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Indiana Garnishment Rules
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- Garnishment of SSI or pensions is not allowed under federal law.
- Creditors are allowed to garnish 25% of your wages in Indiana.
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What are Indiana's wage garnishment rules?
I work for an Indiana hospital and am in charge of wage garnishments. My question is can an employee have more than one wage garnishment as long as it does not go past 25% of their disposable earnings?
Wage garnishment in Indiana is allowed under Indiana Code Title 34, Article 25, Chapter 3: Garnishment, and IC 24-4.5-5-105, and federal law 15 U.S.C. 1673(a).
A judgment-creditor may seek wage garnishment if it is aware of the debtor’s place of employment. Under Indiana and federal law, wage garnishment applies to 25% of the debtor’s net take home pay, (i.e., gross pay less statutorily mandated deductions). Indiana allows wage garnishment of up to 60% for child support, but limits that amount if the debtor is a head of household supporting others.
Garnishment of Social Security benefits or pensions for consumer debt is not allowed under federal law.
The following remedies, found in Indiana Indiana Code Title 34 Article 25, are allowed when a court awards a judgment to a creditor who filed a successful lawsuit against a consumer:
- Attachment: IC 34-25-1 and IC 34-25-2
- Wage Garnishment: IC 34-25-1 and IC 34-25-3
- Lis pendens notice: IC 34-30-11
To learn more, see the Bills.com Indiana Collection Laws page, which discusses the alternatives Indiana judgment-creditors have to wage garnishment.
Judgment Creditors Must Stand in Line to Obtain Wage Garnishment
Consult with your employer’s legal counsel regarding the application of Indiana and federal employment law. In general, creditors must stand in line when a wage garnishment hits the 25% ceiling. However, if the wage garnishment is administrative and relates to federal student loans, a child support order, or alimony, then the 25% limit does not apply. Again, each state’s laws vary, and an attorney with experience in Indiana’s labor law will give you precise advice.
I hope this information helps you Find. Learn & Save.
Best,
Bill
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Struggling with debt?
Debt is used to buy a home, pay for bills, buy a car, or pay for a college education. According to the NY Federal Reserve total household debt as of Q1 2024 was $17.69 trillion. Auto loan debt was $1.62 trillion and credit card was $1.12 trillion.
According to data gathered by Urban.org from a sample of credit reports, about 26% of people in the US have some kind of debt in collections. The median debt in collections is $1,739. Student loans and auto loans are common types of debt. Of people holding student debt, approximately 8% had student loans in collections. The national Auto/Retail debt delinquency rate was 4%.
The amount of debt and debt in collections vary by state. For example, in New Mexico, 32% have any kind of debt in collections and the median debt in collections is $1651. Medical debt is common and 16% have that in collections. The median medical debt in collections is $700.
Avoiding collections isn’t always possible. A sudden loss of employment, death in the family, or sickness can lead to financial hardship. Fortunately, there are many ways to deal with debt including an aggressive payment plan, debt consolidation loan, or a negotiated settlement.