Financial setbacks happen to people all too frequently. The loss of a job can cause you to fall behind on paying your debts. Even when you return to work, catching up on what you owe can be difficult and might result in creditors using the courts or collection agencies in an effort to collect what is owed. One collection method used by creditors is the wage garnishment.

Wage garnishment can leave you in dire financial straits as your creditors receive part of the money you earn each week directly from your employer. Also, having the embarrassment of having co-workers know about your financial difficulties makes wage garnishment a powerful weapon for creditors. Fortunately, Texas offers some protections for you by restricting the circumstances under which creditors can garnish your wages.

Wage Garnishment in General

Wage garnishment is a powerful collection tool available to creditors or others, such as the Internal Revenue Service or a former spouse, to whom a person owes money. A creditor must first obtain an order from a court directing your employer to deduct a specific amount of money from your paycheck and send it directly to the creditor.

Each state enacts laws controlling the practice of wage garnishment. These laws can limit the amount that can be deducted from each paycheck or set other limits on the use of garnishment orders. Federal laws also impose limits on the amount of money that can be taken under a garnishment order.

Texas Restrictions on Wage Garnishment

The laws in Texas prohibit the use of a wage garnishment order to collect most debts. The following are the only debts for which a person’s wages may be garnished in Texas:

• Unpaid court-ordered child support and alimony
• Unpaid income taxes
• Defaulted student loans

1) Child Support Arrears

If you are in arrears in the payment of spousal support or child support under a court order, the other parent of the child or your former spouse may ask the court for a wage garnishment to take up to 50 percent of your disposable earnings from your wages. Texas law defines your earnings that are subject to wage garnishment as your gross wages less the following deductions:

• Taxes
• Union dues
• Retirement deductions
• Medical and disability insurance premiums

2) Unpaid Taxes

The IRS does not require a court order to obtain a wage garnishment if you owe unpaid federal taxes in Texas. If you owe taxes to the state or to a local government, they might be able to collect through a wage garnishment.

3) Student Loan Collections

If you fall behind on a federal student loan, the government can garnish your wages in order to collect what you owe. A wage garnishment to collect money owed for a federal student loan is limited to 15 percent of disposable income up to a maximum of 30 times the federal minimum wage amount.

Wage Garnishment Attorney

Money shortages can be very stressful and embarrassing. On top of that, financial deficits can cause personal problems including broken relationships with significant others and strained friendships. If you are having your wages garnished, then you should consider hiring a professional who knows how to fight the legal system. Get a hold of Rand Mintzer today by calling 713-862-8880.