The amount of garnishment may vary, but the IRS has the ability to collect everything someone earns beyond minimum wage.
Again, a garnishment is not done to put someone in an impossible situation but rather to “wake them up” so that they may negotiate a more reasonable solution. 3 rd party levies are served upon clients and others that pay non-employees.
Typically, these levies apply to self-employed individuals. A third-party levy is the most burdensome in that the payer is required to remit to the taxing agency, 100% of the amount they owe the delinquent taxpayer until the tax debt is paid in full. Like the other collection tools, this is used to force the taxpayer into addressing their problem and not to collect the entire debt. In each case referenced above, you are better off entering into a manageable agreement, rather than worrying about active collection or even worse, waking up one day to find out your money has been taken.
It takes years of experience to be able to negotiate releases of garnishments and levies. For this reason, we recommend you preemptively address your tax matters. If by chance that ship has sailed, you can always contact the taxing agencies to request a release. Below is a list of points to consider when doing so Things to Consider When Requesting a Levy/Garnishment Release.
1. Don’t just ask for your money back. Provide valid reason/s why you need it. It is important to be specific here. You should list specific expenses that are due very soon and that you will not be able to pay if your funds are compromised.
2. The most effective reason to request a release is hardship. If you can prove that you are unable to pay your necessary and reasonable expenses, you may be able to have some or all of your funds returned to you
3. If possible try and calculate a reason installment agreement amount (see Installment Agreements below) and have backup to support your number. If you can enter into an agreement, sometimes you can also obtain a release
5. Request that a 2nd copy of the release be sent to you directly. If you are successful in request a release, you should follow up with the person or department to which the levy/garnishment was served to verify (1) they received the release and (2) that they are not going to remit funds to the tax agencies. If by chance they have not received the release, you can fax them a copy yourself assuming you have a one.
6. Don’t wait until the last minute. It often takes more than one call to have a levy or garnishment released. If the IRS requires documentation you don’t have ready, you may have blown your chance if the funds are to be remitted in a day or two. Remember you only have 21 days for the IRS and sometimes less for your State to request that a levy be released.