State Law
Arizona 2026 Creditor Garnishment Update
Arizona’s 2026 minimum-wage increase raises the protected earnings floor on creditor wage garnishments. Withhold the lesser of 10% of disposable earnings or the amount above 60 times the highest applicable minimum wage.
Effective January 1, 2026, Arizona’s minimum-wage increase raised the protected earnings floor on ordinary creditor wage garnishments. The formula under A.R.S. § 33-1131(B) is unchanged: withhold the lesser of 10% of disposable earnings or the amount those earnings exceed 60 times the highest applicable federal, state, or local minimum wage. If disposable earnings are at or below that floor, withhold nothing on the creditor writ.
Support orders, tax levies, and bankruptcy orders are not subject to this cap.
Employer Compliance Checklist:
- Update garnishment tables for earnings payable on or after January 1, 2026, and recalculate open creditor writs. Do not leave the 2025 statewide floor of $882 a week in production.
- Apply the highest federal, state, or local rate based on where the employee works, and withhold the lesser of 10% (or any court-ordered hardship percentage) and earnings above the floor.
- Do not apply the 10% / 60× formula to child support, spousal maintenance, tax levies, or bankruptcy orders.
Support orders, tax levies, and bankruptcy orders are not subject to this cap.
Employer Compliance Checklist:
- Update garnishment tables for earnings payable on or after January 1, 2026, and recalculate open creditor writs. Do not leave the 2025 statewide floor of $882 a week in production.
- Apply the highest federal, state, or local rate based on where the employee works, and withhold the lesser of 10% (or any court-ordered hardship percentage) and earnings above the floor.
- Do not apply the 10% / 60× formula to child support, spousal maintenance, tax levies, or bankruptcy orders.
Employer Compliance Checklist:
- Verify whether current employees operate, reside, or have active writs in this jurisdiction.
- Audit HCM wage deduction caps to guarantee alignment with shifting disposable pay exemptions.
- Connect State Disbursement Units to the Federal e-IWO portal to eliminate 10-day postal mail lag.
Published by Global Pay Compliance Desk (Minneapolis)
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