Does Minnesota Allow Wage Garnishment for Judgements?
When you don't pay your credit obligations, a creditor may file a lawsuit and obtain a court judgment against you. The judgment allows him to take steps to collect the past-due debt by garnishing your paycheck, your bank account or seizing your property. Minnesota, like most states, allows a creditor to collect a debt through wage garnishment.
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Minnesota Statute of Limitations
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Before a creditor can garnish your wages, he must sue you for the debt and obtain a judgment against you. You have a right to challenge the lawsuit in court. The judgment establishes the creditor's right to collect the money. Minnesota gives creditors six years to seek judgment against a debtor for unpaid credit cards and written contracts. According to the Minnesota garnishment law, a judgment creditor has 10 years to collect debt by garnishing wages or bank accounts.
Minnesota Garnishment Threshold
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According to the Minnesota garnishment law, a creditor can garnish up to 25 percent of your weekly net income. Net income includes regular pay, overtime, sick pay minus the mandatory withholding. However, he must leave at least 40 times the minimum wage for your basic needs. If you owe child support, then the government can take 50 to 65 percent of your net weekly income to offset the debt.
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Minnesota Exemptions
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Minnesota law prohibits creditors from garnishing certain types of income, such as unemployment compensation, disability insurance benefits, Social Security and Supplemental Security Income benefits, and railroad retirement benefits, unless the garnishment is for child support. Pensions are exempt to $54,000. Minnesota exempts $36,000 of life insurance benefit received by a surviving spouse and $9,000 per dependent. You can claim an exempt income by filing an exemption claim form. If you don't have any exemptions and don't object to garnishment, the creditor will send garnishment papers to your employer.
Garnishment Process
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When your employer receives a garnishment order, he must follow the procedure and withhold a designated amount from your paycheck during a 60-day period. If he doesn't comply, he may be legally liable. The money withheld from your paychecks will be released when a writ of execution -- a court order to release the funds -- is served. You can sign a consent form to have the funds released to avoid the fees incurred when a writ or garnishment is issued. If the funds collected during the 60-day garnishment period aren't sufficient to repay debt, a creditor can repeat the process until the balance is paid off.
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