Individuals work hard in order to earn the funds that are necessary to support themselves and their families. For many individuals, purchasing necessary and desired goods and services will lead to the acquisition of debt.

Borrowers will eventually be required to repay the debt that they acquire. Due to unforeseeable circumstances, an individual may not be able to repay his/her debt. In instances such as these, creditors may use aggressive methods of collection, in order to retrieve the funds that they have lent a borrower.

For example, an individual may be required to foreclose his/her home, file for bankruptcy, or surrender his/her motor vehicle, in order to pay the debts that he/she has accumulated. One technique that is used by creditors is wage garnishment. 

The term wage garnishment refers to the deduction of funds from an individual’s income in order to repay acquired debts. Wage garnishments vary depending upon an individual’s income, his/her debt, and the surrounding circumstances. In addition to creditors, the Internal Revenue Service is also permitted to levy a portion of an individual’s earnings through wage garnishments, if an individual does not pay his/her taxes.

Each state has the authority to establish wage garnishment laws. While many states do not maintain or enforce this type of legislation, some states have established wage garnishment laws. Nevertheless, wage garnishment is ultimately regulated by federal legislation. If a state’s wage garnishment regulations permit lenders to levy more than a specified amount, the federal regulations must be used.

When an individual has acquired debt that he/she is not able to pay, creditors may initiate garnishment of wages. As a result, a certain portion of an individual’s income can be taken in order to repay creditors. There are many states that maintain wage garnishment laws. However, the United States government has also established federal wage garnishment laws.

If the federal wage garnishment laws result in the deduction of fewer funds from an individuals income, then the federal legislation is to be employed. The amount that is deducted from an individual’s wages often depends upon the extent of his/her income. In most instances, only 25 percent of an individual’s income can be garnished. This is usually a weekly deduction, and therefore, 25 percent of an individual’s weekly income can be garnished. 

The Federal Wage Garnishment Law, Consumer Credit Protection Act is the legislation that is responsible for regulation the portion of an individual’s income that can be garnished. This legislation was established in order to protect consumers from extensive and unreasonable wage garnishment. The garnishment of wages can severely impact an individual’s ability to support him/herself and his/her family. Therefore, it is important for an individual to understand his/her rights, outlined in both state and federal wage garnishment laws.

The established legislation protects an individual’s entire personal earnings, including commission, salaries, hourly wages, and any bonuses that he/she may receive. Retirement funds and pension plans are also protected under federal wage garnishment laws.