How to Stop Wage Garnishment

According to the IRS website, if the IRS levies (garnishes) your wages, part of your wages will be sent to the IRS each pay period until:

• You make other arrangements to pay your overdue taxes,
• The amount of overdue taxes you owe is paid, or
• The levy is released.

Part of your wages may be exempt from the levy and the exempt amount will be paid to you.  In reality the amount paid to you will not be enough to pay your ordinary household expenses.

So What can you do about it?  Well first off it depends on whether or not you are in compliance.  Remember, the IRS wants, and expects, everyone to be in compliance.  For IRS collection purposes, compliance can be defined as:

1. Filed all tax returns for the previous 6 years.
2. Paid current this year. (Either you have adequate withholding taxes taken from your paycheck or you are current on estimated quarterly taxes for self-employed people).

For People in Compliance

The good news is that you are in compliance, the bad news is that you’ve had a  balance due to the IRS for quite some time now and the IRS has begun garnishing your wages.  The first thing the IRS is going to request from you is a completed financial disclosure statement, IRS form 433(A). 

If the IRS determines that you have the ability to repay the debt in full they will place you on an installment agreement.  The monthly payment amount will be determined by the amount you owe, the amount the IRS, the amount of time remaining before the debt expires, and determines you can afford.

Unfortunately this also means the IRS is going to expect you to full pay the debt owed, including penalties and interest.

If you do not have the ability to pay, you are possibly a good candidate for an offer in compromise.  The offer in compromise oftentimes takes a lot of effort to prepare and will take weeks for the IRS to acknowledge receipt.  Once the IRS has receipt of you offer all collection activity will be placed on hold, including wage garnishments.

For People Not in Compliance

The IRS is still going to request a completed 433(A) from you.  Based on the income on record at the IRS and possibly current pay stubs, the IRS may request an installment agreement while you are in the process of filing all necessary tax returns.  If you do not have the ability to pay the IRS may temporarily place you into non collectible status while you are preparing your missing tax returns.  While you are in non collectible status penalties and interest on your debt will continue to accrue. 

In most instances, when you file your missing tax returns and there is a balance due your case will fall out of non collectible status and into collections again. 

Strategies for Stopping Wage Garnishments Quickly

So back to the wage garnishment, the entire payroll department knows about it and among other problems you have, you are really embarrassed at work.  So how can this garnishment be stopped immediately? 

Go on a payment plan… even if you cannot afford to pay.  Sounds crazy right?  Here’s why.  First of all, the payment plan can be established within a couple of hours.  Once the payment plan is in place all other collection activity will stop.  Including wage garnishments.  Additionally, the first payment due on the installment agreement can be pushed out as far as 59 days. 

During that 59 days you and your tax professional can evaluate your overall financial situation and determine if you are eligible for an offer in compromise.  Get the paperwork submitted to the offer in compromise department before your first payment is due and the case will be put on hold while the offer is being reviewed.  This may take somewhere between 4-6 months.

Oftentimes, we are able to stop wage garnishments and get people offer in compromises before the IRS ever gets a penny.

If you are a non-filer, speak to a tax professional about the possibility of going into non collectible status while you file your returns.  Once you have filed, immediately request an installment agreement and follow the steps in the previous paragraphs.

For more information on wage garnishments visit the IRS website at www.irs.gov

Tax Resolution in Las Vegas

Has the constant pressure from the IRS just taking its toll on you and your family?  Remember, you are one phone call away from getting your tax resolution case started.  Call today and speak to a tax expert at Patriot Tax Professionals.

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Your tax resolution case will be handled by trained professionals 100% of the time because every employee at Patriot Tax Professionals is licensed and admitted to practice before the IRS.  Our employees have a formal education in taxes and have passed all required examinations to practice before the IRS?  What other tax resolution firm can make that claim? 

When you call Patriot Tax Professionals, you will never speak to a “salesman” that really doesn’t know anything about tax resolution or the inner-workings of the IRS  and will tell you anything you want to hear just to get your business.   You will have the assurance of knowing that every single person that handles your case is licensed with years of professional tax experience working on tax cases similar to yours. 

Now who would you rather have work on your case, a licensed professional or a slick talking salesperson?