Wage garnishments and collections

So, you set up a protected account through the IRS, and the whole point is that ONLY money that's legally shielded from garnishment can go into it.

The stuff that’s 100% untouchable (fully protected) includes:
child support payments, compensation for health issues or loss of work capacity, and payouts for lost support due to someone's death;
disability benefits under standard social security regulations;
any kind of social welfare assistance;
unemployment benefits;
child allowances;
scholarships and financial aid for students;
wages earned by inmates (though you can't use this to dodge child support or damages caused by criminal acts);
awards and official honors;
maternity and parental support payments, unless some specific law says otherwise;
and any other income specifically exempted by law (like certain sick leave pay or newborn grants from the government).

Now, wages and pensions? They’re only partially protected.

Everything else isn't covered, so don't even think about dumping it into the protected account.

vividsailor19 said:Hey everyone... I need some urgent help here, so if anyone could give me a quick answer, I'd really appreciate it. I tried searching for this thread, but it just keeps redirecting me to page 117, where there’s absolutely nothing about this topic.
I just got laid off, and since I'm eligible for severance, I'm wondering how exactly they're going to deposit it. It'll go straight into my checking account, even though I have a protected account set up. If that money hits my regular account, I can kiss it goodbye. Is there any way to save it before it's gone?

Look,

Please pay the severance into checking account IBAN ................. owner Mark Markovic, Markovic's address, 156964 Drpina Lower.

But first, ask whoever is paying you if that's an option. I don't see why it wouldn't be—most people handle it exactly how I wrote it.

rowdyraven112 said:Look,

Please pay the severance into checking account IBAN ................. owner Mark Markovic, Markovic's address, 156964 Drpina Lower.

But first, ask whoever is paying you if that's an option. I don't see why it wouldn't be—most people handle it exactly how I wrote it.

Thanks... I'll give it a shot, though I'm not sure if it'll fly.

So, here’s the deal with my situation. I’ve got this old debt from AT&T dating all the way back to 1999 for some mobile phone plan. Someone else was actually the one using the phone, but since the account was in my name, I was on the hook. Naturally, that person refused to pay up, and when the enforcement office came knocking, I just didn't have the cash to cover it. After they tried and failed to seize any of my property, everything just went quiet...
By 2001, I finally managed to scrape the money together and paid off the full principal amount they were suing for
A few months later, I get this letter in the mail from AT&T’s legal department and their accounting office confirming that my payment covered the entire principal and the court costs, plus a chunk of the interest. But then they hit me with the news that I still owed about $333 in interest, and if I didn't settle it, they’d keep pushing with the seizure process. I called their legal team and told them straight up that I couldn't afford those extra interest charges right then... Later that same month, I get a bill for roughly $333 specifically labeled as late interest. After that, nothing. I never heard another word from AT&T or the courts...
Since it’s been over 13 years since that last notice, and it’s been 15 years since the whole seizure thing started, and everything has just stayed dormant... is it possible this is all past the statute of limitations? I really need some advice on how to handle this because now I actually have the means to settle it once and for all...
Should I even bother contacting AT&T to ask for a bill for those interest charges, or should I just leave it alone??
Thanks in advance for any help you guys can give!

Well, if you aren't quite sure which law firm they sent the file to, why not just give customer service a quick call with your Social Security number handy so they can look it up for you? Once you have that info, you really ought to reach out to the attorney directly, because since the matter was handed off, AT&T isn't really involved anymore, and seeing as AT&T has already been paid, those remaining balances are strictly legal fees—and let's be honest, an attorney isn't exactly going to just wave those costs away, right?

It’s always much better to prevent a problem than to try and fix one after the fact, don't you think? 🤷

Ryan Lopez4 said:Well, if you aren't quite sure which law firm they sent the file to, why not just give customer service a quick call with your Social Security number handy so they can look it up for you? Once you have that info, you really ought to reach out to the attorney directly, because since the matter was handed off, AT&T isn't really involved anymore, and seeing as AT&T has already been paid, those remaining balances are strictly legal fees—and let's be honest, an attorney isn't exactly going to just wave those costs away, right?

It’s always much better to prevent a problem than to try and fix one after the fact, don't you think? 🤷

First off, thanks for the reply. I don't actually owe this attorney anything, because back when this whole thing was going down in '99, we were fighting it out in court, and I paid off the principal, the court costs, and a chunk of interest—basically everything they told me to pay at the time. I’ve still got the receipts and even a letter from them confirming the balance was settled. But then, after I thought it was all over, I get hit with a notice saying I still owe some interest that apparently never got cleared. I really want to get this sorted because I completely lost track of this interest debt, and now I'm stressing about an IRS seizure or more crazy legal fees piling up... Is it even legal for them to charge interest on top of unpaid interest?

casualranger22 said:First off, thanks for the reply. I don't actually owe this attorney anything, because back when this whole thing was going down in '99, we were fighting it out in court, and I paid off the principal, the court costs, and a chunk of interest—basically everything they told me to pay at the time. I’ve still got the receipts and even a letter from them confirming the balance was settled. But then, after I thought it was all over, I get hit with a notice saying I still owe some interest that apparently never got cleared. I really want to get this sorted because I completely lost track of this interest debt, and now I'm stressing about an IRS seizure or more crazy legal fees piling up... Is it even legal for them to charge interest on top of unpaid interest?

They aren't allowed to do that, though—but just so you know, when you make a payment, they don't apply it to the principal first. According to how the law is set up here in the States, they have to clear the collection costs first, then the interest, and only then does it touch the actual principal amount.

John Clark6 said:They aren't allowed to do that, though—but just so you know, when you make a payment, they don't apply it to the principal first. According to how the law is set up here in the States, they have to clear the collection costs first, then the interest, and only then does it touch the actual principal amount.

Thanks a ton for the reply.
Look, I’m gonna quote this follow-up letter I got from AT&T, dating back to 2001:

Dear customer, we are informing you that the debtor ---------, has settled the entire sued principal amount of ----- and court costs in the amount of ----- as of October 22, 2001.
Please note that the debtor paid $96 toward late interest as of October 22, 2001, and accordingly, the remaining balance for those amounts is $352.
The debt you are required to settle consists of the difference in the late interest payments in the amount of $352 credited to the creditor's account.
I have to point out that before I actually sent the money, I specifically asked them at AT&T for the exact figure I needed to pay, and I paid precisely what they told me to, so I was dead certain I had everything squared away...

So yeah, I still technically owe for those interest charges, and honestly, I’d love to just pay it off so I can finally get some sleep, but I have no clue where to even start because their account numbers have been changing constantly in the meantime...
And how on earth is it possible that in all this time there haven't been any invoices, warnings, letters, bank freezes, or anything? Not even a single notice from the court... I don't even know what stage my case is in right now. I've been working steadily since 2003, so they definitely could have collected from me if they wanted to...
Can anyone please give me some advice on how to fix this mess?
Thanks so much!!

I wanted to reach out and see if anyone here has a deeper understanding of legal precedents—if you could weigh in, I’d really appreciate it... basically...
- So, I initiate an enforcement action, and the guy files an appeal claiming he never received his billing statements. Get this: the court actually rules in *his* favor (it's honestly ridiculous). I might end up having to cover the legal costs too, even though right from the jump, I attached all the invoices clearly showing every single charge and due date. Since the obligation to pay was explicitly laid out in the contract—meaning there is zero doubt he knows he owes the money—the court still sides with him. And the kicker? Nobody ever sends those billing statements via certified mail anyway...
By that logic—and I think the court has gone completely off the rails here—you could practically get out of any enforcement action just by claiming you never got the bills... LOL. I mean, nobody is actually mailing them out requiring a signature upon receipt! As a result, no creditor can ever truly prove that the debtor actually received the statements in the first place.

I was wondering if anyone might be willing to send me a template via PM—or perhaps just post it here—for a "third-party objection in an enforcement proceeding."
Alternatively, if someone happens to know of a reliable website where I could hunt down a link myself, please let me know..

Much appreciated!

John Clark6 said:I wanted to reach out and see if anyone here has a deeper understanding of legal precedents—if you could weigh in, I’d really appreciate it... basically...
- So, I initiate an enforcement action, and the guy files an appeal claiming he never received his billing statements. Get this: the court actually rules in *his* favor (it's honestly ridiculous). I might end up having to cover the legal costs too, even though right from the jump, I attached all the invoices clearly showing every single charge and due date. Since the obligation to pay was explicitly laid out in the contract—meaning there is zero doubt he knows he owes the money—the court still sides with him. And the kicker? Nobody ever sends those billing statements via certified mail anyway...
By that logic—and I think the court has gone completely off the rails here—you could practically get out of any enforcement action just by claiming you never got the bills... LOL. I mean, nobody is actually mailing them out requiring a signature upon receipt! As a result, no creditor can ever truly prove that the debtor actually received the statements in the first place.

In my experience, courts regularly shut down those types of objections. They usually point out that standard business practices and U.S. regulations don't require invoices to be sent with proof of delivery. Plus, the simple fact that the debtor still hasn't paid after receiving the actual judgment—clearly knowing they owe the money—pretty much invalidates their argument.

So, I agree that this particular court went off the rails, and that ruling will almost certainly be overturned on appeal.

Susan Thompson15 said:In my experience, courts regularly shut down those types of objections. They usually point out that standard business practices and U.S. regulations don't require invoices to be sent with proof of delivery. Plus, the simple fact that the debtor still hasn't paid after receiving the actual judgment—clearly knowing they owe the money—pretty much invalidates their argument.

So, I agree that this particular court went off the rails, and that ruling will almost certainly be overturned on appeal.

You won't believe what the judge wrote in the reasoning—it was quite something! He basically said, "The fact remains that the creditor isn't required to send payment slips via certified mail, yet the debtor does have the right to dispute the debt based on not receiving them, since the creditor lacks proof of delivery; this doesn't mean the debt doesn't exist, it just means it hasn't technically become due yet"—which is just... well, wow. Especially considering the person actually used the service! They used the service, there's a contract in place, and they are fully aware they need to pay for it. It feels like finding a sensible judge is a rare occurrence these days, I guess. Honestly, I feel like I'm just spinning my wheels on these appeals. Now, instead of simply posting the order on the courthouse bulletin board like they should, the clerk is insisting that I cover $59 the fees for a process server. There isn't even a rule requiring that kind of service, and I even provided her with the proof of residence. (That was for the insurance order, by the way).

Thomas Ward5 said:I was wondering if anyone might be willing to send me a template via PM—or perhaps just post it here—for a "third-party objection in an enforcement proceeding."
Alternatively, if someone happens to know of a reliable website where I could hunt down a link myself, please let me know..

Much appreciated!

In what sense are we talking about a third party? Are we talking about a stakeholder who has a vested interest in joining the proceedings—like an employer who was supposed to withhold funds from a debtor's paycheck, for instance—but didn't 🙂—or perhaps a joint liable debtor? 🙂 I guess I'm just not quite sure which specific scenario you're dealing with here 🙂

Ryan Lopez4 said:Well, if you aren't quite sure which law firm they sent the file to, why not just give customer service a quick call with your Social Security number handy so they can look it up for you? Once you have that info, you really ought to reach out to the attorney directly, because since the matter was handed off, AT&T isn't really involved anymore, and seeing as AT&T has already been paid, those remaining balances are strictly legal fees—and let's be honest, an attorney isn't exactly going to just wave those costs away, right?

It’s always much better to prevent a problem than to try and fix one after the fact, don't you think? 🤷

Sorry to jump in here, but I'm dealing with something similar. Does this stuff ever actually hit the statute of limitations?

John Clark6 said:In what sense are we talking about a third party? Are we talking about a stakeholder who has a vested interest in joining the proceedings—like an employer who was supposed to withhold funds from a debtor's paycheck, for instance—but didn't 🙂—or perhaps a joint liable debtor? 🙂 I guess I'm just not quite sure which specific scenario you're dealing with here 🙂

My brother just had a judgment enforcement action served against his personal property.
Given that he's currently unemployed, his bank accounts are frozen, and he lacks the liquidity to settle this debt immediately, he’s essentially stuck living with his parents at the same address. The problem is, his parents actually own everything in the house, yet the creditor is now attempting to "seize" all the household goods. We are looking for a template or an example of a "third-party claim"—in this case, filed by the parents—to halt the seizure of their belongings. Does anyone know how one should properly draft such a third-party objection...

John Clark6 said:You won't believe what the judge wrote in the reasoning—it was quite something! He basically said, "The fact remains that the creditor isn't required to send payment slips via certified mail, yet the debtor does have the right to dispute the debt based on not receiving them, since the creditor lacks proof of delivery; this doesn't mean the debt doesn't exist, it just means it hasn't technically become due yet"—which is just... well, wow. Especially considering the person actually used the service! They used the service, there's a contract in place, and they are fully aware they need to pay for it. It feels like finding a sensible judge is a rare occurrence these days, I guess. Honestly, I feel like I'm just spinning my wheels on these appeals. Now, instead of simply posting the order on the courthouse bulletin board like they should, the clerk is insisting that I cover $59 the fees for a process server. There isn't even a rule requiring that kind of service, and I even provided her with the proof of residence. (That was for the insurance order, by the way).

😁 😁 I've seen this before.
It's a common issue with way too many judges in this country... They’re terrified of the public bulletin board.😍

John Clark6 said:You won't believe what the judge wrote in the reasoning—it was quite something! He basically said, "The fact remains that the creditor isn't required to send payment slips via certified mail, yet the debtor does have the right to dispute the debt based on not receiving them, since the creditor lacks proof of delivery; this doesn't mean the debt doesn't exist, it just means it hasn't technically become due yet"—which is just... well, wow. Especially considering the person actually used the service! They used the service, there's a contract in place, and they are fully aware they need to pay for it. It feels like finding a sensible judge is a rare occurrence these days, I guess. Honestly, I feel like I'm just spinning my wheels on these appeals. Now, instead of simply posting the order on the courthouse bulletin board like they should, the clerk is insisting that I cover $59 the fees for a process server. There isn't even a rule requiring that kind of service, and I even provided her with the proof of residence. (That was for the insurance order, by the way).

I was actually the one filing an appeal in a similar case once—arguing that I never received the bill for the period I was eventually sued for, and the court actually sided with me.
To be honest, I really didn't get the bill and even though your point about using the service makes total sense, the court agreed with my side too. I don't think anyone should be expected to just wander around begging for bills just so they can pay someone money 🤷
The thing is, the creditor has a customer service department, but they don't record their calls, and since I insisted I had called them... the court basically just took my word for it.

Even if you aren't thrilled that the court upheld the objection, I don't see why one side should automatically be trusted over the other, right? 🤷

Roger Williams said:Sorry to jump in here, but I'm dealing with something similar. Does this stuff ever actually hit the statute of limitations?

That’s likely already past the statute of limitations anyway. I don't see any reason to give them a single cent unless they're desperate for the cash.
Different types of debt have different expiration periods, so you really have to specify what kind of debt we're talking about.

Thomas Ward5 said:My brother just had a judgment enforcement action served against his personal property.
Given that he's currently unemployed, his bank accounts are frozen, and he lacks the liquidity to settle this debt immediately, he’s essentially stuck living with his parents at the same address. The problem is, his parents actually own everything in the house, yet the creditor is now attempting to "seize" all the household goods. We are looking for a template or an example of a "third-party claim"—in this case, filed by the parents—to halt the seizure of their belongings. Does anyone know how one should properly draft such a third-party objection...

If anyone has any insight, I would be most grateful. Please provide a link or some sort of template that could serve as a guide for drafting this..

Thomas Ward5 said:If anyone has any insight, I would be most grateful. Please provide a link or some sort of template that could serve as a guide for drafting this..

The parents basically just need to draft a formal statement confirming that all the personal property inside the house belongs to them, and then they can submit that directly to the court.

Hey there.
So, my husband just got hit with a wage garnishment, and they took his entire paycheck. It’s all because of what he owes Diners. The only thing they didn't grab yet was another $15, which covers the collection fees and the interest accruing from the day the order was issued until everything is paid off—all due within 8 days.
Now, here's my question: was the bank actually required to notify him that they received a request from the IRS to garnish his wages?
Also, what's the deal with those interest charges? Is he going to be stuck paying even more interest on top of that $667 amount, or does it stop there?