Geraldine Wolfe is a supervisor at Fantastigifts. She has an annual salary of $45,000, paid biweekly, and a garnishment for cons

Question

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Geraldine Wolfe is a supervisor at Fantastigifts. She has an annual salary of $45,000, paid biweekly, and a garnishment for cons

umer credit of $375. Assuming that her disposable income is 80 percent of her gross pay per period, does the garnishment follow the CCPA? If not, what is the maximum garnishment allowed for Geraldine’s consumer credit garnishment? (Round your intermediate calculations and final answer to 2 decimal places.)

Business

1 answer:

stepan [3.5K] · Answer 1 · 2026-03-22T11:22:12+03:00

Response:

Reasoning:

The Consumer Credit Protection Act was established to safeguard employees from termination by their employers if their wages are subjected to garnishment due to a single debt. Nonetheless, this legislation imposes a limit on the amount that can be garnished. It is applicable to all individuals earning income for their personal services. Specifically, it stipulates that the garnishment can be either 25% of disposable income or the amount exceeding 30 times the minimum hourly wage (which is $7.25).

In Geraldine Wolfe's situation, she receives her pay biweekly, with 80% of her earnings being disposable income. The calculations are as follows, based on 52 weeks per year.

Disposable income = ($45000/52)*2*80%=$1385 (rounded to the nearest dollar)

25% of disposable income= $346.25 ($1385*25%)

For a minimum wage of $7.25= $7.25*60 (biweekly)=$435

Thus, the surplus over the minimum hourly wage amounts to =$1385-$435=$950

Conclusion:- Consequently, the maximum allowable wage garnishment is the lesser of $346.25 or $950. Therefore, the permissible garnishment for Geraldine's consumer credit case is $346.25.