Larson Tax Relief: Prevent or Reverse Bank Levies and Wage Garnishments

About Larson Tax Relief

Larson Tax Relief has been specializing in providing solutions for state and federal tax issues for over 16 years, with awards and an A+ Better Business Bureau rating to show for it. The firm is family-owned and operated, and boasts an experienced team of 65 employees, 17 of whom have undergone the training and examinations required to become IRS Enrolled Agents.

Among those agents is company president Jack Larson, who is a member of both the National Association of Enrolled Agents and the National Association of Tax Professionals.

Wage Garnishments

If tax authorities garnish your wages, it can have a massive impact on your paychecks. Tax debt is only one cause, as garnishments can be used for other debts like medical bills, student loans, child support, and alimony.

What Is Wage Garnishment?

Wage garnishments are when a tax authority demands the full amount or a portion of your paycheck to be applied directly to your tax debt. This aggressive collection action is generally taken when the tax authority feels that you are especially far behind on your obligations. Garnishments are done directly through your employer, who is legally required to comply.

You will receive advance notice of a tax authority’s intent to garnish your wages. Generally, you are given 30 days to pay your balance in full before the garnishment goes into effect. Along with wage garnishment, tax authorities tend to also consider taking money directly from your bank accounts as well, in the form of a levy. These collection actions continue until either the debt is paid or other terms are negotiated.

How Much of Your Wages Can Be Garnished?

Although it does depend on the specific tax authority, the IRS and many states may garnish up to the entirety of your post-tax income.

Types of Garnishments

The IRS and the State can garnish W2 employees’ paychecks, self-employed taxpayers’ (1099) income, or businesses’ receivables. Garnishment of a bank account is referred to as a “bank levy.”

How to Prevent or Stop Wage Garnishments

A professional that specializes in tax law is your best bet for addressing wage garnishment. The experts at Larson Tax Relief can give you a free consultation, in which your situation will be evaluated and your best options for halting or reversing the garnishment will be explained.

Tax Levy

If you are behind on your taxes, the IRS or State can place levies on your checking, savings and retirement accounts. Multiple levies can be issued at a time.

What Is a Bank Levy?

Bank levies aren’t complicated: they involve seizing funds directly from your bank account, and applying them to your tax debt. Before levying funds, government tax authorities generally make a reasonable attempt at informing you of their intent, usually by mail. A lien may also be filed.

Additionally, the IRS or State may also seek to resolve your debt by:

  • Seizing property
  • Garnishing wages or social security income
  • Levying earned commissions, self-employment income, rental income, retirement accounts, or accounts receivable (in the case of businesses)

How Often Can the IRS or a Creditor Levy Your Bank Account?

There is no limit on the frequency or volume of levies you can receive. That said, you can make formal arrangements with the issuing authority. If you do so quickly, funds may be returned to the appropriate accounts, and it may prevent additional levies in the future.

How Long Does a Levy Stay on Your Bank Account?

While levies freeze the balance of the account to which they’re applied, they have a one-time effect on the funds therein. If you make deposits into a levied account after the date of the levy, they generally won’t be affected. But they can be affected if another levy is issued.

To give you time to reach a resolution, funds levied by the IRS are held by your bank for 21 days before being applied to your tax debt. If a resolution is reached, all or part of the levied funds may be returned. However, that window can be as small as 7-10 days for funds levied by the State.

How to Prevent or Stop a Bank Levy

If you need help with a bank levy, consider getting in touch with us. We can slow down or prevent additional collection actions, and give you time to reach a reasonable solution for your situation. Because of the windows described above, you’re more likely to get a levy released the sooner you get help.

Other Services Larson Tax Relief Can Provide

Our expertise goes far beyond just tax levies. Depending on your situation, we can also help you reach:

About Larson Tax Relief

Larson Tax Relief is a family-owned and operated tax resolution company that’s been helping individuals and businesses around the US since 2004. With an A+ rating from the Better Business Bureau, Larson is comprised of 65 employees, including 17 federally licensed IRS Enrolled Agents.

One of those agents is Larson co-founder and company president Jack Larson, who is a member of both the National Association of Enrolled Agents and the National Association of Tax Professionals.

To learn more, or to get a free evaluation of your situation call us today at 888-589-0955 or fill out our online form below.

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