Administrative wage garnishment is a legal process where a federal agency directs a non-federal employer to withhold a portion of an employee's wages to repay a debt owed to the United States. This process is typically used to recover unpaid federal debts, such as student loans or taxes. The employer is required to send the withheld funds directly to the federal agency until the debt is satisfied.
This term is commonly used in debt collection practices within federal law. Administrative wage garnishment falls under the jurisdiction of federal agencies, including the Department of Education and the Internal Revenue Service. Individuals may encounter this process if they have outstanding debts that have not been resolved through other means. Users can manage certain aspects of this process using legal templates from US Legal Forms, which can help in understanding their rights and obligations.
Here are a couple of examples of abatement:
Example 1: A federal employee has defaulted on a student loan. The Department of Education issues a garnishment order to the employee's private sector employer, requiring them to withhold a portion of the employee's paycheck to repay the loan.
Example 2: An individual owes back taxes to the IRS. The IRS sends a garnishment order to the individual's employer, instructing them to deduct a specified amount from the employee's wages until the tax debt is settled. (hypothetical example)
The primary statute governing administrative wage garnishment is the Debt Collection Improvement Act of 1996. This law allows federal agencies to garnish wages without a court order for debts owed to the federal government. Additional regulations can be found in Title 31 of the Code of Federal Regulations, Part 285.
| Term | Definition | Key Difference |
|---|---|---|
| Wage garnishment | A court-ordered process to withhold wages for various debts. | Administrative wage garnishment is initiated by a federal agency without court involvement. |
| Judgment garnishment | A court-directed garnishment based on a legal judgment. | Judgment garnishment requires a court order, while administrative wage garnishment does not. |
If you receive a notice of administrative wage garnishment, it is important to act promptly. You can:
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Debts such as unpaid federal student loans, taxes owed to the IRS, and other federal obligations can lead to garnishment.