Got this regarding a Tenant who skipped town to Texas, any advice?

[Joe Delia]

Joe,

Bad news – Texas has a law that I was not aware of that prohibits wage garnishments. Please see the attached.

I’ve done a little research, and this seems to be a bad law, or at least a bad interpretation of Texas law, since this is an Ohio judgment and the US Constitution requires each state to honor other states’ judgments and court orders.

Still, in order to start arguing with Nordstrom (and eventually Sephora) over their application of the Texas law, I would have to start charging you hourly – and I’m not sure that effort is worthwhile.

The cheaper way to go is to send a subpoena to Nordstrom and Sephora and require those employers to tell us what bank they are depositing Beth and Clancy’s paychecks into. (This assumes they use direct deposit.) Once money is in a bank, it’s no longer “wages” and even under Texas’s bad law, can be seized to pay a judgment.

There will be additional court costs associated with the bank-subpoena route – but again, it will be less than fighting the wage garnishment issue. And as court costs, they will get reimbursed by the former tenants once money comes in (if it ever does).

Shall I proceed with the subpoenas?

Any suggestions here people? Especially you TX landlords?

[Steve Babiak]

One thing not yet mentioned is that once you have a judgment from the courts, you can then forgive the bad debt (once you reach the point of giving up on collecting) and issue a 1099C for that forgiven debt to now become income for which the deadbeat now will owe income taxes. That's how forgiveness becomes revenge.