Charging Orders and Garnishment Limits

Charging Orders and Garnishment Limits

 

In my most recent column in the Journal of Passthrough Entities, I considered whether the various garnishment limits apply to charging orders. Under both federal and state law, as a general proposition, no more than 25% of the “wages” paid an employee may be garnished in order to satisfy a judgment-creditor. This column explores whether those limitations apply with respect to a charging order issued against a member’s distributions from an LLC. There is, perhaps surprisingly, essentially no law directly on point. However, when I look across a range of circumstances, I conclude that the weight of authority is that the garnishment limits do not apply to charging orders.

 

 HERE IS A LINK to that article.