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Maryland Wage Garnishment Formula:
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Maryland wage garnishment follows federal guidelines under the Consumer Credit Protection Act, which limits the amount that can be garnished from an employee's wages to the lesser of 25% of disposable earnings or the amount by which disposable earnings exceed 30 times the federal minimum wage.
The calculator uses the Maryland wage garnishment formula:
Where:
Explanation: The formula ensures that garnishment doesn't exceed 25% of disposable earnings and that the employee retains at least 30 times the federal minimum wage per week.
Details: Proper wage garnishment calculation is crucial for employers to comply with Maryland and federal laws, protect employees from excessive garnishment, and avoid legal penalties for improper withholding.
Tips: Enter disposable earnings in USD/week and the current federal minimum wage in USD/hour. Disposable earnings should be the amount after mandatory deductions like taxes.
Q1: What are considered disposable earnings?
A: Disposable earnings are wages remaining after legally required deductions such as federal, state, and local taxes, Social Security, and Medicare.
Q2: Are there different rules for different types of garnishment?
A: Yes, child support, alimony, tax debts, and student loans may have different garnishment limits and rules.
Q3: How often should garnishment calculations be reviewed?
A: Garnishment calculations should be reviewed whenever there's a change in the employee's pay rate, hours worked, or when the federal minimum wage changes.
Q4: What if multiple garnishments apply to the same employee?
A: Total garnishment from all sources generally cannot exceed 25% of disposable earnings, with certain exceptions for priority debts like child support.
Q5: Are there state-specific variations in Maryland?
A: Maryland generally follows federal garnishment limits, but certain state-specific deductions and exemptions may apply in specific circumstances.