IRS Wage Garnishment

Paying your taxes on time is important in avoiding any actions that the IRS can take against you for any tax debts. The IRS has the right to collect on debts owed by individuals. In such cases, it is important to note that the IRS differs from other creditors in that they can begin collecting on debts owed even without first taking you through a court process. The IRS also has the right to recover as much as they want from you without any set limit; it is possible for the IRS to recover up to 70% or even more of your income leaving you with a bare minimum to only support your family’s basic needs. We offer our clients various solutions meant to help them understand tax garnishments and how to stop them.

What is an IRS Wage Garnishment?

The IRS has the right to track down an individual who owes them a tax debt and then directly contact their employer to deduct an amount towards the repayment of this debt. In such a case the IRS recovers the amount owed from the individual’s income including basic pay, bonuses, and commissions. The employer is legally obligated to deduct the required amount and then forward the same to the IRS while the remaining amount is paid to the employee.

Process of IRS Wage Garnishment

When the IRS determines that you owe them a tax debt, they usually use wage garnishment or other legal avenues available to recover the same from you. In such cases, they will first send you a detailed report of the amount you owe as well as penalties and any interest therein. The report will contain a due date when you are supposed to cover the amount in full. Failure to pay this debt by the stipulated period results in the service of a “Final Notice of Intent to Levy,” which should be honored within a month. Failure to do this prompts the tax authority to commence IRS wage garnishment.

How to stop IRS Wage Garnishment

There are different ways in which individuals can stop IRS wage garnishment actions including:

Making a Compromise Offer

In this case the individual agrees with the IRS to make a payment lower than the amount previously by the IRS. This amount is mainly influenced by the financial situation of the taxable individual.

Installment Agreements

To avoid the IRS from collecting relatively large amounts from your income you can agree to cover the due amount through installments over a period of three years.

Financial Hardships

If the individual under consideration of an IRS wage garnishment can prove that the deduction leaves them unable to cover basic necessities for their family then, the IRS can suspend the action for extended periods.