Federal law caps how much of a worker’s paycheck an ordinary creditor can take, and it protects the job itself. Under the Consumer Credit Protection Act, the weekly amount garnished for an everyday debt cannot go past 25 percent of disposable earnings. The same law bars an employer from firing a worker over garnishment for any one debt, the U.S. Department of Labor says.

The cap is the lesser of two figures, and for lower-paid workers the second figure often matters more than the quarter. Child support, taxes and some bankruptcy orders follow different rules.

How the 25 percent cap actually works

The Labor Department’s Wage and Hour Division explains the rule in Fact Sheet #30, revised in December 2024. The weekly amount taken for an ordinary debt may not exceed the lesser of two numbers. One is 25 percent of the worker’s disposable earnings. The other is the amount by which disposable earnings are greater than 30 times the federal minimum wage.

With the federal minimum wage at $7.25 an hour, 30 times that is $217.50 a week. The fact sheet’s examples show what follows. A worker whose weekly disposable pay is $217.50 or less cannot be garnished for an ordinary debt. Between $217.50 and $290, only the amount above $217.50 can be taken. At $290 or more, which is 40 times the minimum wage, the cap is the full 25 percent.

For a worker with $250 in weekly disposable pay, the math works out to $32.50, because that is the amount over $217.50 and it is smaller than a quarter of $250. For a worker with $400, a quarter is $100, and that is the lower number. The two figures in the statute, 15 U.S.C. 1673, produce those results.

For anyone holding a garnishment notice, the first step is to find which kind of debt it is, since the cap below applies only to ordinary ones. The next is the pay stub: subtract the legally required deductions and compare what is left with the weekly or monthly figure for that pay period.

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The fact sheet defines disposable earnings as the pay left after legally required deductions are made. Those include federal, state and local taxes, the employee’s Social Security and Medicare taxes, state unemployment insurance and legally required retirement withholdings.

Voluntary deductions generally cannot be subtracted before the cap is figured. Union dues, insurance premiums and retirement contributions a worker chose to make are examples the department lists. That means the pay the cap is built on can be higher than a worker’s take-home pay.

For workers paid on a schedule other than weekly, the Labor Department publishes matching figures. Its table lists $435 and $580 for biweekly pay, $471.25 and $628.33 for semimonthly pay, and $942.50 and $1,256.66 for monthly pay.

When the cap does not apply

The quarter is not a limit for every debt. The statute and the fact sheet carve out several cases, and a worker facing one of them can lose a bigger share of each check.

Child support and alimony can reach 50 percent of disposable earnings for a worker who supports another spouse or child, or 60 percent for a worker who does not. The department says an extra 5 percent can be garnished when the support is more than 12 weeks behind.

Federal non-tax debts and federal student loans collected through Education Department guaranty agencies are capped lower, at up to 15 percent of disposable earnings, according to the fact sheet. Federal and state tax debts and certain bankruptcy court orders are outside the 25 percent limit, and the fact sheet gives no set percentage for either. The statute lists the same three exceptions: support orders, Chapter 13 bankruptcy orders and any state or federal tax.

The job protection, and where it stops

The firing ban is in 15 U.S.C. 1674. Under the fact sheet, the law prohibits an employer from firing an employee whose earnings are subject to garnishment for any one debt, regardless of the number of levies made or proceedings brought to collect that one debt.

The wording is specific. Protection covers garnishment for a single debt. The department’s description does not say what happens when wages are garnished for more than one debt at once, and the statute is the place to read the exact language before assuming either way.

The statute says an employer who knowingly breaks the ban can face a fine of up to $1,000, imprisonment of up to a year, or both. The Wage and Hour Division enforces the garnishment limits and the firing protection against employers. Questions about the order of payment among creditors go to the court or agency that started the garnishment.

The fact sheet adds one more point on limits. If a state law sets a lower garnishment amount than the federal law, the lower amount applies.

A worker holding a garnishment order has three things to pin down: what kind of debt it is, what the weekly figure is for the pay period, and whether the employer is taking more than the cap allows. The Wage and Hour Division is the federal office that enforces the limits against employers.

The cap covers pay. It does not by itself say what happens when a creditor goes after a bank account instead of a paycheck. That is a different set of rules, and readers who have had an account frozen face a different question.

Is a creditor taking more than the cap from the paycheck?

A garnishment that runs past the cap, or a frozen account that nobody explained, can drain a month’s money before the problem is spotted. The fixed dates, the pay-period math and the notices all pile up at once.

The Bank Account & Debt Protection Kit is a 75-page guide that covers the 2-month bank protection rule and the frozen-account response, along with the steps to make a collector prove a debt. Part 6 deals with judgments and garnishment, and Part 8 holds the letters, worksheets and contacts.

Get the garnishment and frozen-account response steps and letters →

This article was produced with AI assistance and edited for accuracy against the sources linked above.