Do you want to learn how to handle non-judgment garnishments? At Cherney Law Firm, LLC, we are ready to help you. Book a free consultation call with us today.
A Debtors Guide to Non-judgment Garnishments
Financial debt can be crippling. Most of us have experienced the dread of indebtedness and an inability to settle the debt. This can be due to many different reasons and circumstances.
Creditors have several tools they can use to recover the money owed. One of those methods is known as a garnishee against your salary or wage. This is also known as wage garnishment: when your employer withholds a certain sum from your paycheck to pay your creditors.
Some creditors can get an order to garnish your earnings without filing a lawsuit. These consist of:
- Those who you owe alimony or child support payments
- Federal student loan providers
- The United States federal government or federal agencies for any unpaid taxes
- Administrative Wage Garnishments (AWG)
At Cherney Law Firm L.L.C., we are familiar with garnishment law. Our team of seasoned and experienced professionals understands this area of the law.
Are you facing wage garnishment? If you do not have a judgment against you, yet you are staring at garnishment, we may be able to assist you. This article deals with non-judgment garnishments, so if this is you, read along.
Is There Any Protection Against Non-judgment Garnishments?
Wage garnishments are subject to restrictions under state and federal law. This is to ensure that you have enough money to survive on. The exclusions and the processes for requesting them differ from state to state.
Federal law provides additional protections for some of the cash in your account. Federal benefits cannot be garnished. These include Social Security and Supplemental Security Income. They also include Veterans Affairs.
If your earnings are garnished, or money is taken from your bank account or frozen in your account, you should probably get legal counsel. In some circumstances, it is possible to stop the garnishment.
Title 3 of the Consumer Credit Protection Act (CCPA) restricts how much an employer may deduct from an employee’s wages. It is a federal law that applies in all 50 states.
Let’s look closer at the categories of non-judgment garnishments.
Alimony and Child Support Payments
The legislation on garnishments permits deductions up to 60% of a worker’s disposable earnings. This depends on whether the worker is supporting another spouse or child.
For support payments that are more than 12 weeks late, an extra 5% may be withheld.
Federal Student Loan Providers and Garnishment Orders
Your salary may be withheld if you default on a federal student loan. No court order or judgment is required.
A maximum of 15% of your disposable income can be withheld for federal student loan garnishment.
Unpaid Taxes and Garnishment Orders
We all know about the certainty of death and taxes.
The Internal Revenue Service (IRS) sends warning letters for outstanding tax burdens. It is not a good idea to ignore these. The IRS has the right to withhold your salary. Provided you fail to respond. You can prevent this by proposing an installment payment plan or another solution.
Have you received a letter that reads, “Final Notice of Intent to Levy and Notice of Your Right to a Hearing”? If so, you usually have 30 days to react. You can ask for a hearing or settle the debt. If you do nothing, the IRS can garnish your salary or take money from your bank accounts.
The IRS will determine how much of your take-home pay is subject to garnishment. They also decide how much of your income is exempt. They assess your filing status and the standard deduction. They do consider how many dependents you have.
Your pay will be withheld until:
- You make a full payment of the back taxes.
- You set up alternative payment plans with the IRS
- You ask for a levy release.
If you pay court-ordered child support, let the IRS know. They should lower your garnishment by the amount of your child support payments.
Administrative Wage Garnishments
There is an administrative wage garnishment (AWG) debt collection procedure. This allows a federal agency to instruct a non-federal employer to deduct up to 15% of an employee’s take-home pay. It is levied to satisfy a past-due non-tax debt owed to the agency.
A non-tax debt includes the following:
- Direct loans
- Guaranteed loans that have defaulted
- Administrative debt (such as overpayments of salaries and benefits)
- Outstanding fines and penalties
31 U.S.C. 3720D grants authority for the AWG procedure.
Were you involuntarily separated from your old job? A federal agency can only garnish your earnings if you have worked at your current position for at least 12 months.
Have you filed for bankruptcy, and an automatic bankruptcy stay is in effect? Notify Fiscal Service. While the stay is in place, they cannot deduct money from your paycheck.
The AWG process is governed by federal law, and state laws do not apply.
Is it Possible to Stop Garnishment?
You might be able to stop the garnishment by making a full payment on the debt. Or you could consider submitting a legal objection or declaring bankruptcy.
An experienced team of garnishment attorneys can provide you with the best strategy.
What is a Voluntary Wage Assignment?
In a voluntary wage assignment, an employee agrees their employers may pay a specific amount of their earnings to a creditor or creditors.
These are not included in wage garnishments. They are also not subject to exemptions and restrictions which apply to garnishments.
How Can an Attorney Assist You With Garnishments?
Unmanageable debt can ruin your life. If you start to get behind on your payments, it’s easy to feel like you’re drowning. This is because it can lead to foreclosure, wage garnishment, and creditor harassment. The earlier you consult with legal counsel, the better. So don’t put off seeking legal counsel until your matter is terminal.
If you face garnishment, our lawyers can assist you. We may be able to devise a repayment strategy or bargain for a settlement. Also, we can protect your rights as a consumer. Do you feel as if paying off your debt is an impossible challenge? You don’t have to stand by passively as everything around you disintegrates. Cherney Law Firm, LLC is here to assist you in weighing your alternatives. Contact us today.