Wage Levies: The IRS is taking my paycheck

The IRS is taking my paycheck


Before the IRS levied your wages, they sent you a final notice in the mail to your most recent address on file. While it’s possible you did not see that notice, it’s still important that you ask fast—because not reading registered mail will not prevent or stop a levy.

What is a Wage Levy?

A levy is the IRS’s legal authority to directly take your income or assets to pay off your IRS balance. If you have an unpaid tax debt that has been accruing for some time, the IRS will use that legal authority to levy your wages directly from your employer to pay your IRS balance off. The levy can claim your term salary, wages, bonuses, commissions, and other forms of payment.

It’s possible that if the IRS is garnishing your wages, they might have levied or are levying your bank account too. The IRS may not process the bank account levy until a day or two after your wage levy, but the IRS could levy it next.

What You Should Do if the IRS Is Garnishing Your Wages

  1. Call the IRS immediately, or better yet, have your tax professional call, and ask what caused the levy.

    Usually, the IRS garnishes wages and levies bank accounts when the taxpayer has a large unpaid tax balance. If this amount is paid off in full, the IRS will release all levies on wages and bank accounts.

  2. Either pay off the debt in full, set up a payment plan, or request an immediate release of the levy due to financial hardship.

    For many taxpayers, paying off a large tax debt in full will bring financial crisis to individuals and families. Through pay stubs, bank statements, and copies of bills, the IRS can determine whether paying off the debt in full or remaining to have garnished wages will cause financial hardship. You can report these financial statements on the IRS Collection Information Statement (CIS) form. As there are a few different CIS forms (433-A, B, and F) the IRS will notify you which to use for your specific situation.

  3. Your tax professional will help you find payment plans and other alternative ways to resolve your tax debt without the IRS levying your wages.

Exempt Amounts from Levy Payment

In some cases, the IRS can pay you exempt amounts from your levied paycheck each pay period. An example of this is paying court ordered child support. Your employer should include child support in your exempt amount, but if they didn’t or forgot to, call the IRS and they will exempt the payment needed to pay child support. For more information on these specific cases, call Private Tax Solutions today to consult with a tax professional.

Tax Representation at Your Side

If you have more specific questions on your wage levy or to find other alternative ways to pay off your IRS balance, call Private Tax Solutions today to begin working on your case. Levies can be scary and emotionally taxing. Take control today and find the solution that works for you.