A garnishment is a court-ordered or legally required deduction withheld from a worker's paycheck and paid to a third party. Common examples include child support, tax levies, and creditor judgments.
Because every garnishment order is unique, garnishments should be created individually within each worker's Payroll Profile rather than as an employer-wide policy.
Important: Aaniie Payroll provides the tools to calculate and track garnishments, but employers are responsible for ensuring the garnishment is entered correctly according to the legal order they have received.
When adding a garnishment, you will choose one of the following types:
Used when the IRS or another federal agency requires wages to be withheld for unpaid federal taxes.
Example:
An employee owes back federal income taxes and the IRS issues a wage levy.
Used when a court orders wage garnishment to repay a private debt.
Examples:
Credit card debt
Medical bills
Personal loans
Civil judgments
Used for garnishment types that do not fit the standard categories.
Examples:
State agency collections
Municipal fines
Bankruptcy-related wage withholding
Other court-ordered deductions
Used for court-ordered child support obligations.
This is one of the most common garnishments processed through payroll and is typically issued by a state child support enforcement agency or court.
Do NOT create worker garnishments in the Employer Profile.
Instead:
Create garnishments individually within each worker's Payroll Profile.
This keeps each worker's legal order separate and prevents accidental application to multiple workers.
The Employer Profile Garnishments section is only used if you want to create custom garnishment name(s) that appear in the Garnishment Type drop-down list.
Example:
Instead of selecting a generic name each time, you could create:
County Child Support
IRS Tax Levy
State Tax Levy
ABC Collections
If you do not need custom names, simply create the garnishment directly within the worker's Payroll Profile.
Navigate to:
Menu → Staff Management → Staff Profile → Worker Payroll Profile → Garnishments
Then:
Select Add Garnishment
Choose the appropriate Garnishment Type
Complete the garnishment details according to the legal order.
Each garnishment may require the following information:
Enter the total amount that must eventually be collected.
Enter the current outstanding balance.
This allows Payroll to track how much remains to be withheld over time.
Choose how the garnishment should be calculated.
Fixed Amount
A specific dollar amount is deducted each payroll.
Example:
$100 per paycheck.
Percentage
A percentage of eligible wages is deducted.
Example:
15% of disposable earnings.
Select the date the garnishment should begin.
Start Date (Required)
End Date (Optional)
Only enter an End Date if the legal order specifically includes one.
Advanced settings allow additional control over how the garnishment is calculated.
Options include:
Minimum wage protection calculations
Selecting whether specific benefits should be deducted before calculating the garnishment
Selecting whether specific deductions should be deducted before calculating the garnishment
These settings are primarily used for percentage-based garnishments where disposable earnings must be calculated according to the legal order.
Important: Payroll calculates the garnishment amount, but the payroll provider does not automatically send these funds to the garnishing agency.
After payroll has been processed:
Review the garnishment amount withheld.
The employer is responsible for remitting the withheld funds directly to the appropriate garnishing agency according to the instructions provided in the legal order.
The garnishment funds are not automatically debited or paid by Payroll.
Garnishment laws vary by:
Federal regulations
State regulations
Local regulations
Individual court orders
Because every garnishment order is unique:
Employers should consult their legal counsel, tax advisor, or the issuing agency if they have questions about how a garnishment should be entered or calculated.
Workers should also seek legal or tax advice if they have questions regarding their withholding obligations.
Aaniie Support and the payroll provider can provide general guidance and product assistance but cannot provide legal or tax advice or determine how a garnishment should be configured.
Set up garnishments individually within each Worker Payroll Profile.
Use the Employer Profile only if you want custom garnishment names available in the drop-down list.
Select the correct garnishment type based on the legal order.
Enter the total amount owed, initial balance, calculation method, and start date accurately.
Use Advanced Settings only when required by the garnishment order.
Employers are responsible for sending withheld garnishment funds to the appropriate agency after payroll is processed.
Consult legal or tax professionals whenever guidance is needed on garnishment requirements.
If you need assistance, contact: support@aaniie.com