Wage garnishment, answered plainly.
How much of your paycheck a creditor can legally take in Arkansas or New Mexico, how a bankruptcy filing can pause a garnishment, and when garnished money can sometimes be recovered. Answered by a licensed attorney.
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Can a creditor really take money straight out of my paycheck?
Yes, but for ordinary consumer debts (credit cards, medical bills, personal loans, old repossessions) only after suing you and winning a court judgment. A collector who calls threatening to “garnish your wages tomorrow” without a judgment is bluffing. The big exceptions that skip the lawsuit: unpaid income taxes, defaulted federal student loans, and child support.
How much of my paycheck can be garnished in Arkansas?
For most consumer judgments, federal law caps garnishment at the lesser of 25% of your disposable earnings (take-home after required deductions) or the amount by which your weekly take-home exceeds 30 times the federal minimum wage. In practice that means low-wage workers may be partly or fully protected, and no ordinary creditor can take more than a quarter of your net check. Child support and tax levies follow different, higher limits.
How much can be garnished in New Mexico?
New Mexico is more protective than the federal floor. State law caps a consumer garnishment at the lesser of 25% of disposable earnings or the amount by which your weekly take-home exceeds 40 times the federal minimum hourly wage, a bigger protected cushion than the federal 30-times rule. Errors in the math are common, so bring recent pay stubs to the consultation.
Can bankruptcy stop a wage garnishment?
Filing bankruptcy generally creates an automatic stay that pauses many collection lawsuits, wage garnishments and collection efforts. Exceptions and repeat-filing rules apply; we review what protection is available in your situation. Both Chapter 7 and Chapter 13 trigger the same stay: a Chapter 7 discharge can cover the judgment debt behind the garnishment, and Chapter 13 folds it into a court-approved repayment plan. Some people have options outside bankruptcy, for example when the garnished money is legally protected. This office handles the bankruptcy side; if filing is not the right tool, Asa will say so in the free consultation.
How quickly does a bankruptcy filing affect a garnishment?
Once the petition is filed, the automatic stay applies to most garnishments for dischargeable debts. The creditor and your employer's payroll office then have to be notified, which can take a pay cycle, and a creditor who knowingly keeps taking wages after notice of the filing may be liable for damages. The stay is limited or unavailable in some repeat-filing situations and does not stop garnishment for child support. Both Chapter 7 and Chapter 13 trigger the same stay.
Does bankruptcy stop a garnishment for child support?
No. The automatic stay does not stop garnishment for child support, and child support and alimony are among the debts that generally survive bankruptcy. Garnishments for certain tax debts follow different rules too. Filing can still make sense when other debts are part of the problem, because it can deal with those debts while the support payments continue.
Can I get back money that was already garnished?
Sometimes. If a creditor took $600 or more through garnishment in the 90 days before a bankruptcy filing, that money may be recoverable as a “preference.” Whether it comes back to you depends on whether the amount fits within your exemptions, whether the trustee pursues it, and the cost of recovering it relative to the amount, so recovery is possible in some cases and not worth pursuing in others. Money taken more than 90 days before filing is usually not recoverable. Timing can matter, and Asa looks at the garnishment history before recommending a filing date.
Can they garnish my Social Security, disability, or VA benefits?
Not for ordinary consumer debts. Social Security, SSI, VA benefits, unemployment, and most retirement income are federally protected from judgment creditors. Banks must automatically protect two months' worth of directly deposited federal benefits from account freezes. If your only income is protected benefits, a judgment against you may be hard to collect, and you may not need to file bankruptcy at all; if that is your situation, Asa will tell you so in the consultation.
Can a creditor take money from my bank account too?
With a judgment, yes. A bank garnishment (levy) can freeze and seize funds in your account, often before you know it happened. But exempt money stays exempt in the bank: protected benefits and, in many cases, recently deposited exempt wages keep their protection, and state law has its own short deadlines for claiming them back after a freeze. In a bankruptcy case, exemptions also decide what property you keep, so tell Asa about any recent freeze.
Can I be fired because my wages are being garnished?
Not for a single garnishment. Federal law (the Consumer Credit Protection Act) makes it illegal for an employer to fire you because your wages are garnished for any one debt. The protection weakens if multiple separate debts are being garnished at once. Embarrassment at work is one of the most common reasons people finally deal with a debt, but you should not lose your job over one garnishment.
Should I quit my job, switch banks, or start getting paid in cash?
No. Those moves hurt you more than the creditor. Quitting trades a 25% garnishment for a 100% loss of income; cash pay creates tax problems; account-hopping only delays a levy. The law already gives you better protections: the garnishment caps, the exemptions for protected income, and the automatic stay a bankruptcy filing generally creates. A free consultation shows whether filing makes sense for you.
The garnishment already started. Is it too late to do anything?
It is not too late. A bankruptcy filing generally pauses further deductions once the employer is notified, and wages garnished in the 90 days before filing may sometimes be recoverable. The costly move is waiting until the debt is paid in full through months of garnished checks that a filing might have paused.
Start with a free consultation.
Every case starts with a free 20-minute consultation by phone or video. Asa reviews your whole situation and tells you which path he would recommend, including not filing.
This page is general legal information for Arkansas and New Mexico, not legal advice about your specific situation. Laws, court fees, and exemption amounts change. For advice you can rely on, speak with a licensed attorney. Attorney advertising. Asa King, Attorney at Law, Trumann, Arkansas, is responsible for this content. We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.