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Garnishments – How Exemption Helps Without Bankruptcy

                If the filing of your bankruptcy has to be delayed for certain reasons, such as allowing a statutory time limitation to expire, waiting for taxes to become dischargeable, pendency of tax refunds, or other valid  reasons, there are ways to avoid, delay or minimize garnishments.  The first thing you need to do is to talk to your creditors and make payment arrangements to avoid a lawsuit from being filed against you. In most cases, creditors must first file suit against you, serve you with a summons and complaint, obtain a judgment against you before they can garnish your wages. There are certain exceptions when the creditor does not have to file suit, including certain governmental tax creditors, domestic support obligations, court ordered child support, child support arrears and student loans which are in default.  These creditors can proceed with garnishment of your wages without first having to obtain a judgment against you.

                Exemptions can help when a garnishment is pending. Every state has exemption laws.  The state legislature passes a law that protects certain assets of its citizens from the reach of their creditors, even when a judgment is obtained.  For example, Ohio exemption law allows you to keep $475.00 (this amount is adjusted periodically) of cash, your unemployment benefits, Social Security, certain retirement plans and individual retirement accounts, and the equity in your home, your car, and your household goods, up to certain dollar limits.  There are several other applicable exemptions.

If the garnishment is against your wages, there are certain limitations on the amount that can be garnished. The garnishment of your wages cannot exceed 25% of your disposable earnings (after deduction of taxes), or the amount by which your disposable earnings exceeds thirty times the maximum hourly wages.

                If a creditor tries to take your property or wages, you can request a hearing.  At the hearing you can claim that your property is exempt.  If the creditor garnishes your bank account, and your Social Security or unemployment checks are deposited in your bank account, you can take your bank statements to the hearing and show the Court where the money came from and obtain the proper exemptions.

                Call Mina Nami Khorrami, LLC to discuss your exemption rights in more detail and how the exemption laws apply to your situation. 

The within statements are general in nature and this information is not intended as a substitute for legal advice regarding your specific case, nor is an attorney-client relationship established between Mina Nami Khorrami, LLC and any person reading this information. Mina Nami Khorrami is an experienced bankruptcy and debt attorney based in Columbus, Ohio.

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