How To Calculate Wage Garnishment

Garnishment Formula:

\[ \text{Garnishment} = \min(25\% \text{ Disposable}, \text{Disposable} - \text{Exemption}) \]

Garnishment Amount:

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1. What is Wage Garnishment?

Wage garnishment is a legal procedure where a portion of a person's earnings is withheld by their employer for the payment of a debt. Common reasons include child support, student loans, taxes, or creditor judgments.

2. How Garnishment is Calculated

The garnishment amount is determined by:

\[ \text{Garnishment} = \min(25\% \text{ Disposable Earnings}, \text{Disposable Earnings} - \text{Exemption Amount}) \]

Where:

Disposable Earnings — Gross pay minus legally required deductions (taxes, Social Security, etc.)
Exemption Amount — Protected portion of earnings (typically 30 times federal minimum wage per week)
25% Limit — Maximum that can generally be garnished from disposable earnings

3. Legal Limits on Garnishment

Federal Law: The Consumer Credit Protection Act limits garnishment to the lesser of:

25% of disposable earnings, or
The amount by which disposable earnings exceed 30 times the federal minimum wage ($7.25/hour)

Some states have more protective limits that override federal law.

4. Using the Calculator

Instructions: Enter your disposable earnings (after required deductions) and the exemption amount (typically 30 × $7.25 × hours in pay period). The calculator will determine the maximum garnishment amount under federal law.

5. Frequently Asked Questions (FAQ)

Q1: What types of debts can lead to wage garnishment?
A: Common causes include child support, student loans, taxes, and court judgments for unpaid debts.

Q2: Can my entire paycheck be garnished?
A: No, federal law protects a portion of your earnings from garnishment (the exemption amount).

Q3: Are there different rules for child support?
A: Yes, up to 50-60% of disposable earnings may be garnished for child support, depending on circumstances.

Q4: How do I calculate disposable earnings?
A: Start with gross pay, subtract legally required deductions (taxes, Social Security, etc.). Voluntary deductions (401k, health insurance) may or may not be included depending on state law.

Q5: Can I challenge a garnishment?
A: Yes, you may be able to challenge it in court if the amount exceeds legal limits or if you qualify for hardship exemptions.