Wage garnishment after changing to 1099 Employee

[danv1369]

Hello, I currently have my wages garnished by a creditor. I recently took a new position with a different company and I start in 2 weeks.

When I put in my 2 week notice with my current employer they offered me a part time role as a consultant under a 1099. Since my status with my current employer is changing to 1099 do they need to continue garnishing my wages for the creditor?

Side note, I get a sign on bonus with my new employer after 30 days and I plan to contact the creditor to set up a new payment plan using the bonus as down payment.

Thank you in advance for any feedback on this type of situation.

[justbroke]

Welcome to BKForum.

I'm not a collections expert, but I would always use care when discussing anything with a judgment creditor. In fact, I would not speak with my judgment creditor at all unless required through an interrogatory.

When I put in my 2 week notice with my current employer they offered me a part time role as a consultant under a 1099. Since my status with my current employer is changing to 1099 do they need to continue garnishing my wages for the creditor?.

I would say that the creditor would likely not be able to garnish a 1099 since it's a payment to a vendor, and not wages. You would technically be a vendor (contractor) and not an employee. The question is whether the court order includes a levy against non-employment compensation (not used for payment of employee wages).

Personally, I would not use the bonus as a down payment. I would use the bonus to establish and maintain a rainy-day fund (emergency fund). I would setup a new payment plan which hopefully doesn't include interest. In all likelihood, the creditor would continue the garnishment route since it is guaranteed if you're paid (taken before you receive your income).

I would also be very careful about "talking" to the creditor and divulging any information about your income and situation, unless it's ordered by the court to do so, but only through an interrogatory. I say this because your 1099 compensation is not wages and is not protected.

Please proceed with all due care.

[sophieanne]

I used to do payroll for W2 employees and 1099’d contractors. I was required to take legal garnishments from both.