It is a taxpayer’s worst nightmare; they owe federal tax, they receive a letter from the IRS that states the IRS will be garnishing their wages. Then, before they have a moment to breathe, the taxpayer gets a notice from their employer stating that they will be taking a percentage of their paycheck to put towards the IRS wage garnishments. What can you do?
You might not have been expecting this letter, but taxpayers need to know how wage garnishments work and what steps need to be taken for them to return to normal life and get the garnishment released.
The Internal Revenue Service (IRS) wage garnishment is a legal procedure that allows the IRS to take certain amounts of money from your paycheck to pay the prior year’s taxes. Wage garnishments are not something you want, but you can prevent or remove garnishments if you act quickly. This article will teach you everything you need to know about wage garnishments from the IRS and how to remove them so that your finances remain secure. This article will also teach you how to deal with the IRS and what your rights are when it comes to IRS liens, levies, and wage garnishments so that you are in control of your own life again.
Before the IRS begins garnishing wages, you will receive several notices regarding your delinquent tax debt. You can halt the garnishment process if you show that the debt is not yours or that it was paid already paid it.
The IRS will send notices before it begins garnishing wages. You can halt the process if you show that the liability is not yours or already paid it.
Since the IRS may collect tax liability through wage garnishment, lien, levy, or a variety of other methods. it is important to be aware of your rights so that you are not taken advantage of. Further, Unlike most other creditors, however, the IRS can garnish your wages without first getting a judgment, and the amount it can take is usually more than what regular creditors can take.
The IRS wage garnishments process
The IRS can take as much of your hard-earned wages without ever having to go before a judge. This is why it’s important to be aware of your rights. Wage garnishment starts with a notice from the IRS that you have delinquent taxes, and then if they do not receive payment in full, it will send another letter informing them about wage withholding.
Do you have an IRS bill titled Final Notice of Intent to Levy and Notice of Your Rights? Contact us for help right away.
Statute of limitations
The statute for collecting unpaid tax liability through wage garnishments is ten years, but this time limit only applies when all other means are exhausted by the government agency that may collect tax liabilities through a variety of methods, including liens or levies on property, levy against personal income as well as bank account seizures and/or offsetting federal payments such as Social Security benefits. It’s very common for those taxpayers living below the poverty level without any assets to have their wages taken before paying their monthly bills.
The IRS will give this notice to your employer and stop all future payments from being deposited into your account while collecting any past-due taxes owed. This means that you won’t be able to withdraw money in person, get checks cashed, or use electronic transfer methods such as Automated Clearing House (ACH) transactions without paying a fee first. The Wage Garnishment Notice instructs employers how much they should withhold per pay period.
If you need help making sense of your rights as an individual or business, please contact us today.
Wage garnishment is the process of taking money from a person’s salary or wages in order to pay back taxes owed. The IRS can either voluntarily agree for deductions and withholdings to be made from your paycheck, or they may take involuntary wage garnishment after issuing five notices.
Wage garnishment typically occurs when the IRS is unable to find other ways of collecting a taxpayer’s unpaid taxes. The IRS sends out letters asking for payment, and if those payments are not made by the assigned deadline, a wage garnishment may follow. Refrain from ignoring these notices as penalties and interest can quickly grow into unmanageable amounts.
If the IRS does not garnish your wages, the IRS can take other enforcement such as imposing a levy and taking funds in your bank accounts or offsetting your refund to pay your back taxes.
Rights to a hearing
As part of the letters it sends taxpayers, the IRS is required to give you the opportunity for a hearing, either in person or by telephone, and will give you an opportunity to have the garnishment released. Your right to a hearing will be listed in the intent to levy or other IRS correspondence. A wage garnishment, IRS Lien or Levy can be released or avoided if your wages are being garnished and it would cause financial hardship or if there’s been an error that needs to be corrected.
It is always advisable to seek the help of a professional or tax attorney before your hearing. Your attorney understands the ins and out of income tax and the law so that you have the best chance that your garnishments are released.
What you can do if the wage garnishment is in error
Suppose you’ve received notice of Wage Garnishments, and the garnishment is overly aggressive. In that case, the garnishment calculation could be based on incorrect information, such as not having all your exemptions applied correctly for the number of dependents, then contact the IRS using the number listed on your notice with this information so their records can be corrected and get in touch with your employer about how much should have been withheld from each paycheck.
The more quickly these errors are identified, the better off you’ll be since most IRS operations occur without human oversight. So the garnishment will go into effect automatically without an IRS employee ensuring that the correct amount is being taken out of your wages.
Additionally, some of your wages will be exempt from an IRS wage garnishment. These exempt wages are based on the standard deduction and “amount determined” calculated in part by the number of dependents you are allowed for that tax year.
Avoid garnishments with these tips:
Regardless of the size of your tax debt, there are always options to escape wage garnishment. The following methods may be effective for some people:
– Applying for an Offer in Compromise.
– Requesting wage levy exemption (Frequently called “Levy Release”)
– Using an IRS Installment Agreement (i.e., payment plan.)
– Negotiating a settlement with the private debt collection agency or Department of Treasury collections agency by using good communication skills and being willing to work towards repayment.
– Make sure you understand your rights as an employee who has been notified of wage withholding by the IRS on their paycheck.
– Keep records of all communications with the IRS regarding payments/garnishments and include any paperwork issued by them.
– Be advised that if there’s no response from you within 30 days after receiving notice of levy (i.e., mailed letter), then it will automatically be treated as final.
– Continue to file all tax returns.
The Wage Garnishment process is not only costly but can be life-changing, so make sure you are aware of your rights before it becomes too late!
IRS liens and levies
In addition to garnishing your wages, the IRS may also seize property or assets and your refund. Similar to the letters sent for wage garnishment, the IRS will send you letters that get progressively nastier before they levy your bank account or file a tax lien on your property to pay your back taxes.
When to consult tax professionals or obtain legal advice
Dealing with wage garnishment can be complicated and emotional. The internal revenue service has a team of people just to process your Wage Garnishment request, so don’t be fooled into thinking you can easily handle everything on your own! Consult with a tax professional or lawyer before taking any action that could make the situation worse for yourself.
If you do not act quickly, the IRS will garnish your income, property, or tax refund until you can no longer make ends meet. Wage garnishments can harm your credit score and affect other financial matters, such as applying for loans or mortgages, which is why all wage garnishment issues must be taken seriously and addressed without delay.
In addition, to garnishment, the IRS may intercept any refund if you continue to owe the prior year’s income tax after the garnishment begins.
If you have received IRS notices or the IRS has started garnishing your wages, you should immediately contact the IRS.
If you are unsure of the law or your rights or need assistance in fighting the IRS, it is best to contact a tax professional and attorney who fights for YOU.
Joseph Damiens, a tax attorney with years of experience in fighting the IRS, can help you fight for your rights.
Contact Damiens Law Firm to schedule a consultation and get relief from your IRS garnishment today!