Payroll Garnishment Facts and Solutions
Coming home with a substantial chunk of your paycheck missing is never an easy experience. It fills you with worry, hopelessness, and self-contempt. You wonder how your tax problems got to this point and what you can do to get your life back to normal. If you are experiencing a payroll garnishment, you need to take action! This page will help you to better understand your payroll garnishment and what you can do to stop it.
How Your Payroll Garnishment Happened If the payroll garnishment was imposed on a taxpayer without request, there are three steps that were made before the payroll garnishment happened.
- Once your debt was assessed at the IRS, a notice was sent to you requesting payment.
- No arrangements were made to pay your debt and a Final Notice of Intent to Levy was sent.
- Your employer was notified to begin a payroll garnishment, if you still didn't pay.
If you received nothing from the IRS yourself before the payroll garnishment, it is likely that the IRS has an old address on file for you that they have been sending all communication to. Generally, there are many letters sent by the IRS before a payroll garnishment is performed.
How to Stop Your Payroll GarnishmentIt's always easier to prevent a tax problem, but there are many ways you can get rid of an IRS payroll garnishment. The following three options are well known, but commonly misunderstood.
Offer in CompromiseFiling for an Offer in Compromise will temporarily stop all collection activities, including payroll garnishment, during the review process. However, it is not without risk. Review the following facts and consult a tax professional, before you attempt to use an Offer in Compromise to stop a payroll garnishment and disclose all of your financial information.
- You have to prove that you will never have the money to pay the debt.
- Or, you have to prove that your tax debt is incorrect or unjust.
- If you are approved, you will need to pay the negotiated amount within a few months.
- If you are not approved, the IRS may become even more aggressive.
Currently Not CollectibleAre you going through a difficult time financially, even without a payroll garnishment? You can enter into a Currently Not Collectible state to end a payroll garnishment. Understand a few points before you decide to use this to end one.
- It isn't called permanently not collectible. You will be reviewed every two years.
- If your income improves, you could become subject to another payroll garnishment.
- Your tax debt continues to grow with penalties and interest, during this time.
- Most people placed in this status will have a lien placed against their credit.
Installment AgreementThere are two types of installment agreements. If your tax debt is below $25,000, you can easily enter one without having to disclose your finances. This is often the fastest way to end a payroll garnishment. If your tax debt is higher or you can't afford the payment offered to you, you will need to disclose your finances to get in the right one for you. Entering into an Installment Agreement will immediately stop your payroll garnishment. However, there are a few points to remember about this as well.
- If you neglect to make timely payments or owe future debt, you will default the agreement.
- If you default an installment agreement, the IRS will go straight to collection actions.
- If your finances change, you will need to update your installment agreement.
For payroll garnishment help, consult a professional. Call now or fill out the form below for a free tax debt consultation on how to prevent or end any payroll garnishment! We'll only connect you with a tax debt relief company holding at least a B rating with the Better Business Bureau.