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Here are the three types of tax levies the IRS can institute: Wage levy: The government can garnish your wages to recover what you owe in taxes. After a wage levy is instituted, you might still ...
When you owe a tax debt, the IRS can seize your property to cover the debt. Available levies include your bank account, seizing assets and wage garnishment.
A levy in the form of garnishment upon wages is considered to be a continuous levy, i.e. it needs to be applied only once and will be applicable to future wages until either released by the IRS under §6343 or the debt is fully paid. So as future wages are earned, no additional levy action is necessary by the IRS to take a large portion from them.
Under U.S. federal tax law, a garnishment by the Internal Revenue Service (IRS) is a form of administrative levy. In the case of an IRS levy, no court order is required. [9] Only a few requirements must be met before the IRS starts a wage garnishment: The IRS must have assessed the tax and must have sent a written Notice and Demand for Payment;
For instance, the IRS can garnish your wages if you fail to pay your tax debts. Filing for bankruptcy can stop wage garnishment in many cases. However, there are some exceptions to this rule.
A wage garnishment is a court-ordered method of collecting overdue debts that require employers to withhold money from employee wages and then send it directly to the creditor. [13] Wage garnishments are post-tax deductions, meaning that these mandatory withholdings do not lower an employee's taxable income. [14]
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