Wage garnishments and collections

When does the statute of limitations on collections actually kick in, and does the timeframe change based on how much is owed?

To be specific, I’m waiting on a second collection notice regarding a fine my stepson incurred—it's roughly $75 or so. Since I don't have a steady income right now and don't even maintain a bank account, I'm wondering if this will eventually just expire via the statute of limitations. And, given everything I've been through in this country... is it actually possible for an amount that small to go after my assets? The only thing I truly own is some farmland.

I appreciate any insight you can offer. No matter how ridiculous the amount might seem to some of you, for me, it represents more than a month's worth of income. Thanks for understanding.

Hey, not sure if this belongs here, but I’ve got a situation. I have one unpaid fine and another one that’s already gone to collections. I went to get my car registered yesterday and saw a "STOP" flag from the Department of Homeland Security on my record. Basically, I can't register the car until those fines are cleared. My question is: do I have to settle the collection amount too, or does this just apply to that one outstanding fine? Thanks for any help.

Nezzz, I wasn't quite sure where to ask—so I figured I’d just post it here. I recently bought some land, but the previous owner had an outstanding lien on it. Now that I’m the official owner, the title shows an active foreclosure—and the court is moving to sell the property. Can they actually sell my land like this? It isn't even my debt—it belongs to the former owner, not me.

Donna Harris5 said:Nezzz, I wasn't quite sure where to ask—so I figured I’d just post it here. I recently bought some land, but the previous owner had an outstanding lien on it. Now that I’m the official owner, the title shows an active foreclosure—and the court is moving to sell the property. Can they actually sell my land like this? It isn't even my debt—it belongs to the former owner, not me.

Well, yeah, they absolutely can. I mean, when you buy property that has a lien attached to it, you're essentially stepping right into those liabilities... it's just how it works. That’s why, whenever someone considers buying something with an existing encumbrance, the sale price should be significantly lower to account for that debt—unless the debt itself is higher than the value of the land, in which case, well, you probably shouldn't be buying it in the first place!

rowdyraven112 said:An attachment is either a court order or a notary deed. Here. There’s no deal to be made. Period.The same agencies handle the enforcement—the IRS, the courts, all that. The debtor doesn't have any say in the matter. Collection follows a strict order: interest first, then costs, then principal. Interest is set by law, and the highest I've seen is 15% annually. Short and simple.

Under Section 202, Paragraph 1 of the CIA guidelines, we're looking at a private instrument from the debtor. Paragraph 2 of that same section defines its legal weight—it carries the same force as a final enforcement order and holds the status of a legal transaction under Section 77. I won't bore you with the rest. What does "legal effect" actually mean here? It means if they come after your wages, they can't touch a dime until that determination is finalized. Hope that clears things up.
An injunction or an administrative ban is basically just a contract between two parties. In this setup, the creditor and the debtor... They’re negotiating. That’s the key word right there. They think they can just sit down and cut a deal behind closed doors? Please. Everyone knows how this works. They talk, they scheme, they pretend everything is above board. But we see through it. What are they actually agreeing on? It’s always the same old story. Let’s talk about debt repayment models. It doesn't have to be a third of your paycheck; it could just as easily be a quarter. If you set it up via contract, you aren't bound by the mandatory relationship law where everything is strictly split between interest, fees, and principal. A debtor can actually insist on adding a clause that lets them pause payments whenever they want. Interest rates? Those are whatever you agree upon. As far as I know, before 2011, you didn't even need to have those documents notarized. Correct me if I'm wrong.
You’ll probably tell me that any creditor would look like an idiot if they agreed to terms like this. Sure, they would. I wouldn't agree to these kinds of conditions either if I wasn't backed into a corner just trying to collect what's owed to me. That’s exactly what that section of the CIA code allows—it gives debtors a way to play games and tilt the scales during negotiations.
A debtor signs a loan agreement with a reliable partner—just two bucks, enough to make the legal claim last a lifetime. Immediately after, they set up a garnishment for one-third of their income, or whatever the maximum allowed under mandatory relationship law, plus interest. They can send that garnishment for collection right away, or wait. That’s when the debtor walks over to the creditor and puts the squeeze on them to accept a better repayment plan. If the creditor starts playing games just to stall for time? Just hire an admin for your firm and open a protected checking account.
Why even bother doing this? It’s a direct response to those predatory mandates within the mandatory relationship law and the CIA regulations. They're trying to send a message: don't be malicious. Demand an interest waiver and a reduction in legal fees. Then, agree to pay off the debt in installments. And whatever you do, get everything in writing.

It’s pretty much the same deal with fake invoices during pre-trial settlements, though I bet some people know the ropes better than others.

Can you open a protected checking account that's exempt from garnishment? Absolutely. Just walk into any local clinic and you'll see how Medicare provides administrative exemptions to prevent them from automatically seizing monthly payments. Based on that paperwork, anyone can set up a protected account—I've seen it happen.
Sure, all these tactics are basically an abuse of the system, but if you look closely, even Medicare uses these same loopholes. I'm convinced they target retirees for these exemptions because they're the easiest group to manipulate with these shady schemes.
And listen, gentlemen, this kind of legal abuse needs to be proven in court. Anyone claiming this is just "technicality" either has skin in the game or has never stepped foot inside a courtroom.

I highly doubt you guys will actually get it.

I have to admit, I really didn't get it.

Donna Harris5 said:Nezzz, I wasn't quite sure where to ask—so I figured I’d just post it here. I recently bought some land, but the previous owner had an outstanding lien on it. Now that I’m the official owner, the title shows an active foreclosure—and the court is moving to sell the property. Can they actually sell my land like this? It isn't even my debt—it belongs to the former owner, not me.

Look, if there was already a foreclosure notice filed against that property in the county records, you couldn't have legally become the owner in the first place.

The reason is simple: ownership of real estate—regardless of any contract you signed—isn't official until it's recorded in the land registry. Under Section 48, subsection 3 of the bankruptcy law, you can't officially transfer or acquire ownership once a foreclosure has been noted against the property.

If a buyer shows up, the court is going to sell that property, and they aren't going to stop to ask for your permission. Honestly, all you can do now is sit tight and pray nobody puts in a bid.

Hey there! Does anyone here have any firsthand experience with how long it actually takes to deal with an objection against an enforcement order based on an authentic document at the Los Angeles County Superior Court? It’s just a small claims matter, but the case was transferred from the Los Angeles County Superior Court over to the Chaksta County Superior Court, where it's currently sitting "in progress" with the judge. Thanks...

restlesssailor90 said:Hey there! Does anyone here have any firsthand experience with how long it actually takes to deal with an objection against an enforcement order based on an authentic document at the Los Angeles County Superior Court? It’s just a small claims matter, but the case was transferred from the Los Angeles County Superior Court over to the Chaksta County Superior Court, where it's currently sitting "in progress" with the judge. Thanks...

Resolving an objection in local court takes up to a year, max... I haven't heard of anyone taking longer than that. I always want to ask this one question: Why do you even care?

rowdyraven112 said:Resolving an objection in local court takes up to a year, max... I haven't heard of anyone taking longer than that. I always want to ask this one question: Why do you even care?

Thanks for getting back to me! The reason I'm asking is that right now my paycheck is protected by some specific credits and payroll arrangements, so they can't touch the amount they're trying to claim from me unfairly. But once that loan is paid off and my full salary is back on the table, they'll be able to garnish whatever they want. So, I'm just crossing my fingers that my objection gets settled before then—hopefully in my favor, obviously.😉

hollowmason64 said:It’s exactly because of all those headaches you mentioned—and the constant mess involving SSNs—that they're looking to fix this in the new bankruptcy law.

When does that actually kick in? September 1st?

So, the new bankruptcy law kicked in on September 1st. What changed? Not much. They’re just speeding up the seizure process and slapping even more penalties on debtors. That's it. Nothing else.
By the way, you really need to check the date on that bankruptcy law filing. That specific law doesn't apply to any rulings issued before September 1st, 2014. Simple as that.

Feel free to set me straight if I've misread anything.

In short:
Expansion of protected zones: Articles 172 and 173 of the law.
So, here’s the news: these amounts are now exempt from seizure under bankruptcy law.
Child support payments made into that specific bank account?
Business travel reimbursements and commuting allowances—up to the legal limits—aren't taxed as income. Simple enough?
The 12th gift for kids under 15 and those newborn support payments? They stay under the IRS threshold for non-independent work income, so you don't have to worry about them being taxed. Simple as that.
Disaster relief funds. For what? Recovering from natural disasters and extreme weather events.
Disability benefits, long-term sick leave exceeding 90 days, death benefits for employees or their immediate family—it all falls under the same umbrella. As long as they stay within the limits set by the IRS, these payouts aren't even considered taxable income under non-self-employment rules. Simple enough, right?

Regarding the fees: check Article 173.
Look, the rules in paragraphs 1 and 2 still apply even if we aren't talking about standard wages, pensions, or income from a small business or freelance gig. It covers everything else—property, assets, capital, insurance payouts, you name it. If that money is the only thing keeping someone afloat, they can prove it with a legal document. Once they show that this is their sole source of steady income, the law kicks in. Simple as that.

Regarding Article 173. Look, if you’re pulling in side income, the rules are exactly the same as they are for your regular paycheck. It doesn't matter. If your salary is below the US average, two-thirds of your income is protected. If you're making more than the average American salary? Then two-thirds of that average is what's protected. Simple as that.

The debtor still has to handle their own protected income. That means they have to go down to an IRS branch and report it themselves before the money even hits the account—especially since things like a one-time gift for the kids aren't automatic. The law doesn't provide for automatic protection just because some people in my DMs think it does. They're wrong.

Served the papers.
Still no legal deadline for when a court has to issue an enforcement order and serve it to the debtor. But there is a timeframe that exists... It can't be shorter than 30 days. It can't be longer than 60. Period. Regarding the second delivery attempt. Here’s the update: now, the notary or the court is required to pull residency records from the Department of Homeland Security to locate the debtor and serve them based on that info. It’s still unclear if the court sends written notice to both addresses. After two failed attempts, the ruling becomes final just eight days after being posted on the local court's electronic bulletin board. So, basically, there's still zero guarantee the debtor actually gets served the seizure order.

Objection.
Objection regarding decisions issued after September 1, 2014. It better be backed up by credible documentation. Period. The court has the legal authority to just reject it as incomplete. No chance for a fix, no option to supplement. That's how it works.
Bottom line: foreclosures are going to speed up. It’s highly unlikely any objection will actually be accepted or result in a rejected seizure order.

People who received a seizure order before September 1st, 2014, need to pay close attention. Local courts will probably just rubber-stamp rejections because they claim an objection is "incomplete" or lacks enough detail. You can appeal to the State Court based on misidentified facts. Make sure to mention that the amendments to the bankruptcy law that took effect on September 1st, 2014, cannot be applied retroactively to orders issued before that date. This means your objection doesn't need to be backed by exhaustive documentation right now; those details will be sorted out during a civil lawsuit instead.

That’s the quick rundown of what matters in the law for individuals.

EDIT:

http://www.govinfo.gov/examples/link_placeholder

The bolded parts indicate the specific amendments. Honestly, you should read this given how things are looking.

I actually agree with your point that the bailiff is the one who needs to contact the IRS directly to handle opening a protected account.

But I’m going to have to disagree with you on the idea that the parent has to babysit the process of making sure child support hits that protected account. Once they hand over those protected account details to their employer, HR should know exactly how the mandatory relationship law works. It shouldn't be the employee's job to constantly remind the payroll department which specific account receives those funds; that's what they're paid for.

Fresh off a seminar and honestly, I’m still pretty confused. 😁

They weren't exactly crystal clear when they got to Section 197.

Section 197.
(1) A wage garnishment order specifies the portion of wages to be seized and mandates that an employer who does not pay the debtor via a bank account must instead remit the specified amount directly to the creditor once the order becomes final.
(2) This garnishment order also applies to any subsequent salary increases that occur after the order has been served.

I guess I have to wait for the official ruling to see if this section actually implies that employers are off the hook for garnishing wages if they already pay everything through a bank account.

To be honest, nobody could figure out who they're even talking about—people who don't pay wages through a bank account. I mean, under current IRS regulations, you HAVE to pay via bank transfer.

What do you guys think? Why even mention employers who don't use bank accounts for payroll? What's the actual point of that clause?

Ethan Mitchell4 said:I actually agree with your point that the bailiff is the one who needs to contact the IRS directly to handle opening a protected account.

But I’m going to have to disagree with you on the idea that the parent has to babysit the process of making sure child support hits that protected account. Once they hand over those protected account details to their employer, HR should know exactly how the mandatory relationship law works. It shouldn't be the employee's job to constantly remind the payroll department which specific account receives those funds; that's what they're paid for.

Listen, anyone receiving protected payments—and I mean absolutely anyone—has to report to the IRS first. You go there, and they'll give you the rundown on what comes next. And yeah, I already said this applies to one-time payments too. Do yourself a favor and actually read through this thread; the answers are already here if you bother to look. If I have to start repeating myself, we’re getting off track.

ruggedmaker2 said:Fresh off a seminar and honestly, I’m still pretty confused. 😁

They weren't exactly crystal clear when they got to Section 197.

Section 197.
(1) A wage garnishment order specifies the portion of wages to be seized and mandates that an employer who does not pay the debtor via a bank account must instead remit the specified amount directly to the creditor once the order becomes final.
(2) This garnishment order also applies to any subsequent salary increases that occur after the order has been served.

I guess I have to wait for the official ruling to see if this section actually implies that employers are off the hook for garnishing wages if they already pay everything through a bank account.

To be honest, nobody could figure out who they're even talking about—people who don't pay wages through a bank account. I mean, under current IRS regulations, you HAVE to pay via bank transfer.

What do you guys think? Why even mention employers who don't use bank accounts for payroll? What's the actual point of that clause?

Of course there are parts that can be paid out under the table. We're talking about various payroll add-ons—per diems, field stipends, hazardous chemical allowances, mileage reimbursements... all those extras dictated by collective bargaining agreements that technically count as wage supplements (correct me if I'm wrong on that one). The statute ensures even those specific amounts get handed over to the creditor. Otherwise, there’s a massive loophole: you can just coordinate with your employer to label those payments as, say, a gift for your kid. Under the current bankruptcy law, that falls under protected funds, which then get deposited straight into a protected account.
I reckon employers are going to start getting pretty generous when it comes to childcare benefits lately.

So, I finally realized that applies to those miscellaneous payments made through the cash register—the stuff that's allowed. Salary isn't part of that; if it hits your checking account alongside your paycheck, it should be hitting the garnishment account instead.

No way, isn't it obvious that travel reimbursements have been protected since September 1st?

I honestly don't follow.
How would employers no longer be obligated to handle wage garnishments? Honestly, maybe that would actually be a good thing—just hand everything over to the IRS and let them deal with the headache. Right now, some things go to the IRS, some go straight to the employer; it’s just one giant mess. That change would be great.

ruggedmaker2, just keep me posted on any updates. I'm a little out of the loop on all of this, but I definitely want to stay up to speed.

Ethan Mitchell4 said:So, I finally realized that applies to those miscellaneous payments made through the cash register—the stuff that's allowed. Salary isn't part of that; if it hits your checking account alongside your paycheck, it should be hitting the garnishment account instead.

No way, isn't it obvious that travel reimbursements have been protected since September 1st?

I honestly don't follow.
How would employers no longer be obligated to handle wage garnishments? Honestly, maybe that would actually be a good thing—just hand everything over to the IRS and let them deal with the headache. Right now, some things go to the IRS, some go straight to the employer; it’s just one giant mess. That change would be great.

ruggedmaker2, just keep me posted on any updates. I'm a little out of the loop on all of this, but I definitely want to stay up to speed.

Of course commuting costs and business travel expenses (tolls, gas, plane tickets, train fare...) are protected. I was talking about per diems from those trips and field stipends... those aren't exempt from garnishment...
And no, handing everything over to the IRS is a bad move because people won't be able to exploit legal loopholes 😉.
Look, any expense paid through petty cash can be listed as a gift for a child if you coordinate it with the employer, making those amounts exempt from garnishment. That's the first loophole.
The second loophole is setting up a fake loan agreement with someone close to you and using an administrative payroll deduction (I've written about this before). You essentially garnish yourself so the money lands in the account of that close contact instead. They withdraw the cash and give it back to you. The point is, this should only be a temporary fix until you negotiate a repayment plan with the creditor—force them to waive part of the interest so you can knock out the principal first. Once you show a creditor they can't squeeze you anymore, they'll change their tune and stop playing games. For that same reason, creditors aren't hitting checking accounts as much; they're going straight for the paycheck. You have to move fast with this 😉.

Section 197.
(1) Through a wage garnishment order, a specific portion of an employee's salary is seized. This order instructs the employer—who doesn't pay the employee's salary directly into a bank account—to pay that specified amount to the creditor once the order becomes legally binding.

The thing is, this section doesn't say a single word about reimbursements. You know, those things that are technically the worker's right and can be handed over in cash. Those aren't "salary"—they're reimbursements. Salary is what you get for actually doing the job; reimbursements are just covering your costs. We're talking mileage, per diems, child allowances, help with medical leave after 90 days... none of that is salary. Even the FBI doesn't define those things as wages. They're just reimbursements defined by federal law and income tax regulations.

That’s what’s tripping me up.

To me, it honestly looks like employers might not even have to process wage garnishments anymore if they structure it this way. 🤷
I guess I need someone to sit down and explain this to me properly.

Look, you can't exactly just pay an employee $0.33 out of the petty cash fund as a "baby gift" every single month. I'd say maybe $400 $167 once a year is the limit if you want to stay under the radar tax-wise.
If you have to cover all the payroll taxes on it, you’re basically just throwing money down the drain.

Or is this some other new loophole?

So, let me get this straight: starting September 1st, commuting costs and business travel expenses (just the actual costs) are tax-exempt?
But what about per diems and field stipends? Are those still being hit?
Am I overthinking this?

And where does everything else fall? Christmas bonuses, vacation payouts, retirement benefits, or death benefits for a family member? Where does that all land?

The IRS just updated their site, so you might want to head over there and take a look—everything should be laid out clearly now.
😉

You have a right to your paycheck... my ass... I honestly wouldn't even attempt to interpret what the legislature was actually thinking here... doesn't pay wages via a bank account.
It’s some shady business, plain and simple.

Come to think of it, I remember Nobilo rambling on about paying people in cash because they're having solvency issues (you know, right when that public shame list for employers failing to pay up was released).

Hi everyone,

I was wondering if anyone here knows if I can file an enforcement action against an employer through the IRS for unpaid wages based on my pay stubs, specifically if the employer has already entered into a pre-trial settlement agreement signed before a commercial court? Basically, their accounts are currently unblocked and they're operating "normally," provided they repay their debt in installments over the next five years. From what I understand, wage claims are considered priority claims and aren't included in that specific settlement portion. Since my boss refuses to pay the wages he owes me—especially since I had to submit a constructive discharge notice because of this whole mess—I'm curious if there's a way to collect my back pay this way.

Thanks