Many people are aware that filing bankruptcy immediately stops a wage garnishment. However, they are often surprised to learn that the filing of a bankruptcy case may allow a filing debtor to recover wages which were garnished in the 90 days prior to a bankruptcy filing.
So long as a debtor is able to properly exempt the wages which were garnished, he or she has the ability to ask the Bankruptcy Court to order that the creditor or local sheriff holding the garnished wages pay the money back to the Debtor. The general requirements are found in section 547(b) of the United States Bankruptcy Code. Section 522 of the Bankruptcy Code generally allows a debtor to recover these funds if the following requirements are met: (i) the funds have been exempted on the debtor’s bankruptcy petition; and (ii) the Chapter 7 Trustee has not sought to recover the funds on behalf of the estate.
The requirements found in section 547(b) of the Bankruptcy Code are usually met in the case of a wage garnishment. However, it is recommended that you speak to an attorney to ensure that you will be able to recoup your garnished wages. If you have any questions or would like to find out if your garnished wages can be recovered in bankruptcy, please contact the VC Law Group at (858) 519-7333 or email at info@thevclawgroup.com.