| Maybe you haven't paid taxes in years, perhaps you | | | | taxpayer's wages and pay it directly to the IRS. |
| were busy and simply forgot one year, possibly you | | | | - The employer is not allowed to refuse the wage |
| avoided paying taxes for financial or emotional | | | | garnishment. Should an employer refuse in garnishing |
| reasons. Whatever the reason, you are now | | | | an employee's wages, the employer can be held |
| threatened with an Internal Revenue Service (IRS) | | | | personally liable for money that was not received by |
| wage garnishment. Wage garnishment requires an | | | | the IRS. |
| employer to withhold part of a person's earning for the | | | | - Wage garnishments are taken out of payroll. There is |
| purpose of the person to pay off a debt. In addition to | | | | a particular order garnishments are taken out: first |
| the IRS, wage garnishment can also be issued by | | | | federal tax, then local tax, last other garnishments like |
| courts and federal agencies. Wages garnished can | | | | from credit cards. |
| include salaries, wages, bonuses and commissions as | | | | - An IRS wage garnishment will continue until the entire |
| well as retirement or pension earnings. | | | | tax debt is paid or other arrangement is made to pay |
| How Wage Garnishment Works | | | | off the tax debt. |
| - First, the IRS will send a Notice and Demand for | | | | How to Avoid Wage Garnishment |
| Payment. | | | | - Be sure to contact the IRS as soon as an Intent to |
| - If the taxpayer does not pay the tax or ignores the | | | | Levy or Notice of Levy letter is received. |
| notice, the IRS will send a Final Notice at least 30 days | | | | - Make an appointment with the IRS. Setting up an |
| before the wage garnishment. | | | | agreement with the IRS right away will most likely be |
| - The Final Notice may be served by the IRS in person, | | | | easier than dealing with the embarrassment of having |
| at the taxpayer's home or usual place of business, or | | | | your employer receive an "Order to Withhold Taxes" |
| the taxpayer's last known address by certified or | | | | letter from your wages. The financial burden placed |
| registered mail. The IRS is only required to send the | | | | upon you with a wage garnishment may also be |
| notice to the last address it knows for the recipient; the | | | | greater than if you just entered into an agreement with |
| taxpayer does not need to receive the notice in order | | | | the IRS to begin with. |
| for it to be valid. Because the IRS may not have a | | | | - Get a tax specialist involved. Tax professionals can |
| current address for some taxpayers (such as those | | | | contact the IRS to negotiate stopping a wage |
| who have not paid their taxes in a while), many | | | | garnishment. The next steps after getting a wage |
| taxpayers see their wages garnished without receiving | | | | garnishment is released is setting up a repayment plan |
| a notice. The notice will be on intent to garnish wages | | | | or getting an offer in compromise settlement. |
| and the recipient's right to a hearing. | | | | The best solution to avoiding the problems of wage |
| - By federal law, wage garnishments are restricted to | | | | garnishment is to pay taxes in full, on time and not |
| 25% of an employee's disposable income if employee | | | | have to worry about it in the first place. If you find |
| disposable earnings are more than 30 times the | | | | yourself facing wage garnishment, keep working until |
| federal minimum wage. Several states, however, have | | | | taxes are paid so you can sleep sound or seek the |
| a maximum garnishment level that is lower than 25%. | | | | counsel of a tax specialist who may be able to help |
| What Employers Should Know About Wage | | | | with getting the wage garnishment released and |
| Garnishment | | | | negotiating a repayment plan or getting an offer in |
| - A notice is sent to the taxpayer's employer, telling the | | | | compromise settlement. |
| employer to withhold a certain amount of the | | | | |