Your boss just told you that your next paycheck is going to be garnished. You’re at work, so you’re
trying to stay calm, but you’re embarrassed, you’re scared, and you feel overwhelmed. You can barely
able to pay all of your monthly bills as it is.
Your mind is racing:
How can they garnish my wages?
How much money can they take from my paycheck?
Why is this happening to me?
Take a deep breath. Count to 10.
I’m going to tell you exactly what you need to do to stop your wage garnishment.
But first, you need to know what it means to have your wages garnished in Florida.
If you have a wage garnishment, it means that you were sued, you lost your case in court, and the winner got a judgment against you.
But a judgment is just a piece of paper signed by a judge saying that you owe a certain amount of money. Judges don’t write checks in court to pay the winner of a lawsuit. The person or company that got a judgment against you still has to figure out how to get the money from you. They will usually hire a debt collection law firm to help them.
According to the Florida wage garnishment law, F.S. 77.0305, the legal term for a wage garnishment is a “Continuing Writ of Garnishment Against Salary or Wages”. A wage garnishment is a legal tool that debt collectors use to try to get your money. It forces your employer to pay your debt collector a portion of your paycheck before you receive it. A wage garnishment can last for up to 20 years, or until you quit, get fired, or pay off your entire judgment, including interest and collection costs.
Wage garnishments suck.
If you live in Florida and you have a wage garnishment against you, your first $217.50 of weekly disposable earnings is automatically protected from wage garnishment by the federal Consumer Credit Protection Act. Your “disposable earnings” are your gross pay minus mandatory payroll deductions, like taxes. Disposable earnings are often more than your take home pay.
If you earn more than $217.50 per week, your debt collector can take the lesser of: (A) 25% of your disposable weekly earnings or (B) your disposable weekly earnings above $217.50.
Here’s an example to show you how this works:
Let’s suppose that you are paid every week, your gross weekly pay is $600, and your mandatory payroll deductions are $60.
Your disposable earnings would be $540 ($600 minus $60). 25% of your disposable earnings would be $135 ($540 x .025). Your disposable earnings above $217.50 would be $322.50 ($540 minus $217.50).
In this example, your wage garnishment amount would be $270 every paycheck ($135 per week times 2 weeks).
If you are paid every two weeks, you would multiply this amount by 2 to determine your paycheck garnishment amount.
If you have trouble paying all of your bills before a wage garnishment, it may be impossible for you
to make ends meet when you only get to keep 75% of your paycheck.
Unless you make so much money that you don’t need 25% of your paycheck, you will have to cut your expenses. Most people’s biggest expense is housing. So a 25% wage garnishment may suddenly make your rent or mortgage payments unaffordable and force you to move to a cheaper house or apartment.
If you own your home, you may not be able to sell it for enough money to pay off your mortgage loan. This may mean that you will lose your home in foreclosure. If you are renting, you may have to break your apartment lease and lose your security deposit. Either way, you will probably get sued if you stop paying your mortgage or your rent. Which could mean another judgment against you and another wage garnishment.
Nobody likes to move. Moving is an expensive, back-breaking headache. Hiring professional movers can cost you thousands of dollars. Even a do-it-yourself move is not cheap. Not to mention the stress from packing and unpacking a lifetime’s worth of your belongings and loading and unloading the moving truck.
If your wage garnishment forces you to move to a cheaper home, it may be located in a neighborhood or town that you are not familiar with. It may be in an area with higher crime. The new home may be smaller, which means that you may have to get rid of some of your favorite belongings.
If your new home is farther away from your job, you will have a longer drive every workday, which means that you will pay more for gasoline and car maintenance.
If you are forced to move due to your wage garnishment, you could disrupt your children’s education if you have to enroll them in a new school, especially if you move in the middle of the school year. Their grades may drop when they switch schools. They may not be able to take the same classes at their new school. They may lose credit for classes they took at their old school. If they were playing on a sports team, played an instrument in the school band, or participated in any other school activity at their old school, they will have to quit. All of these changes could decrease their chances to get into college and receive a scholarship.
Your kids’ new school may not be as good academically as their old one. Your kids may lose their old friends and have to make new friends. There may be bullying, drug use, gang activity, or other undesirable activity at the new school.
Alright, enough with the bad news.
So you now know that your wage garnishment could be devastating to you and your family. You’re scared and probably a little angry. You want to know how you can fight. The good news is that you have three options to protect your wages against your wage garnishment.
You may be able to work out a deal with your debt collector to settle your debt. If you are able to settle your debt, the wage garnishments will stop. To settle, the debt collector will probably demand that you pay them a lump sum of cash to payoff a portion of the debt, maybe 50-75% of the total debt.
The amount of your settlement will depend on your negotiation skills, the amount of the debt, and the amount of your paycheck garnishments. You may have better results if you hire a bankruptcy lawyer to negotiate your settlement. That’s because the debt collector may be afraid that you will file for bankruptcy if you do not settle your debt.
There are two problems with debt settlement.
The first problem with debt settlement is that it may be hard or impossible to come up with enough cash to settle the debt in a lump sum. Most people don’t have piles of cash laying around to settle their debts.
If you have a retirement account, it may be tempting to make an early withdrawal from your retirement savings to settle your debt. But that is usually a terrible idea because retirement money is safe from garnishment, you will probably have to pay a hefty tax penalty for early withdrawal, and you are stealing from your future income to pay off your debt.
You may also be tempted to get a cash advance on your credit card or otherwise borrow money to settle your debt. But that’s just replacing old debt with new debt and your interest rate may be even higher on the new debt. That’s not a real solution.
The second problem with debt settlement is that your debt collector will report any reduction in the amount you have to pay to the IRS as debt forgiveness income.
For example, if your debt is $30,000 and you settle for $24,000, you will have $6,000 of debt forgiveness income. At the end of the year, you may have to pay tax on that “income”. But if you can’t pay the tax, the IRS will be your new bill collector. You do NOT want to owe money to the IRS — it is the toughest bill collector on the planet. And yes, the IRS can garnish your wages for unpaid taxes.
In Florida, you can prevent your salary or wages from being garnished by claiming the head of family wage exemption if you provide more than one-half of the support for a dependent.
Only your spouse, your children, or other close family members that you take care of count as dependents. You cannot claim your girlfriend, boyfriend, fiance, your best friend, or your pets as dependents. Only wages or salary paid to you as an employee for your labor or services can be claimed as exempt.
If you are self-employed or if you own a corporation and you control how much money you are paid, you cannot claim the head of family exemption.
You will find out about your wage garnishment when you receive a notice in the mail titled “NOTICE TO DEFENDANT OF RIGHT AGAINST GARNISHMENT OF WAGES, MONEY, AND OTHER PROPERTY PURSUANT TO F.S. 77.041”. When you receive this notice, you should immediately contact a wage garnishment defense lawyer because you will only have 20 days to respond. It is unfair, but if you do not respond to your wage garnishment notice within 20 days, you will lose the right to fight the wage garnishment — even if you qualify for the head of family exemption.
There are two problems with the Florida head of family wage exemption.
The first problem is that you may not have any dependents that rely on you for more than one-half of their support. The second problem is that you may be self employed.
If you do not have eligible dependents or if you are self-employed, you cannot claim the head of family wage exemption.
The fastest way to stop your wage garnishment is by filing for bankruptcy.
If you file for bankruptcy, your wage garnishment must IMMEDIATELY stop due to the bankruptcy “automatic stay”.
The automatic stay is a legal protection that stops almost all collection activity against you the moment that you file your bankruptcy case.
As soon as your bankruptcy case is filed, a diligent bankruptcy lawyer will notify your debt collector that you are protected by the bankruptcy automatic stay and demand that your wage garnishments must immediately stop. The debt collector will also receive notice of your bankruptcy from the court.
Most debt collectors are smart enough to stop garnishing your wages after you file for bankruptcy. But if your debt collector does not immediately stop your wage garnishments upon being notified about your bankruptcy filing, you can sue the debt collector to force them to return your garnished wages to you and to pay your attorney fees and court costs. You may also be able to sue them for your emotional distress and punitive damages.
If your wages are being garnished or if you are afraid that they will be garnished soon, the worst choice that you can make is to do nothing. Do not give in to your fear and simply hope for the best. Things will not get better if you do not take action.
Get the help you need and get it NOW.
Call Suncoast Law Office today at 727-771-5989 to schedule a free telephone consultation with a wage garnishment defense lawyer. We will gather the facts about your Florida wage garnishment and help you determine your best course of action.