Training For Iowa Garnishment Law Requirements

What Is A Garnishment?

A wage garnishment is any legal or equitable procedure through which some portion of a person's earnings is required to be withheld by an employer for the payment of a debt.

The six basic types of garnishments are child support, federal, state, or local levies, creditor garnishments, and student loans, with the largest amount of garnishments being for child support.

Employer Guidelines For Handling Garnishments

Employers generally have to notify the debtor in writing that a wage garnishment is about to start before making a garnishment and sending payments to the creditor. The wage garnishment then typically continues until the debts are paid off or otherwise resolved. Employers are required to provide employees with a copy of garnishment paperwork.

With regard to child support garnishments, all states are required to use the "Order/Notice To Withhold Income For Child Support" notice for Child Support. This notice is designed to provide employers with key information so that they do not have to decipher unfamiliar orders/notices from different states. Click here for details on this notice, including steps to process this notice.

Employers should note that they cannot contest the income-withholding order; however, the employer should contact the issuing agency if unable to implement the withholding either because the individual named in the order is not an employee or a withholding is already in place for the child and employee. Additionally, employers should note that states often have varying garnishment rules, so they should be sure to know the payroll wage garnishments rules for the state(s) in which it does business.

Iowa Wage Garnishment Rules

Employers should be aware that there are two general types of garnishments, one for child support and one for creditors (commonly referred to as "levies").

Re child support orders, the maximum amount that can be withheld runs between 50 (if the employee is supporting another spouse and/or children) and 65% (if the employee is not supporting another spouse and/or children and is at least 12 weeks in arrears in making support payments).

Re levies, Iowa law generally follows federal law in determining the amount of disposable earnings exempt from a garnishment order. Except for a child or spousal support order or a tax levy, the maximum that employers can withhold is the lesser of 25 percent of disposable earnings, or the amount by which weekly disposable earnings exceed 30 times the federal minimum wage, or the amount by which weekly disposable earnings exceed 40 times the federal minimum wage from a garnishment that arises from a consumer credit sale, loan, lease or rental.
,br />Iowa also sets limits on the maximum amount that can be garnished during a calendar year based on expected annual earnings, if:

• Annual earnings are expected to be less than $12,000, the annual garnishment allowed for each creditor is $250
• Annual earnings are expected to be from $12,000 to $16,000, the annual garnishment allowed for each creditor is $400
• Annual earnings are expected to be from $16,000 to $24,000, the annual garnishment allowed for each creditor is $800
• Annual earnings are expected to be from $24,000 to $35,000, the annual garnishment allowed for each creditor is $1,500
• Annual earnings are expected to be from $35,000 to $50,000, the annual garnishment allowed for each creditor is $2,000
• Annual earnings are expected to be $50,000 or more, the annual garnishment allowed for each creditor is 10 percent of earnings

Wages, salary, commissions, bonuses, any compensation paid for personal services, and periodic payments from a pension or retirement program are all subject to withholding. Disposable earnings are earnings remaining after deductions required by law.

Recommended Garnishment Training Courses:

• Garnishments, Child Support Orders, And Other Levies
• Dealing with Subpoenas, Summonses, Garnishments, Tax Levies, Etc.
• Certificate Program For Payroll Specialists
• Paycheck Fundamentals Training & Certification Program