Can child support in arrears be garnished from an LLC?

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Can child support in arrears be garnished from an LLC?

Asked on December 13, 2011 under Family Law, New York

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

The child support debt can only be garnished directly from the LLC  (e.g. from money owed to it, as in accounts receivable; or from its bank accounts) if the LLC either guaranteed the debt for some reason or if it can basically be shown that the LLC is not a legitimate business, but is only a sham or fraud designed to hide the debtor's personal assets. This is called "piercing the corporate veil" and is very hard to do.

However, payments from the LLC to an employee, owner, managing member, etc. may be garnished, so, for example, if an owner draws a paycheck or takes draws from the LLC, those payments to him are potentially subject to garnishment.


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