Served with a wage garnishment in Colorado? How bankruptcy stops it fast
How Colorado garnishments work, how much a creditor can take from your paycheck, and how filing bankruptcy stops a garnishment, often before your next payday.
An emergency bankruptcy filing can be made within a day or two to stop the next deduction. Call or text now so we can look at your timing.
Few things cause a sinking feeling like opening your paycheck and finding a big piece of it missing. For many people in the Denver metro area, a notice from payroll is the first sign a debt collector has gone to court.
It’s stressful, but you have more control than it feels like. Federal bankruptcy law gives you a way to stop a garnishment immediately, and often to wipe out the debt behind it for good.
How a wage garnishment happens in Colorado
A creditor can’t take your wages out of nowhere. First, a collection agency, credit card company, or medical provider has to sue you in a Colorado county or district court, such as in Arapahoe, Denver, Jefferson, or Adams County, and win a judgment. Many judgments are entered by default when the person sued doesn’t file an answer or show up.
With a judgment, the creditor can ask the court for a writ of continuing garnishment. That order goes to your employer and requires payroll to withhold part of each paycheck and send it to the creditor until the judgment, plus interest and costs, is paid. Creditors can also use a writ of garnishment to freeze money in your bank account.
How much can be garnished from your paycheck?
For ordinary consumer debts like credit cards, medical bills, and personal loans, Colorado law limits a garnishment to the lesser of:
- 20% of your disposable earnings (your pay after legally required deductions like taxes), or
- the amount your weekly disposable earnings exceed 40 times the Colorado minimum wage.
With Colorado’s 2026 minimum wage of $15.16 an hour, the first $606.40 a week of disposable earnings is protected. Even so, losing up to a fifth of your take-home pay can mean the difference between paying rent and falling behind.
C.R.S. § 13-54-104. Different, higher limits apply to child support, alimony, and some tax and student loan debts.
Colorado garnishment calculator
Estimate the most a creditor can take for an ordinary consumer debt, and what that adds up to over a year.
An estimate for ordinary consumer debts using Colorado’s 2026 minimum wage. “Take-home pay” here approximates disposable earnings; voluntary deductions like 401(k) contributions are added back in the legal calculation. Nothing you enter is saved or sent.
How bankruptcy stops a garnishment: the automatic stay
The moment a bankruptcy case is filed with the U.S. Bankruptcy Court for the District of Colorado, a federal court order called the automatic stay takes effect. Under section 362 of the Bankruptcy Code, most collection must stop immediately. That means:
- Ongoing wage garnishments must stop
- Pending collection lawsuits in county court are put on hold
- Bank account garnishments and levies are frozen
- Collection calls, letters, and threats must end
A creditor that knowingly keeps taking money from your paycheck after you file is violating a federal court order. It can be ordered to return the money and pay damages, including your attorney fees. Learn about stay violation claims.
One important exception: garnishments for child support and alimony generally continue during bankruptcy, and those debts can’t be discharged.
Being garnished right now? The sooner you file, the less you lose.
Chapter 7 or Chapter 13 for a garnishment?
Both chapters trigger the automatic stay and stop a garnishment. The difference is what happens to the debt afterward.
Wipes out the credit card, medical, or loan debt behind the garnishment, usually in about four months. Once you receive your discharge, that garnishment can’t come back.
About Chapter 7 →Stops the garnishment and puts your debts into a 3 to 5 year plan you can afford. A good fit if you’re also behind on a mortgage or car, or your income is too high for Chapter 7.
About Chapter 13 →Not sure which applies? The 2-minute Chapter 7 or 13 screener is a good place to start.
How fast can a garnishment be stopped?
- Emergency consultation. We review the court judgment and the garnishment, and confirm bankruptcy is the right move for your situation.
- Emergency filing if needed. If payday is a day or two away, we can file the core bankruptcy petition right away and complete the remaining paperwork within 14 days. You get a case number immediately.
- Notice to payroll and the creditor. As soon as the case is filed, we notify your employer’s payroll department and the creditor’s attorney so the next deduction stops.
- Getting garnished money back. If more than $600 was garnished in the 90 days before you filed, some or all of it may be recoverable, depending on your exemptions.
Are there options besides bankruptcy?
Sometimes. Colorado lets you object to a garnishment and ask the court to protect more of your pay if your family’s actual living expenses require it. You can also try to negotiate a payment plan with the creditor’s attorney. These options don’t erase the debt, and the garnishment usually continues while they play out. If you have several debts or more lawsuits are likely, bankruptcy is often the more complete solution. A consultation will help you compare.
Frequently asked questions
Can my employer fire me because of a garnishment?
Federal law prohibits firing an employee because their wages have been garnished for any one debt. It’s also illegal for an employer to fire you solely because you filed bankruptcy.
Will my employer know I filed bankruptcy?
If your wages are being garnished, your employer will receive notice that the garnishment must stop. Beyond that, your employer generally isn’t involved in your case.
Does bankruptcy stop a bank account garnishment?
Yes. The automatic stay applies to bank garnishments and levies too. Funds that are already frozen may be released, depending on your exemptions and timing.
What about garnishments for taxes or student loans?
The automatic stay generally stops IRS and state tax levies and federal student loan wage garnishments while the case is open. Whether the debt itself can be discharged is a separate question. Some older taxes can be; student loans rarely are. Chapter 13 can give you time to pay them.
I haven’t been garnished yet, but I’ve been sued. What should I do?
Don’t ignore the lawsuit. Filing bankruptcy before a judgment is entered stops the lawsuit and keeps a garnishment from ever starting. Even if you don’t file, responding to the suit preserves your options.
Stop the garnishment before your next payday
You’ll talk directly with an experienced Colorado bankruptcy attorney, not a call center. The first consultation is free.
