Can bankruptcy stop a wage garnishment in Michigan?
If you have had a garnishment or are currently getting garnished it’s important to contact Detroit Lawyers immediately! A bankruptcy filing can stop the wage garnishment and potentially recover the money that was taken!
Garnishment is a procedure creditors use to satisfy debts. In order for a creditor to garnish you, it must sue you in court and get a judgment. Once the creditor gets a judgment, the creditor has to wait 21 days until it can get a Writ of Garnishment. Once the creditor has a Writ of Garnishment, it must send the Writ to the entity (Garnishee) which has your assets. A variety of your assets may be garnished, but the most common we see in our office are paychecks, bank and credit union accounts and state tax refunds.
Michigan Wage Garnishment
In Michigan, your paycheck can be garnished up to 25% of your income after taxes and social security. We don’t know many people who can afford to lose 25% of their income and still continue to live comfortably. Call us today to make sure your paycheck garnishment is stopped!
Even scarier is a bank account or credit union garnishment. If a creditor finds your bank or credit union account, often through a process known as skip tracing, they can garnish the entire account in order to satisfy the judgment. So, if the judgment is for $10,000 and you have $5,000 in your bank account, the entire $5,000 amount can be taken! Creditors may also garnish your WHOLE STATE TAX REFUND in order to satisfy a debt. Many Michigan families rely on refunds to make down payments on cars, homes or even to help make ends meet throughout the year. We understand how important it is to stop the garnishment so you can receive your entire state tax refund!
Is any of my money exempt from garnishment without filing bankruptcy?
Talk to a bankruptcy attorney about your specific situation. Even if a certain type of income is exempt, chances are the creditor will be able to find something of yours that isn’t.
Social Security income is exempt from garnishment but the burden of proof about the exemption is on you. Other income like supplemental security, welfare, and veteran payments are also exempt before they are paid to you.
Garnishing income tax refunds in Michigan
I hate to see our clients relying on a tax refund only to have it garnished. State agencies and individuals creditors can garnish your state tax refund in Michigan. The timing of a bankruptcy filing is extremely important when it comes to garnishments. You won’t receive notice that the state is keeping your refund until after you file you income tax return.
A creditor is able to garnish your tax refund if it files a write for garnishment with the court. You’ll receive a copy of the garnishee disclosure and can object within 14 days by filing an objection in the proper Michigan court. Other important issues to discuss with a Michigan bankruptcy lawyer are the order of payments (if there are multiple creditors trying to garnish your refund) and spouses who are also being garnished because you filed a joint tax return.
Bottom Line
Time is of the essence when dealing with garnishments. If you think it was difficult to make ends meet before, it’ll be next to impossible once part of your paycheck, bank account, or income tax refund are going to your creditors. The good news is that we can stop garnishments and even recover some of the money that was already taken by creditors. The longer you wait, however, the less you’ll be able to get back. This makes it harder to not only keep your head above water but also makes it much harder to file bankruptcy and get the fresh start you’re looking for.
Not only can our office stop garnishments, it can potentially recover all of the money taken. Once a Chapter 7 or Chapter 13 bankruptcy case is filed, the automatic stay goes into place which prohibits creditors from continuing to garnish your wages. If you have been garnished over $600.00 within the last 90 days, we may even be able to recover the garnished funds! Call our office today at 248.237.7979 to schedule a FREE CONSULTATION and get your GARNISHMENT STOPPED!