Michigan Wage Garnishment Exemption

 

Wages are protected by federal non bankruptcy law, and by state wage garnishment laws, which are generally more generous than the Federal wage garnishment protection. There are typically exceptions to this exemption for things like child support, and other priority debts.

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Wage Exemptions -- State System

Michigan Law Wage Garnishment Limits

Michigan only protects the federal minimum. 75% of wages or 30 times federal minimum wage.

Michigan scored an "F" in the the NCLC grading of state wage garnishment protections.

Federal Non-Bankruptcy Law
(available only if using State System)

Federal "non-bankruptcy" law also offers exemption protection for wages.

Wage Garnishment — Federal System § 522 (no exemption)

Can Michigan debtors use the Federal Bankruptcy exemptions instead of Michigan exemptions?

Yes. Michigan residents can use the Federal or State exemption systems.

Michigan has passed a special set of exemptions designed only to be used in bankruptcy cases (found in Section 600.5451). Although debtors can use the the exemptions in Michigan's "bankruptcy only" exemption statute, as well as ANY OTHER exemptions found in other Michigan statutes, such as exemptions for life insurance. (See In re Sasasak, 426 B.R. 680.)

The Federal Bankruptcy Exemptions under 11 U.S.C. § 522(d) are available to you if

  • you haven't lived in any state longer than 180 days for a while,
  • or
  • if your state allows the Federal exemptions as a choice.
 Michigan collections law and federal labor law (a federal non-bankruptcy exemption) set limits on what wages can be garnished.
 
The Wage Garnishment exemption in bankruptcy is for "earned by unpaid wages"... that is wages you'd earned as of the date you filed, but hadn't been paid for yet.
In a few states, the exemption protects earlier wages deposited in a bank account.
 
As the NCLC pointed out in a 2019 survey of state wage garnishment laws, some states fail to guarantee that a debtor can earn a poverty wage free of garnishment.

See also on LegalConsumer.com

From Elsewhere on the web:


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Jurisdictional relevance: ST

There are versions of this article for each State.