The Wage Garnishment: The IRS Doesn’t Care About You or How You're Going to Pay Your Bills
The IRS is an asshole.
It’s Friday and it's payday and you look at your bank account expecting to see all the money you need for the next two weeks but instead you see that your paycheck is A LOT smaller than it should be.
The IRS took your money before you even had a chance to do something about it.
This scenario is a real possibility for taxpayers with IRS tax debt.
Let’s talk about it.
Introducing The Wage Garnishment
A wage garnishment, also known as a wage levy, is an aggressive tactic the IRS and state tax authorities use to collect unpaid taxes. When it happens, you’ve lost all control over your financial situation.
The IRS has little regard for the impact it’s about to have on your life.
Why the Wage Garnishment is the Worst
A wage garnishment is a massive financial hit, a total loss of control over your money and a clear message from the IRS that they’re done messing around. This isn’t just a problem for individuals—it also cripples businesses, leaving owners scrambling to cover payroll, vendors, and at the end of the day, to keep the doors open.
The Problem:
When you're hit with a wage garnishment, it seems like it comes out of nowhere. It hasn't, of course, and you’ve received multiple letters about it, but it always seems like it. When you’re living check to check, a wage garnishment is devastating.
How Most People React:
Most people react in panic.
They call the IRS even hough they have no idea what they're doing, what they qualify for, or how not to get screwed. Even so, they willingly put their trust in the friendly neighborhood IRS.
Because of course, the IRS is looking out for the taxpayer's best interests! The IRS will always do what’s best for you as the taxpayer…right?
Others take out high-interest loans to pay off the debt as quickly as possible, which puts them in a worse position than they were in before. But hey, at least the IRS situation is “under control.” Others ultimately turn to tax professionals, but only after they’ve already made things worse by trying to go it alone.
These approaches are understandable.
You’re shocked, panicked, and don’t know what to do. The problem is that these panicked decisions are terrible decisions, which lead to an even more devastating situation than the wage garnishment.
The IRS isn’t interested in making your life easier—they’re focused on getting their money as fast as possible, and they don’t care about your rent.
Why Your Panicked Decisions Are Terrible:
The problem with reacting in a total panic is that the decisions are reactive instead of proactive.
Calling the IRS without a clear strategy is always a bad idea.
Hastily setting up a payment plan might provide temporary relief, but without a full understanding of your financial situation and the IRS’s procedures, you could end up committing to a resolution that you can’t sustain. You very well may sign up to pay more than you need to.
I Do It Differently:
Over a decade plus, I’ve developed a systematic approach to dealing with the wage garnishment that puts the power back in your hands as the taxpayer.
Immediate Intervention: Take immediate action to stop the garnishment, even if it’s only temporary but do understand the consequences. Once the garnishment is stopped, it gives you time to evaluate the situation and develop a comprehensive plan without the IRS concurrently draining your income and sending you into a full-blown psychiatric meltdown.
Negotiate from a Position of Strength: Negotiating with the IRS is not for the faint of heart. The IRS is the most powerful collections company in the world, and once they’re taking your money, it’s hard to get them to stop.
You can’t come to the negotiating table knowing nothing about IRS administrative law and procedures or a clear picture of the effect your financial situation has on the outcome.
Negotiate from a position of strength.
Make sure you agree to something you can actually afford and that you’re paying the least amount of money possible.
3. Comprehensively Review Your Finances Before You Do Anything: No two tax cases are alike. Don’t let anyone tell you otherwise. Understanding your personal finances is the key to resolving tax debt cases so that you get the best deal and don’t hurt your finances in the process.
Conduct a thorough analysis of your financial situation before you do anything else.
This isn’t just about looking at your income and expenses—it’s a complicated review using your finances but also taking into account IRS procedures and standards to make sure to show the least amount of income required and the most amount of expenses.
Your financial picture is key to negotiations. Anyone who hasn’t reviewed your finances and tells you how to resolve your case is full of it.
You must conduct a thorough financial analysis before agreeing to anything.
4. Resolve Your Tax Debt for the Long Haul: It’s great to get the wage garnishment resolved but if you're going to run into this problem again and again, who cares.
Stopping the garnishment is just the start.
Your goal should be to resolve your tax debt so you’ll never find yourself in this situation again.
The key here is sustainability.
You don’t just want to get out of the immediate crisis—you want to set yourself up for the future.
Action Steps: Here’s What to Do When You’re Facing a Wage Garnishment:
Act Fast: The sooner you act, the more options you’ll have. The longer you wait, the more damage the IRS will do.
Don’t Go It Alone: You don’t know what you don’t know. The IRS will not protect yourself or give you the best deal. In fact, they’ll withhold that information, either on purpose or because they don’t know what the hell they’re doing (most of them).
Understand Your Rights and Your Options: I repeat, you don’t know what you don’t know. The IRS will not help you. They're not required to nor do they want to. They want your money and they want it quickly, whether or not it serves you well. Knowing your rights will prevent the IRS from overstepping the power they're given and give you (some) leverage in negotiations.
Fix the Underlying Problem: Fix whatever created the tax debt that led to the garnishment so that it doesn’t happen again.
Why My Approach Works:
My approach to handling wage garnishment is built on over a decade of experience, and a deep understanding of the IRS’s inner workings.
It’s not about quick fixes or temporary relief—it revolves around a comprehensive, strategic approach that puts you in control.
By acting quickly, negotiating from a position of strength, and developing a long-term plan, you won’t just survive your tax issues—it will allow you to focus on what really matters: living your life without the constant threat of IRS action hanging over your head.
TL;DR (Too Long; Didn’t Read):
The IRS doesn’t care about you. A wage garnishment will leave you without money to pay your bills and backed into a corner.
Reacting out of panic rarely leads to an effective resolution.
A proactive, informed approach is essential in agreeing to a resolution you can actually afford and paying the least amount of money.
Don’t mess around. Take immediate action but come up with a long-term plan to fix the problems that created this mess.
As always, hank you for reading my weekly newsletter, Resolving Tax Debt.
I love that you support me and it does not go unnoticed.
BTW: Have you or one of your clients had your/their wages garnished before?
How’d that go? How did was it resolved?
Share your thoughts in the comments so we can commiserate together but also so we can learn from one another, one depressing wage garnishment story after another.
