Wage Garnishment in Alabama
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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 Alabama regulates wage garnishments.
Written by Upsolve Team.
Updated October 21, 2021
Wage garnishment is when money is taken out of your paycheck to pay back a debt — but Alabama wage garnishment can only happen in certain situations. Generally, a creditor must first file a lawsuit against you for non-payment and win a court judgment before they can garnish wages. Only a portion of your paycheck can be garnished because federal laws and state laws limit the amount that can be garnished each pay period. In the Heart of Dixie, you can stop a wage garnishment by paying off the amount owed or filing for bankruptcy protection.
What Is Wage Garnishment?
Wage garnishment is a way for a creditor to collect a debt by having funds withheld directly from your paycheck. Facing wage garnishment is a stressful experience. Wage garnishment laws are in place to limit when a creditor can garnish wages and the amount of your paycheck they can take.
When you fall behind on your bills, your creditors — such as credit card companies and debt collectors — will attempt to collect payment from you. In general, a creditor cannot garnish your wages unless they file a lawsuit against you for non-payment, win, get a court judgment, and use that judgment to get a wage garnishment order (or writ of garnishment). But certain types of creditors can garnish wages without filing a lawsuit. These creditors are mostly governed by state law and generally, they will have to give you notice before the garnishment starts.
Who Can Garnish My Wages in Alabama?
Creditors with a valid judgment can garnish your wages in Alabama. A judgment comes from a court order after a successful lawsuit. Creditors that can get a judgment against you include credit card companies, doctors, medical facilities, and other lenders. Original creditors, debt buyers, or debt collection agencies are able to obtain judgments for unpaid debts and garnish wages in Alabama.
Some creditors can garnish your wages without suing you. Certain federal debts, including IRS income tax debts and federal student loans, have their own rules. In Alabama, garnishing wages for current or past-due child support payments doesn’t require a lawsuit or judgment. Other creditors can also garnish wages without a court judgment, such as the Alabama Medicaid Agency for certain required costs of health services for a child.
Special rules apply to creditors that can legally garnish wages without a valid judgment. Here our focus is on wage garnishment for non-special debts that can only happen after a lawsuit and with a court judgment, like garnishments for credit card debts.
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Alabama Wage Garnishment Process
The wage garnishment process in Alabama usually doesn’t begin until after you’ve been sued for not paying back a consumer debt you owe, like a credit card, personal loan, or medical bill. After a creditor files a lawsuit against you for non-payment, you will be served notice of the lawsuit. You will have the opportunity to reply to, or answer, the lawsuit.
If the creditor wins the debt collection lawsuit, it will get a court judgment against you. If you ignore the lawsuit, the creditor can get a default judgment against you, which has the same effect as the creditor winning the suit. A creditor with a judgment can begin the wage garnishment process in Alabama. To initiate the process, your judgment creditor will file the Alabama Process of Garnishment form. The court will serve a copy of this form to you and your employer.
Your Employer’s Answer
The Process of Garnishment form includes a Writ of Garnishment, which notifies your employer that they have to withhold a certain amount of your wages and send that money to the court. Your employer is called the garnishee in wage garnishment cases. Your employer is then given 30 days to file a Garnishee’s Answer form to the Writ of Garnishment. If the garnishee doesn’t file an answer, Alabama law allows your creditor to go after the garnishee for the judgment amount plus court costs.
Filing a Claim of Exemption From Garnishment in Alabama
You will be served with the Process of Garnishment form and Notice to Defendant of Right to Claim Exemption form. A claim of exemption from garnishment tells the court that your wages are protected from garnishment. Filing a claim for exemption can help you protect as much of your wages as possible or even stop the wage garnishment altogether. Also, Alabama law allows low-income residents to protect at least $1,000 of their paycheck each pay period.
You can file a claim for exemption using the Motion to Stop Wage Garnishment form. This form can’t be used for judgments related to child support, personal injury, or car accidents. Filing a claim of exemption for wages doesn’t guarantee that the wage garnishment will be stopped. Your creditor has 15 days to contest your claim of exemption. At that point, the court will schedule a hearing to decide if your wage exemption is valid.
How Much of My Paycheck Can Be Taken by Wage Garnishment?
The amount of your paycheck that can be taken by wage garnishment is governed by federal and state laws. There’s a cap on how much can be garnished so that you’re able to meet your family's basic living expenses.
Certain deductions are taken from every paycheck, such as income taxes, Social Security, and Medicare. The amount left after required deductions are taken is called your disposable earnings or disposable income. The wage garnishment cap in Alabama is either 25% of your disposable earnings for the week or the amount that your weekly income exceeds 30 times the federal minimum wage ($7.25 x 30 = $217.50). Whichever amount is less will be the cap on how much of your paycheck can be taken by wage garnishment in Alabama.
For example, let’s say that after taxes and mandatory deductions your disposable income is $400 per week.
25% of $400 is $100.
$400 minus $217.50 (the amount over 30 times the federal minimum hourly wage) is $182.50.
Since $100 is less than $182.50, the creditor can only garnish up to $100 each week in this example.
Let’s say that after taxes and mandatory deductions your disposable income is $250 per week.
25% of $250 is $62.50
$250 minus $217.50 is $32.50
In this example, the creditor can only take up to $32.50 each week.
The allowed garnishment amount is limited by exemptions on a per paycheck basis. If your weekly disposable earnings are less than $217.50, then your wages can’t be garnished. Also, the total amount garnished can’t be more than the judgment, plus fees, costs, and interest. The interest rate that accrues on judgments in Alabama is 7.5% annually.
Some Sources of Income Are Exempt From Garnishment
Some sources of income are exempt, meaning they’re protected from garnishment and can’t be taken to satisfy a judgment against you. Alabama exemptions include Social Security, disability benefits, Supplemental Security Income (SSI), unemployment benefits, received child support payments, and payments from pension or retirement programs.
How To Stop a Garnishment in Alabama
Beyond claiming exemptions with the court, you can stop wage garnishment in Alabama by paying off the amount owed or filing for bankruptcy protection. You can pay off the amount owed in a lump sum or through wage garnishment. Your creditor must stop garnishing your wages as soon as the judgment is paid off.
You can also stop a wage garnishment by filing for bankruptcy in Alabama. When you file, the court issues an automatic stay, which requires all collection activity against you to stop. If your bankruptcy case is successful, many of your debts will be wiped out or discharged. Alabama’s bankruptcy exemptions protect many of your assets and property.
If you’re facing debt collection lawsuits, judgments, and garnishment, then it’s time to explore what debt relief options are available to you. Upsolve offers a free tool that can help you file for bankruptcy on your own if you qualify.
Are There Any Resources for People Facing Wage Garnishment in Alabama?
Legal Services Alabama (LSA) represents eligible clients in civil legal matters, gives legal advice, and develops and distributes legal self-help materials and forms. LSA helps with consumer protection, including issues involving wage garnishment and protection against unlawful collection, among other legal services. LSA is Alabama’s only free, civil legal aid organization. Offices are located in Montgomery, Anniston/Gadsden, Birmingham, Dothan, Huntsville, Mobile, Selma, and Tuscaloosa.
The following official Alabama resources and nonprofit organizations may offer helpful resources on wage garnishment in Alabama:
