Thank you to our Yesner Law Podcast listener Larry, who asked us the following question about wage garnishment and asset protection:
"I filed bankruptcy about four years ago. I was renting a home outside the State of Florida at the time and there was an accident at my home in Florida and it burned down. The insurance company has a judgment against me for damages. I'm not back in Florida but working only under the table jobs because I'm afraid of a wage garnishment that I can't afford because I have a new born baby at home. I cannot file bankruptcy again for 3 years. What should I do?"
First, we never advise "under the table" work simply because that violates different IRS laws, rules and regulations. However, we recognize this happens.
Second, It may be possible to file bankruptcy even though the previous bankruptcy was four years ago, depending on the chapter of bankruptcy filed before and what chapter would be appropriate now.
However, in Florida one common exemption is the "Head of Household" exemption against wage garnishment. Section 222.11 of Florida Statutes defines the "Head of Household" as that natural person who provides more than one-half of the support for a child or other dependent. There is really no mechanism for asserting the exemption until a creditor has attempted to garnish wages. Then, Chapter 77 applies, which requires that the person applying for the exemption respond to court notices and motions within a certain period of time (20 days) in order to have the Head of Household Exemption protect their wages.
Two classic examples of people who qualifies for Head of Household exemption are: (1) a single parent, or (2) a two-parent household where one parent does not work to raise the kids. Where both parents work, only one would qualify as Head of Household, and then only if their income paid more than 50% of the support for dependents. Finally, once the qualifying wage-earner no longer qualifies, the creditor could try to re-impose the garnishment. Obviously, there would be a huge expense to the creditors to track this. Consider the example where the head of household is a single mom with a 2 year-old - the creditor would have to follow up to determine if the single mom were to ever remarry, or would have to follow up in 16 years when the 2 year-old would then be an 18 year-old. This would place a HUGE cost and administrative burden on the creditor, but is within the realm of possibility.
For more information on wage exemption, please subscribe to the Yesner Law Podcast, on iTunes and Stitcher. Or, please contact us to schedule a free initial consultation to discuss your options at 813-774-5737 or email me directly email@example.com.
Shawn M. Yesner, Esq., is the founder of Yesner Law, P.L., a Tampa-based boutique real estate and consumer law firm that helps clients eliminate debt by providing options, so they can live the lifestyle of their dreams. We assist clients with asset protection and exemptions, the sale and purchase of real property, Chapter 7 liquidation, Chapter 13 reorganization, bankruptcy, foreclosure defense, debt settlement, landlord/tenant issues, short sales, and loan modifications in Tampa, Westchase, Odessa, Oldsmar, Palm Harbor, Clearwater, Pinellas Park, Largo, St. Petersburg, and throughout the greater Tampa Bay area.