An unpaid creditor has a right to collect on the debt through legal action. An unsecured creditor, such as a credit card company, can sue the debtor and secure a judgment for the unpaid debt. One way the creditor can collect on the judgment is to garnish the wages of the debtor. Such wage garnishments in Georgia are subject to federal and state laws.
Wage Garnishment
A wage garnishment describes a legal action used by a creditor who's owed money by a debtor. The wage garnishment forces the employer of the debtor to pay a portion of the debtor's wages directly to the creditor. In Georgia, state law compels employers to execute the garnishment unless they can show the court that the debtor isn't owed any wages and isn't working for that employer. Employers who don't comply with the law can be held liable to pay the total garnishment themselves. A garnishment order must meet state legal requirements and federal law restrictions.
State Law Provisions
State law mandates that wage garnishment action can be taken only after the creditor first secures a judgment against the debtor-employee. The creditor then can try to collect on such a judgment via a wage garnishment. The creditor must serve legal papers to the employer and the debtor-employee to start collecting money. The debtor-employee must be served within three business days after the employer is served. The debtor-employee has a right to challenge the garnishment order and ask for the garnishment to be suspended pending the outcome of the challenge.
Federal Law Provisions
Federal law regulates the amount of money that can be taken from the debtor-employee. The maximum amount that can be garnished at a time is 25 percent of the disposable weekly earnings for non-governmental debts. Also, the debtor must earn at least 30 times the minimum hourly wage for the week in order for any earnings to be garnished. Garnishments for child or spousal support debts can be up to 60 percent of disposable earnings. Student loan debt garnishments can be up to 10 percent.
Other Provisions
Disposable earnings, per federal law restrictions, refers to all gross wages minus all legally required payroll deductions, such as taxes and Social Security. Deductions for things like medical insurance aren't counted. Proper service of the garnishment papers can be done by sending them to the debtor-employee by registered mail. Any proof of receipt or refusal of delivery will meet the service requirement. The federal maximum garnishment amounts don't apply to debts for taxes or from a bankruptcy action. The allowable amounts in those cases are regulated by the tax authority rules and bankruptcy court rules.
0 comments:
Post a Comment