According to a recent survey, about 20% of Americans dealing with tax debts report being “extremely” stressed about their situations. Many know they’re going to struggle to pay the Internal Revenue Service what they owe, and they aren’t sure what to do about it. Some of those facing tax debts worry about facing an IRS tax levy, while others wonder, “Can the IRS garnish Social Security payments?”
Unfortunately, the answer to this question is “Yes.” This can complicate a person’s financial situation even further when they have a delinquent tax liability.
Has the IRS started garnishing your Social Security payments and put you in a precarious financial position? Find out what you should do below.
People are often surprised to hear the answer to the question, “Can the IRS garnish Social Security payments?” Private creditors aren’t allowed to garnish Social Security payments, so some Americans assume the IRS can’t do it, either.
However, Title II of the Social Security Act and Section 6331 of the IRS Code lay out the only exemptions that exist when it comes to tax liability. Neither prohibits the IRS from garnishing Social Security payments.
Instead, they enable the IRS to garnish up to 15% of a person’s Social Security payments through the automated Federal Payment Levy Program. The IRS can also use a manual levy, which could end up being even worse for tax debtors. In this case, the IRS will typically leave you with just enough to cover your living expenses and garnish any Social Security payments beyond that.
If the IRS advises you of a tax debt and warns that you may face a levy if you don’t pay it, don’t ignore the agency’s warnings. This could lead to the IRS garnishing Social Security payments as well as cash and other assets.
Rather than turning a blind eye to your IRS tax debt, look at your finances to see if you can afford to pay it all off at once. By paying the IRS what you owe, you can stop the agency from garnishing your Social Security payments and more.
This might not serve as an option for everyone. But if you can pay off IRS tax debt, you can prevent further garnishment attempts and steer clear of interest and additional penalties you might have to pay.
Do you know you can’t afford to pay off your entire IRS tax debt right now? There is another option you can pursue so that you don’t have to wonder, “Can the IRS garnish Social Security payments?” anymore.
You can work out an alternate arrangement to start repaying the IRS without facing further garnishment attempts. For example, you can set up an installment payment plan with the IRS or even a more advantageous Partial Payment Installment Agreement that can reduce your tax liability.
Despite the reputation the IRS has earned for being unwilling to budge on tax debts, the agency is usually open to negotiating payment plans with Americans in exchange for stopping further garnishment attempts.
Do you have an IRS tax debt hanging over your head that’s causing you to wonder, “Can the IRS garnish Social Security payments?” Levy & Associates can help you come up with a solution to your tax troubles. Call us at 313-447-1704 or fill out this form to start the process.
Levy & Associates is available for free initial consultations. We’re happy to answer any questions you have about the audit process or address any concerns about your specific situation.
There’s never a good time to be audited, and the time-consuming process will take away from your business or family if you try to face it alone. Let us handle and coordinate communication, so you can return to your daily life.