New York Debt Collection Laws: The 10% Income Execution Cap and the 3-Year Credit Card Deadline

A New York creditor cannot take money from a paycheck or a bank account on the strength of an unpaid bill alone. It has to sue, win a judgment, and then use one of New York's specific enforcement tools, most often an income execution against wages or a restraining notice against a bank account. Most of these cases begin with a default judgment entered because the person sued never answered, which makes responding to the summons the single highest-value move available. New York's rules that follow are, in several places, meaningfully more protective than the federal floor, and one of them has changed recently enough that older summaries of New York law get it wrong.

New York's Income Execution: The 10% Ceiling and the Disposable-Earnings Floor

New York enforces most consumer judgments through an income execution under CPLR 5231, and the statute layers two protections on top of each other. The base rule caps withholding at 10% of gross income. On top of that sits a version of the federal disposable-earnings test: nothing may be withheld for any week unless disposable earnings for that week exceed 30 times the greater of the federal or New York state minimum hourly wage, and even then the amount withheld is the lesser of 25% of disposable earnings or the excess over that floor.

For most working New Yorkers, the 10%-of-gross number is what actually binds, since it is almost always the smaller figure. New York's minimum wage for 2026 is $17.00 an hour in New York City, Long Island, and Westchester County, and $16.00 an hour in the rest of the state, which puts the 30-times floor at $510 a week in the higher-wage region and $480 a week elsewhere. Below that floor, nothing can be withheld at all.

Child support runs under a separate, higher federal framework, and a support deduction already in place reduces the room available under the 25% ceiling for any other execution, so a debtor with an active support order and a separate income execution should not assume both amounts stack cleanly on top of each other without review.

Automatic Bank Account Protection: EIPA

New York is one of the more protective states for bank accounts specifically because the protection is automatic. Under the Exempt Income Protection Act, codified at CPLR 5222(i), a restraining notice or levy simply does not reach the greater of 240 times the federal minimum wage or 240 times the New York minimum wage in an individual's account. For 2026 that works out to $4,080 in the New York City metro region and $3,840 in the rest of the state, and the bank must apply the shield without you filing anything.

A second, separate EIPA layer protects direct-deposited exempt benefits specifically, things like Social Security, SSI, pensions, child support, and unemployment. If those payments were deposited within 45 days before a restraint, the bank must additionally protect a CPI-indexed amount with a statutory base of $2,500 under CPLR 5222(h); the most recent adjustment on record put that figure at $3,425 as of April 2024, with the next scheduled adjustment in April 2027. Confirm the current figure with the state Department of Financial Services before relying on an exact number in a specific case.

A third rule protects wages after they land in the bank: CPLR 5205(d)(2) exempts 90% of earnings for personal services rendered within the last 60 days, on top of the EIPA amounts above.

Job Protection Beyond Federal Law

Federal law only bars firing an employee over a single garnished debt. New York goes further. CPLR 5252 forbids an employer from discharging, disciplining, refusing to promote, or refusing to hire someone because «one or more» wage assignments or income executions have been served, explicitly covering multiple garnishments, not just the first. Violations carry penalties up to $500 for a first offense and $1,000 for later ones, and an affected employee can sue within 90 days for up to six weeks of lost wages plus reinstatement.

State Tax Garnishment

New York's Department of Taxation and Finance uses its own income execution, and its published guidance describes the same structure as the court-ordered version: 10% of gross income, or 25% of disposable earnings, whichever applies, with the lesser figure governing in practice.

Medical Debt: Garnishment Banned Outright

A 2022 amendment to CPLR 5231 bars income executions entirely on judgments arising from medical-debt actions brought by hospitals licensed under Public Health Law article 28, or by health care professionals authorized under Education Law title 8. If a medical creditor of that kind has a judgment against you, wage garnishment is not an available tool at all, regardless of the income-execution math above. A companion 2022 protection is widely reported to also bar placing a lien on a primary residence for a medical-debt judgment; confirm the exact statute before relying on that specific point in a case, since it was not independently reverified this session.

The Statute of Limitations: Why "6 Years" Is Outdated for Most Consumer Debt

For decades, New York treated essentially all contract claims, including credit cards, the same way: 6 years under CPLR 213(2). That is still the rule for ordinary business and non-consumer contract debt, and you may see general resources, including older statute-of-limitations summaries, describe New York debt collection deadlines as a flat 6 years across the board. That description is now incomplete.

The 2022 Consumer Credit Fairness Act carved consumer credit transactions out of the 6-year rule entirely. Under CPLR 214-i, a case where the defendant is a purchaser, borrower, or debtor in a consumer credit transaction, which covers the overwhelming majority of credit card, personal loan, and retail installment debt, must be commenced within 3 years. The same law killed revival for that category outright: the statute states plainly that a payment, a written affirmation, an oral affirmation, or any other activity on the debt does not revive or extend the limitations period. For consumer credit specifically, once the 3-year clock runs out, nothing brings it back.

Outside consumer credit, the older rules still apply: 6 years under CPLR 213(2), and reviving a time-barred claim generally requires a signed writing under the state's general obligations law, a rule that was not independently reopened this session and should be confirmed before relying on it in a specific matter.

New York's own UCC retains its pre-revision Article 3 language, so a reference to «UCC 3-118» in New York does not describe a limitations period the way it does in most other states; consumer-purpose promissory notes fall under the 3-year rule above, and other notes fall under the general 6-year rule.

An expired limitation period, in either category, does not erase the underlying debt. A collector may still ask for payment, and the account can remain on a credit report for up to 7 years on its own separate clock. Suing or threatening suit on a time-barred debt is what federal Regulation F flatly prohibits.

Repossession in New York

New York enacted the standard UCC rule: after default, a secured lender may repossess a financed vehicle without a court order, as long as it proceeds without a breach of the peace, a standard whose exact content is left to New York case law. We did not find a general pre-repossession notice or right-to-cure requirement for ordinary auto loans this session. After repossession, the sale must be commercially reasonable, and a lender that fails to follow the disposition rules can lose or reduce its claim to a deficiency. A servicemember whose loan predates military service cannot be repossessed without a court order under federal law.

If You Are Being Garnished or Sued in New York

Answer the summons before the deadline; a default judgment forfeits every defense, including the statute of limitations. If an income execution is running, check both the 10%-of-gross figure and the disposable-earnings floor for your region. If a bank account is restrained, the EIPA amounts, $4,080 or $3,840 depending on where you bank, should already be protected without any filing; anything above that may need a claimed exemption. If the debt is medical and the creditor is a hospital or licensed health professional, wage garnishment may not be available at all. Do not pay anything on an old, non-consumer debt before confirming how old it is, since a payment there can still matter even though it no longer matters for consumer credit. And when judgments have stacked past what a budget can carry, bankruptcy's automatic stay halts garnishment and bank restraints while the case is pending; the guide to stopping wage garnishment walks through the options in order.

Information last verified on 2026-08-12. This article has not yet been reviewed by a licensed lawyer.

Related Resources

• Debt Collection Laws by State
• Statute of Limitations on Debt
• How to Stop Wage Garnishment
• Can Social Security Be Garnished?
• New York Statute of Limitations
• New York Bankruptcy

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Last updated: 2026-08-12.