The majority of states allow creditors to garnish debtors' wages; however, Texas does not. If a creditor has a judgment in one state and the debtor is in a different state, wage garnishment might be possible. This concept also applies to debtors who live in Texas but are paid in a state that allows wage garnishments.
General Criteria
A wage garnishment is a mandatory document that orders the debtor's employer to withhold monies from his income to satisfy the balance he owes the creditor. A wage garnishment is sent to the debtor's employer; therefore, it is executable in the state that the debtor is paid. If a debtor lives and works in Texas, wage garnishment does not occur since Texas does not permit creditors to garnish wages.
Possibility
If the debtor lives in Texas and is paid in a state that allows wage garnishment, an out-of-state creditor can garnish her wages. The creditor would need to go through domestication to obtain a wage garnishment. Domestication requires the creditor to obtain a judgment against the debtor in her (the creditor's) state, complete the required paperwork in the debtor's local court, pay the necessary fee and serve the debtor notice that she's domesticating the judgment. Domesticating a judgment can be a time-consuming and expensive process. For procedures on domestication, the creditor can consult the courthouse in the county that the debtor's assets are located.
Applicable Laws
Where domestication of a judgment is successful and wage garnishment is possible, the laws of the state that issues the garnishment apply. Therefore, interest is accrued on the judgment at the rate of the issuing state, plus employee discharge protection laws and garnishment withholding limits of the issuing state apply.
Considerations
Though Texas does not allow wage garnishment, an out-of-state creditor can still obtain a judgment in his state, domesticate it in Texas and execute it via other collection methods, such as bank account, rents or royalties garnishments.
Legal Agencies
Statutory entities, such as the United States Department of Education, the Internal Revenue Service and the state taxation agency do not need a court order to garnish wages. These agencies must, however, send the debtor a bill demanding payment and a notice of their intent to garnish prior to garnishing. If the debtor lives and works in Texas, her wages can be garnished for child support, back taxes and student loans.
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