Levy Assistance

Hood & Associates CPAs, PC

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May 15, 2024

When it comes to IRS levies, two of the most common types are wage garnishments and bank levies. Both can be incredibly detrimental to a taxpayer’s financial situation, leaving them with little or no disposable income to cover their living expenses. However, having representation from a tax attorney or enrolled agent can help protect the taxpayer from these severe consequences.

A wage garnishment or wage levy occurs when the IRS orders an employer to withhold a portion of an employee’s wages to satisfy a tax debt. The IRS can order an employer to withhold up to 25% of an employee’s disposable income, leaving them with very little to cover their expenses. A tax attorney or enrolled agent can help protect the taxpayer from wage garnishment by negotiating with the IRS to set up a payment plan or settle the debt for less than the full amount owed.

Similarly, a bank levy occurs when the IRS orders a bank to freeze the taxpayer’s bank account and withdraw funds to satisfy a tax debt. This can leave the taxpayer without access to their money, making it challenging to pay bills or cover living expenses. A tax attorney or enrolled agent can help protect the taxpayer from a bank levy by negotiating with the IRS to set up a payment plan or settle the debt for less than the full amount owed. Additionally, they can help the taxpayer prepare and file a Collection Due Process (CDP) request, which is a request for a hearing with the IRS to challenge the levy.

Having representation from a tax attorney or enrolled agent can also provide the taxpayer with peace of mind. Tax professionals understand the intricacies of tax law and can help the taxpayer navigate the complex process of dealing with the IRS. They can advise the taxpayer on their rights and options, prepare and file necessary paperwork, and represent the taxpayer in court if necessary. This can alleviate some of the stress and anxiety associated with dealing with the IRS and provide the taxpayer with a sense of security.

In conclusion, wage garnishments and bank levies can have severe consequences for a taxpayer’s financial situation. However, having representation from a tax attorney or enrolled agent can help protect the taxpayer from these consequences. They can negotiate with the IRS to set up a payment plan or settle the debt, help the taxpayer prepare and file necessary paperwork, and represent the taxpayer in court if necessary. If you are facing a wage garnishment or bank levy, it is essential to seek the advice and assistance of a qualified tax professional.