Wage Garnishment Limits

Wage garnishment is a legal process by which a creditor obtains a court order requiring your employer to withhold part of your paycheck and send it directly to the creditor. Federal law under the Consumer Credit Protection Act (CCPA) sets maximum limits on how much of your "disposable earnings" — what's left after legally required deductions — can be garnished. For most consumer debts (credit cards, medical bills, personal loans), creditors can take the lesser of 25% of your disposable earnings or the amount by which your weekly earnings exceed 30 times the federal minimum wage ($217.50/week). Child support and alimony orders carry much higher limits — up to 60-65% of disposable earnings. Federal student loan debt can be garnished at 15% without a court order through an administrative process. IRS levies on wages follow a different formula based on filing status and dependents. One important protection: federal law prohibits employers from firing an employee solely because of a single garnishment order, though this protection doesn't extend to multiple garnishments.

Current Law (2026)

Federal law limits the amount of an employee's disposable earnings that can be garnished by creditors. Different limits apply to different types of debt.

Legal Authority

• 15 U.S.C. § 1671 — Congressional findings: wage garnishment limits needed because predatory use of garnishment causes job loss and disrupts interstate commerce
• 15 U.S.C. § 1672 — Definitions: "earnings" means compensation for personal services (wages, salary, commissions, bonuses, pension/retirement payments); "disposable earnings" means earnings less legally required deductions; "garnishment" means any legal process requiring an employer to withhold earnings
• 15 U.S.C. § 1673 — Restriction on garnishment: maximum garnishment is the lesser of 25% of disposable earnings or the amount by which disposable earnings exceed 30 times the federal minimum wage per week ($7.25 × 30 = $217.50); higher limits for child/spousal support (50-65%)
• 15 U.S.C. § 1674 — Anti-retaliation: employers cannot fire an employee because of garnishment for any one indebtedness; willful violation is a misdemeanor ($1,000 fine, 1 year imprisonment, or both)
• 15 U.S.C. § 1675 — State exemption: Secretary of Labor may exempt state-regulated garnishment if state protections are substantially similar to federal
• 42 USC Section 659 — Child support enforcement through wage garnishment
• 20 USC Section 1095a �� Student loan administrative wage garnishment

How It Works

The garnishment calculation starts with disposable earnings — not your gross paycheck. Disposable earnings are gross pay minus legally required deductions: federal income tax withholding, state income tax, Social Security, and Medicare. Voluntary deductions like 401(k) contributions or health insurance premiums do NOT reduce disposable earnings for garnishment purposes — only legally mandatory withholdings count. This distinction matters: an employee grossing $1,000/week might have $800 in disposable earnings after taxes, but $650 in take-home after 401(k) and health insurance; the garnishment limit is based on the $800 figure, not $650. The federal ceiling under 15 U.S.C. § 1673 is the lesser of 25% of disposable earnings or the amount by which disposable earnings exceed 30 times the federal minimum wage ($7.25/hour × 30 = $217.50/week). States can — and many do — set lower garnishment ceilings that are more protective of workers; the federal limit is a floor, not a mandate.

When multiple creditors garnish simultaneously, the total withholding still cannot exceed the single-creditor limit — garnishments compete for the same capped pool rather than stacking on top of each other. Priority rules determine who gets paid first within that cap: child support and spousal support take statutory first priority, followed by tax levies, then general creditors in the order their garnishments were received. Under 15 U.S.C. § 1674, employers are prohibited from terminating an employee because of a garnishment — but only for a single garnishment; the protection does not explicitly extend to employees with two or more simultaneous garnishments from different creditors, a gap that leaves workers with multiple debts in a more precarious position with their employer. For the underlying debt collection rules governing how creditors pursue debts before reaching garnishment, see Fair Debt Collection Practices Act.

Several categories of income are entirely exempt from ordinary creditor garnishment under federal law: Social Security benefits, SSI, VA disability compensation, railroad retirement benefits, and federal student aid. These protections extend into bank accounts — if you receive exempt federal benefits by direct deposit, up to two months' worth of deposits in your account are automatically shielded from garnishment, even after the funds are mixed with other money. Filing for bankruptcy triggers an automatic stay that immediately halts all wage garnishments from ordinary creditors; the stay remains in effect while the case proceeds, and successful completion of Chapter 7 (discharge) or Chapter 13 (restructuring plan) can end the garnishment permanently by eliminating or restructuring the underlying debt. At the state level, Florida and several other states provide additional protection through a head-of-household exemption that can shelter a larger portion of wages for workers supporting a family.

How It Affects You

State Variations

Many states provide stronger protection than federal law:

• TX, PA, SC, NC: Prohibit or severely limit wage garnishment for consumer debt (Texas protects current wages entirely)
• NY: Only 10% of gross wages or amount exceeding 30x state minimum wage (whichever is less)
• FL: Head of household earnings are fully exempt from garnishment
• CA: 25% of disposable earnings or amount exceeding 40x state minimum wage (more protective than federal due to higher state minimum)

Implementing Regulations

• 29 CFR Part 870 — Restriction on Garnishment (Consumer Credit Protection Act Title III): the DOL Wage and Hour Division's implementing rule for the CCPA's Title III maximum garnishment limits (15 U.S.C. § 1673):

  • § 870.10 — Maximum garnishment amounts: the federal maximum is the lesser of (1) 25% of disposable earnings, or (2) the amount by which disposable earnings exceed 30 times the federal minimum wage per week ($7.25/hr × 30 = $217.50/week); "disposable earnings" means the amount remaining after legally required deductions (federal/state/local income tax, Social Security, Medicare); voluntary deductions (401k, health insurance) are NOT subtracted from earnings before applying the garnishment limits; the lesser-of calculation means low-wage workers receive more protection than high-wage workers in absolute dollar terms
  • § 870.11 — Exceptions and priorities: child support and alimony orders are excepted from the CCPA limits — they are not subject to the 25%/$217.50 ceiling; instead they can go up to 50-65% of disposable earnings; federal and state income tax levies are also excepted from the CCPA caps; when a creditor has an ordinary judgment and a support order is also served on the same employer, the support order has priority — the ordinary judgment creditor can only reach what remains after the support order is satisfied, subject to the aggregate CCPA limit
  • § 870.50–870.57 — State exemptions: the Secretary of Labor may exempt State-regulated garnishments from the CCPA limits if the state laws provide restrictions on garnishment that are "substantially similar" to or more protective than the CCPA; states that have obtained these exemptions include many that have stronger garnishment protections than the federal baseline; absent a state exemption, the CCPA federal floor applies everywhere

• 31 CFR Part 212 — Garnishment of Accounts Containing Federal Benefit Payments: the Treasury Department's implementing rule (issued jointly with Social Security, VA, RRB, OPM, and other benefit agencies) protecting federal benefit payments already deposited in bank accounts from being swept under garnishment orders. This rule is distinct from the wage garnishment limits — it addresses what happens when a garnishment order arrives at a bank where a beneficiary keeps their direct-deposited Social Security or VA benefits:

  • § 212.4 — Bank's initial action: when a financial institution receives a garnishment order against one of its customers, it must first check whether the order includes a "Notice of Right to Garnish Federal Benefits" — a special notice that creditors use when they believe the account may contain protected federal benefits; this initial review step prevents banks from immediately freezing accounts before checking for protected funds
  • § 212.5 — Account review (2-business-day rule): upon receiving a garnishment order, the bank must perform an account review within 2 business days by looking at the account's history over the preceding 2-month lookback period; the bank must identify whether a benefit agency made any direct deposits to the account during that period; covered benefit types include Social Security, SSI, VA disability/pension, federal retirement (CSRS/FERS), RRB, and OPM benefits
  • § 212.6 — Protected amount: if the bank's review finds federal benefit deposits during the lookback period, the bank must identify the "Protected Amount" — the lesser of (1) the total of all federal benefit payments deposited during the lookback period, or (2) the current account balance; the Protected Amount is automatically shielded from the garnishment; the bank may not remove these funds from the account or charge them against the garnishment; amounts in the account above the Protected Amount may be subject to the garnishment
  • § 212.7 — Notice to account holder: within 3 business days after the garnishment order is received, the bank must send the account holder a notice explaining that a garnishment order was received, that the bank has identified protected funds, what the Protected Amount is, and how the account holder can assert additional protections under state law; the notice gives the account holder the information needed to challenge any garnishment attempts on protected funds
  • § 212.10 — Safe harbor: a financial institution that follows Part 212 in good faith is not liable to the garnishing creditor for funds it protects or withholds under the rule; the safe harbor encourages compliance without fear of competing liability

  The Part 212 rule addresses a practical crisis that had emerged: judgment creditors would obtain garnishment orders and serve them on banks, which (before this rule) often froze entire accounts — including direct-deposited Social Security or VA disability benefits — without distinguishing protected from unprotected funds. Recipients would then face inability to access their benefits while waiting for the legal process to play out. The 2011 rule eliminated this problem by requiring automatic bank-level review and protection. The rule applies to all financial institutions that receive electronic direct deposits of the listed benefit types. It does not protect benefits that have been commingled with non-benefit deposits for more than 2 months — only the 2-month lookback period is covered. Recent rulemakings: 76 FR 9939 (February 2011) — original joint final rule; 77 FR 12280 (March 2012) — technical corrections.

5 CFR Part 581 — Processing Garnishment Orders for Child Support and/or Alimony: OPM rules implementing 42 U.S.C. § 659, which waived the federal government's sovereign immunity from wage garnishment for child support and alimony, requiring federal agencies to comply with state court orders in the same manner as private employers (implements 42 U.S.C. § 659; 15 U.S.C. § 1673; 5 U.S.C. § 8336a):

• § 581.103 — Moneys subject to garnishment: covered pay includes salary, overtime, night differentials, Sunday and holiday premium pay, saved pay, retained pay, and bonuses — the full scope of compensation based on personal service; the statute reaches any remuneration based on employment by the federal government
• § 581.104 — Moneys not subject to garnishment: expressly excluded are civil service retirement and disability annuities (5 U.S.C. §§ 8346 and 8470), VA disability and retirement pay (38 U.S.C. § 5301), Federal Tort Claims Act payments, and workers' compensation; a federal annuitant's retirement check is not reachable by a garnishment order under this Part, even for child support — a significant distinction from active pay
• § 581.201–581.202 — Service of process on designated agents: legal process must be served on the specific governmental entity's designated agent (listed in Appendix A to Part 581); serving the wrong agency or using a general address does not constitute valid service; OPM maintains the master list of designated agents for all Executive Branch entities
• § 581.301–581.302 — 15-day employee notice: after valid service of process, the governmental entity must identify all moneys owed to the obligor and notify the employee within 15 calendar days; the notice must include the amount being withheld, the employee's right to contest the withholding through state court procedures, and the beginning date of withholding
• § 581.305 — Compliance requirement: governmental entities must comply with valid legal process; they may refuse compliance only when: the order does not conform on its face to the laws of the issuing jurisdiction, the obligor is not employed or receiving pay from the agency, or the order would require an unlawful payment; the agency cannot refuse on the basis that child support proceedings are pending or contested
• § 581.402 — Higher garnishment caps for support orders: CCPA maximum limits for child support and alimony garnishment from federal pay are significantly higher than for ordinary debts — 50% of disposable earnings if the employee supports a second family; 55% if more than 12 weeks in arrears while supporting a second family; 60% if no second dependents; 65% if no second dependents and more than 12 weeks in arrears; these compare to the standard CCPA limit of 25% of disposable earnings for ordinary debt garnishment

The Part 581 framework works in parallel with the private-sector CCPA framework: federal employees face the same garnishment exposure as private workers, subject to the same percentage caps and procedural protections, but with the added requirement that the court order must be routed to the correct designated federal agent. The most significant practical distinction is the annuity exclusion — a retired federal employee whose retirement income consists entirely of a civil service annuity is largely insulated from garnishment, while a retiree drawing a private pension may face different state-law treatment. Recent rulemakings: The most recent substantive update was 79 FR 46618 (2014), which updated designated agent lists.

5 CFR Part 582 — Commercial Garnishment of Federal Employees' Pay: OPM rules implementing 5 U.S.C. § 5520a, which authorizes state and local courts to garnish federal employee pay for ordinary commercial debts (credit card judgments, personal loans, medical bills) — a separate authority from the child-support garnishment framework in Part 581 (implements 5 U.S.C. § 5520a; 15 U.S.C. § 1673):

• § 582.101 — Scope: 5 U.S.C. § 5520a authorizes commercial creditor garnishment of federal employee pay; the Part sets the rules for complying with state court garnishment orders for debts other than child support and alimony (which are governed by Part 581)
• § 582.103 — Exclusions from garnishable pay: amounts excluded from the garnishable base include military pay allotments already committed, travel and relocation reimbursements, amounts owed to the government (setoff), and any amounts excluded by the agency's specific enabling legislation; the exclusions narrow the base before applying the CCPA percentage caps
• § 582.201 — Designated agent: legal process must be served on the agency's designated agent to receive garnishment orders — the same appendix A that Part 581 uses; serving the wrong office or a general agency address does not constitute valid service; the creditor's attorney must identify the correct agency and office before proceeding
• § 582.202–582.203 — Service requirements: legal process must include sufficient identifying information — employee name, SSN (or other identifier), agency — to allow the agency to locate the employee's pay record; invalid or incomplete service does not start the agency's compliance clock
• § 582.301 — Suspension upon service: upon valid service of legal process, the agency must withhold (suspend) the appropriate amount from the employee's pay and hold those funds pending resolution
• § 582.302 — Employee notification: the agency must notify the employee within 15 calendar days of valid service, informing them of the withholding, their right to contest the order through state court procedures, and the amount being withheld
• § 582.303 — Response deadline: the agency must respond to the legal process or interrogatories within 30 calendar days of valid service
• § 582.401 — Disposable earnings definition: disposable earnings for commercial garnishment are pay remaining after mandatory deductions — federal, state, and local income tax withholding, Social Security and Medicare taxes, health insurance premiums, retirement contributions, and state unemployment insurance
• § 582.402 — Maximum garnishment: commercial debt garnishment from federal pay is subject to the same CCPA caps as private-sector garnishment — the lesser of 25% of disposable earnings or the amount by which disposable earnings exceed 30 times the federal minimum wage per pay period; states with more protective limits take precedence when applicable

The Part 582 framework closed a gap that existed before the 1996 law: prior to 5 U.S.C. § 5520a, the federal government's sovereign immunity shielded federal employee pay from ordinary commercial creditors even when state courts had entered valid judgments. Part 582 waives that immunity on the same terms as Part 581 did for support orders — federal employees are now as reachable by judgment creditors as private-sector employees, subject to the same CCPA percentage caps and the designated-agent service requirements. The most significant practical difference from Part 581 is the lower garnishment cap: commercial debts face the 25%-of-disposable-earnings CCPA maximum, compared to the 50–65% caps available for support orders.

• 34 CFR Part 34 — Department of Education Administrative Wage Garnishment (ED, 30 sections): the Department of Education's implementing regulations for administrative wage garnishment (AWG) of delinquent federal student loan borrowers and other ED debtors, operating under 31 U.S.C. § 3720D. Unlike court-ordered garnishments that require creditors to sue and obtain a judgment, AWG allows the Department of Education to garnish wages by serving an order directly on the employer — no court order required. The AWG authority is one of the federal government's most powerful debt collection tools and applies to defaulted federal student loans (Direct Loans, FFEL loans, and Perkins Loans held by the Department). Key provisions:

  • § 34.4 — Notice of proposed garnishment: before beginning AWG, ED must send a notice to the borrower at their last known address; the notice must include the amount and nature of the debt, ED's intention to garnish, and the debtor's rights (§ 34.5); the notice also explains how to request a hearing or enter a repayment agreement
  • § 34.6 — Debtor rights before garnishment: upon receiving the notice, the debtor has the right to: (1) inspect and copy ED's records related to the debt; (2) enter into a written repayment agreement (which stops the garnishment while the agreement is in force); (3) request a hearing concerning the existence, amount, or enforceability of the debt; the right to enter a repayment agreement is particularly significant — a borrower who negotiates a payment plan with ED before garnishment begins avoids the garnishment entirely
  • § 34.8 — Hearing right: a borrower may request an oral or paper hearing; oral hearings are available only when the debtor shows a good reason that documentary review alone cannot resolve the dispute (§ 34.9); the hearing request must be timely — within 30 days of the garnishment notice date or postmark, whichever is later (§ 34.11); a timely hearing request stays garnishment until the hearing decision is issued; if the request is untimely, ED may issue the garnishment order before the hearing while the hearing proceeds
  • § 34.14 — Burden of proof: at the hearing, ED bears the burden of proving the existence and amount of the debt; ED meets this burden by including documentation in the record; if the debtor claims financial hardship as a basis for reducing the garnishment rate, the debtor bears the burden of proving that the proposed withholding would cause hardship
  • § 34.16 — Hearing timeline: the hearing official must issue a written decision within 60 days of receiving all documents or completing the oral hearing; if the decision is not issued within 60 days, the case is treated as if ED had waived the right to garnish until the decision issues
  • § 34.18 — Garnishment order issuance: if no timely hearing is requested, ED issues a garnishment order to the employer within 30 days after the deadline for requesting a hearing; if a hearing is requested and ED prevails, the order issues within 30 days after the final decision
  • § 34.19 — Garnishment amount: the employer must withhold the lesser of (1) 15% of the debtor's disposable pay each pay period, or (2) the amount by which disposable pay exceeds 30 times the federal minimum wage ($217.50/week); this 15% cap is the student loan AWG-specific ceiling (lower than the 25% cap for ordinary judgment debts, reflecting Congress's policy choice to limit income disruption for student loan borrowers); disposable pay is defined the same way as under the CCPA
  • § 34.23 — Involuntary separation exclusion: ED may not garnish wages if it has credible evidence that the debtor was involuntarily separated from employment (laid off, fired — not voluntary resignation) and has not yet been continuously reemployed for at least 12 months; this protection recognizes that borrowers who just lost a job are particularly vulnerable to income disruption
  • § 34.24 — Financial hardship reduction: a debtor may object to the proposed garnishment rate on financial hardship grounds, submitting evidence of income, expenses, and debts; if ED concludes that 15% garnishment would cause hardship, it will reduce the withholding to an amount that still allows repayment while not causing hardship — potentially as low as zero in extreme cases (§ 34.25)
  • § 34.27 — Anti-retaliation: employers may not discharge, refuse to employ, or take disciplinary action against any debtor because ED issued a garnishment order; violation of this protection gives the debtor a cause of action against the employer
  • § 34.29 — Employer noncompliance: if an employer fails to comply with an ED garnishment order, ED may sue the employer for the amount that should have been withheld, plus costs and attorney's fees; employer liability for noncompliance provides a strong incentive for prompt compliance

  ED resumed administrative wage garnishment in the fall of 2023 after the COVID-19 payment pause. Borrowers who did not re-enroll in income-driven repayment plans during the restart period and fell back into default are now subject to AWG. The Department typically sends at least one notice before initiating AWG, and borrowers who enter into a loan rehabilitation agreement (9 on-time monthly payments under an income-based formula) can stop AWG and exit default. Loan consolidation into a Direct Loan is another exit path, and the Fresh Start program (announced during the repayment restart) provided a temporary one-time pathway out of default for eligible borrowers. No major amendments to Part 34 since 2004 (when the current framework was finalized); the Department's COVID-related AWG suspension was implemented through executive action, not rulemaking, and does not appear as an amendment to Part 34 itself.

Pending Legislation (119th Congress)

• S 3424 — Bankruptcy Administration Improvement Act of 2025. Raises Chapter 7 trustee pay to $120 per case and reallocates fee revenue. Status: Became law.
• S 3977 — Bankruptcy Threshold Adjustment Act of 2026. Adjusts who can use Chapter 11 and Chapter 13 by raising the small-business cap to $7.5M and capping consumer filings at $2.75M. Status: Introduced.
• HR 7730 — Bankruptcy Threshold Adjustment Act of 2026 (House companion). Status: In committee.

Recent Developments

• Federal minimum wage floor unchanged since 2009 — garnishment protection eroding in real terms: The federal garnishment floor protects workers who earn at or near minimum wage: the lesser of 25% of disposable earnings or the amount above 30 times the federal minimum wage ($7.25/hour × 30 = $217.50/week). Because the federal minimum hasn't changed since 2009, this floor protects fewer actual dollars in real terms. A worker earning $15/hour is subject to substantially more garnishment than the law intended when it was designed around lower-wage earners. States with higher minimum wages (CA, WA, CO) have effectively stronger garnishment floors due to state minimum wage increases.
• Student loan administrative wage garnishment resumed after COVID pause: The COVID-era federal student loan payment pause (March 2020 - September 2023) halted all administrative wage garnishment for federal student loans. Garnishment resumed after the pause ended. With the SAVE plan's legal invalidation and the expiration of enhanced IDR payment options, more borrowers may find themselves in default and facing administrative garnishment (which does not require a court order). Federal student loan garnishment is capped at 15% of disposable earnings — lower than the 25% consumer debt limit — but unlike other garnishments, it doesn't require a court judgment.
• Texas wage exemption broadest in the nation: Texas law exempts current wages from garnishment for consumer debt entirely — only child support, alimony, and certain tax debts can reach wages. Texas workers facing aggressive debt collection should be aware of this protection. The exemption does not apply to bank accounts (once wages are deposited, they lose the wage exemption), so Texas debtors should carefully manage cash flow around deposit dates if facing active collection.
• "Exempt benefits" bank account protection (2 months): Federal regulations (31 CFR Part 212) automatically protect 2 months of directly deposited Social Security, SSI, VA benefits, federal railroad retirement, and other exempt federal benefits from bank account garnishment (levy), without the account holder needing to take any action. Banks must establish "lookback periods" to identify protected amounts. Account holders receiving these benefits by direct deposit do NOT need to fight in court to protect two months of payments — the protection is automatic at the bank level.
• Student loan defaults surging in 2025 — garnishment wave expected: With the SAVE income-driven repayment plan enjoined by federal district courts in 2024 and the Eighth Circuit affirming the injunction on February 18, 2025, and the Trump administration's Department of Education unwinding Biden-era borrower protections, millions of borrowers are at elevated default risk in 2025-2026. The Department of Education restarted collections and credit reporting for defaulted loans in 2025, ending the "Fresh Start" program's protections. Administrative wage garnishment for federal student loans — which requires no court order and can begin after a single written notice — is authorized under 20 U.S.C. § 1095a and is capped at 15% of disposable earnings. Borrowers who entered Fresh Start but did not complete the rehabilitation process face potential garnishment without advance judicial review.
• DOL Wage and Hour Division enforcement under budget pressure: DOGE-driven reductions at the Department of Labor have affected the Wage and Hour Division, which enforces the Consumer Credit Protection Act's garnishment limits (Title III) as well as minimum wage and overtime laws. Reduced enforcement staffing means employers who violate the anti-discharge and garnishment cap rules face lower risk of proactive federal enforcement. Workers whose wages are being garnished in excess of CCPA limits must increasingly rely on state labor offices or private litigation to vindicate their rights.