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Protecting Your Wages from Creditors Free Advice Law Advice Insurance Advice Community Law Advice Free Case Evaluation Ask a Lawyer Q amp A Legal Topics All Legal Topics Accident Law Bankruptcy Law Business Law Criminal Law Employment Labor Law Estate Planning Family Law Financial Law General Practice Government Law Immigration Law Insurance Law Intellectual Property Litigation Malpractice Law Personal Injury Real Estate Law Tax Law Small Claims Admiralty Maritime Aviation Law Estate Planning Topics All Estate Planning Topics Estate Planning BasicsWillsTrustsProbateAsset ProtectionLiving Wills Power of AttorneyElder Law Free Advice Law Advice Estate Planning Asset Protection Current Page Protecting Your Wages from Creditors Written by FreeAdvice Staff Every state has an exemption for certain types of income which creditors may not be able to garnish even if they hold a judgment against you If you have exempt income or property a debt collector cannot take it in order to cover a debt These may include wages salary social security welfare or unemployment compensation Some exemptions apply to only heads of households but many apply to anyone In some states earnings of independent contractors or sole owners of corporations are not considered exempt wages A creditor or debt collector cannot force you to use exempt income to pay a debt The following types of income are exempt under federal law Public Assistance PA Supplemental Security Income SSI Social Security Social Security Disability SSD Veterans benefits VA Child Support Spousal Maintenance Workers Compensation Unemployment Insurance Railroad Retirement benefits Black Lung benefits Wages Under federal law Title III of the Consumer Credit Protection Act protects employees by limiting the amount of earnings that may be garnished in any workweek or pay period to the lesser of percent of disposable earnings or the amount by which disposable earnings are greater than times the federal minimum hourly wage prescribed by Section a of the Fair Labor Standards Act of This limit applies regardless of how many garnishment orders an employer receives The federal minimum wage is per hour effective July and per hour effective July Note All states allow wage garnishment for child support alimony taxes and federal student loans Each state differs in its wage garnishment laws but if a state s law allows for more of your wages to be garnished than the federal law the state must comply with federal law Wage Account A way to help protect your income from creditors is to place the funds into a separate bank account called a wage account The purpose of the wage account is to segregate protected wages and not commingle it in accounts with money from other sources Separate wage accounts are not always necessary In Florida for example the law provides for the protection of of the head of household s wages from garnishment even if the wages are commingled with other funds as long as you can clearly trace and identify the wages deposited into the account Note however that it has become common practice for debt collectors to freeze accounts containing protected income If your account consists solely of exempt funds it is much easier to get the account released Other states may differ but under Florida law wages are exempt for a period of six months This means wages in the debtor s possession which are less than six months old on the date of filing are exempt However those wages must be identifiable So although not necessary under Florida law it would seem to be beneficial to segregate your wages from other money In New York the maximum amount of garnishment is ten percent of gross income or the federal maximum whichever is less If the debtor is subject to garnishment for alimony support or maintenance the combined garnishments cannot exceed twenty five percent of disposable earnings Other examples are California which uses the same rules as the federal government Massachusetts which allows garnishment of wages up to a week and Pennsylvania where wages can only be garnished for taxes and child support Check with your state s Department of Labor or an attorney in your area for your state s rules on wage accounts and garnishment of wages by creditors It is important to know your rights If a creditor freezes your bank account and all the money in the account is from recent paychecks odds are it is all exempt from debt collection View Related What Can You Protect Articles View the Next Article Estate Planning Homepage All Legal Topics Find a Estate Planning Attorney Ask a Lawyer Didn't find what you were looking for Make it Social Must Read ArticlesHow can I protect my personal residence How to Protect Your Interest in Real PropertyProtecting Assets of the Elderly or Disabled with a ConservatorshipProtecting Your Wages from CreditorsProtecting Yourself from Creditors When You Own a BusinessRemarriage and Estate Planning An Overview Select Practice Area Adoption Support amp Child Custody 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