Previous Story
How to Take Control of your Money
If you are the subject of an IRS wage levy, you know how crushing it can be. However, even if the IRS has started taking your money it’s not too late to get help from an accountant. It’s also not too late to talk to your bank and find out about any other IRS bank liens. If the IRS hasn’t come after you yet, but could, getting help now could save you from having to experience the full weight of their heavy hand.
How Levies Work
If you have unpaid taxes, the government has an almost unlimited right to collect them. They can levy your bank accounts and take out their entire balance, up to your total tax debt, as of the date of the levy. If you put more money in your bank account, such as through direct depositing a paycheck, they can file another levy and take that.
Even more seriously, the IRS can contact your employer and have them divert most of your paycheck right to paying down your tax balance. All that the IRS has to do is to leave you enough to cover what they say the average living expenses are for your area. If your expenses are higher than the IRS’s calculated area average, you won’t have enough to pay your bills. Needless to say, an IRS wage levy is a very serious matter.
Dealing With Levies
There are two ways to deal with in-place or pending levies. The first is to play games to avoid them. The second is to handle them.
You can avoid levies if you really want to. Instead of depositing money in the bank, keep it with you. You can also quit your job or work with your employer to reduce your salary to the point that you earn too little for the IRS to levy. If you change jobs frequently, the IRS might not ever catch up with you. Filing bankruptcy can also delay levies.
However, the best way to deal with levies is to get some professional help. Accountants usually stop IRS levies while they work out an arrangement. They might be able to negotiate an “offer in compromise” where you pay the IRS a fraction of what you owe. If you cannot qualify for this, they can help you set up an installment plan. This lets you pay the IRS over time and prevents them from placing an IRS wage levy or bank levy.
When you get help and confront your tax problem, you’ll find how easy it can be. After all, the IRS wants to make it easy for you to pay them.
Not a Solicitation for Legal Services.
Patrick Whalen is a writer who specializes in SEO. He has written for numerous web sites. Follow him at @2patwhalen.
