What Percent Is the Wage Garnishment in Maryland?
Maryland is one of the many states that allow wage garnishments. A legal entity, such as the Internal Revenue Service does not need a court order to garnish wages, but creditors do. Maryland's wage garnishment law is unique in that the withholding percentage depends on the employee's county of residence.
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Process
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If a debtor refuses to pay a delinquent debt, the debtor must obtain a judgment from the court to garnish his wages. Once judgment is granted, the creditor completes the necessary form to request a garnishment on wages. The court then issues an order or writ, which is delivered to the debtor's employer by the sheriff or constable, registered mail or someone over 18 who is not involved in the lawsuit. Upon receiving the garnishment notice, the employer completes the enclosed "answer" within 30 days. The answer should state the employee's status, his pay rate and whether he has had prior wage garnishments.
Withholding Amount
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Title III of the Consumer Credit Protection Act restricts the amount an employer can garnish within a single pay period to the lesser of 25 percent of the employee's disposable earnings or the total by which the weekly disposable income exceeds 30 times the federal minimum wage. The employer applies federal law if the employee lives in Worchester, Caroline, Queen Anne's and Kent counties. Employees outside of those counties are subject to the lesser of 25 percent of disposable income or $145 per week.
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Child Support
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For child support garnishment, the employer can withhold up to 50 percent of disposable income if the employee is supporting a child not included in the support order and up to 60 percent if she is not. It can withhold an additional 5 percent for payments over 12 weeks in arrears. The employer uses IRS Publication 1494 to calculate IRS wage levies.
Considerations
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To determine disposable income, the employer subtracts legally required deductions, such as Social Security and Medicare taxes from the employee's gross pay. Wages and salaries are not exempt from garnishments, but other types of income, such as pension benefits, child support, workers' compensation, unemployment benefits and income from insurance-related benefits are exempt. In Maryland, a wage garnishment accrues interest from the date the judgment was granted until it is paid off.
Payments
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The creditor sends the debtor and his employer a Judgment Creditor's Monthly Report within 15 days of receiving payments from the employer. Payments are applied first to accrued interest, then to the principal, and lastly to attorney or court costs charged to the debtor. The report shows credited payments for the month and the withholding method. The creditor files an Order of Satisfaction with the court within 15 days after the garnishment has been paid off.
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