Minnesota Statute of Limitations on Wage Garnishment

When a debtor fails to pay his debt obligations, creditors can seek a garnishment judgment against him. Once a creditor obtains a garnishment judgment, the creditor has a prescribed period of time within which to collect the debt. There is a limit on the amount a creditor can collect during a work week or pay period. Regarding limits on the amount a creditor can garnish, Minnesota's laws are more favorable to debtors than Title III of the Consumer Credit Protection Act, the federal wage-garnishment statute.

Overview

Minnesota's limitations on wage garnishment are codified in the Minnesota Code Section 571.922. Pursuant to the Minnesota Code, creditors may garnish up to 25 percent of a debtor's disposable earnings or the amount by which a debtor's disposable earnings exceed 40 times the federal minimum wage. Disposable income is defined as whatever wages remain after "legally required deductions" such as state and federal taxes, mandatory retirement and Social Security.

Statute of Limitations on Consumer Debt

According to Minnesota's consumer credit laws, the statute of limitations on consumer debt, such as credit-card debt, is six years; the statute of limitations for contracts is also six years. This means that creditors have six years in which to bring an action for garnishment if a debtor has defaulted.

Statute of Limitations After Judgment

In Minnesota, after a creditor has successfully obtained a judgment for garnishment, the creditor has 10 years in which to begin garnishing the debtor's paychecks. This 10-year statute of limitations results in creditors waiting for a debtor's earnings to increase, as creditors assume a debtor's earning potential will increase over time. The higher the debtor's disposable earnings, the more a creditor can collect.

Additional Considerations

In Minnesota, although creditors are not permitted to garnish more than 25 percent of disposable income, child-support withholding percentages can be as high as 50 to 60 percent. Additionally, child-support withholdings take priority over consumer-credit withholdings. A creditor who has obtained a garnishment judgment must wait until all child-support deductions are made.