Federal law supercedes state law, and under the federal Debt Collection Improvement Act of 1996, federal agencies are permitted to garnish your wages, no matter that it is not allowed by Texas law.

If this has happened to you, you have likely received a notice from the Financial Management Service ("FMS"). The FMS is a bureau of the U.S. Department of Treasury. The FMS manages the collection of delinquent debts owed to the United States. If you have received a Notice of Administrative Wage Garnishment ("AWG"), it's time to come into our office and speak with one of our attorneys concerning what options that you have.

If your wages or salary are about to be garnished or seized, federal law permits a federal agency to use AWG to collect delinquent debt if a debtor is employed and not paying a federal debt as agreed. 31 U.S.C. Section 3701.

How much can they take? They can take 15% of your disposable income, which is basically what is left after deduction of withholding taxes, insurance, and any mandatory retirement deductions. If you have other garnishments for debt, the AWG garnishment will be reduced so that total garnishments are not more than 25% of your disposable pay.

You must be given notice that they are going to start AWG, and you have the right to a hearing. You can also ask for a payment plan. Another option is to file a bankruptcy, which automatically stops most collection actions including lawsuits, judgments, repossessions, foreclosures, and garnishments for debt.

Call our office at 713-772-8037 anytime to schedule your first consultation or to request one of our publications. We represent people in bankruptcy cases in all of the following counties in Texas: Austin, Brazoria, Brazos, Chambers, Colorado, Fayette, Fort Bend, Galveston, Grimes, Harris, Madison, Matagorda, Montgomery, San Jacinto, Walker, Waller, Wharton.

J Thomas Black
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Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization