Definition - What does Garnishment mean?

Garnishment refers to a court order that directs a party owing money to a debtor or a party holding funds of the debtor to set that money aside until the court decides what amount the debtor owes the creditor(s) and what needs to be done with the debtor's funds.

Justipedia explains Garnishment

Garnishment is issued by courts in order to secure a monetary judgment that a defendant must pay the plaintiff. The most common form of garnishment is wage garnishment. This is where an individual's wages are withheld by the employer according to the order of the court. However, other forms garnishment, like asking the bank that holds the debtor's money to set it aside, also exist. Garnishment is used to collect defaulted student loans, late child support or alimony payments, fines, and other debts. According to U.S. federal tax law, the Internal Revenue Service (IRS) can also put an administrative levy on an individual who has defaulted on their taxes. This is similar to garnishment but does not require a court order.

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