Wage Garnishment

An IRS wage garnishment is any equitable or legal procedure through which some portion of a person’s earnings is needed to be withheld by an employer for the payment of a debt. Most garnishments are made by court order.

Wage garnishment occurs when a court order directs an employer to withhold earnings of an individual for payment of a debt.  Wage garnishments are commonly used for the collection of past due debts, including:

  • Credit and Installment
  • Federal and State Taxes
  • Student Loans
  • Child Support and Alimony

Background of Wage Garnishment – If a debt goes ignored or unpaid, the courts could intervene by issuing a judgment needing your employer to withhold or “garnish” a portion of your wages to pay back the debt.  When wages are garnished, money is deducted from the debtor’s paycheck and sent to the creditor.  Garnishment is a legal remedy generally considered a collection tool of last resort.  In most states, the garnishment process can only be initiated by a court order.

Wages Garment

Wage Garnishment and Job Security – Under the Consumer Credit Protection Act, (CCPA) your employer cannot fire you for having a single debt garnished from your wages.  However, the Act does not prevent the employer from firing you after two or more debts are garnished separately.  If you believe you have been improperly discharged because of wage garnishments, contact the Department of Labor. You may be able to have your job reinstated. If the Department determines that your employer knowingly violated the law, civil and criminal charges may be pursued.


Prior to the IRS can levy or garnish the paycheck or wages of a taxpayer, they first must inform the taxpayer of such action by sending the taxpayer several letters. If you have received one of these letters, contact us quickly or hire an experienced IRS Tax Attorney at Defense Tax, so that we can start taking action on receiving the IRS wage garnishment or IRS wage levy released or stopped. The sooner you take action after receiving the letter, the easier it is to get their wage levy released.

Usually, the IRS will have the Notice of Intent sent to Levy Wages to the taxpayer first in an IRS-certified letter. The Notice of Intent to Levy Wages is the first of two letters that the taxpayer will get before having their paycheck or wages garnished by the IRS. If the taxpayer doesn’t take action on the very first letter, a second letter will be followed up by the IRS which is the final notice of intent to final wages.  This letter needs fast action from you since it’s the final notice prior to the IRS will attempt to garnish your paycheck. This Final Notice of Intent to Levy Wages notification has in it a mechanism that lets the IRS wage levy or IRS wage garnishment be halted. But there’s a tight deadline related to the action so a taxpayer who gets this final notice letter couldn’t delay taking action. Otherwise, the IRS certainly will garnish your paycheck.

Many taxpayers ignore the letters sent to them by the IRS notifying them of the IRS wage garnishment or IRS wage levy. When these IRS letters are being ignored & no action’s taken after getting them, unfortunately, the taxpayer finds out that their paycheck or wages will be garnished by the IRS directly from their employer. When the issue reaches this point, the taxpayer’s only a few days away from having their paycheck or wages seized by the IRS. If an employer informs you that they’ve received a wage garnishment from the IRS, from the employer, it’s important to get a copy of the wage levy in order for you to complete the forms in order to lessen the amount of funds that the IRS will attempt to garnish from your paycheck.

The good news is that an IRS wage garnishment or IRS wage levy can be stopped or lifted if it happens. It isn’t automatic and it requires some work, but it can be done if action is taken by the taxpayer. One of the major obstacles to obtaining an IRS wage levy stopped or IRS wage garnishment is having tax returns that are un-filed. The IRS commands that taxpayers be in tax compliance with their tax returns before they’ll think about lifting the wage garnishment. Tax returns need to be up to date for all un-filed tax years.

In the unfortunate event that the wage garnishment gets to your employer prior to it can be prevented, you should most certainly fill out the wage garnishment form that your employer is required to give you. If a taxpayer doesn’t have the IRS wage garnishment form filled out, after that the IRS will take a bigger amount of your paycheck. The form follows a garnishment scale in order for a taxpayer with dependants or a spouse to have less amount of money garnished from their paycheck than one person who doesn’t have dependants or a spouse. Often, the amount of money that the IRS can take from the paycheck of an employee with the IRS wage garnishment could be up to two-thirds of the paycheck. With the IRS garnishing, it can cause financial hardship for you, so contact a tax professional to help you avoid the problem or to help solve it for you if the levy or garnishment’s already in motion.

Suggested Read: Wages garnished is a stressful and financially debilitating experience

IRS Garnishment of Wages

Stopping Wage Garnishment By Filing Bankruptcy

Garnishment Amount –

Only a certain percentage of wages can be withheld.  Employers first apply deductions that are legally required to be paid by the employee, such as federal, state and local taxes, unemployment insurance, and Social Security payments. The remaining amount is called disposable income.  The law protects employees by limiting the amount that may be garnished to 25 percent of disposable earnings in any pay period.  This limit applies no matter how many garnishment orders an employer gets.  There are some exceptions depending on the type of debt.  For example, the law allows a greater percentage of the wages of an employee to be garnished for bankruptcy, child support or state or federal tax payments.

How much can the IRS Garnish? See the detailed chart here.

As with any legal situation, it is best to consult a qualified IRS tax attorney to determine your best options. In order for a creditor to receive a judgment, which can be used to issue a wage garnishment order, it must be issued by a court. Legally, the creditor must inform you that you are being sued and provide you with the court date so that you can appear in court or send in the required paperwork to defend your side of the case. If you were not properly informed of the court date, our attorney will be able to have the court stop the garnishment.

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