Will my wages be garnished for child support and credit card debts?
Recently on our legal forum a user asked, “I have fallen behind on some debt payments. Specifically, I owe child support of $5,000 and unsecured credit card debt payments of $10,000. I was wondering whether creditors in Texas have the right to garnish my wages?”
Wage garnishment overview
Wage garnishments allow a creditor to go to court and receive a judgment which orders an employer to withhold a certain amount of money from an employee’s paycheck and send it to the creditor who obtained the judgment. The garnishment generally is in effect until the debt has been repaid.
The good news for debtors in Texas is that Texas laws generally protect Texas residents from wage garnishments from creditors who are seeking reimbursement for consumer debts, breach or contracts, or torts such as personal injury claims and auto accidents.
Texas residents, however are not fully protected from all garnishments. In fact, debtors in Texas who owe money for child support, spousal support, or student loans may have their wages garnished, often without the creditor having to go to court and obtain a judgment. Additionally, there are federal wage garnishment laws in place for the IRS to garnish federal taxes owed.
It’s also important to note that some types of money which is not considered a wage but is in the possession of a third party- such as bank account, savings account, or rental income- may be garnished. With that said, however, state and federal laws do protect a wide variety of other types of income and monies from garnishment from most creditors, including public assistance, pension funds, and Social Security benefits.
How will child support owed and credit card debt be treated?
You mentioned you owed money for both child support and credit card debts. As mentioned above, the credit card lenders will not have the legal right to have your income garnished to pay for credit card debt. Since 1988, however, the state has had the legal right to automatically withhold wages to pay child support obligations, which means it’s likely that if you are employed that your employer has already been deducting your child support payments from your paycheck.
Your ex-spouse also has the legal right to obtain a wage garnishment order from the court if you owe back child support payments. And as mentioned above, child support garnishments are allowed in Texas.
How much can the state take to pay child support owed?
If you owe child support, under Texas state laws, it’s possible that up to 50% of your disposable earning may be taken from your paycheck each pay period to pay for your child support obligations. Keep in mind, however, that deductions from your pay are only made after other payment obligations are made, such as retirement deductions and medical insurance costs.
Although most other types of garnishments are not allowed, if a garnishment is allowed the maximum will be determined by federal garnishment laws. Specifically, the state will allow a garnishment of 25% of disposable income (not including child support payments); or amount by which a debtor’s weekly income exceeds 30 times the minimum wage.
What do I do?
It’s likely you will be forced to repay the child support back payments through a wage garnishment. In fact, even if you decided to declare bankruptcy it would still not eliminate your obligation to pay child support.
With regards to the credit card debt, however, you do have some options. Declaring Chapter 7 bankruptcy may allow you to discharge the credit card debt, but given the relatively low amount that you owe and the negative financial ramifications of filing bankruptcy, it might make more sense to simply cut your budget or get a second job so you can simply repay the debt as quickly as possible.
Attendees for the Meeting of the Creditors usually includes the bankruptcy filer (you), the trustee and potentially the creditors.