Getting Back Garnished Wages
No one wants to file bankruptcy. Even when people can no longer pay their bills, they often postpone filing bankruptcy until their wages are garnished. We previously discussed how to stop a wage garnishment here. But after the garnishment is stopped, can we help you get your money back? YES, As long as certain conditions are met.
When you file bankruptcy, everything you own becomes property of the bankruptcy estate. However, there are certain laws created by Congress that “claw back” property that you once owned or had a right to that are now in the possession of someone else. 11 U.S.C. § 547 brings payments of over $600.00 in the ninety days prior to filing back into the bankruptcy estate.Now that the garnished funds have come back into the bankruptcy estate, it must be determined whether you can exempt the garnished funds. 11 U.S.C. §522(g) allows you to exempt involuntary transfers of property if the transfer is disclosed to the Trustee.
Now that we know you are allowed to exempt garnished funds, we must determine whether you have any exemptions available. If you have exemptions available, we can exempt the garnished funds and have them returned to you.
In short, if you’ve been garnished more than $600.00 in the 90 days prior to filing a Chapter 7 Bankruptcy or a Chapter 13 Bankruptcy, you disclose the garnishment to your Trustee and have exemptions available to protect the garnished wages, we can get those funds back for you.