What You Need to Know About California Wage Garnishment
Wage garnishment is a common practice that makes paying money more efficient. Here’s everything you need to know about Wage Garnishments in California.
A “wage garnishment,” sometimes called a “wage attachment,” is an order requiring your employer to withhold a certain amount of money from your pay and send it directly to one of your creditors.
What is Wage Garnishment?
Wage garnishment is a way to collect money an employee owes to someone else. When someone loses a civil court case and owes money to the winning side (called the “judgment creditor” or “creditor”), the court does not collect the money for the creditor. If the person who loses the case (the “debtor”) has a job and gets paid wages and he or she does not pay the creditor voluntarily, the creditor can file papers to have part of the employee’s wages taken (garnished or withheld) to pay the money that is owed. Wage garnishment is sometimes called “wage assignment,” “earnings assignment,” or “earnings withholding.”
How Does California Determine Garnishment Limits?
Creditors cannot seize all of the money in their paycheck. Different rules and legal limits determine how much of your pay can garnish. For example, federal law limits how much judgment creditors can take. The garnishment amount is limited to 25% of your disposable earnings for that week (what’s left after mandatory deductions) or the amount by which your disposable earnings for that week exceed 30 times the federal minimum hourly wage, whichever is less. Some states set a lower percentage limit for how much of your wages are subject to garnishment. California law also considers the state minimum wage and a different multiplier and divides that number in half, resulting in less money garnishment.
Related: California Wage Garnishment FAQs
When Does Garnishing end?
The creditor will continue to garnish your wages until you pay off your debt or take measures to stop the garnishment, such as claiming an exemption with the court. Your state’s exemption laws determine the amount of income you’ll be able to retain. Depending on your situation, you might be able to partially or fully keep your money. You can also potentially stop most garnishments by filing for bankruptcy.
What Are The Limits on Wage Garnishment in California?
The most California law can garnish from your wages is the lesser of:
- 25% of your disposable earnings for that week or
- 50% of the amount by which your weekly disposable earnings exceed 40 times the state hourly minimum wage.
If a judgment debtor works in a location where the local minimum hourly wage is greater than the state minimum hourly wage, the local minimum hourly wage in effect at the time the earnings are payable is used for the calculation. (Cal. Civ. Proc. Code § 706.050).
A bigger exemption is available if the debtor can show their need. Under California law, “the portion of the judgment debtor’s earnings which the judgment debtor proves is necessary for the support of the judgment debtor or the judgment debtor’s family supported in whole or in part by the judgment debtor is exempt from levy under this chapter.” (Cal. Civ. Proc. Code § 706.051).
What if You Pay Child Support, Student Loans, or Unpaid Taxes?
If you owe child support, federal student loans, or taxes, the government or creditor can garnish your wages without a court judgment. The amount that can be garnished is different for judgment creditors, too.
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1. Child support
Since 1988, all court orders for child support include an automatic income withholding order. If you get behind in child support payments, the other parent can also get a wage garnishment order from the court. Federal law limits this type of wage garnishment. Up to 50% of your disposable earnings may be garnished to pay child support if you’re currently supporting a spouse or a child who isn’t the subject of the order. If you aren’t supporting a spouse or child, up to 60% of your earnings may be taken. An additional 5% may be taken if you’re more than 12 weeks in arrears.
2. Federal Student Loans
If you’re in default on a federal student loan, the U.S. Department of Education or any entity collecting for this agency can garnish up to 15% of your pay. This kind of garnishment is called an “administrative garnishment.” But you can keep an amount equivalent to 30 times the current federal minimum wage per week. Federal law protects the income level equal to 30 times the minimum wage per week from garnishment.
3. Unpaid Taxes
The federal government can garnish your wages (called a “levy”) if you owe back taxes, even without a court judgment. The weekly exempt amount is based on the total of the taxpayer’s standard deduction and the aggregate amount of the deductions for personal exemptions allowed to the taxpayer in the taxable year in which such levy occurs. Then, this total is divided by 52. If you don’t verify the standard deduction and how many dependents you would be entitled to claim on your tax return, the IRS bases the amount exempt from levy on the standard deduction for a married person filing separately, with only one personal exemption. States and local governments might also be able to garnish your wages to collect unpaid state and local taxes. If you owe California state taxes, up to 25% of your net wages may be garnished by the state to satisfy your tax obligations. Contact your state’s labor department to find out more.
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