One of its most effective tools the IRS has for the enforcement of tax payment is wage garnishment. Ben Franklin is noted as saying, “an ounce of prevention is worth a pound of cure” and that advice holds true here – it is always better to prevent an IRS garnishment before it starts. But even if the garnishment is in place, there are steps that a tax attorney can take to put an end to it.
IRS collection power through wage garnishment
Most wage garnishments require a court order and can only take a limited portion of a paycheck – but tax debts are one of the few exceptions. The IRS, for example, does not need to obtain a court ruling to begin collection actions against a debtor. It can also take more of a paycheck than private creditors – it only needs to leave the debtor with a requisite amount according to a federal exemption table. Many individuals will not find this amount sufficient for basic living.
Prevent or end an IRS wage garnishment
There are many possible options to prevent or end a tax garnishment, but these approaches are best made with the help of a tax professional.
- A monthly installment plan – This lets the debtor pay the taxes over time while remaining in good standing with the IRS. The requirements and effects will vary depending on the amount of the debt.
- Offer in compromise – The debtor makes an offer to the IRS to settle the debt for less than full value when they cannot pay the full value of the debt within a reasonable time. These are difficult to obtain but working with a knowledgeable tax professional can increase chances of success.
- Establish financial hardship – The debtor may be able to establish that repaying the tax debt would create undue financial strain. This process is very document-intensive and difficult to obtain.
Wage garnishment can be time-consuming and expensive for the IRS to enforce so it is often more willing to be flexible on the options before the garnishment is in effect. If you receive debt collection notification from the IRS, speak with a tax attorney as soon as possible in order to preserve your options.
Effects of wage garnishment
An IRS wage garnishment can leave little money left over for basic expenses. However, working with an experienced tax attorney can improve the likelihood of reaching a workable solution with the IRS. Let the Maryland-based tax law firm of Rosenberg Martin Greenberg handle the legal complications surrounding your wage garnishment. We can help raise any and all potential defenses, apply for applicable abatements, and explore other relief that may affect the amount currently being withheld from your paycheck along with a way to expeditiously resolve your situation.
Additional IRS wage garnishment resources:
- United States Bankruptcy Court for the District of Maryland, Maryland Rules Rule 3-646 Garnishment of Wages, http://www.mdb.uscourts.gov/sites/default/files/Maryland%20Rules%20Garnishment%20of%20Wages.pdf
- IRS, Information About Wage Levies, https://www.irs.gov/businesses/small-businesses-self-employed/information-about-wage-levies