a court order against you. How much the IRS can garnish depends on the number of dependents you have and your deduction amounts. State and local governments can also garnish your wages to collect unpaid taxes. But the amount they can garnish and procedures they must follow depend on state law.

To find out more about wage garnishment limits for unpaid state and local taxes in your area, contact your state labor department. If you're behind on your federal student loan payments , the U. Department of Education or any entity collecting on its behalf can garnish your wages without a court order, called an "administrative garnishment. It can be challenging to make ends meet when a wage garnishment reduces your paycheck.

The good news is that you have options. For instance, you might be able to:. The information provided on this site is not legal advice, does not constitute a lawyer referral service, and no attorney-client or confidential relationship is or will be formed by use of the site. The attorney listings on this site are paid attorney advertising. In some states, the information on this website may be considered a lawyer referral service. Please reference the Terms of Use and the Supplemental Terms for specific information related to your state.

Grow Your Legal Practice. Meet the Editors. Your employer will then withhold a portion of your wages each pay period and send that money directly to your creditor. The garnishment will end when you have paid the entire judgment or you reach a separate settlement on the debt with the creditor.

This process works similarly for creditors on student loans, child support, and back taxes. Federal law limits the amount that can be garnished from your paycheck each week or month. The amounts vary depending on whether the creditor is a judgment creditor, student loan collector, taxing authority, or collector of child support.

State laws also limit garnishment amounts. However, states cannot allow creditors to take more than is allowed under federal law. That is, they can offer more protection to debtors, but not less. For the specific federal garnishment limits, see Limits on Wage Garnishment Amounts.

In all types of wage garnishments, you may object to the garnishment or the amount of money that is being garnished. To do so, you must file a Claim of Exemption with the court that issued the underlying garnishment. Under federal law, your employer cannot fire you because it receives a garnishment for one debt, or two or more garnishments from the same creditor.

If, however, you have more than one garnishment from different creditors, federal law does not protect you. Some states offer more employment protection when it comes to garnishments. The information provided on this site is not legal advice, does not constitute a lawyer referral service, and no attorney-client or confidential relationship is or will be formed by use of the site.

The attorney listings on this site are paid attorney advertising.