Debtor Grounds for a Hearing In an Administrative Wage Garnishment

The federal Debt Collection Improvement Act of 1996 provides administrative wage garnishments for the collection of wide array of debts owed to the federal government. Debtors are entitled to request and obtain a hearing to contest such a wage garnishment. The grounds a debtor may assert are as follows.

(1) Existence, validity, past-due status or amount of the debt: Objection on grounds that –

• The debt was previously paid or settled in full
• The debtor is in compliance with a valid repayment agreement
• The amount owed on the debt is incorrectly stated because not all payments had been credited
• The debtor has a legal defense as to liability for the debt under Federal or State law

(2) Enforceability of the debt through  Administrative Wage Garnishment (AWG):

• The debt was discharged or is currently in active bankruptcy
• The debt is unenforceable by AWG due to involuntarily separation from previous employment and debtor currently employed for less than 12 months

(3) Financial hardship: Garnishment of fifteen  percent (15%) of the debtor’s disposable pay will create a financial hardship on the debtor and his or her dependents .