You won't lose your entire paycheck if a creditor garnishes your wages. Both the state of Michigan and the federal wage garnishment (or attachment) limits allow creditors who have sued you and obtained a money judgment to take 25% of your net wages (the amount left after subtracting required deductions). However, for a few types of debts, creditors don't need to file a lawsuit first—the creditor's right to a wage garnishment is in the statutory law, along with the specific amount the creditor is entitled to receive.
(Learn more about Michigan wage garnishments, including how to object to one, in Wage Garnishment & Attachments.)
A wage garnishment is an order from a court or a government agency that requires your employer to withhold a certain amount of money from your paycheck for a creditor. Different rules and amount limits apply to different types of debt.
Most creditors can't garnish your wages as soon as you fall behind on a credit card payment or medical bill. The creditor must file a collection lawsuit in court, win, and get a money judgment stating that you owe the creditor money.
However, there are a few exceptions to this rule. A creditor—such as the government or the parent of your child—can garnish your wages without a court judgment for the following types of debt (called a statutory garnishment because the right is created in statutory law):
(Find out how bankruptcy can stop wage garnishments when the creditor has a money judgment.)
Federal law places limits on wage garnishment amounts so that you'll have enough money to maintain a household and job. While states are free to impose stricter limits, Michigan hasn't done so.
Because federal law governs in Michigan, in any given workweek, a creditor can garnish the following amount from your check (refer to the section below for statutory garnishment amounts):
(Figures are accurate as of May 2018.)
Disposable earnings are the amount remaining after your employer takes mandatory deductions out of your check, such as taxes. Voluntary deductions for things like health and life insurance don't reduce disposable earnings.
Example. You're paid weekly and earn $1,000 after taxes and other mandatory deductions. The first test—25% of your disposable income—leaves $250 in funds available for garnishment. The second test—disposable earnings less 30 times the federal minimum wage—allows for $782.50. Your employer must send your creditor the lesser of the two amounts. So your employer can garnish only $250 of your weekly pay.
If you owe child support, student loans, or taxes, the government or creditor can garnish your wages without getting a court judgment—and the garnishment amount is different too.
(Learn how Chapter 13 bankruptcy can help with child support arrears, tax debt, and in some cases, student loan payments.)
It's not unusual to have more than one garnishment—and to worry that your employer will terminate you because of it. Here are the rules.
If you'd like additional information about wage garnishment limits in Michigan, including the procedures that employers must follow in carrying out wage garnishment orders, check out the website of the Michigan Department of Licensing and Regulatory Affairs.