Malcolm Rivera
Texas has some of the most restrictive wage garnishment laws in the country. The Texas Constitution, in Article 16, section 28, prohibits an employer from garnishing an employee's wages except for a few types of debt, including court-ordered child support, spousal support payments, federal student loans, and federal taxes. This means that for most creditors, it is not possible to garnish the wages of a Texas resident, even if the creditor has won a lawsuit and obtained a court order. However, Texas employers with facilities in other states may be required to comply with out-of-state wage garnishment orders under the full faith and credit doctrine of the U.S. Constitution.
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What You'll Learn
Texas Constitution and wage garnishment
The Texas Constitution, in Article 16, Section 28, prohibits an employer from garnishing a Texas employee's wages except for court-ordered child support or spousal support payments. Texas employers must also comply with tax levies executed by the Internal Revenue Service (IRS), garnishment orders for federally guaranteed student loans, and garnishment orders for federal debts that fall under the federal Debt Collection Improvement Act (DCIA). This is because the statutes under which these orders and levies are issued expressly supersede state law.
Under Texas law, most creditors are not allowed to garnish wages except for court-ordered child support and spousal maintenance. Texas employers must also comply with garnishment orders for federal debts, like federal student loans and taxes. However, they do not have to comply with garnishment orders that involve consumer debts. Therefore, the only unpaid debts that can be collected through wage garnishment in Texas are court-ordered child support and spousal maintenance (alimony).
Federal law limits this type of wage garnishment. Up to 50% of disposable earnings may be garnished to pay child support if the individual is currently supporting a spouse or a child who isn't the subject of the order. If the individual is not supporting a spouse or child, up to 60% of their earnings may be taken. Additionally, Texas law allows for a bank account to be frozen. Once wages are deposited into a bank account, the funds can be frozen and possibly seized. While some property is exempt from garnishment in Texas, such as wages, other property such as bank accounts and stocks may be subject to garnishment.
If an individual works for an out-of-state company or receives their wages from a source outside of Texas, a creditor might serve a wage garnishment order in that other state. In such cases, creditors might still be able to levy or seize the individual's other assets, such as funds in bank accounts, even if they cannot garnish their wages. For example, in the case of Knighton v. IBM Corp, an IBM employee was required to pay alimony to his wife under a Florida divorce decree. IBM transferred the employee to Texas, where he stopped making alimony payments. The Florida court then entered a wage garnishment order requiring IBM to pay the employee's ex-wife from his salary and retirement fund. The Texas court held that the garnishment order was enforceable, stating that "a state cannot deny full faith and credit to another state's judgment solely on the ground that it offends the public policy of the state where it is sought to be enforced."
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Child support and spousal maintenance
Under Texas law, most creditors are not allowed to garnish an individual's wages except for court-ordered child support payments and spousal maintenance. Texas employers must also comply with garnishment orders for federal debts, like federal student loans and taxes. However, they do not have to comply with garnishment orders that involve consumer debts. Therefore, the only unpaid debts that can be collected through wage garnishment in Texas are court-ordered child support and spousal maintenance.
Up to 50% of an individual's disposable earnings may be garnished to pay child support if they are currently supporting a spouse or a child who is not the subject of the order. If an individual is not supporting a spouse or child, up to 60% of their earnings may be taken. An additional 5% may be taken if they are more than 12 weeks in arrears. However, under Texas law, up to 50% of disposable earnings may be garnished to pay domestic support obligations such as child support or alimony.
Texas law also states that an employer cannot fire, discipline, or refuse to hire someone because of a wage garnishment. Wage garnishment orders are sent to employers, who then automatically deduct the payment amount from the employee's paycheck and send it to the custodial parent.
Spousal maintenance in Texas is decided on a case-by-case basis. There are four ways in which a spouse can be awarded spousal maintenance:
- The spouse who would be paying has been convicted of or received deferred adjudication for a family violence offense against the other spouse or the other spouse's child within two years before filing the divorce or while the divorce is pending.
- The spouse seeking spousal maintenance lacks sufficient property or income to provide for their reasonable needs.
- The spouse seeking spousal maintenance will have to show that they have diligently searched for employment, training, and educational opportunities.
- The court may order that spousal maintenance remains in effect for the time the spouse is unable to earn sufficient income to provide for their minimum reasonable needs because of a disability or because they are a caretaker of a disabled child.
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Federal debts
The Texas Constitution prohibits wage garnishment for consumer debt and most other kinds of debt. However, Texas employers must comply with garnishment orders for federal debts, like federal student loans and taxes. The federal government can garnish some kinds of federal benefits, like Social Security and Social Security Disability Insurance (SSDI), to recover certain debts, such as back taxes or defaulted student loan payments.
In Texas, your wages can be garnished for federal income tax debts, federal student loans, and other federal debts. The IRS can garnish an unlimited amount of your wages and does not need a court order to do so. The amount garnished depends on the number of dependents and the deduction rate. For student loans, the Department of Education or loan servicer can garnish up to 15% of your wages or the amount your weekly disposable income exceeds 30 times the federal minimum wage.
If you work for an out-of-state company or receive your wages from a source outside of Texas, a creditor might serve a wage garnishment order in that other state. In such cases, consult an attorney to learn about your rights. Additionally, while your wages may be protected from garnishment, creditors might still be able to levy or seize your other assets, such as funds in bank accounts.
Under federal law, an employer cannot discharge an employee if they have only one wage garnishment. However, federal law does not protect employees with more than one wage garnishment order. Texas law provides additional protection, stating that an employer cannot fire, discipline, or refuse to hire an employee because of a wage garnishment.
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Out-of-state wage garnishments
Texas law restricts wage garnishments, allowing them only for court-ordered child support or spousal support payments, federal student loans, and federal debts like taxes. However, if you work for an out-of-state company or receive wages from a source outside Texas, a creditor might serve a wage garnishment order in that state.
The "'full faith and credit' doctrine" of Article IV of the U.S. Constitution requires each state to honour the "public acts, records, and judicial proceedings of every other state." This means that a Texas employer with facilities in other states may have to comply with other types of creditor garnishments on their Texas employees' wages.
In the Knighton v. IBM Corp case, an IBM employee was required to pay alimony to his wife under a Florida divorce decree. IBM transferred the employee to Texas, where he stopped making alimony payments. The Florida court then entered a wage garnishment order requiring IBM to pay the employee's ex-wife from his salary and retirement fund. The employee filed suit in a Texas state court, arguing that the out-of-state judgment could only be enforced through Texas collection procedures. The court held that the garnishment order was enforceable, stating that a "state cannot deny full faith and credit to another state's judgment solely on the ground that it offends the public policy of the state where it is sought to be enforced."
This decision has been interpreted to encompass other types of garnishments, including creditor garnishments. Therefore, if you are a Texas resident facing an out-of-state wage garnishment, it is essential to consult an attorney to understand your rights and options.
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Property exempt from garnishment
In Texas, certain federal and state laws, called "exemptions," protect some kinds of money and property from being taken to pay debt judgments. The Protected Property Claim Form can be filled out and turned into the court if you would like to get back exempt money or property that has been frozen or taken.
The Texas Constitution, in Article 16, section 28, specifically prohibits an employer from garnishing a Texas employee's wages except for court-ordered child support or spousal support payments. Texas employers must also comply with tax levies executed by the Internal Revenue Service (IRS), garnishment orders for federally guaranteed student loans, and garnishment orders for federal debts that fall under the federal Debt Collection Improvement Act (DCIA).
Additionally, under Texas law, your paycheck (or "current wages") can only be garnished to pay child support, spousal support, alimony, and certain federal debts (like income tax debt, other IRS debt, or federally-backed student loan debt). Once you deposit a paycheck into your bank account, it is no longer considered current wages and can be garnished from your bank.
Other exempt property includes most money and property you need to live on, such as benefit income (from Social Security, the VA, unemployment, etc.), your homestead, vehicles, and retirement income. It's important to note that if you receive government assistance in the form of a check that you deposit into a bank account, your account does not have the same automatic protection. Therefore, it is recommended to keep government benefits and other exempt money in separate accounts from nonexempt money.
If you have exempt money or property taken, you should file a Protected Property Claim Form with the court as soon as possible. You should have received this form from the creditor shortly after your account was garnished.
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Frequently asked questions
Yes, the Texas Constitution, in Article 16, section 28, prohibits wage garnishment for consumer debt and most other kinds of debt.
The Texas Constitution allows for wage garnishment in the case of court-ordered child support, spousal support payments, federal student loans, and other federal debts, like taxes.
No, under federal law, your employer cannot discharge you if you have one wage garnishment. Texas law also states that your employer cannot fire, discipline, or refuse to hire you because of a wage garnishment.
If you work for an out-of-state company or receive your wages from a source outside of Texas, a creditor can serve a wage garnishment order in that state. In this case, consult an attorney to learn about your rights.
Yes, creditors can garnish your bank account in Texas. However, certain money in your bank account is protected from garnishment, such as two months' worth of federal benefits.
