Last updated: October 2026

Employer Garnishment Obligations: What the Law Actually Requires

Your employer garnishment obligations begin the moment that envelope hits your mailbox. Every deadline that follows is set by the order itself or by the law that issued it, so read them off the paperwork rather than assuming you have time.

For a support order and for a federal tax levy, an employer who fails to withhold becomes liable for the amount that should have been withheld.

Why the Paperwork on Your Desk Is a Legal Deadline

A wage garnishment order is a court or agency directive, not a request. When a creditor, a state child support unit, or the Internal Revenue Service (IRS) serves you, you become a stakeholder in that debt. You hold money that belongs to your worker, and the issuing authority now has a claim on a portion of it.

The Income Withholding for Support order (IWO), Office of Management and Budget (OMB) form 0970-0154, covers child support. A writ of garnishment covers civil creditor judgments. Federal student loan collection is not a writ at all. Under 20 United States Code (U.S.C.) 1095a and 34 Code of Federal Regulations (CFR) 34.19(a)(1), the Department of Education issues the garnishment order itself. IRS Form 668-W covers federal tax levies.

The penalties for ignoring these are not theoretical. For a support order, 42 U.S.C. 666(b)(6)(C) makes an employer who fails to withhold under a valid IWO liable for the full amount that should have been withheld. For a federal tax levy, 26 U.S.C. 6332(d)(1) makes the employer liable for the amount not surrendered. Section 6332(d)(2) adds a penalty of 50 percent of it when the failure has no reasonable cause. For a creditor writ, the liability is created by state law and enforced by the court that issued the writ, so look up your own state's rule.

Receiving an Order and the Clock That Just Started

The first rule is simple. Date stamp the envelope the day it arrives. That timestamp is what you will use to run every deadline that follows, and what you will point to if the date of receipt is ever disputed.

For an IWO, the start deadline is set by state law, not federal law. For a creditor writ, the deadline to answer and the deadline to begin withholding are both set by state law. Read the writ, then confirm both dates with the issuing court before the clock runs. An IRS Form 668-W comes with a Statement of Dependents and Filing Status, which you give the employee to complete and return within three days.

Miss any of these and the order does not go away. The liability that follows is the one set by the statute behind that particular order, not a single federal rule.

Calculating Disposable Earnings Without Getting It Wrong

Title III of the Consumer Credit Protection Act (CCPA) caps what you may withhold. Disposable earnings is the figure the whole calculation rests on, and it is not take home pay. The federal definition is gross pay minus amounts required by law to be withheld. That means federal income tax, Social Security, Medicare, state income tax, and state unemployment insurance tax come out first. Health insurance, 401(k) contributions, union dues, and repayments of payroll advances usually do not reduce disposable earnings under federal law, even though they reduce the check the worker actually sees.

Once you have disposable earnings, the withholding ceiling depends on the debt type. Consumer debt garnishments under federal law cap at 25 percent of disposable earnings. The alternate cap is the amount by which disposable earnings exceed 30 times the federal minimum wage, whichever is less.

Child support ceilings work in four brackets. The cap is 50 percent when the worker supports a second family and is not more than 12 weeks in arrears. It rises to 55 percent when the worker supports a second family and is more than 12 weeks in arrears. It is 60 percent when there is no second family. It reaches 65 percent when there is no second family and the worker is more than 12 weeks behind.

State law can tighten these ceilings. Under 15 U.S.C. 1677 a state may leave more of the paycheck with the worker than the federal rule does. There is no shortcut here: look up the rule for the state where the employee works.

Apply the state ceiling if it gives the worker more protection.

Federal tax levies use the exemption tables in IRS Publication 1494, which the IRS mails with the levy. Those tables leave the worker a set amount based on filing status and dependents, then take everything above that.

Priority Ordering When Multiple Orders Stack Up

There is no single federal rule to follow. The CCPA sets no priorities at all. 29 CFR 870.1(a) puts that outside the Secretary's duties, and 29 CFR 870.11(b)(2) says priority is determined by state law or by another federal statute. The federal part is narrow, and it is this.

Child support beats any state tax levy or creditor writ no matter the timing. That is 42 U.S.C. 666(b)(7), which gives support priority over any other legal process under state law. A federal tax levy is federal process, so that provision does not reach it.

Below that, ordering is a question of state law rather than federal law. Confirm your state's rule before you assume a sequence.

Under 26 U.S.C. 6334(a)(8), the wages necessary to comply with a support judgment entered prior to the date of levy are exempt from the levy. Support judgment first, and it is exempt from the levy. Support judgment second, and it is not. When both are on the same worker, notify the child support agency that you have a federal tax levy, and it can tell you whether the levy has priority.

If two child support orders cover the same worker and together exceed the CCPA ceiling, the state allocates the available amount giving priority to current support. That is 45 CFR 303.100(a)(5), which also requires the state to establish procedures for allocating support among families. Use the method your state or the order specifies.

If the employee files Chapter 7 or Chapter 13, the automatic stay under 11 U.S.C. 362(a) halts creditor garnishments. Keep withholding child support.

Remittance, Record Keeping, and the Administrative Fee

Child support and a federal tax levy go to different places by different mechanisms. Keep them apart in your process.

Send the money where the order tells you to send it. Child support goes to the State Disbursement Unit within 7 business days of the pay date, under 42 U.S.C. 666(b)(6)(A)(i) and 45 CFR 303.100(e)(1)(ii).

A federal tax levy goes nowhere near that path. You surrender the withheld amount to the Secretary under 26 U.S.C. 6332(a), following the instructions that come with Form 668-W. Publication 15 says the same thing: on a Notice of Levy in the Form 668 series you withhold as the instructions for those forms describe.

Whether you may charge the worker an administrative fee for processing the withholding is set by state law, so check your state before you charge it.

Keep the original order, every withholding record, every remittance confirmation, and every piece of correspondence.

The Order for Someone Who Does Not Work Here

A former employee walks out. Two weeks later, a writ of garnishment for that person arrives in the mail. You toss it. Why respond to a garnishment for somebody who no longer works there?

Because whether you owe a written answer, and what happens if you do not file one, are set by the state whose court issued the writ. Read the writ for the answer deadline, and call the issuing court if it does not state one. Do not decide on your own that an order for someone who is not on your payroll needs no response.

The response costs nothing, and it is the only one of the two options whose consequences you can see in advance.

Every order gets a response. Even the ones that do not apply.

Termination Notices, Retaliation, and Rehires

Under 45 CFR 303.100(e)(1)(x), the IWO tells you to notify the State promptly when a worker with an active order leaves. Complete the Termination Notification on the last page of the IWO form and return it to the sender. Give the worker's last known address and the new employer's name and address, if known.

Federal CCPA Section 304 prohibits termination because of a garnishment for any one indebtedness. That bar does not by its terms reach a second distinct debt, and state law may go further. Under 15 U.S.C. 1674(b) a willful violation is punishable by a fine of not more than $1,000, imprisonment of not more than a year, or both. Any further remedy is a question of the state where the worker is employed.

If the worker is rehired, check with the issuing agency or court whether the original order is still live before treating it as closed. Do not assume a new order is needed.

Your Action Plan for the Next 72 Hours

If an order is sitting on your desk right now, here is what to do before you clock out today.

Date stamp it. Photocopy it. Put the original in a locked file and the copy in the payroll processing queue. Open the order and find three things: the debt type, the issuing authority, and the first required action date. Write that date on a calendar you actually check.

Calculate disposable earnings for the affected worker using the current pay period, not a hypothetical one. Run the federal cap and your state cap and use the lower number. Update your payroll software with the deduction.

Whether your payroll platform has a garnishment module at all, and whether it handles order intake and the calculation or leaves both to you, is a question for your provider. Ask before your next cycle runs, and compare options at the payroll providers hub.

Read the Department of Labor's Fact Sheet #30 on the Consumer Credit Protection Act. It is the agency's own summary of the federal withholding limits.

When the debt is large, the worker is disputing service, or multiple orders have stacked up in a confusing sequence, get an employment attorney on the phone the same day.

If the order is a child support IWO and you are unsure about the arrears percentage, read our walkthrough on child support garnishment before running the math. If the worker has questions about protected income or wants to fight the underlying judgment, point them to how to stop wage garnishment. For broader context on the whole process, start at the wage garnishment hub.

This is not legal or financial advice. Consult a qualified professional for your specific situation.