Washington creditors who are not paid by their debtors on a legally recognized debt can use garnishment to secure repayment. In garnishment, the creditor seeks an order directing a third party, called a garnishee, to turn over to it money in its possession or control which belongs to a debtor. The money is used to satisfy (or pay) the creditor’s monetary judgment (court determination of one party’s obligation to pay another party), which serves as the basis for the garnishment.
Any source or type of belonging to a debtor which is in the control of a third party can be garnished. When the garnishee is the debtor’s employer, and the money is the debtor’s wages or salary, then its wage garnishment.
Washington Garnishment Exemptions and Non-Exemptions
Federal law protects—or exempts—Social Security from most garnishment, allowing it to be garnished only for child support, alimony, federal taxes, and a few other, narrowly defined federal debts.
Washington has chosen, like other states, to establish additional exemptions to garnishment, such as:
- Pensions or retirement benefits: Washington provides broader-than-average protection for retirement benefits and pensions, exempting not only many public employee (including both federal and municipal employee) pensions, but also private pensions and many distributions from 401(k) plans or IRAs. A debtor receiving retirement income should check whether his or her specific benefits are exempt—there’s an excellent chance they are.
- Public benefits or assistance: similarly, Washington exempts many public benefits, such as unemployment compensation, worker’s compensation, aid to families with dependent children, general assistance, crime victim’s compensation, and old age assistance. Debtor’s on public assistance should check to see whether their particular aid is exempt.
- Insurance or annuities: Washington exempts annuities, up to $2,500 per month; fraternal society benefits; disability benefits; and life insurance proceeds in many situations.
Washington Maximum Threshold
Not all non-exempt income can be garnished. Instead, in order to leave the debtor something to live on, income (including wages and salary) can only be garnished up a certain amount or percentage. Washington essentially follows federal law in this regards, since for most debts—including commercial or consumer debts—it allows the lesser of the following to be garnished:
- 25% (total; across any/all garnishments) of disposable income; or
- The amount by which a debtor’s weekly income exceeds 30 times the minimum wage
“Disposable income” for purposes of the above is all income remaining income after any deductions mandated by law, such as FICA. (This departs from the common usage of “disposable income,” which is income after necessary or required expenses, such as food, transportation, medical care, or shelter.) Since there are few legally mandated deductions, the vast majority of a debtor’s income will be disposable income.
As mentioned to above, the 25% threshold holds for most debts, but not all. There are certain debts or obligations which will allow more of person’s income to be garnished. The principal debt supporting additional garnishment is child support obligations, which allow up to 50% (or more) of income to be garnished. Tax debts may also allow greater garnishment.
Washington Statute of Limitations
A state’s statute of limitations is how long it allows a person to bring a legal action. This varies by the type of action or the debt on which someone is suing. In Washington, some of the most common statutes of limitations relating to garnishment are:
- Oral/verbal contract or open account (e.g. credit card): 3 years
- Sale of goods: 4 years
- Written contracts, promissory notes, accounts receivable: 6 years
- Judgments: 10 years
The final statute refers to how long a creditor has to seek garnishment on (or otherwise enforce) a judgment received in a previous legal action. In regards to other limitations periods, always remember that if the creditor did not sue in time, he, she or it cannot collect on a debt.
Writ of Garnishment in Washington
A garnishment proceeding is not where the court determines whether someone owes money—that was done during the preceding legal action, where the creditor sued the debtor on some debt, obligation, or cause of action. (Note: the IRS and state tax authorities do not need to sue first—they can make legally enforceable determinations of a person’s obligation to pay, though a taxpayer has the right to dispute that determination, including in court.)
Since the debtor’s obligation to pay has already been determined, the debtor’s involvement in garnishment (unless he or she is challenging it on some grounds; see next section) is often minimal. Instead, the main actors or participants in garnishment are the creditor and the garnishee.
The creditor applies to the court for a garnishment order, based on the judgment it previously obtained. The creditor needs to state that it hasn’t been paid; garnishment is necessary in order to secure payment; and there are one or more garnishees (such as the creditor’s employer), who have money owing or belonging to the debtor (such as debtor’s wages) which can be used to satisfy the judgment.
The garnishee will have papers served on him, her, or it, directing the garnishee to verify that the garnishee has some of the debtor’s money. The garnishee cannot challenge the creditor’s judgment against the debtor or the creditor’s right to garnishment, but it can challenge any incorrect facts—that is, if it doesn’t owe the debtor anything, owes the debtor less than the creditor believes, or has never even hear of the debtor, it can show that.
Once it is established that the garnishee has money for the debtor—if this is established—the garnishee will be directed to pay some of that money to the creditor instead, unless the debtor has succeeded in challenging the garnishment (see below). More on Stopping Wage Garnishment in Washington.
Getting Legal Help
Garnishment is not the time for the debtor to challenge the creditor’s claim that the debtor owes it money—that should have been done during the previous litigation (when the creditor obtained a judgment in his favor). However, even given that, there still are ways to dispute garnishment, such as:
- Is there a mistake in the garnishment, such as wrong party or wrong amount of debt?
- Is the garnishment being brought too late, after the statute of limitations has passed? (The debtor may also be in a position to challenge the creditor’s original lawsuit claiming it owes money on statute of limitations grounds.)
- Is the garnishment process not being followed, such as the creditor not serving papers on the correct parties, or not providing the right information?
- Should the underlying judgment not have been granted, such as if the correct legal process or procedure was not followed? For example, it’s often the case that the debtor was never given proper notice of the lawsuit, and so lost “by default” when in fact the debtor had not chance to defend him- or herself.
- Is much or most of the debtor’s income exempt? Income from exempt sources is not considered as part of disposable income. The less disposable income there is, the less that can be garnished.
For more information:
Washington Statutes (state statutes)[ http://apps.leg.wa.gov/rcw/]
FAQ sheet about Federal garnishment rules[http://www.dol.gov/whd/regs/compliance/whdfs30.pdf]
Social security and garnishment[http://www.ssa.gov/deposit/DDFAQ898.htm]