Garnishment forces your employer to pay your creditors a portion of your disposable earnings before she pays you. "Disposable earnings" are the part left after your employer takes out taxes, Social Security and unemployment insurance. The laws on garnishment don't limit how many creditors can get a piece of your paycheck, but they do limit how much of your pay you lose.
Federal law says that creditors, with a few exceptions, can't garnish more than a total of 25 percent of disposable earnings; some states set an even smaller percentage. If 25 percent of your paycheck is greater than 30 times the federal minimum wage, then creditors can only garnish up to 30 times the minimum wage. Exceptions include child support, which can claim up to 60 percent of your disposable earnings, and back taxes. The maximum tax garnishment varies with your standard deduction and the number of your dependents.
If 25 percent of your wages isn't enough for multiple creditors to divide up, they usually form a queue and wait. The first creditor to file gets to garnish your wages until she's paid off. Then the second creditor gets her turn, then the third. Priority debts -- back taxes, student-loan debt and child support -- are exceptions: If you're garnished by the IRS or your spouse, those debts go to the head of the line, regardless of when they were filed.
Even if your employer thinks your debts are a sign you're irresponsible, the law says she can't fire you, punish you or retaliate against you because one creditor has garnished your wages. Nothing in federal law, however, stops your boss firing or retaliating against you if you have two garnishments, either at the same time or one after the other. This applies whether it's two different creditors or one creditor with two different court judgments. Some states give you more protection from your employer than the feds do.
A few states, such as Texas, ban garnishment except for child support and government debts. In states that allow garnishment, a creditor must notify you before collecting any money. If you want to fight back, request a court hearing, then try to prove that you don't owe the money or that you can't survive on what's left after the garnishment. Filing bankruptcy stops all wage garnishment until you emerge from bankruptcy -- and it may wipe out some of your debts too.
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