WHAT IS A WAGE GARNISHMENT?

Wage garnishment occurs when the IRS seizes a taxpayer’s income directly from his or her employer. Wage garnishments occur against any taxpayer that receives a wage, salary or any other income. The levy or garnishment of a wage has a continuous effect, meaning it attaches to all future payments until the levy is released. Additionally, the IRS is not required to re-issue a wage levy in order garnish each of your paychecks.

HOW DOES WAGE GARNISHMENT WORK?

The IRS will not surprise a taxpayer with a wage garnishment. Initially, a taxpayer will receive several notices of past due taxes along with a request for immediate payment. If this notice is ignored and unanswered, a taxpayer will eventually receive a “Final Notice of Intent to Levy”. The IRS will give the taxpayer 30 days of the final notice to comply. If the taxpayer shows no effort to cure the tax debt in that time, the IRS will issue a Form 688-W to a taxpayer’s employer and the garnishment of wages begins. Taxpayers are afforded some exemptions for dependents on Form 668-W, but the allowance is nominal.

HOW DO I STOP IRS WAGE GARNISHMENT?

Stopping an IRS wage garnishment is always a top priority. When trying to stop wage garnishment, you will find that there are short-term options and long-term solutions. Short term options include promising to pay the IRS in full with borrowed funds from family, friends or other legitimate sources to stop the garnishment. Another short-term option includes arranging a payment installment plan with the IRS.

The long-term solutions include completing any missing tax returns, Offer In Compromise, looking into statutes of limitations and bankruptcy. You can also try negotiating with the IRS by offering a lower lump sum payment as a compromise for payoff. Before taking this path, you should consult with an experienced taxpayer advocate at Tax Resolution to weigh the options and consequences.

CAN I APPEAL A WAGE GARNISHMENT?

When you receive a “Final Notice of Intent to Levy,” you have 30 days to appeal. However, you have to provide solid evidence that there are grounds for the appeal. Examples of this include:

  • Proving that there was an error made by the IRS
  • You have filed for bankruptcy and an injunction has been made on your behalf
  • Statute of limitations applies to your case
  • Offer in Compromise has been requested, but no decision has been made yet
  • An IRS installment agreement is already in place
  • An installment agreement was denied and no valid reason was provided

What to do if you face or experience a wage garnishment immediately after you receive a notice for back tax payment, or “Intent To Levy,” you need to look at all of your options and contact the IRS. If you do not know how you are going to pay the IRS, contact a taxpayer advocate at Tax Resolution. It is in your best interest to have an experienced professional on your side than to just ignore the requests and make the situation worse.

If the IRS is currently garnishing your wages, contact our office today to speak with our Tax advocates so they can resolve your situation quickly and efficiently. 770-671-8830

WAGE GARNISHMENT VS. INCOME DEDUCTION ORDERS

The IRS has an arsenal of options to collect on unpaid tax debts. Two of these methods are wage garnishment and income deduction order. If you ever find yourself in a circumstance where you are subject to an IRS wage garnishment, creditor wage garnishment or an income deduction order, you need the assistance of an tax advocate at Tax Resolution.

Wage Garnishment

A wage garnishment is an order that is issued by a court of the federal government in instances of IRS tax obligations that instructs your employer to deduct a specific amount from each of your paychecks in order to satisfy a debt. The amount that is withheld is given to the issuing creditor. The IRS does not require a judgment to garnish your wages.There are certain restrictions and limitations on how much can be garnished. These limitations are imposed by federal regulations. Most debts are capped at either 25 percent of your disposable income or the amount that your weekly disposable earnings exceeds the federal hourly minimum wage.

Income Deduction Orders

An income deduction order is very similar to a wage garnishment. Like a wage garnishment, your income is withheld by your employer to satisfy the debt of the issuing creditor. However, income deduction orders are very rarely issued. They are more commonly issued in circumstances involving child support and Chapter 13 bankruptcy cases.

Unlike a wage garnishment, income deduction orders are not as limited or restricted in terms of how much can be taken or withheld to satisfy debts. Wage garnishments are used to collect on unpaid debts after they have become due, while an income deduction order can be issued before you ever fall behind on a payment. For example, as soon as a child support order is set into place, an income deduction order can be put in place to guarantee payment.

When an income deduction order or wage garnishment is put in place, your financial goals can come to a screeching halt. To get back on track, you need skilled tax advocates at Tax Resolution by your side to guide you through the process and protect your interests. If you or a loved one is currently having their wages garnished or has an active income deduction order against them, contact Tax Resolution today for a free consultation with an expert Atlanta Tax Advocate.