What is Wage Garnishment?
Wage Garnishment is the process of subtracting money from an employee's personal compensation (including salary), often as a result of a court order. Wage garnishments continue until the entire debt is satisfied or arrangements are made to pay off the debt. Garnishments are often taken for any form of debt, but familiar examples of debt that result in garnishments include child support, defaulted student loans, owed back taxes, unpaid court fines, plus any other kind of monetary judgment.
How Does Wage Garnishment Work?
When served on an employer, garnishments will be obtained as a portion of the payroll plan. When processing payroll, at times there is not adequate cash in the employee's net compensation to satisfy all of the garnishments. When this occurs, the correct order to use a garnishment must be fulfilled. As an example, in a circumstance with federal tax, local tax, and credit card garnishments, the first garnishment taken will be the federal tax garnishments, then the local tax garnishments, and lastly, garnishments for the credit card. Employers receive a notice telling them to withhold a particular quantity of their employee's wages for payment and cannot refuse to garnish wages.
What Rights Have I Got When Wage Garnishment Occurs?
As soon as your employer is forced to garnish your wages through a court order or directly from the IRS, your good-standing with the company may be compromised. If this is indeed happening, you do have certain rights. Title III of the Consumer Credit Protection Act (CCPA) protects staff from discharge by their employers for the sole reason that their wages have been garnished for any one debt, and it limits the amount of your earnings that can be garnished in any one week. Title III doesn't, however, safeguard an employee from discharge if the employee's earnings have been garnished for a second or subsequent debt. As well, Title III will almost always give wage earners the right to receive at least partial compensation for the individual services they supply despite wage garnishment.
How to Stop a Wage Garnishment
To put a halt to a wage garnishment before it begins, determine if you can work out some sort of agreement rapidly with the other party. If you can not do that then perhaps your only option is to file bankruptcy immediately. Filing bankruptcy legally puts a stop on wage garnishments. As well, filing bankruptcy stops all your creditors' collection activities which is why it is often used as ammunition to avoid judgments.
Can a Wage Garnishment Be Reversed?
Okay, so you couldn't work something out with the other party to avoid the garnishment to start, so what might be achieved now? Unfortunately, once a writ of garnishment has been awarded, it is quite difficult to undo, but not impossible, specifically if the garnishment is eating up too much of your living expenses. If your wages are being garnished and you can't even afford to file a "Claim of Exemption" form with the court that issued the writ, you are able to obtain this form at your local courthouse. When you have your day in court, you will need to bring documented proof of your income and monthly living expenses, such as home loan or rent payments, utilities, groceries, and so on., in order to convince the judge to set aside the writ of garnishment.
Paying a Writ of Garnishment
Should you lose in court or don't contest the garnishment, there are no other options except to pay it off in full or simply wait until the day arrives when your paycheck is no longer garnished. Regardless of the course you choose, ensure that you acquire documentation from the creditor after the judgment has been payed off in full so that you have proof you paid the debt. You might want this proof in the future should you want to obtain a loan or credit.
