In California, wage garnishment occurs when a creditor obtains the right for a debtor’s employer to withhold a portion of their wages to be sent directly to the creditor, for payment of an outstanding debt. In most cases this is done following a lawsuit, and a court order for the garnishment is required. However, the federal government can obtain a wage garnishment for debts owed them (such as income taxes or student loans) without going through the court process.
Garnishment is governed at both the federal and state level. When the laws conflict, whichever law is more beneficial to the debtor will apply (such as the law resulting in the larger garnishment exemption.)
California Garnishment Exemptions
California garnishment law is complex. Any specific questions regarding California garnishment exemptions, or other areas of garnishment law in California should be directed to a California wage garnishment attorney.
However, under California law, the following types of income are usually not subject to wage garnishment:
- Public and private retirement benefits (such as IRAs and 401Ks)
- Most forms of public assistance, including unemployment and workers’ compensation benefits, county assistance, student financial aid, and union benefits
- Insurance benefits, including payments received from life and homeowners insurance policies
- Under federal law, Social Security benefits are exempt from garnishment (except in cases of debts owed to the federal government, such as delinquent taxes, and garnishments for overdue child support)
California Garnishment Limits
California does not provide its own law in terms of the maximum amount of earnings that can be subject to garnishment – therefore the federal rule applies. Under federal law, the maximum amount of an employee’s earnings that is subject to garnishment is the calculated as the lesser of the following:
- 25% of the debtor’s disposable income (disposable income is defined as what’s left after federally-required deductions, such as income taxes)
- The amount by which the garnishee’s weekly incomes exceeds 30 times the federal minimum wage
Note that larger amounts are allowed for debts related to taxes or child support. The amounts exempt from garnishment in these cases varies by state law, as well as by other circumstances.
California Garnishment Statute of Limitations
In most cases, a creditor must bring a lawsuit against the debtor within four years of the debt occurring. Note that this doesn’t mean that the garnishment must take place within four years, just that the lawsuit resulting in the garnishment order must have been filed within that time.
Once the judgment allowing the garnishment has been issued, the creditor can continue to garnish wages for up to 10 years (or until the debt has been paid in full.)