Georgia Wage Garnishment Laws
Georgia wage garnishment is a way creditors can collect from debtors who do not voluntarily pay. The creditor has part of the debtor’s wages or salary sent to the creditor for the debt. Garnishment is available for any debt, including those resulting professional malpractice, auto accidents, breach of contract, or any other lawsuit. Its most common usages are for consumer debts (including credit cards), domestic debts (such as alimony or child support), and taxes. Any money owed to or owned by a debtor, which is in the hands of a third party (like an employer or a bank), can be garnished, but wages and salary are among the most common subjects of garnishment.
A creditor needs a court order to garnish wages. That means that the creditor first has to sue the debtor and win, obtaining a judgment for money. Garnishment is one of several ways creditors can look to enforce judgments that debtors do not honor voluntarily.
Georgia Garnishment Exemptions and Non-Exemptions
Always, Social Security is largely protected from garnishment. Under federal law (remember: Social Security is a federal program), it can only be garnished for a few specifically defined debts, such as child support, alimony, or federal taxes.
Above and beyond Social Security, states can—and have—established other exemptions to garnishment. Georgia, unfortunately, seems to protect fewer types of income than most other states. Note that there is an atypical distinction in Georgia: it’s exemptions for bankruptcy are quite broad, but in contrast to most states, the bankruptcy exemptions and the garnishment exemptions do not track each other closely. This means that expecting that bankruptcy exemptions to provide protection against a creditor’s efforts to garnish wages can be dangerous.
The Georgia exemptions appear to break down into just a few categories. Examples of Georgia garnishment exemptions include—
- Some pensions: public employee—which means state worker—pensions are protected from garnishment, but the pensions for municipal employees may not be; and private pensions or retirement benefits are effectively not protected, since while the fund or account itself may not be targeted by creditors, distributions to the retiree can be garnished.
- Some public benefits or assistance: workers’ compensation, and aid to the blind, elderly, and disabled are protected from garnishment.
- Some insurance: annuity benefits; disability or health benefits, up to $250 per month; group insurance benefits
Most states protect more categories of income from garnishment, especially more categories of retirement benefits. In Georgia, most forms of income can be garnished.
Georgia Maximum Threshold
Many states, including Georgia, follow federal law in terms of the maximum amount garnished. Under federal law, the lesser of the following may be garnished:
- The amount by which a debtor’s weekly income exceeds 30 times the minimum wage
The purpose of this threshold is to allow a debtor something to live on—at least the equivalent each week of working 30 hours at minimum wage.
- 25% of disposable income (total; not for each garnishment or claim)
Disposable income is defined very broadly for garnishment purposes. It is all income left after legally required deductions, such as FICA or state employee retirement contributions, are taken out of a person’s paycheck. No deduction not mandated by some law, including health insurance or 401(k) contributions, is considered when determining disposable income, which means that most income will be considered “disposable income” and subject to garnishment.
Under federal law, the 25% rule is for most debts. There are certain debts, like tax obligations and child support, where more income can be garnished. Depending on the exact circumstances, for example, up to 50 % - 60% of a debtor’s income could be garnished for child support.
Georgia Statute of Limitations
There are two different statutes of limitation relevant to garnishment.
Statute of limitations for the underlying debt. If it’s too late to sue, it’s too late to garnish, which means that lawsuit which gave rise to the judgment the creditor is trying to enforce must have been brought within the time to sue (the statute of limitations). The time period is different for each kind of debt or cause of action, but the limitation periods for the most common types of consumer debts are:
- Written contracts: 6 years
- Open accounts (credit cards): 4 years
Statute of limitations for enforcing judgments. If the creditor successfully sued, won, and received a judgment, the creditor has either 5 years (“foreign” judgment—i.e. one from any place other than Georgia) or 7 years (“domestic” judgment—one from a Georgia court) to act. That means that a creditor can wait for a few years, to see if a down-on-his-or-her-luck debtor gets into a better financial position—such as by getting a higher-paying job—before garnishing wages. This is less time than most states allow, which is obviously good for creditors.
Writ of Garnishment in Georgia
The original lawsuit is between the creditor and the debtor. The garnishment is between the creditor and someone holding money for the debtor or owing money to the debtor, called a “garnishee.” For example, the debtor’s employer can be a garnishee, since the employer owes the debtor money (wages or salary) for services.
Since garnishment is between the creditor and the garnishee, the debtor’s involvement is minimal. The creditor needs to apply (in writing) to the court to enforce its judgment by garnishment. The creditor needs to set out the following—
- money is due to it, pursuant to a valid and enforceable judgment
- garnishment is necessary to collect
- the garnishee has money available, owed to the debtor, which can be used for the debt
Assuming the above facts are all true, the creditor will almost certainly get its garnishment. Since if a garnishee does not comply, the garnishee him/her/itself may become liable for the money, the garnishee has strong incentive to comply with all lawful garnishments. (And after all, it’s not as if the garnishee is paying its money—it’s diverting some of the debtor’s money to the creditor.) More on Stopping Wage Garnishment in Georgia.
Getting Legal Help
Attacking a garnishment generally involves attacking it (or possibly the underlying debt) on procedural grounds, or challenging how the debtor’s disposable income is calculated. (Since the debtor should have already had its day in court to fight the debt during the original lawsuit, it’s hard to challenge the debt at this late date on substantive grounds.) Because challenging a court order on these bases is “technical”—it requires a thorough understanding of the procedural rules and the rules for exemptions—a lawyer’s assistance is invaluable.
The main grounds for a challenge are:
- The original judgment is invalid because the debtor was never properly served or put on notice of the debt (this is not that uncommon; creditors and their attorneys often do everything they can to prevent the debtor from having fair notice and a chance to fight the debt).
- The original judgment is invalid because the lawsuit was brought too late (violates statute of limitations).
- The garnishment or enforcement action is invalid because it violates the statute of limitations.
- Debtor has little or no disposable income, possibly due to most income coming from exempt sources. (Unfortunately, this is apt to be of less benefit in Georgia than in many other states, but it’s worth it for a debtor to check if his or her non-wage, non-salary income is exempt.)
- Debtor is paying other garnishments, and is already paying at or close to the maximum amount.