Attorney General Opinion; Garnishments

Topic Code: G021Garnishment (ST)          Document Reference:

Policy Statement;

Mr. D. G. Briggs, Director

Iowa Department of Revenue

LOCAL

Dear Mr. Briggs:

Your revenue agents have inquired if the Federal restriction on garnishments, 15 § 1671-1677 U.S.C.A., applies to collections by means of a distress warrant issued under § 422.26, Code of Iowa, 1971, and garnishments thereunder.

Delinquent income, withholding, sales and use taxes are collected by means of a distress warrant. This written instrument is the authority which authorizes the sheriff or revenue agent to act. It may be compared to a general execution, but is broader and stronger. Specifically, your attention is called to § 422.26 which provides in part that:

"except that no property of the taxpayer shall be exempt from the payment of said tax."

Therefore, all (100%) of a delinquent taxpayer's weekly earnings is subject to garnishment under a distress warrant.

Recognizing that Federal statutes take precedence over State statutes, one must look to the Federal statutes to determine if the State is prohibited from garnishment of 100% of the taxpayer's weekly wages.

The applicable Federal statutes are set forth below:

15 § 1671-1673.

Commerce and Trade, United States Code Annotated.

"Subchapter II.—Restrictions on Garnishment

"1673. Restriction on garnishment—Maximum allowable garnishment

"(a)          Except as provided in subsection (b) of this section and in section 1675 of this title, the maximum part of the aggregate disposable earnings of an individual for any workweek which is subjected to garnishment may not exceed (1)          25 per centum of his disposable earnings for that week, or (2)          the amount by which his disposable earnings for that week exceed thirty times the Federal minimum hourly wage prescribed by section 206(a)(1) of Title 29 in effect at the time the earnings are payable, whichever is less. In the case of earnings for any pay period other than a week, the Secretary of Labor shall by regulation prescribe a multiple of the Federal minimum hourly wage equivalent in effect to that set forth in paragraph (2).

Exceptions

"(b)          The restrictions of subsection (a) of this section do not apply in the case of

(1)          any order of any court for the support of any person.

(2)          any order of any court of bankruptcy under chapter XIII of the Bankruptcy Act.

(3)          any debt due for any State or Federal tax.

Execution or enforcement of garnishment order or process prohibited.

"(c)          No court of the United States or any State may make, execute, or enforce any order or process in violation of this section.

Pub.L. 90-321, Title III, § 303, May 29, 1968, 82 Stat. 163."

(Emphasis ours)

You will note that the Congress, in its infinite wisdom, created an exception to the Federal statute limiting the amount that may be garnished for State taxes. Undoubtedly the reasoning for this exception is that the orderly function of government may not be stifled by limiting the amount that may be collected for delinquent taxes to only 25% of the taxpayer's weekly earnings.

Therefore, the sheriff and revenue agents may still garnish all of the taxpayer's weekly earnings to satisfy outstanding State tax liabilities.

Very truly yours,