Illinois law establishes how much of your wages a creditor can deduct (garnish) to repay debt. The Illinois laws governing wage deduction (or wage garnishment) allow earners to protect more income than federal wage garnishment laws. Specifically, consumer creditors, such as credit card issuers and hospitals, must have a money judgment against you, and even then, can deduct only 15% of your wages. Some creditors—such as the government—can take a larger amount without first going to court.
(Can’t afford to lose income? Find out how filing for bankruptcy can stop wage garnishments.)
A wage garnishment or wage deduction is an order that requires your employer to withhold money from your paycheck for the benefit of a creditor. Different wage deduction rules and laws that how much of your paycheck your creditors can deduct.
(You can learn more about wage garnishments, including how to object to a wage garnishment, in Wage Garnishment & Attachments.)
Most creditors can’t garnish your wages as soon as you fall behind on payments—they must file a lawsuit. However, the following types of debt are an exception:
Creditors holding these types of obligations don’t have to go to court first.
All others, such as creditors with credit card or medical debt, must first file a court action and get a money judgment against you for the amount you owe before garnishing your wages.
(For more information, read Creditor Lawsuits: What to Expect When the Case Is in Court.)
Federal law limits the amount creditors can garnish from your wages. These laws exist to help ensure that you have enough income left to pay your living expenses.
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. Under Illinois law, the most an employer can deduct from your wages is the lesser of the following two amounts:
You can find this law at 735 Illinois Compiled Statutes 5.
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.
In Illinois, the following types of income are not subject to wage deductions:
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. (Learn about income withholding orders and collection procedures in Enforcement of Child Support.)
Illinois uses the federal limits set forth under the Consumer Credit Protection Act (CCPA). Federal law limits the amount 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 might 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 on how much is owed for each.
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 (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. (Learn more by reading 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.
(Learn how Chapter 13 bankruptcy can help with tax debt.)
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.
To learn more about wage deduction limits in Illinois, including the rules that apply to employers carrying out wage garnishment orders, check out the Illinois Department of Labor.