Wage Garnishment in Nebraska: What the Law Says and What Bankruptcy Changes

How much of your pay can be garnished in Nebraska?

Neb. Rev. Stat. § 25-1558 limits the maximum part of your aggregate disposable earnings for any workweek that is subject to garnishment to the least of three amounts: twenty-five percent of your disposable earnings for that week; the amount by which those earnings exceed thirty times the federal minimum hourly wage in effect when the earnings are payable; or fifteen percent of your disposable earnings, if you are a head of a family. Disposable earnings are what remains after deducting amounts required by law to be withheld, and earnings include wages, salary, commission, bonus, and periodic pension or retirement payments.

Because the statute takes the smallest of the three, a low-earning week may leave little or nothing garnishable. That second figure moves with the federal minimum hourly wage rather than a fixed dollar amount. The statute also directs that no court shall make, execute, or enforce any order or process in violation of it, and that these exemptions are granted without further proceedings.

What do Nebraska statutes require of creditors and courts?

Ordinary wage garnishment in Nebraska follows a court judgment. Neb. Rev. Stat. § 25-1010 provides that prior to final judgment, no order of garnishment shall issue for wages due from an employer to an employee. After judgment, Neb. Rev. Stat. § 25-1056 requires the creditor to file an affidavit stating the amount due on the judgment, interest, and costs; the clerk then issues a summons, returnable within ten days, requiring the garnishee to answer written interrogatories within ten days of service. When wages are involved, that statute directs the garnishee to pay the employee all disposable earnings exempted by statute and hold only the remainder until the court orders otherwise.

Under Neb. Rev. Stat. § 25-1011, the summons, interrogatories, a notice to judgment debtor form, and a request for hearing form are served on the garnishee, and the creditor must mail the summons and order, notice and hearing-request form to your last-known address by certified mail within seven business days after the court issues them and certify the mailing date.

How long can a Nebraska wage garnishment keep taking money?

A Nebraska wage garnishment is not a permanent payroll deduction. Under Neb. Rev. Stat. § 25-1056, a continuing lien on nonexempt earnings exists only if the court orders one on the judgment creditor's application; while it is in effect, your employer withholds nonexempt earnings and delivers your exempt earnings to you each pay period.

The same statute lists events that make a continuing lien invalid and of no force and effect: the judgment is satisfied in full, vacated, or expires; you leave that employer for more than sixty days; the creditor releases the garnishment; the proceedings are stayed by a court of competent jurisdiction, including the United States Bankruptcy Court; you earn no nonexempt earnings for at least sixty days; the court quashes the garnishment; or ninety days pass after service of the writ. The creditor may extend the lien for a second ninety-day period by filing a notice during the fifteen days immediately before the initial lien expires.

Which income is protected from garnishment under Nebraska law?

Nebraska protects the exempt portion of wages under Neb. Rev. Stat. § 25-1558 without further proceedings. Section 25-1563.01 also protects certain stock bonus, pension, profit-sharing or similar plan interests payable because of illness, disability, death, age or service, to the extent reasonably necessary for the debtor and dependents. The protection has exceptions: a plan established or amended to increase contributions within two years before bankruptcy or entry of a money judgment that later becomes final, by or under the auspices of the individual or an insider who employed the individual when the plan rights arose; or a plan that fails the listed Internal Revenue Code qualifications.

Section 25-1563.02 protects personal-injury or death settlement proceeds, including interest, subject to a written assignment obtained by the claimant. Its subsection (2) permits garnishment of personal-injury proceeds by a county or authorized attorney under § 43-512.03, or for child support through the defined obligee route. The exception does not simply refer to every death settlement.

Which statutory protections may matter when contesting a Nebraska garnishment?

Neb. Rev. Stat. § 25-1011 requires the notice to judgment debtor form to tell you that certain funds are exempt, that wages are exempt up to a certain level with a different amount if you are the head of a family, and that if you believe the funds sought are exempt or the amount is not owed on the judgment, you are entitled to a hearing within ten days after your request. To ask for that hearing, the statute directs you to fill out the request for hearing form and file it with the court within three business days after you receive the notice; the court must then grant the hearing within ten days of the request.

Separately, Neb. Rev. Stat. § 25-1030.03 lets the defendant in the original action file a suitable pleading in the garnishment proceedings showing that the debt or property is exempt from execution or is not liable for the plaintiff's claim.

How does filing bankruptcy affect a Nebraska garnishment?

A voluntary bankruptcy case is commenced by filing a petition with the bankruptcy court, and 11 U.S.C. § 301 provides that the commencement itself constitutes an order for relief. Filing then operates as a stay under 11 U.S.C. § 362(a), applicable to all entities and without a separate court order, of the enforcement against the debtor of a judgment obtained before the case began and of any act to collect a prebankruptcy claim. That is why ordinary judgment garnishment commonly stops. Neb. Rev. Stat. § 25-1056 separately provides that a continuing lien has no force when the proceedings are stayed by a court of competent jurisdiction, including the United States Bankruptcy Court.

The stay is not unconditional. § 362(b)(2)(C) excludes withholding of income that is property of the estate or of the debtor for payment of a domestic support obligation under a judicial or administrative order or a statute, and § 362(d) lets a creditor ask the court to lift or limit the stay.

What happens to the stay if you have had bankruptcy cases dismissed recently?

Under 11 U.S.C. § 362(c)(3), if a single or joint chapter 7, 11 or 13 case is filed by or against an individual whose single or joint case was pending within the preceding year but dismissed, the stay concerning an action regarding a debt, property securing it or a lease terminates “with respect to the debtor” on the thirtieth day after the later filing. The exception is a case refiled under a chapter other than chapter 7 after a § 707(b) dismissal. A party in interest may move for continuation; after notice and a hearing completed before the thirty-day period expires, the court may extend the stay as to any or all creditors, subject to conditions, only on a showing of good faith as to those creditors.

Section 362(c)(4) separately covers a single or joint case filed by or against an individual when two or more single or joint cases of that debtor were pending within the previous year but dismissed, with the same § 707(b) refiling exception. No stay arises. A party in interest must request imposition within thirty days after the later filing. After notice and a hearing and a showing of good faith as to the creditors to be stayed, the court may impose a stay as to any or all creditors, subject to conditions. It takes effect upon entry of the order. Ask a lawyer about the scope and requirements of either rule.

What should you ask a lawyer about a Nebraska garnishment?

Bring the documents with you: the summons and order of garnishment, the interrogatories and the garnishee's answers, the notice to judgment debtor form, the request for hearing form, and recent pay stubs. Useful questions include whether the least-of calculation in Neb. Rev. Stat. § 25-1558 was applied correctly to your pay and whether you meet that statute's definition of head of a family; whether this withholding is an ordinary judgment garnishment, support withholding, or tax collection, since the limits differ; whether the three-business-day window for filing the request for hearing form has passed and what remains available; whether a continuing lien is in effect under Neb. Rev. Stat. § 25-1056, when the writ was served, and whether the creditor has filed a notice of extension; and whether filing under chapter 7 or chapter 13 would change anything, including how any prior dismissed cases affect the stay. Nebraska legal aid programs and bankruptcy lawyers in your federal district can review the file.

Frequently asked questions

Can a creditor garnish my wages in Nebraska before it has a judgment?

Neb. Rev. Stat. § 25-1010 provides that prior to final judgment in an action, no order of garnishment shall issue for wages due from an employer to an employee. Pre-judgment garnishment of other property or credits held by a third party is addressed separately in that statute, and post-judgment wage garnishment proceeds under Neb. Rev. Stat. § 25-1056. Whether a particular withholding is a garnishment at all is worth checking with a lawyer.

Can I be fired because my wages are being garnished?

Neb. Rev. Stat. § 25-1558 states that no employer shall discharge any employee by reason of the fact that his or her earnings have been subjected to garnishment for any one indebtedness, and 15 U.S.C. § 1674 contains the same prohibition with federal penalties. That protection addresses being fired over one debt. It is not a remedy for money withheld incorrectly, which is a separate question about the garnishment itself.

Can my wages be garnished if I work for the state, a city, or a school district?

Yes. Neb. Rev. Stat. § 25-1012.01 applies Nebraska's garnishment provisions, requirements, conditions, and exemptions, including the continuing lien in Neb. Rev. Stat. § 25-1056, to officers and employees of the state, counties, townships, municipalities, municipally owned corporations, and school districts to the same extent as employees of private corporations. Neb. Rev. Stat. § 25-1012.02 adds that certified mail service may not be used on those public garnishees.

Does Nebraska's opt-out mean federal exemptions never apply?

No. Nebraska has opted out of the federal list in 11 U.S.C. § 522(d) (Neb. Rev. Stat. § 25-15,105). Section 522(b)(3) still reaches property exempt under other federal law and qualifying retirement funds. Which state's exemptions apply depends on your domicile for the 730 days before filing, or, if not a single state, the 180 days immediately preceding those 730 — whichever place held it for the longer portion of that period. If that leaves you ineligible for any exemption, § 522(b) permits electing the subsection (d) list.

Is the garnishment ceiling set by Nebraska law or federal law?

Both. 15 U.S.C. § 1673 caps ordinary garnishment at twenty-five percent of weekly disposable earnings or the amount above thirty times the federal minimum hourly wage, whichever is less, with exceptions for support orders, orders of a United States court in chapter 13 cases, and state or federal tax debts. Under 15 U.S.C. § 1677, that subchapter does not annul or affect state laws providing more limited garnishment — which is where Nebraska's fifteen percent head-of-family figure operates.

Are government benefits in my account exempt from garnishment?

Neb. Rev. Stat. § 25-1011 requires the notice to judgment debtor form to state that certain funds are exempt from garnishment if they come from certain government benefits and other sources. The statute itself does not list which programs those are, so identifying them for your account is a question for legal aid or a lawyer, and it is the kind of issue the hearing described above exists to decide.

Sources

• Neb. Rev. Stat. § 25-1010
• Neb. Rev. Stat. § 25-1011
• Neb. Rev. Stat. § 25-1012.01
• Neb. Rev. Stat. § 25-1012.02
• Neb. Rev. Stat. § 25-1030.03
• Neb. Rev. Stat. § 25-1056
• Neb. Rev. Stat. § 25-1558
• Neb. Rev. Stat. § 25-1563.01
• Neb. Rev. Stat. § 25-1563.02
• Neb. Rev. Stat. § 25-15,105
• 11 U.S.C. § 301
• 11 U.S.C. § 362 · official source
• 11 U.S.C. § 522 · official source
• 15 U.S.C. § 1673
• 15 U.S.C. § 1674
• 15 U.S.C. § 1677

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