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When it comes to eating a fancy dinner, a garnish can be the perfect compliment to an outstanding culinary delight. When it comes to your taxes, however, any type of garnishing is going to be very bad news.
That’s because the IRS has the power to garnish your wages in order to satisfy unpaid tax liabilities. In the financial context, a garnishment is a type of levy imposed on your wages in order to satisfy unpaid debts. The issuing authority, such as the IRS or the Florida Department of Revenue, will then be entitled to a portion of all the wages you earn until your debt is satisfied or some other arrangement is worked out in order to fulfill your liability.
Creditors may also be be able to fulfill your unpaid debts with a garnishment. However, creditors must obtain a court judgment in order to garnish your wages. The IRS, on the other hand, has the power to issue a garnishment on its own without court involvement in order to enforce the Internal Revenue Code and compel you to satisfy your unpaid tax liabilities.
Though it is not the first course of action the IRS will take against you, when it elects to do so, it will send the wage levy order to your employer. Your employer will provide you with a copy, and he or she will then be required by law to submit an obligatory portion of all your paychecks directly to the IRS.
There are limits on the amount of your wages that can be lawfully garnished. While state and federal law limits how much creditors and other entities may take from your paycheck, the Internal Revenue Code dictates how much the IRS must leave in your paycheck. This means that the IRS can garnish as much of your wages as they want, as long as they leave you with the required minimum.
The amount which the IRS must leave in your paycheck is intended to be enough for you to pay all necessary living expenses. It is based on your income tax filing status (Single, Head of Household, etc), the number of exemptions you claim (such as when you have dependent children), and how often you are paid (daily, bi-weekly, monthly, etc).
While the IRS may deem this amount to be enough to pay all of your necessary living expenses, you may disagree and feel that it is not enough to pay all of your monthly expenses. For examples of how much the IRS must leave in a paycheck following a wage garnishment in 2016, take a look at this helpful table.
The IRS normally only uses wage garnishments as a last resort when you continually refuse to pay your tax liabilities. If it occurs, a wage garnishment can be devastating to your finances and your way of life.
If the IRS is garnishing your wages, there are alternative options available. You will be able to have the levy released if you pay your tax liabilities, or you can work with an attorney to develop a payment plan such as an installment agreement. When the IRS is satisfied that a viable payment plan as been established or that your debt has been fulfilled, they will then release the garnishment.
If you are facing tax challenges like wage garnishments, and you are in need of knowledgeable support and guidance, please do not hesitate to contact the law office of Weisberg Kainen Mark today and let’s make a plan!
Weisberg Kainen Mark, PL
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