Last updated: August 2026

Wage Garnishment Limits: The 25% Federal Cap and the Exceptions That Break It

Federal wage garnishment limits cap creditor orders at 25% of disposable earnings.

Below $217.50 a week, no ordinary creditor can touch a paycheck. That floor comes from multiplying the federal minimum wage of $7.25 by 30, a rule set in Title III of the Consumer Credit Protection Act.

The Consumer Credit Protection Act here is a federal debt-collection statute at 15 USC 1673, not California's privacy law of the same acronym. These CCPA wage rules are a separate federal regime.

The creditor cap does not cover child support orders, IRS tax levies, or federal student loan administrative attachments. Each of those sits outside the creditor cap and follows its own garnishment priority order. Identifying which regime owns the paycheck is the first step, because the cap, the exemption and the priority rule all differ by regime.

Federal Wage Garnishment Limits: The 25% Cap and the $217.50 Floor

The Title III garnishment framework sets two tests. Creditors take whichever protects more pay. An order withholds the lesser of 25% of disposable earnings, or the amount by which weekly disposable pay exceeds 30 times the federal minimum wage.

At today's $7.25 federal minimum wage, the weekly floor is $217.50. Biweekly, it doubles to $435. Semi-monthly it lands at $471.25. Monthly it sits at $942.50.

Below those numbers, ordinary creditor orders recover nothing.

Earners with disposable pay just over the floor keep more than 25% because the lesser-of test wins. A paycheck with $240 in weekly disposable pay owes just $22.50 to a creditor order, not the full $60 that 25% would suggest. That baseline rule favors low earners, but the benefit fades fast once weekly disposable pay clears $290.

Total creditor orders share that 25%. Two creditor garnishments on one paycheck split the slice; they do not each get their own 25% allowance. How they split it is a question of state law: 29 CFR 870.11(b)(2) leaves priority to the state or to another federal statute, so read your state's rule before you decide which order collects first.

Example: Joe earns $1,200 gross weekly, with $240 in mandatory deductions. Disposable earnings run $960. The 25% test gives a creditor $240. The floor test gives ($960 minus $217.50) $742.50. The lesser wins, so a creditor collects $240 that week.

Both tests have to be configured, not just the 25% one. A system that applies the percentage alone will take more than the floor allows on a small paycheck, because the floor test is the binding one there. Audit one pay cycle per order against a hand calculation rather than trusting the configuration.

Why the drafters chose 30 is worth knowing. Congress wanted a floor tied to subsistence wages, and in 1968 a 30-hour week at the minimum wage was the working definition of that baseline. Congress keyed that floor against federal minimum wage, which has held at $7.25 since July 2009.

How Disposable Earnings Get Calculated Before the Cap Applies

Disposable earnings are not take-home pay. The figure equals gross wages minus the deductions that law requires. Those deductions include federal income tax, state income tax, local income tax, Social Security, Medicare, mandatory state disability like California SDI, and state unemployment where an employee bears it.

Health insurance premiums do not reduce that base. Neither do 401(k) contributions, union dues, garnishments already running under other orders, HSA contributions, or any voluntary payroll deduction. A creditor base stays broad on purpose.

An employee earning $1,000 gross with $200 in legally required deductions and $200 in benefit contributions has $800 in disposable pay, not $600. A 25% cap applies against that $800 figure, giving creditors up to $200 a week. Benefit contributions protect nothing from the order.

A garnishment already running does not reduce the disposable base for a second calculation. The base stays gross minus legally required deductions, and a prior order is not one of those. What a prior order consumes is the aggregate ceiling. Where 25% or more already goes to support and support has priority under state law, 29 CFR 870.11(b)(2)(iv) permits no additional ordinary garnishment at all.

The exception worth flagging: if your payroll software treats voluntary deductions as if they reduced disposable pay, the base is wrong. That misconfiguration under-garnishes every creditor order, and the shortfall becomes an employer debt owed back at that creditor. Run a manual calculation on one live order and compare to what the system produced.

A tradeoff baked into federal design: broader base, larger creditor slice, fewer dollars protected for voluntary savings. Employees pushing retirement contributions higher do not shrink what a creditor can take.

The Stacking Mistake That Makes Employers Personally Liable

A 25% cap covers the total of all creditor orders against an employee, not each order separately. A payroll team that receives a second creditor garnishment while the first is still active should not honor both at 25%. Withholding 50% from disposable pay violates federal law.

Over-garnish an employee and the excess becomes your debt.

The catch: honoring two creditor orders at 25% each exposes the company to repaying the over-withheld portion as an employer debt, plus damages a court may award on top. The right response to a second creditor order is a written answer. Tell the sheriff or court that the employee is already at maximum under Title III garnishment, and state that this order will run when the prior is satisfied. Keep a copy in the payroll file with the existing order.

A concrete example makes the trap clear. Sarah earns $800 in weekly disposable pay. An existing creditor order takes $200 at 25%. A second creditor files a garnishment for a different debt. Payroll withholds another $200 and sends it along at that second creditor.

Sarah has now had 50% withheld, $200 more than federal law allows. Her employer owes her that $200 plus any damages a court awards.

Ordering among creditor orders is set by state law and varies, so confirm your state's rule before you assume the sequence. What federal law fixes is the ceiling, not the sequence: 29 CFR 870.11(b)(2) leaves priority to state law or to another federal statute.

Confusing the creditor cap with the support-order rule is the error that produces the largest over-withholding on multi-order paychecks. A child support garnishment and an IRS wage levy sit in separate buckets with their own ceilings. A support order running at 50% does close the creditor bucket, and not by shrinking the base. The base is unchanged. The aggregate ceiling is exhausted, and 29 CFR 870.11(b)(2)(iv) permits no additional ordinary garnishment.

Employer garnishment obligations run in both directions. Payroll misses on the shortfall side mean the company owes a creditor for what should have been withheld. Payroll misses on the over-withholding side mean the company owes the employee for the excess. Risk runs in both directions, and it lands on the team that processes the check.

Child Support, IRS Levies, and Federal Loans Run in Separate Buckets

Three federal regimes sit outside the 25% creditor cap entirely.

A child support order can claim 50% of disposable pay when an employee supports another family, or 60% when not. An extra 5% stacks on top in either case after 12 weeks of arrears. A hard ceiling lands at 55% or 65%, depending on facts.

Federal tax levies follow IRS Publication 1494. The Service sends Form 668-W to the payroll department, and withholding covers everything above the exempt amount for the employee's filing status and number of dependents. In the 2026 table the weekly floor is $309.62, for a single filer or married filing separately with no dependents, and each dependent adds $101.92. Publication 1494 is reissued every year, and Publication 15 tells employers to use the current year table. The Service skips the court system entirely, which is a meaningful limitation on due-process defenses at the front end.

Federal student loan administrative wage garnishment caps at 15% of disposable pay under 20 U.S.C. 1095a, and the Department of Education issues it without a court judgment. Check the status before you plan around it. On 16 January 2026 the Department announced it would delay implementation of involuntary collections on federal student loans, including administrative wage garnishment and the Treasury Offset Program, pending repayment reforms, and it published no resumption date. That was still the published position when this page was checked on 28 August 2026.

A child support garnishment does not reduce the disposable base. It consumes the aggregate ceiling. Once 25% or more of disposable pay is going to support and support has priority under state law, 29 CFR 870.11(b)(2)(iv) permits no additional ordinary garnishment. So a 50% support withholding leaves creditor orders collecting nothing, and the reason is the exhausted ceiling rather than a smaller base.

A worked example illustrates the stacking. Maria earns $1,200 gross with $300 in mandatory deductions, leaving $900 in disposable pay. A federal student loan AWG on its own would take 15%, or $135 a week. Add a $300 support order and it does not. 34 CFR 34.20(b) caps the AWG at the smaller of that ordinary amount or 25% of disposable pay less what the priority orders take. Here 25% of $900 is $225, minus the $300 support order, which leaves nothing. The AWG collects $0 that week, not $135.

State tax levies follow their own rules. The Title III creditor cap does not reach them at all, because 15 U.S.C. 1673(b)(1)(C) excepts any debt due for a state or federal tax, so look up the formula the state applies rather than assuming the 25% figure carries over.

The downside for employees caught in multiple regimes is obvious. A full support order plus an IRS wage levy can pull a paycheck down to the Publication 1494 floor. A federal student loan AWG on top then vanishes because no room is left. The math stops mattering once three orders stack.

Where State Law Takes Over From the Federal Cap

States can protect more of a paycheck than federal law requires. States cannot protect less. Employees always get whichever rule keeps more money in their bank account.

State rules cut deeper, never shallower.

That room comes from 15 U.S.C. 1673(c), and nothing in Title III limits how a state uses it. A state rule can bar the garnishment, use a different percentage, or run a different second prong. This page does not carry a state-by-state table. Work the rule for the state where the employee works, on that employee's actual disposable pay, rather than assuming the federal numbers apply.

The exception worth knowing: state-level garnishment exemptions never help an earner below the federal floor, because federal protection is already stronger there. State rules raise that baseline, but the federal version anchors it nationwide.

Rule of thumb: if federal and state numbers disagree, the employee gets whichever version leaves more take-home pay. A payroll system that defaults to the federal formula alone will under-protect employees in every state that sets a higher floor. Check the state flag in the wage attachment module before processing any creditor order.

Commissions, Bonuses, and Final Paychecks All Count as Wages

Earnings under Title III include commissions, bonuses, PTO payouts, severance, and tips where the tips are legally the employee's wages. A final paycheck falls under creditor garnishment in full, but only the disposable portion faces the 25% cap.

Separation does not end the obligation. A $10,000 final check that includes accrued vacation and a prorated bonus stays subject to any order running against the employee until the court confirms termination. Payroll cannot skip the last withholding because an employee is leaving.

Commissions paid on irregular schedules need a special calculation. Title III garnishment rules talk about earnings for any workweek, and when pay arrives less frequently than weekly, payroll converts to a weekly equivalent for the lesser-of test. A commission check covering eight weeks of work gets divided into eight weekly pieces, each tested against $217.50 and 25%.

Tips get complicated. In states where tips are legally the employee's property and never pool into wages for minimum wage purposes, they may sit outside CCPA earnings. In tip credit states where an employer takes a tip credit against minimum wage, the tips count as wages and face the cap. Check state law before excluding tip income, because misclassifying it creates employer liability in either direction.

Severance packages negotiated at separation fall inside CCPA earnings too. An employee signing a severance agreement after a creditor order is active should expect the full 25% to hit each scheduled payment. The same floor test runs on each tranche. Drafting severance as a lump sum paid in one check does not evade the order; it just moves the entire 25% into one line.

Do not assume 1099 status puts income outside Title III. The statutory test is not W2 status. 15 USC 1672(a) defines earnings as compensation paid or payable for personal services, whether denominated as wages, salary, commission, bonus, or otherwise, and it expressly includes periodic pension and retirement payments. Compensation for personal services is the question, and whether a given contractor payment meets it is a question for the court that issued the order. Federal tax levies reach any payer regardless. Workers converted to 1099 status to dodge an order also face a separate worker misclassification claim.

Responding to a Second Order Without Tripping the Cap

Pull the existing garnishment file before processing any new order.

Calculate disposable pay on the current pay period, then compare to the floor and cap. File a written answer to the new order stating the employee is already at the Title III garnishment maximum, and attach copies of the prior orders. Send that answer through certified mail inside the deadline the state sets, which the writ or the issuing court will give you.

Run whatever allocation your state requires, pro-rata or otherwise, and confirm which it is before the next payroll run rather than after.

Employers handling multiple orders per pay cycle should call the payroll provider and ask about the wage attachment module. A platform can apply both tests automatically once orders are loaded with the right priority codes, but the codes have to be set on day one.

Multi-order paychecks are where employer liability runs in both directions at once, to the creditor for under-withholding and to the employee for over-withholding. Check the flag. Check the stacking. Check garnishment priority against the order date on file, not the date the document arrived in the mail.

The DOL Fact Sheet #30 is the authoritative federal summary of Title III garnishment rules, and the full statute lives in 15 U.S.C. 1673 at the Office of the Law Revision Counsel.

For the full picture of employer garnishment obligations, visit our main wage garnishment hub. For the playbook on receiving a new order, review our employer guide to wage garnishment obligations. Employees trying to reduce what an order takes should read how to stop wage garnishment, especially the exemption and hardship sections. For the specific rules on support orders and federal tax collection, see child support garnishment and IRS wage levy. Multi-state employers running garnishments across jurisdictions will also want to check the payroll tax hub for state-specific compliance.

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