A Brief Q&A on IRS Wage Garnishments

The IRS has an immense amount of power when it comes to taking action against taxpayers in order to uphold the US Tax Code and induce the payment of appropriate taxes. As we have previously discussed, the IRS has the power to levy your wages in order to satisfy your debts, better known as a “wage garnishment.”

Below we have provided a number of answers to frequently asked questions regarding IRS wage garnishments. If you have questions which we have not answered in this blog, or you are currently facing the prospect of having your wages garnished by the IRS, please contact our law firm today!

What is a wage garnishment?

A wage garnishment is a type of levy that can be employed by the IRS in order to satisfy an unpaid tax debt. A levy is any seizure of your property, and when that property is the wages owed to you by your employer, it is known as a wage garnishment. The IRS issues a notice to your employer stating that a portion of your wages each pay period must be sent to the IRS instead of being paid to you. That portion of your wages is used to pay whatever debts you owe to the IRS.

How will I know if the IRS has issued a levy against my wages?

The IRS is required to first notify you of your unpaid tax debt and send you a demand for payment. If you do not act or respond to the demand for payment, the IRS must send you a Final Notice of Intent to Levy at least 30 days before the actual levy takes effect. Once 30 days have passed following the appropriate delivery of this notice, the IRS may freely garnish your wages as needed.

How long will the IRS garnish my wages?

This will depend on the amount of tax debt you owe. The IRS has the power to garnish your wages until your debt is entirely fulfilled, or until you make other arrangements with the IRS to pay off your debts.

Is there any way to stop IRS wage garnishment before my tax debt is fulfilled?

There are many different measures with which a tax attorney can assist you that may induce the IRS to drop the levy on your wages. If the IRS is already garnishing your wages, you would need to make some other acceptable arrangement with the IRS to fulfill your tax debt, such as an offer-in-compromise or an installment agreement.

Additionally, you may be able to achieve the release of the levy if you can demonstrate that the wage garnishment is causing you undue hardship. Wage levies by law cannot cause you an immediate economic hardship that would prevent you from fulfilling your basic living expenses. If wage garnishment is causing you to struggle to pay rent, buy enough food, or fulfill other basic needs, the IRS must drop the levy.

How much of my wages can the IRS garnish?

The amount the IRS takes from your wages or salary will depend on a number of factors, including how often you are paid, tax exemptions claimed, and your tax filing status (married, single, head of household, etc). You will be given the opportunity to choose a filing status, but the default will be to treat your wage garnishment as if you are married filing separately with one exemption. The IRS has created a chart to help you calculate how much you could expect to pay depending on your circumstances, which can be found here.

What if the wage garnishment prevents me from paying court ordered child support?

Child support should be included as an exemption, which means enough of your wages will still be paid to you to be able to afford any such support payments. If for any reason child support is not included as an exemption in your levy, you must contact the IRS in order to have the levy changed to reflect the child support obligation.

If you are facing wage garnishments or any other types of IRS penalties or collections due to unpaid tax debts, it is vital that you contact me right away. No matter where you live, I can help you understand your options and take appropriate action to fulfill your tax debts in a manner which will be acceptable to the IRS and best suits your unique circumstances. Call my office today at (610) 640-9481.

Written by E. Morgan Maxwell

E. Morgan Maxwell

Since beginning his own firm, Mr. Maxwell has continued a tax-law oriented practice encompassing a wide range of transactions, planning and dispute resolution. His dispute resolution experience includes involvement at all levels of the Internal Revenue Service (Examinations, Appeals, Collections, Office of Professional Responsibility, the U.S. Tax Court), the Pennsylvania Department of Revenue, the Tax Litigation Section of the Pennsylvania Attorney General’s Office, Pennsylvania Commonwealth Court, Common Pleas Court and local taxing jurisdictions in southeastern Pennsylvania.

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