Can an MCA Ruling Garnish a Guarantor Paycheck in New York
Income Execution

A judgment against the company does not reach the paycheck of the guarantor by itself. New York income execution runs against the earnings of the person the judgment names, within floors and ceilings the statute sets without regard to the size of the underlying MCA debt.

You guaranteed the company debt and now your own pay is the asset in question, which is why the first task is confirmation rather than calculation. Counsel compares the name on the judgment with the name on the execution, reviews the guaranty and the court record behind it, and only then measures what the employer may withhold.

The Individual Judgment Comes First

A demand concerning company debt establishes none of the elements of personal liability on its own. Evidence the creditor gathered against the company does not prove the case against the guarantor, and counsel insists on that distinction before any number is discussed. The income execution must identify the person or entity paying the debtor, the amount and frequency of payment and the installments sought, and those details should match the actual pay arrangement rather than the creditor recollection of it.

Provide counsel with the complete execution and the relevant pay statements, because a figure remembered from the last deposit cannot support the arithmetic the statute requires. In most of the pay files we have seen, though the sample is not scientific, the employer withholds the stated installment without testing whether the floor was met, which leaves the correction to counsel and to the motion practice that follows.

Ten Percent Installments and the Twenty Day Service

Where the debtor is receiving money or will receive it from any source, the income execution provisions permit installments of not more than ten percent. Within twenty days after the execution reaches the sheriff, the sheriff serves a copy on the debtor in the manner of a summons or by certified mail with an additional copy by regular mail, and the debtor is directed to commence payment of the installments to the sheriff forthwith.

Only on default does the execution go to the person or entity paying the debtor, which means the guarantor who pays the sheriff on time keeps the employer out of the file entirely. Twenty days for service, ten percent for installments, and a floor measured at thirty times the hourly wage: the three numbers around which every income execution turns.

The first deduction arrives without explanation. The merchant should simply confirm the dates and amounts in writing to counsel and let counsel test whether the service and the arithmetic both hold. The timetable that follows is extremely tight.

Floors and Ceilings on Withholding

The statute protects the paycheck first and satisfies the creditor second, which is the principle the rest of this section exists to detail. Nothing is withheld for a week unless disposable earnings exceed the greater of thirty times the federal minimum wage or thirty times the state minimum wage as in effect when the earnings are payable (a comparison that favors the debtor in a high wage state, though the advantage matters only where the pay hovers near the line).

The weekly bite is then capped at twenty five percent of disposable earnings or the excess above that floor, whichever amount is less, with support deductions under the maintenance and support enforcement sections reducing the ceiling further. The floor functions the way a sill functions in a house the creditor does not own: it decides how far inside anyone may step, regardless of the size of the claim waiting outside.

Most creditors prefer the employer to do the collecting, since the employer cannot afford to argue. The federal garnishment ceiling reinforces the same boundary from above, capping garnishment at twenty five percent of disposable earnings or the excess over thirty times the federal minimum wage. Rarely does a payroll department produce the correct reading of disposable earnings on the first attempt, which is why counsel recomputes from the pay statements with extremely close attention rather than trusting the deduction line.

What Counts as a Paycheck

Earnings means compensation paid or payable for personal services, whether called wages, salary, commission or bonus, and the definition includes periodic payments under a pension or retirement program. Disposable earnings means what remains after amounts required by law to be withheld, so the gross figure on the offer letter is never the figure the percentages apply to.

Whether owner draws or distributions receive the same treatment as wages is a question I cannot answer from this desk, since the cases turn on control and regularity that pay records alone may not show. The judgment must name you; the company name on the caption is not enough. The income arrangement must fit the statutory terms before any withholding is conceded as correct.

Support Orders and Other Statutory Limits

Where earnings already carry deductions for alimony, support or maintenance under the family enforcement sections, the income execution takes only what remains within the twenty five percent ceiling after those deductions. The creditor names the payor in order to route the deduction around the debtor without further notice, but the prior support obligation keeps its priority in the arithmetic.

No amount at all is imposed where the judgment arises from a medical debt action brought by a licensed hospital or an authorized health care professional, a peculiar carveout that sits in its own subdivision, easy to miss and decisive where it applies.

Review Before the First Deduction

The first deduction is the hardest to reverse. Counsel will compute and confirm the withholding from the pay statements, identify any failure of service, form or floor, and construct a response that guards and preserves the floor the statute guarantees while addressing the balance behind the execution. What the employer withholds, or fails to withhold, in the first pay cycle shapes the entire file, so the execution should reach counsel before the payroll office acts on it.

Resist the urge to change jobs, demand cash pay or discuss the execution with the payroll office, even briefly, beyond confirming receipt in writing. Independent counsel ensures the objection deadlines are calendared from the service date and ensures no statement about income goes to the creditor without review. Delancey Street, a settlement company and not a law firm, offers a free confidential initial review of MCA income executions and coordinates with independently licensed counsel for objections and negotiation, because the floor holds only for the debtor who claims it, and paper claiming it must be exact.