A wage garnishment order allows creditors to take money directly from your paycheck. Most of the time, this is only possible after a court has entered a judgment. Here's how Alaska regulates wage garnishments.
Written by Upsolve Team.
Updated December 3, 2021
Wage garnishment can disrupt your finances no matter where you are. With Alaska’s high cost of living, the challenges may be even greater. If you aren't getting your full paycheck, paying for basics like rent and food can become very difficult. Fortunately, both Alaska state laws and federal wage garnishment laws provide some protections for people facing garnishment. Here’s what you need to know about garnishment procedures, limits on wage garnishment, and how to claim exemptions in the Last Frontier state.
What Is Wage Garnishment?
Wage garnishment involves your employer taking some of your income to pay to a creditor. In most situations, a creditor must get a judgment against you and then a court order for wage garnishment. There are a few exceptions, though.
Alaska law limits the amount that can be garnished from your paycheck and also provides you an opportunity to claim exemptions. The federal government also sets some limits, but the protection offered by Alaska state law is usually greater. State and federal law also protect and exempt many other types of assets. These include certain types of personal property, retirement accounts, and some income (such as Social Security benefits).
Who Can Garnish My Wages in Alaska?
Most creditors, debt buyers, and others with a valid judgment against you can request a garnishment order from the court. A garnishment order will typically be entered upon request unless you can claim a valid exemption.
Some types of debts are treated differently. For example:
Wages may be garnished for certain types of debt, such as federal student loans and debt to the IRS, without a court order.
The maximum amount of wages that can be garnished is different for certain types of debt, such as child support or other domestic support obligations like alimony.
The information in this article relates primarily to regular judgment debts such as credit card debt. The rules for special debts like student loans, tax debt and domestic support obligations aren’t covered here.
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Alaska Wage Garnishment Process
First, the creditor must obtain a judgment against you in court. After the judgment is entered, creditors may or may not have a waiting period before they can request a garnishment order. This depends on the type of proceeding and the way the judgment was entered. The standard waiting period for a small claims court judgment in Alaska is 48 hours. But there is no waiting period if the court enters a default judgment because you didn’t respond to the complaint or show up in court. If you still have time to answer the complaint or appear in court, do. Many debt collection lawsuits that could have been won end in default judgment.
If you talk with the creditor before a judgment is entered or act quickly after a judgment is entered, you may be able to avoid wage garnishment by entering into a payment plan or agreeing on a lump sum payment.
Once the waiting period expires, the judgment creditor can file an Information for Issuance of Writ of Execution. This is simply a request to the court to issue a writ for wage garnishment, also known as a wage garnishment order. When the court issues a writ of execution, the creditor must arrange to have it served on your employer. The employer is required to provide certain information about your wages and the amount available for garnishment. Copies of this calculation go to the court, to the creditor, and to you.
The creditor has some flexibility in when to serve notice of the writ on you. It may be served at the same time notice is served on the employer, or at any time before or up to three days after wages are first garnished. Along with your notice, you will receive information about claiming additional exemptions that may protect more of your income.
How Much of My Paycheck Can Be Taken by Wage Garnishment?
Garnishment is a means of collecting on a judgment. So, over time, the creditor may collect the amount of the judgment, along with any costs, fees, and interest awarded by the court. Alaska law limits the amount that may be withheld from each paycheck.
Federal Wage Garnishment Limits
Federal law limits wage garnishment to 25% of your disposable income or the amount in excess of 30 times the federal minimum wage (that’s currently $7.25/hour, so the amount protected is 30 x $7.25, or $217.50) — whichever is less. Disposable income is the amount of money you have left after you pay legally required deductions like payroll taxes.
Alaska Wage Garnishment Limits
The state of Alaska also protects at least 75% of disposable earnings (meaning 25% can be garnished). But, the basic exemption, at $473 per week, is considerably higher than the federal exemption.
Here’s how it works:
If your income after taxes and other required deductions is $450/week, your entire income is exempt and there’s nothing to garnish. You keep your whole paycheck.
If your income after taxes and other required deductions is $500/week, your income can be garnished. But, the creditor can’t take 25%, because that would leave you with less than $473. So, the garnishment will be limited to $27/week.
If your income after taxes and other required deductions is $800/week, 25% of your income can be withheld for the creditor. They’ll get $200/week until the judgment is paid, and you’ll get $600/week.
The exemption amount is always based on weekly income. If your pay period is different and you only have one payday every two weeks or one payday per month, the court provides a formula to apply the weekly exemption amount.
If your income is the sole source of support for your household, you may be able to exempt $743/week instead of $473. But, you’ll have to act quickly to claim this exemption. The claim must be filed with the court within 15 days of service of the Notice of Garnishment and Right to Exemptions. If you’re having trouble, you may be able to get help from legal aid.
How To Stop a Garnishment in Alaska
Generally, a valid wage garnishment can only be stopped in two ways: by paying off the debt or by letting the garnishment run its course until the judgment and related costs and interest are paid in full. If the debt will take a long time to pay through garnishment, the creditor may agree to settle the debt for less than the full amount if you can make payment all at once.
Depending on the type of debt, filing bankruptcy may temporarily or permanently stop wage garnishment. In most consumer bankruptcy cases, an automatic stay is entered right after you file. This order temporarily stops all collection action, including wage garnishment. If you file Chapter 7 bankruptcy and the debt is discharged in the bankruptcy case, the judgment will no longer be collectible. That means no more garnishment.
If you qualify, you may be able to use Upsolve’s free online tool to file for Chapter 7 bankruptcy without an attorney.
Are There Any Resources for People Facing Wage Garnishment in Alaska?
The Alaska courts and some non-profit organizations and government agencies within the state provide information, forms, and other assistance to people facing wage garnishment.