Federal wage garnishment is a particularly difficult IRS technique for most taxpayers to handle. When an individual fails to pay tax debt or ignores their responsibility, the IRS can put that debt into collection. Levies are a form of collection effort in which the IRS will begin to collect property and assets to settle a taxpayer’s balance. When the IRS garnishes wages, it can continue until the debt is satisfied. Individuals having their paychecks lessened in this fashion should contact a wage garnishment attorney for assistance.
There are specific laws governing wage garnishments by state. The IRS, however, does not have to obey these laws due to federal law superseding the related state laws. The good news for taxpayers having their wages garnished is that there are limits to which the IRS is held. Each paycheck for an indebted taxpayer can only be garnished up to 50%. The IRS cannot cause anyone to enter into financial hardship, which is determined by the amount of income an individual earns compared to their monthly expenses. If a reduction in income as a result of federal garnishment wage efforts causes a taxpayer’s income to be less than their monthly expenses, that person is considered to be in financial hardship.
Depending on the finances of a taxpayer in debt to the IRS, federal garnishment of wages can include more than just reduction in earnings through a typical paycheck. If a business owner has a debt owed to the IRS, the federal government can require their customers to send any outstanding balances from products or services to the IRS. This can affect not only the taxpayer but other employees working at their company. Another wide-ranging effect of federal wage garnishments is the IRS’ repossession of anything from the property on which the business is located to the inventory and equipment owned by the company. Seeking out debt settlement, whether through repayment, penalty abatement or temporary relief from payment obligations is the best plan to stop wage garnishment.
Taxpayers experiencing wage garnishment by state or federal government should be aware that there are settlement options available. If part of your paycheck is being taken by the IRS to settle a debt, tax lawyers near you can help. Even when funds are tight due to debt collection efforts, wage garnishment attorneys are offering free consultation to anyone contacting them with tax issues. You can call today and once again start earning the money you need!