What Happens If Your Wages Are Being Garnished for IRS Tax Debt?

Seeing less money in your paycheck because of IRS tax debt can be frightening. But don't assume your only option is to live with it.

If the IRS has issued a levy against your wages, part of your paycheck may be sent to the IRS to satisfy your tax debt.

This is serious but it is also a situation where understanding what's happening matters.

What Is an IRS Wage Levy?

An IRS wage levy is a legal action that allows the IRS to collect unpaid taxes by taking a portion of your wages.

Unlike a one-time bank levy, a wage levy can generally continue with each paycheck until the levy is released, the tax debt is paid, or another circumstance ends the levy.

The amount that can be taken depends on IRS rules and your circumstances. Certain amounts of your wages are protected from the levy based on factors such as your filing status and number of dependents.

Why Would the IRS Levy Your Wages?

A wage levy generally doesn't happen without prior notice.

Before issuing a levy, the IRS generally must send you a Final Notice of Intent to Levy and Notice of Your Right to a Hearing at least 30 days before the levy, with certain exceptions.

That notice is important.

If you've received one, don't put it aside and hope the problem resolves itself.

The deadline in the notice may affect your rights and what options are available.

Can an IRS Wage Levy Be Released?

In some circumstances, yes.

The IRS says a levy may be released when certain conditions apply—for example, when the tax debt has been fully paid, the levy is creating an economic hardship, or an approved installment agreement or other arrangement makes the levy unnecessary.

That does not mean every wage levy can be released.

Your tax debt, financial situation, filing history, and other circumstances can all matter.

That's why it's important to understand your situation before assuming what will happen.

What Should You Do If Your Wages Are Being Levied?

Start by getting organized.

Gather:

• The IRS notices you've received

• Information about the tax years involved

• Your current IRS balance

• Recent pay stubs

• Information about your household and financial obligations

• Any payment arrangements you've already made with the IRS

You don't need to have everything perfectly organized before asking for help.

The goal is to understand what the IRS has done, why it happened, and what options may be available.

Don't Wait for the Problem to Get Bigger

If your paycheck is already being affected, this isn't something you want to ignore.

And if you've received a final notice warning that the IRS intends to levy your wages, you may have an opportunity to address the situation before the levy takes effect.

The sooner you understand where you stand, the sooner you can make an informed decision about what to do next.

Not Sure What to Do?

IRS collection issues can be difficult to navigate when you're already trying to keep up with work, family, and everyday expenses.

You don't have to figure out the entire process alone.

If you're dealing with an IRS wage levy or you've received a notice that one may be coming book a complimentary consultation.

We can talk through what's happening, identify the questions that need to be answered, and evaluate what options may be available based on your circumstances.

BOOK YOUR COMPLIMENTARY CONSULTATION

You don't have to know exactly what solution you need before you reach out.

You just need to know that something needs attention.