The Washington State legislature passed several new laws in 2019 pertaining to debt, debt collection, and related matters.
One such law modifies RCW 6.27.150, which provides the basic guidelines for exemption amounts.
Having recently modified private student loan debt exemptions, SHB 1602 addresses "consumer debt" exemption to be set to 35 times the state minimum wage ($12/hr as of date of this article) per week or 80% of disposable earnings, whichever is greater.
Example 1: a consumer debtor works 40 hours per week at minimum wage
40 x $12 = $480 gross pay. After standard deductions the approximate paycheck is $394.72.
80% of disposable (net) earnings: $315.77
35 x state minimum wage: $420
The <35 x minimum wage> is bigger. This debtor gets to keep this larger amount as exempt from garnishment. In other words, for consumer debt this debtor is not subject to garnishment.
Example 2: a consumer debtor works 40 hours per week at $35/hour
40 x $35 = $1,400.00 gross pay. After standard deductions the approximate paycheck is
$1,074.81.
80% of disposable (net earnings): $859.84
35 x state minimum wage: $420
Here the exempt amount is $859.84. Thus, the difference between net and exempt pay will be withheld. $1074.81 - $859.84 = $214.97 per week will be withheld.
Garnishments of bank accounts also have a new exempt amount of $2,000.
About the author:
Jonathan Baner is a practicing creditor-debtor and collections attorney in Tacoma. He practices with his lovely wife, Miranda Baner, at Baner and Baner Law Firm. His practice is focused on legal enforcement of debts and advising his clients on their rights and remedies under contracts or other avenues. He also has an active civil litigation and appellate practice. When not working he enjoys motorcycle rides near the beach and demonstrating at the gym that gravity is just a conspiracy created by Sir Issac Newton.
Contact him at: Jonathan@BanerBaner.com or call the office 253.212.0353
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