When you fall behind on your bills, your creditors may take legal action to collect the money you owe them. One way they may do this is by asking the court to issue a wage garnishment order. This empowers the creditors to take direct deductions from your paycheck.
In Ohio, wage garnishments are governed by Chapter 2716 of the Ohio Revised Code. If you have been served with a wage garnishment order, you should contact one of our experienced attorneys to discuss your options and help you protect your rights.
When Can Wage Garnishment Happen in Ohio?
Wage garnishment in Ohio can happen for a few different reasons. The most common reasons are listed below:
- Unpaid Child Support or Spousal Support: Unpaid child support or spousal support can trigger wage garnishment in Ohio. If you have fallen behind on your payments, the other parent can request that your wages be garnished in order to catch up. It is important to note that this type of debt does not require opening a court case and getting a court judgment before a wage garnishment begins. Instead, they just need to ask for a court order that lets the wages be taken.
- Tax Debt: When an individual owes taxes to the state of Ohio, the state has the legal right to collect that debt through wage garnishment. The state will send an individual's employer a notice to withhold a certain amount of money from their paycheck each week and send it to the state to pay down the tax debt. The IRS can also garnish your wages if you owe back taxes, and they will continue to do so until the debt is paid in full. Both the state and the IRS do not need to open a court case or obtain a resulting court judgment to begin wage garnishment in Ohio.
- Credit Card Debt: When an individual falls behind on their credit card payments, the credit card company may choose to initiate wage garnishment to recoup the outstanding debt. In order for wage garnishment to occur, the credit card company must first obtain a court order authorizing the withholding of wages.
- Personal Loans: If you take out a personal loan and later default on the payments, your lender can file a lawsuit against you. If they win the lawsuit, they can then get a court order requiring your employer to withhold a portion of your wages to repay the debt. This wage garnishment law applies to all types of personal loans, even student loans. But while all creditors need a court judgment before they can take money out of your paycheck, no court judgment is needed for federal student loan debts.
- Business Loans: If you are one of the many Ohioans who have taken out a business loan while still working at their salary job, you may wonder if your loan could trigger wage garnishment. The short answer is yes, business loans can trigger wage garnishment in Ohio. This process can be triggered by a court judgment that allows the creditor to take out parts of the loan from your wages.
How Much Can Be Garnished From Wages in Ohio?
In Ohio, the maximum amount that can be garnished from wages is 25% of the employee's weekly disposable earnings. Disposable earnings are defined as the employee's net pay after taxes, and other mandatory deductions have been withheld. If an employee has more than one job, the wage garnishment may be applied to all of their jobs, but the total amount garnished cannot exceed 25% of their disposable earnings.
There are a few exceptions to the general rule that only 25% of wages can be garnished. If an employee owes child support or spousal support, you may be required to pay up to 60% of your weekly disposable income. On the flip side, if you owe back taxes or student loans, the maximum percentage of your weekly disposable income that can be garnished is 15%.
Are There Any Exceptions to Wage Garnishment in Ohio?
There are a few sources of income that are exempt from wage garnishment in Ohio. These include Ohio Social Security benefits, unemployment compensation, and worker's compensation payments. Other payments that can't be garnished are disability payments, payments for child support or spousal support, and most pensions.
This means that you cannot have your state social security benefits garnished to pay off debts. Unemployment compensation is also exempt from wage garnishment in Ohio. This means that if you are receiving unemployment benefits, they cannot be garnished to pay for debts. The same applies to the other types of income listed above.
This can be a great help for people who are struggling to make ends meet and are worried about their meager subsistence incomes being garnished. In any case, it is important to remember that these sources of income are not always exempt from other debts, so it is essential to check with an attorney or financial advisor to ensure you are protected.
How to Protect Your Wages From Garnishment in Ohio
If your wages are being garnished, there are a few ways you can protect your money. In Ohio, you can raise an objection, agree to debt scheduling, or file for bankruptcy.
If you raise an objection, you will need to show why the garnishment is unfair or unlawful. For example, if the debt is not yours or if the amount being garnished is more than you can comfortably afford. This is usually argued in court.
The second option is to agree to a debt repayment schedule with your creditors. This can be done with the help of an attorney out of court. This will allow you to make smaller, more manageable payments over time instead of having a large chunk of your paycheck taken away each week.
A third way to protect your wages is to file for bankruptcy. This will stop all creditors from garnishing your wages, giving you a fresh start financially.
If you are in the middle of a wage garnishment or you sense one around the corner, speak with us. Our team of attorneys and financial experts can advise you on how to best protect your income and assets.