Legal Question in Credit and Debt Law in Illinois

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On Second thought, it is a little more complicated than that.

here are laws that limit how much money your creditors can deduct from your paycheck. These laws exist to help ensure that you have enough income left to pay your own living expenses.

Federal law limits the amount of money creditors can garnish from your wages. Illinois, however, imposes even stricter limits. Wage deductions are taken from your �disposable income,� meaning the amount of money you earn after taxes and other mandatory deductions are taken out. In accordance with Illinois law the most that can be deducted from your wages is the lesser of the following two amounts:

up to 15% of your gross wages, or

the amount of disposable income that remains after deducting the Illinois minimum wage (or the federal minimum wage if it's greater than the Illinois minimum wage) multiplied by 45.

You can find this law at 735 Illinois Compiled Statutes 5. (To learn how to find state statutes, see our Laws and Legal Research area.)

Example. John earns $1,000 in disposable income per week. Calculation 1: 15% of his disposable earnings is $150. Calculation 2: His disposable income less the minimum wage multiplied by 45 is $628.75 ($1,000 - ($8.25 x 45)). Illinois wage deduction law requires the employer to take the lesser of the two amounts; $150 of John�s earnings will be garnished and sent to his creditor.

If you earn less than $371.25 in disposable income per week (as of April 2013), your consumer creditors cannot garnish any of your wages. In Illinois, the following types of income are not subject to wage deductions:

Public Aid and General Assistance

Social Security & Supplemental Security Income (SSI)

unemployment compensation

veteran's benefits

worker's compensation

Black Lung benefits

alimony and support (to the extent needed for support of self and dependents), and

pensions (to the extent needed for support of self and dependents).