Comprehending U.S. Government’s IRS Tax Liens and Wage Garnishment
The IRS or Internal Revenue Service of theUnited Statesgovernment regularly files IRS tax lien against U.S residents who have not paid their taxes. A tax lien is filed with the county government where the taxpayer resides. A tax lien comes into effect once the IRS evaluates your liability and informs you about the payment and you neglect to pay the amount in time.
Effects of a Lien-
A tax levy is different from a lien. The IRS collects taxes from unpaid taxpayers through a levy or lien. When you don’t pay your taxes in time, theU.S.government files a lien thus having a legal claim on your property. A levy on the other hand is the actual seizure of your property.
A tax lien affects you financially; therefore, it’s important to take steps to avoid a lien.
- With a tax lien is slapped on you, it becomes difficult to receive a credit for purchasing a car or a house. This means you cannot have any asset with your name on it.
- Your creditors and mortgage company will be informed about the lien.
- The IRS tax lien remains in place until the time the IRS can take move legally against you.
- If you are not able to clear your tax debts, the IRS will begin to seize your assets.
- Even after the release of the lien, your financial history will hinder you from borrowing.
IRS Wage Garnishment-
It is the court that orders an IRS wage garnishment against an employee who does not pay his tax debts. By this order, your employer can withhold a part of your salary for repaying the debt. The IRS gives you enough warnings about the payment of tax. When several options don’t work, the IRS adopts the garnishment method in order to make the debtor pay his taxes.
The IRS will take most of your salary leaving a small amount for your monthly expenses. They will furnish your employer with a table and determines how much of wage levy should be imposed. Even if you work extra hours, you will only get a fixed take-home salary; the amount fixed by IRS.
Lift Wage Garnishment-
There are several ways by which you can lift wage garnishment. Firstly a good debt counsellor can advise you appropriately. Alternatively, you can contact the creditor and explain your difficulties or propose a repayment scheme. An attorney can assist you by negotiating with government organizations to reduce the penalties. Filing for a bankruptcy is the last resort. Eventually, there are tax professionals who can help you lift wage garnishment. It is good to contact tax professionals who will prepare all documentation and effectively negotiate with the IRS.
For more information about IRS tax lien and IRS garnishment, you may visit PerfectTaxRelief website.
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