In the United States, wage garnishment happens when an employer withholds a portion of an employee's earnings to pay back debts. The most common type of garnishment is for child support or unpaid taxes, but it can also be for other debts like outstanding credit card balances or student loans.
The formula for calculating garnishment differs depending on the type of debt and the state you live in. For example, the maximum amount that can be garnished for child support is 50% of your disposable earnings (what's left after taxes and mandatory deductions) if you're supporting another child, 60% if you're not. However, these percentages usually only apply if you're behind on your payments; if you're current on your payments, generally only a smaller portion of your earnings can be taken.
Similarly, the maximum amount that can be garnished for unpaid taxes also depends on the state you live in. The IRS has a Financial Standards document that outlines how much money someone needs to live based on their family size, which is used to determine the maximum amount that can be Garnished from wages.
To calculate the specific amount that will be Garnished from your paycheck, your employer will take a look at your disposable earnings and compare it to the maximum allowed by law based on the type of debt owed. They will then withhold the appropriate amount from each paycheck until the debt is repaid in full.