Did you know the IRS can directly contact your employer to collect compensation for taxes? When the IRS issues a levy on wages it orders your employer to withhold a specific portion of your wages to satisfy a debt you owe. Your employer is then required by law to send a significant portion of each of your paychecks directly to the IRS to offset the debt.
Until you make other arrangements or until the amount of taxes owed is paid, part of your wages will be sent to the IRS each pay period to pay back overdue taxes.
Wage garnishment provisions of the Consumer Credit Protection Act (CCPA) limits the amount of an employee’s earnings that can be garnished per paycheck. The CCPA also protect employees from discharge by their employers due to having their wages garnished for any one debt.
Even with these provisions, wage garnishment can still be detrimental to your finances. Our tax experts never advise any taxpayer to take on the IRS and wage garnishment on their own. However, if you do nothing, the IRS will continue to garnish your wages until the back taxes are paid back in full.
At Tax Pros Plus, we can work with the IRS to end or significantly reduce the wage garnishment if you qualify for release. Depending on the situation, we may be able to set up an Installment Agreement with the IRS where you pay back a specific dollar amount every month until the tax is paid.
Once the Installment Agreement is in place you may qualify for the Offer in Compromise program through the IRS. An Offer in Compromise is an agreement between the taxpayer and the IRS that allows the taxpayer to pay back the debt for less than what is actually owed. Depending on your individual financial circumstances, we might also be able to set you up in a Currently Not Collectible status meaning you may not have to make payments to the IRS at all.
If you receive a letter from the IRS stating they are going to garnish your wages, contact Tax Pros Plus immediately. Our Enrolled Agents have years of experience dealing with the IRS. You can face the IRS with confidence when you have the Tax Experts from Tax Pros Plus on your side!