Wage garnishment is a legal process in which a portion of an individual’s earnings is withheld by an employer for the purpose of paying off a debt. This process typically occurs when a court issues a garnishment order or if there is a legal judgment against the debtor. The employer deducts a specified amount from the employee’s paycheck and sends it directly to the creditor or court.
For example, if an individual has an outstanding debt for unpaid student loans, the lender may obtain a court order to garnish wages. The employer then withholds a percentage of the employee’s salary and remits it to the student loan servicer until the debt is settled.
Wage garnishment can be applied for various debts, including child support, alimony, tax liabilities, or other court-ordered payments. The specific percentage of wages that can be garnished depends on federal and state laws.
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