Illinois law establishes the amount of your wages that a creditor can deduct (garnish) from your wages for repayment of debts. The Illinois wage deduction laws (also called wage garnishment) are more restrictive than federal wage garnishment laws. Consumer creditors, such as credit card issuers and hospitals, can deduct only 15% of your wages, and only if they hold a judgment against you. Some other types of creditors can take more than 15%.
Read on to learn about wage garnishment laws in Illinois.
What Is a Wage Garnishment?
A wage garnishment or wage deduction is an order sent to your employer by a court or government agency. A wage deduction order requires your employer to withhold a certain amount of wages from your paycheck and then send this money to the creditor.
There are different wage deduction rules that apply to different types of debt and there are laws that limit how much of your paycheck your creditors can deduct. To learn more about how wage garnishments (deductions) work, how to object to a wage garnishment, and more, see our Wage Garnishments & Attachments topic.
When Can a Creditor Garnish Your Wages in Illinois?
Consumer creditors, such as credit cards, medical creditors, and banks, must obtain a judgment against you in court before they can garnish your wages. For example, if you don’t make your credit card payments or default on a personal loan from your bank, those creditors must first sue you and win a judgment against you saying you owe them money.
There are some exceptions to this rule. Your wages can be garnished without a court judgment for:
- unpaid income taxes
- court-ordered child support
- child support arrears, and
- student loans in default status.
Limits on Wage Garnishment in Illinois
There are laws that limit how much money your creditors can deduct from your paycheck. These laws exist to help ensure that you have enough income left to pay your own living expenses.
Federal law limits the amount of money creditors can garnish from your wages. Illinois, however, imposes even stricter limits. Wage deductions are taken from your “disposable income,” meaning the amount of money you earn after taxes and other mandatory deductions are taken out. In accordance with Illinois law the most that can be deducted from your wages is the lesser of the following two amounts:
- up to 15% of your gross wages, or
- the amount of disposable income that remains after deducting the Illinois minimum wage (or the federal minimum wage if it's greater than the Illinois minimum wage) multiplied by 45.
Example. John earns $1,000 in disposable income per week. Calculation 1: 15% of his disposable earnings is $150. Calculation 2: His disposable income less the minimum wage multiplied by 45 is $628.75 ($1,000 - ($8.25 x 45)). Illinois wage deduction law requires the employer to take the lesser of the two amounts; $150 of John’s earnings will be garnished and sent to his creditor.
If you earn less than $371.25 in disposable income per week (as of April 2013), your consumer creditors cannot garnish any of your wages. In Illinois, the following types of income are not subject to wage deductions:
- Public Aid and General Assistance
- Social Security & Supplemental Security Income (SSI)
- unemployment compensation
- veteran's benefits
- worker's compensation
- Black Lung benefits
- alimony and support (to the extent needed for support of self and dependents), and
- pensions (to the extent needed for support of self and dependents).
Special Limits for Child Support, Student Loans, and Unpaid Taxes
If you have a child support obligation, student loans, or taxes, your wages can be garnished without a court judgment. The amount that can be garnished is different, as well.
Since 1988, all court orders for child support include an automatic income withholding order. The other parent can also get a wage garnishment order from the court if you get behind in child support payments. Additionally, Illinois can deduct support from any form of periodic payments, including the above-listed sources that consumer creditors can’t touch, including unemployment benefits and workers’ compensation (To learn about income withholding orders and other ways child support can be collected, see Child Support Enforcement Obligations).
Illinois uses the federal limits set forth under the Consumer Credit Protection Act (CCPA). Federal law limits what can be taken from your paycheck for this type of wage garnishment. Up to 50% of your disposable earnings may be garnished to pay child support if you are currently supporting a spouse or a child who isn't the subject of the order. If you are not supporting a spouse or child, up to 60% of your earnings may be taken. An additional five percent may be garnished for support payments over 12 weeks in arrears. (Learn more about wage garnishment for child support arrears.)
You may have more than one child support withholding order but not enough disposable income to pay your child support obligations in full. If this is the case, your total disposable income (from 50-65% as described above) will be split up amongst your child support orders, based upon how much is owed for each.
Student Loans in Default
If you default on a federal student loan, the U.S. Department of Education or any collector for this agency can garnish your wages without a judgment (this is called an administrative garnishment). The Department of Education can garnish up to 15% of your disposable income, but only up to 30 times the minimum wage. To learn more, see the articles in Student Loan Debt.
The federal government can deduct from your wages for back taxes without a court judgment. The amount it can garnish depends on how many dependents you have and your deduction rate.
States and local governments may also be able to garnish your wages to collect unpaid state and local taxes. Contact your state labor department to find out more. You can learn more from the Illinois Department of Labor website at www.state.il.us/agency/idol.
Total Amount of Garnishment
If you have multiple wage deductions, the total amount that can be deducted is 15%. For example, if the federal government is garnishing 10% of your income to repay defaulted student loans and your employer receives a second wage garnishment order, the employer can only take another 5% of your income to send to the second creditor.
Restrictions on Job Termination Due to Wage Garnishments
Administering wage deduction orders can be bothersome for your employer, who might be inclined to terminate your employment rather than comply with the order. State and federal law provides some protection for you in this situation.
According to both federal and Illinois law, your employer cannot discharge you if you have one wage garnishment. However, the laws won’t protect you if you have more than one wage garnishment order.
For More Information on Illinois Wage Garnishment Laws
To learn more about wage deduction limits in Illinois, including the rules that apply to employers carrying out wage garnishment orders, check out the website of the Illinois Department of Labor at www.state.il.us/agency/idol.