Attorney General: Honorable Gene Gavin, Department of Revenue Services, 2002-005 Formal Opinion, Attorney General of Connecticut

Attorney General's Opinion

Attorney General, Richard Blumenthal

February 1, 2002

Honorable Gene Gavin
Department of Revenue Services
25 Sigourney Street
Hartford, CT 06106

Dear Commissioner Gavin:

You requested our opinion "concerning the determination of how much of an individual’s disposable income may be taken to satisfy a tax warrant when the individual also is subject to a dependent support order." Your question arises from an inquiry of an employer whose employee is subject to a support order that "meets or exceeds 25% of that individual’s disposable income." Our review is confined to these facts. We conclude that the support order must be satisfied first and that disposable income remaining above the earnings exemption set forth in Conn. Gen. Stat. § 52-362 would be available to satisfy a tax warrant issued under Conn. Gen. Stat. § 12-35.

Your question requires the proper application of two statutes, both involving post-judgment executions on an employee’s wages, respectively a support order issued under Conn. Gen. Stat. §52-362 and a tax warrant issued under Conn. Gen. Stat. §12-35. The application of each of these types of executions to a person’s wages requires an independent computation under each respective statute. Furthermore, the application of the support order may affect the ability to collect, in full or in part, the tax warrant at the same time.

The analysis begins with Conn. Gen. Stat. §52-362, which authorizes a withholding order to enforce a dependent support order. Subsection (e) of this provision states in pertinent part:

(e) A withholding order shall issue in the amount necessary to enforce a support order against only such nonexempt income of the obligor as exceeds the greater of (1) eighty-five per cent of the first one hundred forty-five dollars per week of disposable income, or (2) the amount exempt under Section 1673 of Title 15 of the United States Code, or against any lesser amount which the court or family support magistrate deems equitable. . . .

While this provision contemplates that a court or a family support magistrate may issue a weekly child support order, subject to income withholding, whether all or part of such weekly order may be collected by withholding depends on the person's actual weekly disposable income. Under §52-362(e), 85% of the first $145 of weekly disposable income is exempt from a withholding order.

The term "disposable income" is defined for purposes of §52-362. It means:

that part of the earnings of an individual remaining after deduction from those earnings of amounts required to be withheld for the payment of federal, state and local income taxes, employment taxes, normal retirement contributions, union dues and initiation fees, and group life and health insurance premiums[.]

Conn. Gen. Stat. §52-362(a)(2).

The operation of §52-362 can be illustrated as follows. If an employee’s weekly disposable income is $500, 85% of the first $145, or $123.25, would be exempt from a withholding order. The balance, or $376.75, would be available to satisfy a withholding order to pay a support order. If the weekly support order were more than $376.75, then $376.75 would be the maximum weekly amount that could be applied toward the order.

Turning next to tax warrants, we note that they are authorized under Conn. Gen. Stat. §12-35. This provision states, in relevant part:

. . . Upon the failure of any person to pay any tax, except any tax under chapter 216, due within thirty days of its due date, the state collection agency charged by law with the collection of such tax may make out and sign a warrant directed to any serving officer for distraint upon any property of such person found within the state, whether real or personal. An itemized bill shall be attached thereto, certified by the state collection agency issuing such warrant as a true statement of the amount due from such person. Such warrant shall have the same force and effect as an execution issued pursuant to chapter 906. Such warrant may be levied on any real property or tangible or intangible personal property of such person, and sale made pursuant to such warrant in the same manner and with the same force and effect as a levy of sale pursuant to an execution. . . (Emphasis added.)

The foregoing provision refers to chapter 906 of the General Statutes, which pertains to post-judgment remedies, including wage executions. Thus, a tax warrant is to be treated with the same force and effect as a wage execution issued under Conn. Gen. Stat. §52-361a.

Section 52-361a(f) identifies that part of a person’s weekly earnings that is subject to a wage execution. This provision states:

(f) Amount subject to levy. The maximum part of the aggregate weekly earnings of an individual which may be subject under this section to levy or other withholding for payment of a judgment is the lesser of (1) twenty-five per cent of his disposable earnings for that week, or (2) the amount by which his disposable earnings for that week exceed forty times the higher of (A) the minimum hourly wage prescribed by Section 6(a)(1) of the Fair Labor Standards Act of 1938, USC Title 29, Section 206(a)(1), or (B) the full minimum fair wage established by subsection (j) of section 31-58, in effect at the time the earnings are payable. Unless the court provides otherwise pursuant to a motion for modification, the execution and levy shall be for the maximum earnings subject to levy and shall not be limited by the amount of the installment payment order. Only one execution under this section shall be satisfied at one time. Priority of executions under this section shall be determined by the order of their presentation to the employer. (Emphasis added)

Thus, that portion of one’s ":disposable earnings" which is subject to a wage execution is the lesser of either 25% of his disposable weekly earnings or that amount of his weekly disposable earnings that exceeds 40 times the minimum hourly wage.

Section52-361a uses the term "disposable earnings" while §52-362 uses the term "disposable income." "Disposable earnings" is defined in Conn. Gen. Stat. §52-350a(4) for the purposes of chapter 906 as

that part of the earnings of an individual remaining after the deduction from those earnings of amounts required to be withheld for payment of federal income and employment taxes, normal retirement contributions, union dues and initiation fees, group life insurance premiums, health insurance premiums, federal tax levies, and state income tax deductions authorized pursuant to section 12-34b.

With the exception of the reference to federal tax levies, the definitions are virtually identical.

Assuming that one’s disposable earnings are $500, that the tax warrant totals $300, and that there is no support order outstanding, an employer would need to calculate 25% of the employee’s disposable earnings, which is $125.1 Thus, the tax warrant can only be satisfied up to the amount of $125 per week under this example.

When a support order and a tax warrant are both levied against an individual’s earnings, the focus turns to the interplay between §52-362 and §52-361a. It is important to note at this juncture that "[a]ll orders for withholding issued pursuant to this section [52-362] shall take precedence over any execution issued pursuant to . . . section 52-361a.”" Conn. Gen. Stat. §52-362(g) (emphasis added). Based upon §52-362(g), a support order payment must be withheld before any consideration can be given to the tax warrant. The following example illustrates this situation.

If a person having disposable earnings of $500 were subject to a weekly support order of $300 and a tax warrant of $300, two independent computations, one for the support order and one for the tax warrant, must be made. It is important to note in this illustration that the support order exceeds 25% of the weekly disposable earnings, i.e., it is greater than $125, the maximum execution permitted for the tax warrant.

First Computation (under Conn. Gen. Stat. §52-362(e) -- support statute)

Total disposable earnings  $500.00
Less exempt earnings (85% of the first $145)  123.25
Amount available for support order $376.75

In this example there are sufficient funds remaining to pay the weekly support order of $300. That would leave $76.75 remaining above the exempt amount.

With respect to the tax warrant of $300.00, the calculation is:

Second Computation (under Conn. Gen. Stat. §52-361a(f) -- wage execution statute)

Total disposable earnings 2 $500.00
25% of disposable earnings  125.00
Amount available for tax warrant $125.00

By comparing the two computations the possible conflict between the two statutes becomes evident when there is a support order and a tax warrant (or other wage execution). Under the support statute, the Legislature exempts 85% of the first $145 of weekly disposable income. In the First Computation that sum was $123.25. Under the Second Computation for the wage execution statute, however, the Legislature exempts 75% of weekly disposable income. In this case, the maximum amount available for levy for the tax warrant under §52-361a(f) is $125, which is more than the $123.25 exempt disposable earnings under §52-362. Therefore, the effect of §52-361a(f) in such situations, if it were applied without regard to § 52-362, would be to withhold most, if not all, of a person’s disposable earnings.

To leave an employee with no wages in the event that his exempt disposable weekly earnings under Conn. Gen. Stat. §52-362 were made available to satisfy a tax warrant or any other §52-361a execution was clearly not intended by the legislature. Both statutes specifically allow an employee to retain a specific portion of his disposable income and the legislature could not have intended that the two statutes, working together, would deny an employee all of his disposable income. Statutes must be read together to create a harmonious whole. Pollio v. Planning Com'n of Town of Somers, 232 Conn. 44, 53, 652 A.2d 1026 (1995). Conn. Gen. Stat. §§52-361a and 52-362 cannot operate in isolation from each other. They must be reconciled.

Support orders have statutory precedence over wage executions issued pursuant to Conn. Gen. Stat. §§52-361a or12-35 and, consequently, may be satisfied in an amount equal to or greater than the statutory 25% limit on executions on disposable earnings set forth in §52-361a. Similarly, in circumstances involving executions under both § 52-362 and § 52-361a, the exempt earnings provided for in Conn. Gen. Stat. § 52-362(e) remain exempt against any wage execution filed under § 52-361a. In such cases, if the application of §52-361a would prevent an individual from retaining the minimal amount of disposable earnings exempted under §52-362, then no withholding for a wage execution under §52-361a (including a tax warrant) can be permitted. Thus, under the First Computation set out on page 5, above, the $76.75 that would remain after payment of the $300 support order would be available to satisfy a tax warrant. This is so because the employee would still retain $123.25 of exempt earnings under §52-362(e).

Because both §52-361a and §52-362 clearly contemplate that a portion of an employee’s earnings shall remain exempt from execution, the foregoing analysis achieves this result and reflects the intent of these two statutes.

I trust this answers your question.

Very truly yours,

RICHARD BLUMENTHAL
ATTORNEY GENERAL

William J. Prensky
Assistant Attorney General

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Attachment


1For purposes of simplification in this illustration and the ones that follow, we will assume that the calculation for 25% of weekly disposable earnings and for 40 times the minimum hourly wage would yield an identical sum.

2For purposes of Conn. Gen. Stat. §52-361a(f), the calculation of "disposable earnings" does not allow for the deduction of support order payments taken under §52-362. See Conn. Gen. Stat. §52-350a(4).


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