1. What Is Wage Garnishment?

Wage garnishment is a legal procedure where a portion of a person's earnings is withheld by an employer for the payment of a debt. It's typically ordered by a court or government agency.

2. How Is Garnishment Calculated?

The garnishment amount is calculated using the following formula:

Where:

• Disposable Income — Earnings after legally required deductions
• Exemption — Protected amount based on federal or state law
• 25% — Maximum percentage that can typically be garnished

Explanation: The garnishment is either 25% of disposable income OR the amount by which disposable income exceeds the exemption amount, whichever is less.

3. Understanding The Formula

Details: Federal law protects a minimum amount of earnings from garnishment. States may have higher protections. The calculation ensures creditors cannot take more than the lesser of 25% or the amount above the protected threshold.

4. Using The Calculator

Tips: Enter your disposable income (after taxes and required deductions) and the applicable exemption amount. The calculator will determine the maximum garnishment amount under federal guidelines.

5. Frequently Asked Questions (FAQ)

Q1: What counts as disposable income?
A: Disposable income is what remains after legally required deductions like taxes, Social Security, and state unemployment insurance.

Q2: What is the federal exemption amount?
A: The federal exemption is 30 times the federal minimum wage (currently $7.25/hour), which is $217.50 per week.

Q3: Are there different rules for different debts?
A: Yes, child support/alimony garnishments can take up to 50-60% of disposable income. Student loans and taxes may have different rules.

Q4: Can state laws provide more protection?
A: Yes, many states have higher exemption amounts than federal law. Always check your state's specific regulations.

Q5: Can I challenge a garnishment?
A: Yes, you may be able to file a claim of exemption if the garnishment would cause undue financial hardship.