Everything That You Need to Know About Wage Garnishment | Axiom Tax Resolution Group

Wage garnishment can be an intimidating process for both employers and employees, and it is important for both parties to understand the legal requirements and implications of wage garnishment.  To help you out, here’s everything you need to know about wage garnishment.

What Is Wage Garnishment? 

Wage garnishment is a legal process by which a portion of an individual’s wages are withheld from their paycheck and sent directly to the creditor to pay off a debt. It is a common form of debt collection in the United States and can be used for a variety of debts, including child support, unpaid taxes, and unpaid student loans.

When a creditor obtains a wage garnishment order, they will typically send it to the individual’s employer, who will then begin to withhold a portion of the employee’s wages and send it directly to the creditor. The amount of money that can be garnished is determined by a variety of factors, such as the type of debt, the state laws, and the individual’s income.

In many cases, the employer is required to provide the employee with a notice of the wage garnishment prior to it taking effect. This is an important notice because it provides the employee with an opportunity to challenge the garnishment in court if they believe it is unjustified.

What Are the Types of Wage Garnishment?

There are several different types of wage garnishment that can be used by creditors. The most common type is a court order of wage garnishment, which requires a court order before an employer can withhold money from an employee’s pay. This type of garnishment is often used for the collection of child support and alimony payments. The amount that can be garnished is often limited by state law and is usually a percentage of the employee’s disposable income.

Another type of garnishment is voluntary wage assignment. This type of garnishment does not require a court order and is often used for the collection of student loan payments. The employee voluntarily agrees to have a portion of their wages withheld for the repayment of the debt. The amount that can be garnished is usually limited by state law and is usually a percentage of the employee’s disposable income.

The third type of garnishment is involuntary wage assignment. This type of garnishment does not require a court order and is often used for the collection of overdue taxes. The amount that can be garnished is usually limited by state law and is usually a percentage of the employee’s disposable income.

Finally, the fourth type of garnishment is the federal tax levy. This type of garnishment requires a court order before an employer can withhold money from an employee’s pay. The amount that can be garnished is usually limited by federal law and is usually a percentage of the employee’s disposable income.

What Can You Do About Wage Garnishment?

If you’re facing wage garnishment, there are steps you can take to protect yourself and your finances. The first step is to contact your creditor and explain your situation. You may be able to work out a payment plan with your creditor or negotiate a settlement on your debt. If you’re having difficulty managing your debt, you may want to consider working with a credit counselor. A credit counselor can help you understand your rights and develop a plan to pay off your debt. 

Conclusion

Understanding wage garnishment is important for anyone who is at risk of having their wages garnished. While it is an unpleasant situation, understanding the rules and regulations that govern wage garnishment can help one prepare for any potential wage garnishment. Being prepared can reduce the stress and financial hardship that can come with wage garnishment. 

Get the tax relief help you need by seeking tax resolution services. At Axiom Tax Resolution Group, our trusted tax professionals can help you address your problems with the IRS. Get in touch with us to know and discuss your options!