I am a 1099 independent contractor in Arizona and one of the companies I sometimes do work for just received a notice to garnish my "wages" due to unpaid student loans. As a full 1099, I am responsible for paying my own withholdings such as the taxes, ss, etc...

I do not receive weekly, monthly or even yearly payments from any one company directly. My point being, there often are months and months that go by w/out any earned income. To make ends meet at times, I subject myself for medical testing where I earn some money when the testing is complete - anywhere from 6 weeks to 6 months. When I get work, companies pay me directly and the work is inconsistent to non-existant at times.

I own no property, my vehicle is paid for (not worth much) and I have a basic personal bank account, no assets (IRA, 401(k), savings... ).

My questions are thus:
1. As a 1099, are the companies I contract with obligated to withhold anything and if so how much?
2. Can they lien or seize my car?
3. Can they freeze/seize my bank account?
4. I work for several different companies at different times throughout the year, so can they make each company garnish my earnings?
5. If I LLC/PLLC myself, place my car and any bank accounts into a company where I don't draw any income directly, can they still make the companies garnish earned income if the LLC/PLLC is the one being paid instead of me directly?

Thank you for your advice.

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Originally Posted by azbosslady

I am a 1099 independant contractor in Arizona and one of the companies I sometimes do work for just received a notice to garnish my "wages" due to unpaid student loans. As a full 1099, I am responsible for paying my own withholdings such as the taxes, ss, etc...

I do not receive weekly, monthly or even yearly payments from any one company directly. My point being, there often are months and months that go by w/out any earned income. To make ends meet at times, I subject myself for medical testing where I earn some money when the testing is complete - anywhere from 6 weeks to 6 months. When I get work, companies pay me directly and the work is inconsistent to non-existant at times.

I own no property, my vehicle is paid for (not worth much) and I have a basic personal bank account, no assets (IRA, 401(k), savings...).

My questions are thus:
1. As a 1099, are the companies I contract with obligated to withhold anything and if so how much?
2. Can they lien or seize my car?
3. Can they freeze/seize my bank account?
4. I work for several different companies at different times throughout the year, so can they make each company garnish my earnings?
5. If I LLC/PLLC myself, place my car and any bank accounts into a company where I don't draw any income directly, can they still make the companies garnish earned income if the LLC/PLLC is the one being paid instead of me directly?

thank you for your advice.

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Yes, 1099 - independent contractor - income can be garnished.
They could lien or seize your car - seldom happens.
Yes, they can freeze or lien against your bank account.
Yes, they can keep serving garnishment notices on the various companies.
Any transfer of assets now that you know there is a Judgment could be considered fraud.

When student loans are involved there aren't any exemptions.