IRS wage garnishment is the deduction of money from an employee's paycheck resulting from unpaid taxes. Most likely this should not be a surprise as the IRS or State will only levy one's wages after repeated letters and warnings about the taxes owed. This is one of the governments’ most powerful tax collection mechanisms and should not be taken carelessly. The IRS or state would rather resolve taxes in a different way but they will levy when they feel they have run out of other options. It is important to understand how garnishments work to ensure you take the proper actions to avoid them or stop the IRS or State from taking your wages.
The IRS normally follows a standard process that leads up to a wage levy. If you receive an intent to levy it should be no surprise to you since you probably received multiple letters and most likely multiple phone calls from the IRS. Once the IRS has went through their whole series of letters the last one you will receive before wage garnishment is used is the "Notice of intent to Levy". Once this notice is sent the IRS can initiate collections 30 days after you receive this notice. The IRS will then look into your financial condition and decide which levy method would allow them to collect the amount owed the quickest. If you are a salaried employee it is most likely that they will select to garnish your wages.
If you have any questions on the wage levy process or laws it is highly suggested that you consult with a tax professional. A tax professional can quickly analyze your tax and financial situation and come up with the best plan of action in order to stop your wage levy.
In order to resolve your tax problem you must get back into good standing with the IRS. In order to get back into good standing you must either pay the IRS the taxes that are owed or come to some other form of agreement to pay the taxes back over time. Below are the common ways used to pay or settle taxes:
Paying off the entire amount of taxes owed plus interest and penalties will immediately stop the garnishment. Most likely you have gotten into this situation because you did not have the taxes to pay. You can consider options such as borrowing from friends and family, selling an asset or assets to cover the tax liability or even refinance your home. If none of these options seem feasible that is OK because the IRS has many other options you can use to settle your taxes.
If you enter into an installment agreement and have the agreement accepted the IRS will stop the levy. With an installment agreement the IRS will allow you to pay back the taxes you owe in monthly increments until they are fully paid off as long as you can keep up on the monthly amounts and you can pay off the entire amount in a period less than 3 years.
An offer in compromise is a method that allows a taxpayer to settle their taxes for less than the total amount owed. The IRS is very selective about who qualifies for this settlement program. People who are being faced with bank levies tend to qualify for these types of agreements. If you want to consider this form of settlement it is a good idea to talk with an offer in compromise professional to see if you will qualify. Once you file for an offer in compromise it will stop collection actions while your case is reviewed.
When dealing with IRS wage garnishment it is highly suggested that you seek professional help to stop the garnishment. A tax professional can quickly analyze your financial and tax situation and find the best method you can use to resolve your tax problem. They may use a combination of tactics in order to stop the levy depending on your situation. The IRS likes working with professionals in these types of situations and is more likely to give a professional a more favorable deal than an ordinary taxpayer.
If you cannot resolve your tax problems using any of the above then you can consider the following methods in order to temporarily stop the levy or cancel out the effect of the levy.
If you owe back taxes and are afraid the IRS may garnish your wages or if your wages have already been garnished, take action now. Call Tax Debt Pros at 801-878-0363 today and schedule your free initial consultation. When you enlist the help of a South Jordan, UT tax accountant it shows the IRS that you want to cooperate and find a solution to your tax problems. You can be confident that we will fight hard to get you the settlement you deserve so you can put your tax debt behind you.