Wage garnishment is a way that private lendors, such as credit card companies and other lendors of unsecured debt, can receive reimbursement for a debt that you legally owe. However, there are other circumstances in which your wages can be garnished by a governmental agency. If your wages are subject to garnishment, a frequently asked question is how long the garnishment will last. Ultimately, the length of time that it takes to garnish your wages depends on three things: your weekly disposable earnings, the amount of your debt and your state's garnishment laws.
Federal Wage Exemption
Title III of the federal Consumer Credit Protection Act (CCPA) protects a certain percentage of your wages from private creditor garnishment. Typically, such a garnishment takes place after the creditor receives a judgment against you in a court of law. By law, 75 percent of your weekly disposable earnings are protected from garnishment. Alternately, a weekly sum 30 times the federal minimum wage is protected from garnishment; this provision protects part-time, low-income workers from wage garnishment entirely. There are other laws that protect low-income workers from prohibitive amounts of garnishment. (To see what portion of your income is subject to garnishment, see Resources).
Calculating Your Disposable Income
Disposable income is what you have left in your paycheck after all legal deductions have been taken out. Such deductions would include federal, state and local taxes; Social Security; and unemployment insurance. However, if you're paying union dues or health insurance or have a portion of your paycheck voluntarily set aside for retirement, these could not be deducted from the amount of your weekly disposable income. Generally, tips are not considered disposable income; however, any nonwage income, such as bonuses or commissions and even pension or retirement benefits (with the exception of Social Security benefits), can be subject to wage garnishment. Knowing the amount of your disposable earnings that are subject to wage garnishment can give you a better idea of how long a garnishment can last.
Private Lendor Garnishment
Your state's laws must conform to federal law, although certain states may exempt a higher portion of your income. For example, a state may permit a larger percentage of your income to be exempt from garnishment, leaving a creditor with only 15 percent of your wages to garnish. In this case, it may take longer for a creditor to be reimbursed for a debt. A creditor must obtain a court order to garnish your wages--this can be a continuous garnishment in which your paycheck is garnished until the debt is paid, or it can be noncontinuous, enduring for a number of days, weeks or months, as set by state law, after which a creditor must obtain another court order.
Your State's Laws
Many debtors assume that because federal law allows private creditors to garnish wages, their paycheck is in danger of being garnished; however, this is not always true. States are not required to allow private creditors to garnish wages, and in fact, some have stringent laws that protect your paycheck, such as Texas, South Carolina and Pennsylvania. Others permit you to claim additional exemptions that essentially make it futile for a creditor to attempt garnishment. When it comes to wage garnishment, always know your state's laws (see Resources).
Other Wage Garnishments
Federal law differentiates wage garnishment by private lendors and other forms of debt, such as unpaid taxes and delinquent student loans. Also, there are different garnishment laws in place should you be in arrears in alimony and child support. Title III allows up to 50 percent of your disposable earnings to be garnished if you are currently supporting another family but up to 60 percent if you are not. If you're more than 12 weeks in arrears, the amount that can be garnished goes up to 65 percent.
How Long Will Garnishment Last?
If your debt is not for unpaid taxes, a defaulted student loan, alimony, child support or any debt not owed to a private lendor, first consult your state's laws to make sure wage garnishment is permitted. If your state's laws conform with federal wage garnishment laws, 25 percent of your weekly disposable earnings can be garnished. Determine the amount of the debt for which the creditor seeks reimbursement and calculate how long it will take to pay off the debt based on the amount that will be deducted from your paycheck.