A wage garnishment is when the IRS or state taxing authority enforces collection action on a taxpayer who owes back taxes. Garnishments are aggressive and can be devastating to the taxpayer whose wages are being garnished. There are very few restrictions on wage garnishment once one has been ordered. The IRS will garnish your wages until the full amount of your debt is cleared, often leaving you with very little of your paycheck for other expenses.
If you have been notified of a state tax wage garnishment, contact Key Tax Group immediately. Our professional tax specialists have more than 35 years of combined experienced, and the knowledge needed to effectively work on your behalf.
More about state and IRS wage garnishments.
If your wages are subject to garnishment because of outstanding tax debt, it is critical to establish a resolution before a garnishment is in place, especially if your debt is owed to the state. If the garnishment is the result of federal taxes owed, it can be stopped or changed, but in the case of state taxes, once a state garnishment is in place, it will not be lifted until your debt is paid or it expires. Depending upon the state, up to 40 percent of your gross income can be garnished. And when a garnishment is in place, the only hope is to petition for a reduction of 10 to 12.5 percent by submitting your financials.
Under federal law, the IRS is allowed to take the following percentages from your wages until your debt is fully paid:
- If you have a W-2, the IRS can take all of your wages except for $197 a week
- If you have 1099 income, the IRS can take 100% of your earnings, without leaving you anything
- If you are currently receiving Social Security income, the government will take up to 15% of your check
A wage garnishment can occur for several reasons. The most common causes of garnishment include:
- Failure to respond to the IRS in a timely fashion
- Failure to file tax returns
- Owing debt each year and not making the necessary adjustments needed in order to prevent new debts from being created
Contact the tax specialists at Key Tax Group for your tax solution.
Whatever the reason for your garnishment, taking immediate action can help ensure that more of your hard-earned wages end up in your bank account and not in IRS coffers. By contacting the tax specialists at Key Tax Group at the first indication of garnishment, we can quickly assess your tax situation and develop a plan of action.
If your wages are at risk of garnishment or you would like more information on how we can help with wage garnishment, contact our office today for your free initial consultation.