In Texas, wage garnishment is normally not allowed except in the case of government debts, child support, alimony, and student loans. However, if your job is out of state, your wages may be garnished. If you have moved here from another state, and a judgment was entered in the state you moved from, your wages may be garnished. In all cases, once wages are deposited into a bank account, the funds may be levied or seized. Bankruptcy immediately stops all wage garnishments, even by the IRS.
Wage garnishment in Texas is generally not allowed. There are major exceptions to the general rule that wages cannot be garnished in Texas, and if your creditor is the United States government, such as taxes, certain student loans, etc., then your wages can be garnished. Your wages may also be garnished for domestic support obligations, such as child support or alimony, and for student loans. There are limits on the amount of wages that can be garnished, however. Legal procedures must be followed which depend on the type of debt.
Wages may also be garnished if you work for an out of state employer. We frequently have clients who are working in Louisiana or for other companies based out of state, and their wages are subject to garnishment. If you have moved to Texas from another state where a judgment was entered, there is a possibility of garnishment, especially where you transferred and are still working for the same employer.
Also, keep in mind that even though your wages cannot be garnished, one your paycheck is deposited into a bank account, your bank account may be levied, meaning the funds can be seized. Many employers are now requiring electronic deposit of payroll checks which means your paycheck has to be deposited into a bank account where it is subject to being seized to satisfy a judgment.
There are limitations on garnishment of social security benefits and veteran’s benefits, however, they can be garnished for child support and tax debt. Unlike regular wages, social security benefits that are deposited into a bank account may not be subject to levy provided the account contains only the social security benefits. Veteran’s benefits also enjoy this protection. The key to protecting these income sources is to keep the accounts segregated. That means never put any funds into the account other than social security funds or veteran’s funds. You may take them out for any purpose, but do not place funds into the account that you cannot directly prove are social security or veteran’s benefits.
Either a Chapter 13 or Chapter 7 bankruptcy will immediately stop the wage garnishment. Chapter 13 may be needed to continue to stop a garnishment for past due child support or for past due taxes, depending on the facts.
With child support arrearage, to the extent that a domestic support obligation has been assigned to a governmental unit, a debtor may not have to repay the child support in full in a Chapter 13. What this means in English is: if you have a domestic support obligation, such as child support, that has been assigned to a governmental unit for collection (for the benefit of the governmental unit because perhaps the agency paid welfare benefits), and you don’t make enough money to pay the back support in full, you can
If you are facing wage garnishment, contact a bankruptcy attorney at our firm: