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HB 6205

Civil procedure: garnishment; certain benefits and tax credits; exempt from garnishment, and provide state limit on wages that are subject to garnishment. Amends sec. 4031 of 1961 PA 236 (MCL 600.4031) & adds secs. 4001a, 4032 & 4033.

2025-2026 Regular Session Introduced by Joe Aragona and 4 co-sponsors

Michigan limits wage garnishment, expanding exemptions for benefits and credits and setting tiered caps on garnishable earnings based on income.

bill electronically reproduced 07/03/2026
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Bill Summary · HB 6205

Summary of HB 6205 (2025-2026) – Michigan

Purpose and intent

HB 6205 aims to reform wage garnishment rules in Michigan by expanding exemptions for certain types of income and benefits and by establishing a explicit framework for how much of a debtor’s wages can be garnished. The bill also clarifies exemptions related to means-tested benefits, tax credits, and disability benefits, and it introduces a defined calculation for garnishable earnings.

Key provisions and changes

  • Definition of garnishable earnings

    • The bill defines “garnishable earnings” as an individual’s gross wages minus amounts required by law to be deducted, exempted, or withheld. This creates a precise base from which garnishment calculations are made.

  • Exemptions from garnishment (Section 4032)
    The bill specifies several categories of income that would be exempt from garnishment:

    • means-tested public assistance benefits,
    • unemployment compensation benefits,
    • federal earned income tax credit (EITC) under 26 USC 32,
    • a state or local government earned income tax credit (and similar credits),
    • disability benefits,
    • workers’ disability compensation benefits.

  • Garnishment calculation for regular wages (Section 4033)

    • For the portion of weekly gross wages up to $1,925.00:
    • The garnishable portion is limited to the lesser of: 1) 20% of garnishable earnings, or 2) the amount by which garnishable earnings exceed 30 times the federal minimum wage.
    • For the portion of weekly gross wages exceeding $1,925.00:
    • 30% of garnishable earnings is subject to garnishment.

  • Special limitations on certain garnishments (Section 4031)

    • The act’s exemptions and levy procedures apply to attachments and garnishments as appropriate.
    • In a garnishment relating to debt owed by the principal defendant for milk/cream sold from the defendant’s farm or for personal labor performed by the defendant or their family, the garnishee’s liability is capped:
    • 40% of the money in the milk/cream context.
    • In the personal labor context, liability is limited to the exemptions under section 7511 (as referenced).

  • New sections introduced

    • Adds sections 4001a (definition of garnishable earnings) and 4033 (garnishment calculation) and 4032 (exemptions), providing structural changes to the Revised Judicature Act provisions related to garnishment.

Who is affected

  • Debtors with wages subject to garnishment: The calculated garnishment amounts and the exemption framework will directly impact take-home pay for individuals facing wage garnishment.
  • Recipients of certain benefits and credits: Means-tested benefits, unemployment benefits, federal and state EITCs, disability benefits, and workers’ compensation are protected from garnishment under the new exemptions.
  • Employers and garnishees: Employers must apply the new garnishment limits and exemptions when calculating withholdings for employees under garnishment orders.

Procedural and timeline aspects

  • Status: Introduced July 3, 2026; referred to the Committee on Finance.
  • Effective date: The text does not specify an effective date; typical enactment would follow passage and signing, with a future date set by the statute or a later effective period (not stated in the bill text provided).

Observations

  • The bill reflects a shift toward broader protection of wages and earned income credits from garnishment, aligning Michigan with policy goals to shield critical income supports from collections.
  • It introduces a tiered garnishment framework based on income levels, potentially reducing the amount withheld from lower-wage earners while maintaining a deduction structure for higher earners.

Compiled from official sources — confirm details with the bill’s official record.

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