AV-Rated Attorney Paul Deloughery is licensed in Arizona and helps clients throughout the U.S.

How to Prevent Future Garnishment

by | Aug 13, 2020 | Uncategorized | 0 comments

If you’ve been sued and you have a judgment against you, one way the creditor can get paid is by garnishing your wages. This means they take up to 15% of your earnings until the judgment is paid off. For most people, 15% of their earnings is a big deal. However, that creditor cannot get 15% if another creditor has already started to garnish your earnings. So, the idea here is for you to find a “friendly” creditor (that you own or control) that can garnish your earnings so the other creditor can’t get anything. That’s the whole purpose of asset protection … namely, to defend against frivolous lawsuits and other claims to your assets. I have successfully used this tactic a couple of times in my career. Of course, there is always more than one way to do anything. This is merely one way to prevent garnishment. For this particular approach, here’s what you need:


  • A family holding company with some cash in it. This is often a limited partnership or LLLP.
  • OPTIONAL: An asset protection plan already in place. (This provides you the best leverage, but is not necessary for this strategy to work.)
  • A smart lawyer.
  • Someone with a legal claim against you. (This could be a real lawsuit, or just an unhappy family member or employee.)

That’s it. That’s the list of what you need.


So here’s how this plays out:

  1. You get sued.
  2. OPTIONAL: The plaintiff (person suing you) discovers that you have an asset protection plan. This provides leverage for offering a steep discount in settling the lawsuit.
  3. Your family holding company offers to pay off the plaintiff in exchange for an assignment of the legal claim or judgment.
  4. If a future creditor comes along, the family holding company can foreclose on any remaining unprotected assets.
  5. Family holding company can garnish your wages. Only 15% of your wages can be garnished. And the first creditor to garnish your wages has priority. Future creditors are out of luck.


No one likes to contemplate getting sued. However, the strategy discussed above is a way to turn lemons into lemonade should it happen to you. In fact, you can now start looking for people who might have legal claims against you. Normally you could just settle the claim and move on. But now you have an option to benefit from the process by strengthening your own asset protection.

Garnishment of your wages is one of the most annoying aspects of getting a judgment against you. If you can take measures to prevent garnishment from happening in the future, you’ll feel a lot more confident about your ability to defend a frivolous lawsuit. However, do not try to prevent garnishment on your own. Get competent legal help.

The information in this blog post was general in nature. It was not intended as legal advice. If you need legal help, BOOK A CALL.

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