LA Business Daily
Can a wage garnishment come out from gross earnings not disposable income?
I should explain. For example: X=Gross $1500.00 , X=wage assignment is $300.00 (per pay check), This all happens before taxes. X= $1200.00 Taxable income. Shouldn't $300.00 be taken from X's net income? Who pays for the income tax of the wage garnishment if it was taken before taxes (Gross Amount)? Who is responsible for income taxes on $300.00 garnishment?
Public Comments
- Wage garnishments are always based on gross income, not net. Edit: wage garnishments are considered to be AFTER-tax money. They do not reduce the income tax bill.
- Most commonly they are, although there are some states where if you are a primary wage earner for a family the judge does not allow as much of a garnishment as based on gross earnings.
- Dear S: Gross is the number although you may have an argument for the actual amount being with held. Speak up! This advice was prepared based on out understanding of the tax law in effect at the time. Click on my profile to read more. Errol Quinn Enrolled Agent
