What happens to the stay if I had a bankruptcy case dismissed in the past year?

Under § 362(c)(3), if a single or joint case is filed by or against an individual under chapter 7, 11 or 13 and the debtor had a single or joint case pending within the preceding 1-year period that was dismissed (other than a case refiled under a chapter other than chapter 7 after dismissal under § 707(b)), the stay with respect to any action taken with respect to a debt or property securing such debt or with respect to any lease terminates with respect to the debtor on the 30th day after the filing of the later case. On a party in interest's motion, after notice and a hearing completed before that 30-day period expires, the court may extend the stay, but only if the party shows the later filing is in good faith as to the creditors to be stayed. Extension is discretionary.

And if two or more cases were dismissed within the previous year?

Under § 362(c)(4), if a single or joint case is filed by or against an individual under title 11 and two or more of the debtor's single or joint cases were pending within the previous year but were dismissed (other than a case refiled under a chapter other than chapter 7 after dismissal under § 707(b)), no § 362(a) stay arises on the later filing. A party in interest may request within 30 days after that filing, and after notice and a hearing the court may impose the stay as to any or all creditors, but only on a showing that the later filing is in good faith as to the creditors to be stayed. An imposed stay is effective on entry of the order.

If I object after the wage execution order has issued, does my employer stop withholding?

Not automatically. N.J. Ct. R. 4:59-1(e) provides that if the clerk receives your objection after the order has issued, all moneys remitted by the employer are held until further order of the court, and the matter is set down for a hearing within seven days of receipt. The rule directs that the money be held pending the court's decision; it does not say payroll withholding immediately ceases or that funds are returned without an order.

Which exemption list applies if I recently moved to or from New Jersey?

The federal § 522(d) list is available only if the State law applicable under § 522(b)(3)(A) does not specifically bar it; otherwise the debtor claims exemptions under State or local law or other federal law. That State is where the debtor's domicile was for the 730 days before filing, or, if not a single State over that period, where it was for the 180 days before those 730 days, or for a longer portion of that period than anywhere else. If that requirement leaves the debtor ineligible for any exemption, § 522(d) may be elected. Retirement funds are separate under § 522(b)(3)(C), and only so far as the account is tax-exempt under the listed Internal Revenue Code sections.

Can I be fired because my wages are being garnished?

15 U.S.C. § 1674(a) provides that no employer may discharge an employee by reason of the fact that the employee's earnings have been subjected to garnishment for any one indebtedness, and § 1674(b) sets penalties for a willful violation. Section 1677(2) preserves state laws prohibiting discharge where earnings have been garnished for more than one indebtedness. That protection concerns termination, not an incorrect withholding amount.

Wages & debt

Wage Garnishment in New Jersey: What the Law Says and What Bankruptcy Changes

An ordinary New Jersey wage execution generally may not specify more than 10% of the income the statute lists, unless the debtor's income exceeds 250% of the poverty level for an individual taking family size into account, when the issuing court may order a larger percentage (N.J.S.A. 2A:17-56). Federal law sets a separate disposable-earnings ceiling. Filing bankruptcy generally operates as an automatic stay of judgment enforcement, subject to statutory exceptions, repeat-filing limits and court-ordered relief.

Key points

Under N.J.S.A. 2A:17-56(a) a wage execution may not exceed 10% unless the debtor's income exceeds 250% of the poverty level for an individual taking family size into account, when the issuing court may order a larger percentage.
N.J. Ct. R. 4:59-1(e) requires notice before the order issues, lets you give written reasons within ten days after service, and also allows an objection or reduction application at any time afterward.
After an order has issued, an objection means money remitted by the employer is held until further order of the court — not that payroll stops or funds come back automatically.
Federal law separately limits ordinary garnishment to the lesser of 25% of disposable earnings or the amount above thirty times the federal minimum hourly wage, with support, chapter 13 and tax exceptions (15 U.S.C. § 1673).
Filing generally triggers an automatic stay under 11 U.S.C. § 362(a), subject to exceptions, repeat-filing limits and court-ordered relief.

If a creditor with a New Jersey judgment has reached your paycheck, the withholding is governed by statute and court rule, not by the creditor's preference. The rules also give you specific chances to be heard, before the order issues and afterward. This page sets out what the New Jersey statutes and rules say, and what filing bankruptcy changes under federal law.

How much of your pay can be garnished in New Jersey?

Under N.J.S.A. 2A:17-56(a), a wage execution may not specify more than 10%, unless the debtor's income exceeds 250% of the poverty level for an individual taking family size into account; then the issuing court may order a larger percentage.

Federal law applies too. Under 15 U.S.C. § 1673(a), ordinary garnishment in a workweek may not exceed the lesser of 25% of disposable earnings or the amount by which they exceed thirty times the federal minimum hourly wage. Disposable earnings are earnings left after amounts the law requires to be withheld (15 U.S.C. § 1672). Subsection (b) excepts support orders issued by a court of competent jurisdiction or under a State administrative procedure affording substantial due process and subject to judicial review, orders of a United States court with chapter 13 jurisdiction, and debt due for State or Federal tax. Those exceptions are not unlimited withholding: § 1673(b)(2) sets its own percentage ceilings for support. The State-debt column below covers State applications under N.J.S.A. 2A:17-50(b) on a department or agency debt determination, which federal law still constrains.

The state percentage and the federal ceiling are measured against different bases, so a lawful withholding has to satisfy both.
15 U.S.C. § 1677 preserves state laws prohibiting garnishment or providing more limited garnishment than this federal subchapter allows.

Two different New Jersey wage-execution measures
Feature	Ordinary execution, 2A:17-56(a)	State debt execution, 2A:17-56(b)
Stated ceiling	10% of the listed income	Up to 25% of gross earnings
Income safeguard	Court may order more if income exceeds 250% of the poverty level for family size	Income after execution not less than 250% of the poverty level for family size
Who applies	Judgment creditor, in the court where the judgment was recovered or the court having jurisdiction of the judgment	The State, which may file with the Office of Administrative Law under 2A:17-50(b)

What do New Jersey statutes require of creditors and courts?

Under N.J.S.A. 2A:17-50(a), once a judgment is recovered in the Superior Court and income due to the debtor reaches the weekly minimum the statute sets, the creditor may apply, on notice to the debtor unless the court orders otherwise, to the court where the judgment was recovered or another court having jurisdiction of it; on satisfactory proofs the court orders an execution to issue.

On presentation, the execution becomes a lien and a continuing levy on income due or to become due, up to the amount specified (N.J.S.A. 2A:17-51). The person owing you pays over the amount prescribed, less 5% retained as compensation for expense and services; both that payment and the compensation are credited to your account (N.J.S.A. 2A:17-53). Failing or refusing to pay makes that person liable to an action by the judgment creditor, with any recovery applied to the execution (N.J.S.A. 2A:17-54).

In the Special Civil Part, a request to issue a wage execution must be in writing and accompanied by a certification of the amount due (N.J. Ct. R. 6:7-1(a)).
Only one wage execution is satisfied at a time, in order of presentation, with a same-day support order satisfied first and certain State applications given priority (N.J.S.A. 2A:17-52).
Either party may apply at any time, on such notice to the other party as the court directs; on the hearing the court, or an Administrative Law Judge for executions under N.J.S.A. 2A:17-50(b), may modify it as deemed just (N.J.S.A. 2A:17-55).

Which income is protected from garnishment under New Jersey law?

Two protections work differently. On the payroll side, N.J.S.A. 2A:17-57 provides that wages, debts, earnings, salaries, trust income and profits due to a defendant in execution below the weekly figure the section states are not liable to be seized by any execution, civil process or installment order; at or above it, not more than 10% may be taken unless they exceed the annual sum the section names, in which case the court may order a larger percentage. The section also excepts income and property reserved or exempt by law.

Bank accounts follow a different rule. A writ must provide that a levy excludes funds in an account where every deposit during the 90 days immediately before service was a recurring electronic deposit of funds the institution identifies as exempt under New Jersey or federal law, and funds deposited electronically during the two months immediately before the institution's account review that it identifies as exempt (N.J. Ct. R. 4:59-1(b); N.J. Ct. R. 6:7-1(b)).

Those account conditions are specific. They do not make every deposit, or every benefit, exempt.
N.J.S.A. 2A:17-64 lets the Superior Court order installment payments out of income, but not out of income or property recovered or exempt by law.

Which statutory protections may matter when contesting a New Jersey garnishment?

Before the order issues, the notice of wage execution must state the limitations that federal law and the New Jersey wage-execution statutes place on the part of your salary that may be levied upon, and must tell you that you may notify the court and the plaintiff in writing within ten days after service of reasons why the order should not be entered (N.J. Ct. R. 4:59-1(e)). If you do, the application is set down for a hearing; if you do not, the order is entered as of course.

Missing that window does not end your options. The same rule lets you object or apply for a reduction at any time after the order is issued, by filing a written statement with the clerk and sending a copy to the creditor's attorney, or to the creditor directly if there is none, with a hearing within seven days.

Service of that notice on a party, not on an attorney, is made as provided in N.J. Ct. R. 4:4-4, or by registered or certified mail, return receipt requested, and simultaneously by ordinary mail to the last known address; where no address is known despite diligent effort, filing with the clerk satisfies it, and the diligent effort must be recited in the proof of service (N.J. Ct. R. 1:5-2).
If an objection reaches the clerk after the order has issued, all moneys remitted by the employer are held until further order of the court, with a hearing within seven days of receipt. That is a hold, not an automatic stop at payroll.
In the Special Civil Part you notify the Office of the Special Civil Part by filing in the county where the execution originated, and the judgment creditor in writing, within ten days after service (N.J. Ct. R. 6:7-3(a)).

How does filing bankruptcy affect a New Jersey garnishment?

Filing a petition commences a voluntary case and constitutes an order for relief (11 U.S.C. § 301). Except as provided in § 362(b), the petition operates as a stay, applicable to all entities, of actions against the debtor that were or could have been commenced before the case, of enforcement of prepetition judgments against the debtor or estate property, and of acts to collect prepetition claims.

Those exceptions include withholding income that is property of the estate or of the debtor to pay a domestic support obligation under a judicial or administrative order or a statute. Subject to statutory exceptions, the stay of an act against estate property generally lasts while the property remains in the estate, and the stay of other acts generally ends at the earliest of case closing, dismissal, or, where applicable, grant or denial of discharge. Prior dismissed cases can shorten or prevent it, and the court may grant § 362(d) relief on the statutory grounds, after a request, notice and a hearing.

On a party in interest's request, after notice and a hearing, the court may grant § 362(d) relief on the statutory grounds, terminating, annulling, modifying or conditioning the stay.
Notices to an employer and a creditor often matter in practice for getting withholding to stop, but they are not what creates the stay.
Which exemption list applies turns on 11 U.S.C. § 522(b), including the domicile rule covered in the FAQs below.

What should you ask a lawyer about a New Jersey garnishment?

Bring the order, the notice of application and recent pay stubs. A lawyer can say how your debt type and family size affect the limit, whether to object or apply for a modification, and how bankruptcy would bear on it.

Which court issued this execution, and was the notice served on me the way N.J. Ct. R. 1:5-2 requires?
Is the amount being withheld consistent with N.J.S.A. 2A:17-56 and the federal ceiling in 15 U.S.C. § 1673, given my family size and pay period?
Is this an ordinary judgment, a State agency debt under N.J.S.A. 2A:17-50(b), a support obligation or a tax debt, and which rule follows?
Should I file an objection or an application for a reduction under N.J. Ct. R. 4:59-1(e), or seek a modification under N.J.S.A. 2A:17-55?
Has a bank account been levied as well, and have I had a case dismissed within the preceding one-year period that would affect § 362(c)(3) or (c)(4)?

Frequently asked questions

Does filing bankruptcy stop every garnishment?: No. Section 362(a) generally operates as a stay of prepetition collection and judgment enforcement on filing, but § 362(b) excepts withholding of income for payment of a domestic support obligation under a judicial or administrative order or a statute. Prior dismissed cases can shorten or prevent the stay under § 362(c)(3) and (c)(4), and a court may grant relief under § 362(d) after notice and a hearing.
What happens to the stay if I had a bankruptcy case dismissed in the past year?: Under § 362(c)(3), if a single or joint case is filed by or against an individual under chapter 7, 11 or 13 and the debtor had a single or joint case pending within the preceding 1-year period that was dismissed (other than a case refiled under a chapter other than chapter 7 after dismissal under § 707(b)), the stay with respect to any action taken with respect to a debt or property securing such debt or with respect to any lease terminates with respect to the debtor on the 30th day after the filing of the later case. On a party in interest's motion, after notice and a hearing completed before that 30-day period expires, the court may extend the stay, but only if the party shows the later filing is in good faith as to the creditors to be stayed. Extension is discretionary.
And if two or more cases were dismissed within the previous year?: Under § 362(c)(4), if a single or joint case is filed by or against an individual under title 11 and two or more of the debtor's single or joint cases were pending within the previous year but were dismissed (other than a case refiled under a chapter other than chapter 7 after dismissal under § 707(b)), no § 362(a) stay arises on the later filing. A party in interest may request within 30 days after that filing, and after notice and a hearing the court may impose the stay as to any or all creditors, but only on a showing that the later filing is in good faith as to the creditors to be stayed. An imposed stay is effective on entry of the order.
If I object after the wage execution order has issued, does my employer stop withholding?: Not automatically. N.J. Ct. R. 4:59-1(e) provides that if the clerk receives your objection after the order has issued, all moneys remitted by the employer are held until further order of the court, and the matter is set down for a hearing within seven days of receipt. The rule directs that the money be held pending the court's decision; it does not say payroll withholding immediately ceases or that funds are returned without an order.
Which exemption list applies if I recently moved to or from New Jersey?: The federal § 522(d) list is available only if the State law applicable under § 522(b)(3)(A) does not specifically bar it; otherwise the debtor claims exemptions under State or local law or other federal law. That State is where the debtor's domicile was for the 730 days before filing, or, if not a single State over that period, where it was for the 180 days before those 730 days, or for a longer portion of that period than anywhere else. If that requirement leaves the debtor ineligible for any exemption, § 522(d) may be elected. Retirement funds are separate under § 522(b)(3)(C), and only so far as the account is tax-exempt under the listed Internal Revenue Code sections.
Can I be fired because my wages are being garnished?: 15 U.S.C. § 1674(a) provides that no employer may discharge an employee by reason of the fact that the employee's earnings have been subjected to garnishment for any one indebtedness, and § 1674(b) sets penalties for a willful violation. Section 1677(2) preserves state laws prohibiting discharge where earnings have been garnished for more than one indebtedness. That protection concerns termination, not an incorrect withholding amount.

By Antonio G. Jimenez, Esq. · Florida Bar No. 21022

Sources verified October 12, 2026 · How we verify

Every figure on this page is drawn from a primary legal source and checked against our canonical legal database before publication. Bankruptcy.law is not a law firm and does not provide legal advice.

Turn this into a plan for your exact situation, state, and court.

See My Debt Relief Options→