Wages You Cannot Have Garnished: Federal Limits, Exempt Income, and How to Protect Your Paycheck

Wage garnishment is when a creditor obtains a court order directing your employer to withhold a portion of your paycheck and send it directly to the creditor. It is a powerful collection tool and one of the most frightening things a debtor can face. But garnishment is also a legal process with clear limits, and those limits exist specifically to protect debtors from having their livelihoods destroyed by creditors.

Federal law sets a floor for wage garnishment protection. States can and many do provide additional protection beyond the federal minimum. Understanding what the law protects tells you whether a garnishment you are facing is legal and whether you have grounds to object. Use our wage garnishment calculator to see exactly how much of your paycheck can legally be withheld.

The Federal Wage Garnishment Limit

Title III of the Consumer Credit Protection Act limits how much of your disposable earnings can be garnished. Disposable earnings are your earnings after legally required deductions like federal, state, and local taxes, Social Security, Medicare, state unemployment insurance, and required state employee retirement contributions. Voluntary deductions like health insurance premiums, 401k contributions, and union dues are not subtracted when calculating disposable earnings.

For ordinary creditor garnishments, the law limits the amount that can be garnished to the lesser of two calculations. The first is 25 percent of your disposable weekly earnings. The second is the amount by which your disposable weekly earnings exceed 30 times the federal minimum wage. The federal minimum wage is currently $7.25 per hour, making the 30-times-minimum-wage threshold $217.50 per week. Only the amount above that threshold can be garnished.

What this means practically is that if you earn $300 per week in disposable income, the lesser of 25 percent ($75) and the excess over $217.50 ($82.50) would be $75, the 25 percent calculation. If you earn $250 per week in disposable income, the lesser of 25 percent ($62.50) and the excess over $217.50 ($32.50) would be $32.50. At very low incomes, the floor protection is more limiting than the percentage cap.

Higher Protections for Child Support and Alimony

The garnishment limits are different for child support and alimony. These obligations can be garnished at a higher rate because Congress determined that family support takes priority over protecting wages from other creditors.

Up to 50 percent of disposable earnings can be garnished for child support or alimony if the individual is currently supporting a spouse or dependent child other than the one involved in the support order. Up to 60 percent can be garnished if not supporting another family. An additional 5 percent can be added if the obligation is 12 or more weeks in arrears, bringing the maximum to 55 or 65 percent depending on the supporting family circumstances.

Federal Student Loans and Tax Debt

The federal government can garnish wages for student loan debt and back taxes without first obtaining a court judgment, a power that ordinary private creditors do not have. This is called administrative wage garnishment for student loans and levy for tax debt.

Federal student loan garnishment is limited to 15 percent of disposable pay. This is substantially lower than the standard 25 percent limit for private creditors, which provides some protection even in this serious category of debt. The IRS levy for unpaid taxes is limited to the amount that exceeds a protected amount based on your standard deduction and personal exemptions, leaving you a minimum amount to live on.

Types of Income That Cannot Be Garnished at All

Some types of income are entirely exempt from garnishment under federal law. Social Security benefits, including retirement, disability, and survivors benefits, cannot be garnished by ordinary creditors. They can be garnished for child support, alimony, federal taxes, and certain federal debt obligations, but a credit card company, medical provider, or personal loan lender cannot garnish Social Security.

Supplemental Security Income is fully exempt from garnishment without exception. SSI cannot be garnished even for child support and alimony under federal law, making it the most protected income type in the federal system.

Veterans benefits administered by the Department of Veterans Affairs are generally exempt from garnishment. Civil Service and Federal Retirement Fund benefits have similar federal exemption protections. Workers compensation benefits and certain state welfare payments are exempt under federal and state law.

Bank Account Protections for Exempt Income

Federal law provides specific protection for exempt federal benefits when they are deposited into bank accounts. Banks are required to automatically protect two months of directly deposited benefits from garnishment. If Social Security, SSI, or other exempt federal benefits are deposited directly into your bank account and a creditor obtains a bank levy, the bank must protect the amount of the last two months of those deposits.

This automatic protection applies to direct deposits. If you receive benefits by check and deposit them yourself, the automatic protection may not apply, and you would need to affirmatively claim the exemption through the court process. Setting up direct deposit for federal benefits provides automatic protection without requiring you to take any action when a levy occurs.

State Laws That Provide More Protection

Several states provide more generous garnishment protections than federal law. Federal law is the minimum; states can and do go further. North Carolina, South Carolina, Texas, and Pennsylvania do not allow wage garnishment at all for ordinary consumer debt judgments (though they do allow it for child support, student loans, and taxes). These states are among the most debtor-friendly in the country for wage garnishment purposes.

Other states raise the protected threshold above the federal 30-times-minimum-wage floor, use a higher percentage of disposable income as the minimum that must be left untouched, or exempt additional categories of income beyond what federal law requires. California exempts the greater of federal protections or 40 times the state minimum wage, which is substantially higher than the federal threshold given California's higher minimum wage.

How to Object to a Garnishment

When a creditor obtains a garnishment, your employer typically receives a writ of garnishment and you should also receive notice. The notice should explain the source of the garnishment and your rights to claim exemptions. You usually have a limited window, often 10 to 30 days depending on the state, to file a claim of exemption or request a hearing.

If the garnished income is exempt, such as Social Security payments deposited into a bank account beyond the automatic two-month protection, you file a claim of exemption with the court that issued the garnishment. This requires completing a form and providing documentation showing the source of the funds. Courts process these claims relatively quickly because the financial stakes are immediate.

If the garnishment amount exceeds the legal maximum, you file a similar objection demonstrating the calculation error. Bring your pay stubs showing disposable earnings and show how the garnished amount exceeds either 25 percent of disposable earnings or the allowable excess above the minimum wage threshold. Courts take these mathematical disputes seriously and will correct improper calculations.