Garnishments
What is garnishment?
The term “garnishment” refers to when someone’s income is withheld, or their money is taken for the payment of debt. Most garnishments are made by court order. Judgment creditors, which are creditors with a court order giving them permission to get money from someone for a debt, can garnish bank accounts and wages.
Is there a limit to how much can be taken from my paycheck?
Federal and state wage garnishment laws limit the amount of a person’s paycheck which can be garnished in any one week or pay period and protects employees from being fired because of garnishment for any one debt.
It does not change other matters related to garnishments, such as the right of a creditor to collect the full amount owed, and most garnishment procedures established by state laws or rules.
Based on Colorado minimum wage of $14.42 per hour, effective Jan. 1, 2024, the following are limits to how much can be garnished:
Wage garnishment
The term “wage garnishment” refers to when someone’s income is taken out of their paycheck for the payment of debt.
| I AM PAID: | AFTER TAXES, SSA, MEDICARE, and the COST OF EMPLOYER PROVIDED HEALTH INSURANCE, I RECEIVE: |
HOW MUCH WILL BE GARNISHED: |
|---|---|---|
| EVERY WEEK | $576.80 or less | NOTHING |
| EVERY 2 WEEKS | $1153.60 or less | NOTHING |
| TWICE A MONTH | $1249.78 or less | NOTHING |
| ONCE A MONTH | $2498.99 or less | NOTHING |
| I AM PAID: | AFTER TAXES, SSA, MEDICARE, and the COST OF EMPLOYER PROVIDED HEALTH INSURANCE, I RECEIVE: |
HOW MUCH WILL BE GARNISHED: |
| EVERY WEEK | $576.80 – $721 | The amount I earn over $576.80 |
| EVERY 2 WEEKS | $1153.60 – $1442 | The amount I earn over $1153.60 |
| TWICE A MONTH | $1249.78 – $1562.17 | The amount I earn over $1249.78 |
| ONCE A MONTH | $2498.99 – $3124.38 | The amount I earn over $2498.99 |
| I AM PAID: | AFTER TAXES, SSA, MEDICARE, and the COST OF EMPLOYER PROVIDED HEALTH INSURANCE, I RECEIVE: |
HOW MUCH WILL BE GARNISHED: |
| EVERY WEEK | $721 or more | 20% of what I receive |
| EVERY 2 WEEKS | $1442 or more | 20% of what I receive |
| TWICE A MONTH | $1562.17 or more | 20% of what I receive |
| ONCE A MONTH | $3124.33 or more | 20% of what I receive |
Colorado law allows you to request a hearing if a garnishment calculated according to the chart above would not allow you to pay your family’s actual and necessary living expenses after considering all income in the household.
If you owe child support, student loans, or money to the IRS, the above exemptions may not apply.
Garnishments FAQs
What is bank account garnishment?
The term “bank account garnishment” refers to when someone’s money is taken from their bank account for the payment of debt.
Judgment creditors routinely go after bank accounts. A judgment creditor can attempt to take your money from your bank account, even if the money was originally exempt. As soon as you put money into a bank account with your name, a judgment creditor can take it.
Therefore, we recommend to clients that if there is a judgment, you should pay attention to whether the money in the account is protected and what may happen if a writ of garnishment is served on the bank.
What if I have a shared account with someone?
If you have a joint account, your creditors DO NOT have to notify the other account holder of the garnishment, and all funds in the account are frozen, or not accessible to you, up to the amount of the judgment.
What happens when my bank account is garnished?
When a bank account is garnished, the judgment creditor gets a written court order (called a writ) and serves the bank and then serves the person who owes the debt. The funds in the account are frozen up to the amount of the judgment.
This means that if the account is a checking account and the garnishment freezes the entire amount, checks will bounce and you will have to pay bank charges, as well as charges to the merchants. While the account is frozen, any outstanding checks will be returned, resulting in charges for insufficient funds, and the bank will charge a fee for the garnishment.
What do I do if I think my money should be protected from garnishment or if I can’t afford to pay living expenses without that money?
You have 14 days to object to wage or bank account garnishment through a form that you can file with the court. Court forms are available at www.courts.state.co.us, and you should also receive the necessary form when you are served with the writ of garnishment.
If you do not object to the garnishment within 14 days, then the court will release the funds to the judgment creditor, even if the funds may be exempt. We also recommend seeking legal advice.
If you do file an objection to the court within 14 days, the court should set a hearing on the objection. You will have to prove that the funds are exempt from garnishment.
If the court finds that the funds are exempt and should be protected from garnishment, the court will order the money released to you, the judgment debtor.
The court can consider various living expenses to determine how much of your money can be taken through garnishment, including:
- Rent or mortgage
- Utilities
- Food and household supplies
- Medical and dental expenses
- Childcare
- Clothing
- Education
- Transportation
- Maintenance, alimony, or child support
NOTE: Even if the court finds that the funds are exempt from garnishment and releases the money to you, you will still need to pay fees associated with the garnishment. The costs of a garnishment can be very large.
Are my federal benefits safe from garnishment?
Federal money that is protected includes:
- Social Security benefits
- Supplemental Security Income (SSI)
- Veterans Administration benefits
- Social Security and other federal benefits should be safe in a bank account if they are electronically deposited into that account (and not moved into another account), even if a garnishment is served on your bank.
Your bank account is safe from garnishment if the balance does not exceed twice the amount of your federal benefit amount.
- For example, if you receive Social Security Disability of $800 per month, and it is electronically deposited into your bank account, your bank account cannot be frozen if it contains less than $1,600.
When banks or credit unions receive an order to freeze an account, they must review the accounts owned by the individual to determine whether any federal benefits were electronically deposited during the preceding two months.
If there have been federal benefits deposited, banks must calculate the “protected amount.” The “protected amount” is the lesser of the sum of all exempt benefits electronically deposited into the debtor’s account during the previous two months, or the current balance.
| For example: Jane Smith receives $674.00 per month in SSI, and it is deposited electronically into her checking account on the first of each month. On October 10th, her bank receives an order to freeze $850.00 because of a court judgment. The bank must look at her account records and determine if she has received federal benefits in the last two months. Their review will show $674.00 received on October 1st and $674.00 received on September 1st, for a total of $1348.00. On October 10th, she has $650.00 in her account. The “protected amount” is the $650.00 – the lesser of the $1348.00 and $650.00// This means the bank will not freeze her funds.
If Jane had transferred her SSI money from the checking account it was electronically deposited into to a savings account, it would not be protected from being frozen. However, if she acts quickly, she can still file a Claim of Exemption and show that it is SSI. The money will be released, but she will have to pay a fee to the bank. |
Is the money I receive from child support safe from garnishment?
Child support and maintenance that you receive is exempt from garnishment.
GARNISHMENT CALCULATIONS
Multiple Garnishments:
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If an employer receives multiple garnishments, they are taken in the order they were received.
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However, a garnishment for unpaid child support takes priority. Up to 65% of disposable earnings may be taken for child support and previously unpaid child support.
- For other creditors, only up to 20% of disposable earnings may be taken, even if there are multiple garnishments. Starting in October 2020, you may be able to object to the 20% if it is a financial hardship.
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Can I be fired because my wages are being garnished?
The Federal Wage Garnishment law prohibits an employer from firing an employee because they are being garnished for any one debt.
The law does not prevent you from being fired if there are garnishment proceedings for more than one debt.
- The garnishment may be from the same creditor, but they must involve separate debts.