The Effect of Garnishment or Seizure

The Effect of Garnishment or Seizure. A. A garnishment or seizure is a withholding of an amount from earned or unearned income in order to satisfy a debt or legal obligation. Amounts withheld from earned or unearned income to satisfy a debt or legal obligation are income for Medicaid purposes. 1. Example: Ms. Jones’ wages are being garnished to repay a delinquent debt. The amount withheld for the garnishment is countable income.