How to Calculate Multiple Wage Garnishments
- 1). Gather the writs of garnishment. Garnishments for family support, taxes or student loans have priority over other types. Organize the garnishments by priority and then by date. For example, you have garnishment orders for an employee for child support dated in February, for a credit card judgment dated in January and a medical bill dated in March. Pay the child support garnishment first, then the credit card and medical bill garnishments as possible under the limits of your state.
- 2). Subtract any deductions required by law such as taxes and Social Security from your employee's gross pay. The remaining amount is your employee's disposable income. Do not subtract miscellaneous deductions such as uniforms or union dues; states do not consider voluntary deductions when determining disposable income.
- 3). Federal law states that employers must take the lesser amount between 25 percent of an employee's disposable income or any amounts over 30 times the minimum wage. Your state limits may differ but if your employee's disposable income is $475 a week, under the 25 percent rule the garnishments cannot exceed $118.75. Under the 30 times minimum wage rule, the amount is any money in excess of $215.50, as of 2011, or any amount up to $259.50. In this case, you would withhold up to $118.75 because it is the lesser amount.
- 4). Subtract the garnishments from the employee's garnishment limit starting with the first one in your organized list and proceeding through the list until you reach the limit. For example, if the child support garnishment is $50 per week, subtract $50 from $118.75. If the credit card judgment is $50 per week, subtract $50 from $68.75. If the medical bill judgment is more than $18.50 per week, you can only send $18.50 or you would be over the employee's garnishment limit.
- 5). Increase the amount of the garnishments when necessary after you fulfill the requirements of paid garnishments. For example, when you receive a notice of termination for the credit card garnishment in the above example, you can increase the amount you withhold for the medical bill garnishment.