Home » Federal wage garnishment laws explained for consumers, creditors and collectors.

Federal wage garnishment laws explained for consumers, creditors and collectors.

State Garnishment Laws

Learn the federal wage garnishment law and your state’s wage garnishment laws

The best way to prevent wage garnishment actions is to be pro-active when dealing with creditors and debt collectors and to know wage garnishment laws. Federal and state garnishment laws can be used to stop, start and avoid wage garnishment actions by consumers, creditors and collectors. Wage garnishment (except student loans) is only possible after creditors and collectors obtain a court ordered judgment for such action. The garnishment action, otherwise known as “administrative wage garnishment” can be up to 25 percent of your disposable income.

Wage Garnishment rules taken directly from federal law; Title 15, Chapter 41, Subchapter II.

  1. Restriction on garnishments – Section 1673
  2. Restriction on discharge from employment – Section 1674
  3. Exemption for State-regulated garnishments – Section 1675
  4. Enforcement by Secretary of Labor – Section 1676
  5. Effect on State laws – Section 1677
  6. Garnishment of Social Security and Disability Benefits

1. Sec. 1673: Restriction on garnishment

(a) Maximum allowable garnishment

Except as provided in subsection (b) of this section and in section 1675 of this title, the maximum part of the aggregate disposable earnings of an individual for any work week which is subjected to garnishment may not exceed

(1) 25 per cent of disposable earnings for that week, or

(2) the amount by which disposable earnings for that week exceed thirty times the Federal minimum hourly wage prescribed by section 206(a)(1) of title 29 in effect at the time the earnings are payable, whichever is less.

In the case of earnings for any pay period other than a week, the Secretary of Labor shall by regulation prescribe a multiple of the Federal minimum hourly wage equivalent in effect to that set forth in paragraph (2).

(b) Exceptions

(1) The restrictions of subsection (a) of this section do not apply in the case of

(A) any order for the support of any person issued by a court of competent jurisdiction or in accordance with an administrative procedure, which is established by State law, which affords substantial due process, and which is subject to judicial review.

(B) any order of any court of the United States having jurisdiction over cases under chapter 13 of title 11.

(C) any debt due for any State or Federal tax.

(2) The maximum part of the aggregate disposable earnings of an individual for any workweek which is subject to garnishment to enforce any order for the support of any person shall not exceed –

(A) where such individual is supporting his spouse or dependent child (other than a spouse or child with respect to whose support such order is used), 50 per cent of such individual’s disposable earnings for that week; and

(B) where such individual is not supporting such a spouse or dependent child described in clause (A), 60 per cent of such individual’s disposable earnings for that week; except that, with respect to the disposable earnings of any individual for any workweek, the 50 per cent specified in clause (A) shall be deemed to be 55 per cent and the 60 per cent specified in clause (B) shall be deemed to be 65 per cent, if and to the extent that such earnings are subject to garnishment to enforce a support order with respect to a period which is prior to the twelve-week period which ends with the beginning of such workweek.

(c) Execution or enforcement of garnishment order or process prohibited

No court of the United States or any State, and no State (or officer or agency thereof), may make, execute, or enforce any order or process in violation of this section

2. Sec. 1674: Restriction on discharge from employment by reason of garnishment

(a) Termination of employment :

No employer may discharge any employee by reason of the fact that his earnings have been subjected to garnishment for any one indebtedness.

(b) Penalties :

Whoever willfully violates subsection (a) of this section shall be fined not more than $1,000, or imprisoned not more than one year, or both

3. Sec. 1675. – Exemption for State-regulated garnishments

The Secretary of Labor may by regulation exempt from the provisions of section 1673(a) and (b)(2) of this title garnishments issued under the laws of any State if he determines that the laws of that State provide restrictions on garnishment which are substantially similar to those provided in section 1673(a) and (b)(2) of this title

4. Sec. 1676: Enforcement by Secretary of Labor

The Secretary of Labor, acting through the Wage and Hour Division of the Department of Labor, shall enforce the provisions of this subchapter

5. Sec. 1677. – Effect on State laws

This subchapter does not annul, alter, or affect, or exempt any person from complying with, the laws of any State

(1) prohibiting garnishments or providing for more limited garnishment than are allowed under this subchapter, or

(2) prohibiting the discharge of any employee by reason of the fact that his earnings have been subjected to garnishment for more than one indebtedness

Social Security and Garnishment:
Generally, Social Security benefits are exempt from execution, levy, attachment, garnishment, or other legal process, or from the operation of any bankruptcy or insolvency law. The exceptions are that benefits are subject:

(1) to the authority of the Secretary of the Treasury to make levies for the collection of delinquent Federal taxes and under certain circumstances delinquent child support payments; and

(2) to garnishment or similar legal process brought by an individual to enforce a child support or alimony obligation.

Section 207 of the Social Security Act provides: “The right of any person to any future payment under this title shall not be transferable or assignable, at law or in equity, and none of the moneys paid or payable or rights existing under this title shall be subject to execution, levy, attachment, garnishment, or other legal process, or to the operation of any bankruptcy or insolvency law.”

However, section 6331 of the Internal Revenue Code of 1954 (26 U.S.C. 6331) which was enacted into law on August 16, 1954, after the enactment of section 207, gives the Secretary of the Treasury the right to levy or seize for collection of delinquent Federal taxes, property, rights to property, whether real or personal, tangible, or intangible and the right to make successive levies and seizures until the amount due, together with all expenses, is fully paid. References: SSR 79-4: SECTIONS 207, 452(b), 459 and 462(f) (42 U.S.C. 407, 652(b), 659 and 662(f)) LEVY AND GARNISHMENT OF BENEFITS 20 CFR 404.970 SSR 79-4 See the code here

11 comments

  1. I lost a judgement and my bank account was seized by the collector. They took the funds in the account and overdrew the account. I did not receive any prior notification from the collector other than saying that I had 30 days from receipt of the letter to inform them whether the debt was valid or not. What recourse do I have?

  2. I made agranment with the loan after default, because I wast being gunished $140 every month. I’m disabled so I made a lesser payment arangment in Feb
    2015. They did not fix it when I got my payment in March they took out agin said I needed to wait 30- 45 day I said ok. In April I got taken again they said you have a couple more days so definitely by May again I said ok. Now here come mays and I am being told the The process didn’t start till march 26 o 45 day from that Date so basically the run around and there’s nothing I can due about it right?

    • Please give us a call we should look into this issue a little more, they may be violating your fair debt rights by taking more than the amount of the agreement. Call us today for a free case review, if you have a claim we can help at NO COST, let’s make the debt collector pay you! 888-595-9111.

  3. I have a garnishment from 5 years ago delivered to my job. I checked my credit report and the lender has lied saying they received a payment from me in April 2015. I didnt receive the garnishment papers until may . I havent corresponded are paid them anything since 2010.

  4. Just recieved wage garnish papers for a judgement against me from 2005… Judgement plus a extra 7% interest fee from 2005. My question is if i have dependant children. can they take the max of 25% and is that begore or after taxes?

  5. Hi. I’m a federal employee – civilian GS for the USCG. I was garnished for a travel advance that I am not disputing because my travel orders were cancelled at the last minute. My problem is that I was not issued a letter of indebtedness nor did I recieve a notice of garnishment before the funds were removed from my paycheck. I talked to the Coast Guard Finance Center about it and for the second time now, all I get is “My Bad”. Seems to me that this is in violation of wage garnishment laws, but the CG does not seem to care.

  6. I am being garnished from my paychecks, when I logged into my bank account I discovered that they had taken all of the money from there as well. I now have nothing to support my 4 kids on…….

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