For residents of Prince George’s County and Montgomery County, a wage garnishment order can feel like the ground disappearing beneath you. One day your paycheck covers the bills; the next, up to 25% of it is gone before you ever see it. I’m Attorney Jill Phillips, and I help Maryland families in exactly this situation every week from my office here in Greenbelt.

The good news: federal bankruptcy law gives you a powerful tool to stop garnishment fast. This page explains exactly how it works, which chapter of bankruptcy applies to your situation, and what happens from the moment you file.

What Is the Automatic Stay Under 11 U.S.C. § 362?

The automatic stay is the most powerful immediate protection in bankruptcy law. Defined by 11 U.S.C. § 362, it is a federal court injunction — an automatic, court-ordered halt — that takes effect the instant your bankruptcy petition is filed. You do not need a judge to approve it separately. It applies automatically.

The Maryland Bankruptcy Court defines the automatic stay as an injunction that stops lawsuits, foreclosure, garnishments, and all collection activity when the bankruptcy petition is filed. That covers most of the financial pressure that drives people into my office.

Specifically, the automatic stay immediately stops:

• Wage garnishment from your employer’s payroll
• Bank account levies and asset seizures
• Creditor lawsuits and collection calls
• Foreclosure proceedings on your home
• Repossession of vehicles or personal property
• Utility shutoffs (for a limited period)

How Does Bankruptcy Stop Wage Garnishment Immediately?

Here’s exactly what happens from the moment you file. There is no delay, no waiting period, and no separate motion required to stop the garnishment:

1. 1
   You file your bankruptcy petition Your completed petition is filed electronically with the U.S. Bankruptcy Court for the District of Maryland, Greenbelt Division — the federal court that serves Prince George’s County and surrounding communities.
2. 2
   A case number is assigned and the automatic stay takes effect The moment the filing is accepted, the stay is active. This is the legally operative moment — not when the creditor is notified, not when your employer is notified. Right now, at filing.
3. 3
   Your attorney notifies your employer I send written notice of the bankruptcy filing — along with the case number — directly to your employer’s HR or payroll department. This documentation is their legal instruction to stop all deductions.
4. 4
   Employer stops garnishment Your employer is legally required to halt garnishment immediately upon receiving the notice. In practice, this typically happens the same day or the next business day — often before your next scheduled paycheck if we act quickly.
5. 5
   The court notifies the creditor The bankruptcy court sends an official Notice of Commencement of Case to the creditor and their attorney, formally advising them that the automatic stay prohibits further collection activity.
6. 6
   The underlying debt is resolved Depending on whether you file Chapter 7 or Chapter 13, the debt driving the garnishment is either discharged entirely or restructured into a manageable payment plan — providing lasting relief, not just a temporary pause.

Chapter 7 vs. Chapter 13: Which Stops Garnishment and How?

Both chapters stop wage garnishment immediately through the automatic stay. The difference is what happens next — and which chapter fits your financial situation.

Maryland Wage Garnishment Rules — What You Need to Know

Before a creditor can garnish your wages in Maryland, they must obtain a court judgment against you. That typically means they sued you, won, and then applied for a writ of garnishment through the district or circuit court. Once that writ is served on your employer, the withholding begins.

Under Maryland law (Md. Code Ann., Com. Law § 15-601), creditors can garnish the lesser of:

• 25% of your disposable earnings per pay period, or
• The amount by which your weekly disposable earnings exceed 30 times the federal minimum wage

That 25% can gut a household budget. For a family in Greenbelt earning $60,000 per year, that’s over $14,000 gone annually — before they can address any other bills.

What Garnishments Can Bankruptcy NOT Stop?

The automatic stay is broad, but it is not unlimited. Federal law carves out several categories where the stay does not apply:

• Child support and alimony: Domestic support obligation garnishments are explicitly exempt from the automatic stay under 11 U.S.C. § 362(b)(2). If your wages are being garnished for child support or spousal support, bankruptcy will not stop those deductions.
• Certain IRS and tax levies: The automatic stay applies to IRS levies, but the IRS has specific procedures to seek relief from the stay and resume collection in some circumstances. Tax debts require careful analysis.
• Federal student loan garnishments: The stay applies temporarily, but federal student loan creditors have special rules and may seek stay relief. Income-driven repayment options are often a better long-term solution.
• Criminal restitution: Court-ordered restitution in criminal cases is not stopped by the automatic stay.

How Long Does the Automatic Stay Last?

The duration of the automatic stay depends on which chapter you file and what happens in your case:

• Chapter 7: The stay remains in effect until your case is closed. If the debt is discharged — which typically takes 3–6 months — that creditor permanently loses the right to collect. The garnishment cannot resume after discharge.
• Chapter 13: The stay remains in place for the entire duration of your repayment plan (3–5 years) and through the discharge at the end. As long as you stay current on your plan payments, the garnishment stays stopped.
• Prior dismissal within 12 months: If you had a previous bankruptcy case dismissed within the last year, the automatic stay only lasts 30 days automatically. You would need to file a motion to extend it. This is a nuance I address directly with clients who have had a prior filing.

Will My Employer Know I Filed Bankruptcy?

Yes — your employer will be notified to stop the garnishment and will know you filed. There is no way to stop a garnishment through bankruptcy without that notification reaching payroll.

However, federal law protects you from retaliation. Under 11 U.S.C. § 525(b), a private employer cannot terminate your employment, reduce your pay, or otherwise discriminate against you solely because you filed for bankruptcy. This protection exists specifically to prevent the fear of job loss from stopping people from getting the debt relief they need.

What If They Already Took Money from My Paycheck?

Money garnished before your bankruptcy filing is generally not automatically returned. The automatic stay only applies going forward from the moment of filing.

There is one important exception worth examining: garnishments that occurred within 90 days of your filing date may qualify as preferential transfers under bankruptcy law. If a creditor received more than $600 through garnishment in the 90 days before your filing and you are filing Chapter 7, your bankruptcy trustee may be able to recover those funds for distribution to all creditors. The practical benefit to you depends on the specific facts of your case.

If you have been losing significant money to garnishment in recent months, it’s worth discussing the timing of your filing with an attorney before you file.

Frequently Asked Questions