IRS Wage Garnishment

Usually, the first communication will be a letter stating how much you owe. The amount owed will include penalties and interest. The letter will advise you of a date to pay the balance, or make other arrangements. If you are unable to pay, or if you fail to respond, the IRS will send additional notices with increasingly hostile threats. If you continue to ignore these notices, you will receive a “Notice of Intent to Levy” the last step before a wage garnishment. If you are assigned to a Revenue Officer they can come to your house or place of work.

The IRS can take most of your money. The exact amount is calculated by determining what portion of your wage is exempt. For example; if you have $500 in exempt income and make $1000 a week, the IRS will take $500. If you make $2000 with $500 exempt, they will take $1500, and so on. This table from the IRS will tell you how much money you will be allowed to keep. https://www.irs.gov/pub/irs-pdf/p1494.pdf

You can “stay” a wage garnishment through the appeals process. You can file a Collection Due Process Appeal if your request is postmarked within 30 days of recieving the Notice of Intent to Levy and Notice of Your Right to a Hearing. You can represent yourself in a CDP hearing. This is rarely the path of least resistance and can actually worsen the problem. You can appeal for two reasons: 1. Doubt as to liability (you don’t think you owe the amount they claim) or, 2. The levy/garnishment will create an “undue hardship” (you can’t pay your basic living expenses with the levy in place).

Tax relief can take on many forms. You need a solution that resolves your IRS issues once and for all. It is important to research your options if you are going to try this on your own. Remember, experience dealing with the IRS is invaluable. What you read on-line is only a start, and often times wrong. You want the best possible outcome, and there can be many different outcomes. Be careful of companies who give you a quick remedy. It is common in the tax industry to over-promise just to get your business. Commissioned sales people with limited knowledge of IRS guidelines will tell you “what you want to hear.” What is delivered can be far different. Here are some tips to help keep you safe: What are the credentials of the person doing your initial interview? A “Tax Consultant” = commissioned sales person. Never prepay, or pay a large deposit. A reputable tax resolution firm will work with you on a payment plan you can afford. Have them detail the work they will be doing on your behalf, in writing. Know the total cost. If something seems too good to be true, it probably is. Advising someone of a resolution to their tax problem requires education, experience and knowledge. At a minimum, you need to know a taxpayers assets, income, expenses, employment, age, dependents and more. If you are talking to someone who is not asking these questions you should be skeptical. Many firms outsource their work. Ask who you will be working on your case, and what are their credentials. Reputable firms offer a money back return. Ask about it and see if it is posted on their website, and if they will put it in writing.