No one ever really wants to have their wages subject to a legal garnishment. Many New Yorkers, after all, count on receiving all of their paychecks to meet their basic household needs and make other, higher priority payments like the mortgage payment and the electric bill.
One of the most important things for a New York resident to remember is that most creditors, including medical providers and credit card companies, cannot simply garnish wages unless they either go through a formal process or get their debtor’s permission to do so. The formal process includes having to sue in court and get a judgment saying money is owed before even starting the garnishment itself. Getting a garnishment is a separate legal process that is multi-faceted and somewhat complicated. Moreover, at each important step, and before a debtor’s employer gets a copy of the garnishment order, a debtor subject to the garnishment is going to have the opportunity to object to anything improper about it.
Furthermore, in most cases New York garnishments can order employers only to take so much out of a person’s paycheck. Federal and state law limit the amount a creditor can garnish each period and ties that limit to the minimum wage.
Because of another, separate limit, residents also can be assured that, in any event, a wage withholding will not be more than 25 percent of their net, after tax income. In New York, a third limit, capping withholdings at 10 percent of gross income, also applies. The lowest withholding cap will apply, and that will be the amount actually withheld from the paycheck.
Although New York law has protections in place that keep most garnishments from swallowing up a person’s livelihood, even a little bite out of a paycheck can hurt a New York family. These families may want to consider bankruptcy as an option.