Ohio Wage Garnishment Laws

A "wage garnishment," sometimes called a "wage attachment," is an order requiring your employer to withhold a certain amount of money from your pay and send it directly to one of your creditors. Different rules and legal limits determine how much of your wages can be garnished. Creditors can't just seize all of the money in your paycheck. Federal law limits how much creditors, including judgment creditors, can take. Some states set a lower percentage limit for how much of your wages are subject to garnishment.

Both federal and Ohio wage garnishment laws limit most creditors to 25% of your wages. Also, most creditors must file a collections lawsuit and receive a money judgment first. But not all creditors need to go to court, and a garnishment for child support or income taxes can exceed 25% of your wages.

What Are the Types of Wage Garnishments?

Generally, any of your creditors might be able to garnish your wages. Some creditors must first get a judgment and court order before garnishing wages. Other creditors don't need a court order.

The most common types of debt that may be garnished from your wages include:

• child support and alimony
• unpaid federal and state income taxes
• federal student loans, and
• court judgments against you for some other unpaid bill, like a credit card balance or personal loan.

What Is the Most Judgment Creditors Can Garnish From My Paycheck Under Federal Law?

Under federal law, the garnishment amount for judgment creditors is limited to 25% of your disposable earnings for that week (what's left after mandatory deductions) or the amount by which your disposable earnings for that week exceed 30 times the federal minimum hourly wage, whichever is less. (15 U.S.C. § 1673).

Some states limit creditors to a lesser amount. The creditor then has to follow the state's garnishment laws.

What Are the Limits on Wage Garnishments in Ohio?

Again, federal law places limits on wage garnishment amounts. While states are free to impose stricter limits, Ohio's wage garnishment laws are generally the same as federal law.

Under Ohio law, on a weekly basis, the garnishment can't exceed the lesser of:

• 25% of your disposable earnings for that week, or
• the amount by which your disposable earnings for that week surpasses 30 times the federal minimum hourly wage. (Ohio Rev. Code § 2329.66(A)(13)). (Under Ohio law, "disposable earnings" are those left after legally required deductions. (Ohio Rev. Code § 2329.66(C)(1)).

In addition, in Ohio, a wage garnishment isn't allowed for any debt that's the subject of a debt-scheduling agreement between the judgment debtor and a budget and debt counseling service unless:

• the debt is due and unpaid for more than 45 days after the due date, or
• unless the service previously notified the judgment creditor that the debt scheduling agreement between the judgment debtor and the service was terminated. (Ohio Rev. Code § 2716.03).

What Is "Debt Scheduling"?

Generally, under an agreement for debt scheduling, you regularly pay a portion of your income to a budget and debt counseling service, which makes payments to your creditors until your debts subject to the agreement are paid off.

In Ohio, "debt scheduling" means counseling and assistance provided to a consumer by a budget and debt counseling service under all of the following circumstances.

• The consumer and the service establish an agreement under which the consumer regularly pays a portion of the consumer's income to the service.
• Payments are made to the service until the consumer's debts are paid off.
• The service has mailed written notice to the consumer's creditors. (Ohio Rev. Code § 2716.03).

How to Find a Nonprofit Budget and Debt Counseling Service in Ohio

Under Ohio law, a "budget and debt counseling service" means a nonprofit corporation that counsels consumers about their financial obligations and assists them in dealing with their creditors. (Ohio Rev. Code § 2716.03).

Here are a few ways you might go about finding a nonprofit budget and debt counseling service:

• Look for a company that's accredited, usually by the Council on Accreditation (COA) or the International Organization for Standardization (ISO).
• Consider using a member of the National Foundation for Credit Counseling (NFCC), which is accredited by the COA.
• Find out if the counselors working for the agency are certified by an independent agency, which means they've passed a certification exam that tests for understanding in areas like counseling, budgeting, credit and consumer law, debt management, and bankruptcy.
• Check to make sure no complaints have been filed against the company with your state attorney general's office, the Better Business Bureau, and local consumer protection agencies.

Legitimate debt counseling organizations offer financial help for free or at a minimal charge. But you should avoid for-profit debt relief services. Often, the for-profit companies that purport to provide debt relief services are scammers. You'll get little or no help after you've agreed to pay them.

All too often, for-profit debt relief companies charge high fees for services you could do yourself, hurt your credit, drop the ball when it comes to actually performing the services, or simply take off with your money. Even if a debt relief company tries to help you, you'll have to pay a lot for services you could do yourself or would be better off paying to an attorney or a nonprofit budget and debt counseling service.

What Is the Wage Garnishment Process in Ohio?

The garnishment process often starts after a creditor gets a judgment in court against a debtor. If a creditor gets a judgment against you, your employer will get a notice. The notice tells your employer they must withhold a specific amount of your wages. You'll get notice of the garnishment, too.

The garnishment documents you receive should contain instructions on what you must do to object to the garnishment by claiming exemptions. (You might also be able to object if the wage garnishment was made in error or the creditor failed to follow the law or comply with legal procedures. A garnishment lawyer can help you identify any mistakes and object to the garnishment.)

If you don't object or if your objection fails, your employer will start taking money out of your paycheck and sending it to the garnishing creditor.

Limits for Child Support, Federal Student Loans, and Unpaid Taxes

If you owe child support, federal student loans, or taxes, the government or creditor can garnish your wages without getting a court judgment for that purpose. The amount that can be garnished is different than it is for judgment creditors, too.

Garnishment Limits for Unpaid Child Support

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.

Federal law limits this type of wage garnishment. Up to 50% of your disposable earnings may be garnished to pay child support if you're currently supporting a spouse or a child who isn't the subject of the order. If you aren't supporting a spouse or child, up to 60% of your earnings may be taken. An additional 5% may be taken if you're more than 12 weeks in arrears. Idaho state law follows this federal law. (15 U.S.C. § 1673).

Ohio has no additional withholding limits for child support. (Ohio Rev. Code § 3121.03).

Garnishment Limit for Federal Student Loans in Default

If you're in default on a federal student loan, the U.S. Department of Education or any entity collecting for this agency can garnish up to 15% of your pay. (20 U.S.C. § 1095a(a)(1)). This kind of garnishment is called an "administrative garnishment."

But you can keep an amount that's equivalent to 30 times the current federal minimum wage per week. (Remember, federal law protects the level of income equal to 30 times the minimum wage per week from garnishment.) (15 U.S.C. § 1673).

Garnishment Limits for Unpaid Taxes

The federal government can garnish your wages (called a "levy") if you owe back taxes, even without a court judgment. The weekly exempt amount is based on the total of the taxpayer's standard deduction and the aggregate amount of the deductions for personal exemptions allowed the taxpayer in the taxable year in which such levy occurs. Then, this total is divided by 52. If you don't verify the standard deduction and how many dependents you would be entitled to claim on your tax return, the IRS bases the amount exempt from levy on the standard deduction for a married person filing separately, with only one personal exemption. (26 U.S.C. § 6334(d)).

States and local governments might also be able to garnish your wages to collect unpaid state and local taxes. Talk to an Ohio debt collection attorney to learn about local and state tax garnishment.

Restrictions on Job Termination Due to Wage Garnishments

Complying with wage garnishment orders can be a hassle for your employer; some might prefer to terminate your employment rather than comply. Federal law provides some protection for you in this situation. Under federal law, your employer can't discharge you if you have one wage garnishment. (15 U.S.C. § 1674).

Similarly, under Ohio law, your employer can't discharge you solely because of a wage garnishment by a single creditor in any 12-month period. (Ohio Rev. Code § 2716.05).

How Long Can They Garnish Your Wages in Ohio?

A creditor can garnish your wages until the debt is paid off. So, once you get notice of a garnishment, you'll lose part of your paycheck until the debt is repaid unless you take some measure to stop the garnishment, such as claiming an exemption with the court. State exemption laws determine the amount of income you'll be able to keep. Depending on your situation, you might be able to partially or fully keep your money.

Once your wages are being garnished and you've already claimed your available exemptions, your options are to pay the amount owed, come up with a settlement, or file for bankruptcy.

What Are the Consequences of Wage Garnishment?

The most obvious consequence of a wage garnishment is a reduction in your take-home pay. A smaller paycheck can affect your ability to cover basic living expenses, potentially leading to difficulties paying your monthly bills.

Also, while a wage garnishment won't appear on your credit reports, creditors do report delinquent debt to the credit reporting agencies. And the reports can include information about how the debt is being collected, including through a wage garnishment. The missed payments culminating in a wage garnishment and other negative information will generally stay on your credit reports for seven years, affecting your future financial opportunities and potentially hindering your efforts to rebuild your credit.

Beyond the financial strain, the emotional consequences of wage garnishment can be stressful. Knowing that some of your earnings will be garnished can lead to frustration and anxiety. Seeking advice from a lawyer and exploring ways to resolve the underlying debt or work out payment terms can lessen some of these pressures.

How to Protect Yourself From Wage Garnishment

If you receive a notice of a wage garnishment order, you might be able to protect (exempt) some or all of your wages by filing an exemption claim with the court or raising an objection. The procedures you need to follow to object to a wage garnishment depend on the type of debt that the creditor is trying to collect, as well as the laws of your state. But usually, you must act quickly. File the required form as soon as possible. You might have to go to a hearing, but if you win, a judge might eliminate or reduce the garnishment.

Depending on the type of debt that's being garnished, you might have other options. For example, if the IRS is garnishing your wages because of overdue taxes, you can make a settlement offer (an "offer in compromise") or set up a payment plan.

And you can often stop garnishments by filing for bankruptcy. Your state's exemption laws determine the amount of income you'll be able to keep.

Talk to a lawyer to learn more about how you can protect your wages.

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Getting More Information on Ohio Wage Garnishment Laws

This article provides an overview of Ohio's wage garnishment laws. You can find more information on garnishment in general at the U.S. Department of Labor website. To find more about wage garnishment limits in Ohio, including the procedures that employers must follow in carrying out wage garnishment orders, check out the online Franklin County Law Library wage garnishment section.

Talk to a Lawyer About Ohio Wage Garnishments

Contact a local debt relief attorney for information specific to your situation or to get help objecting to a garnishment.