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By Michael S. Anderson of Anderson Tax Law logo for Arizona tax attorney Michael S. Anderson P.C.
  • Does the IRS have to leave me with a “livable wage” if it garnishes my paycheck?

    bigstock-Keep-Your-Head-Above-Water-44126563No, the IRS doesn’t have to leave you a livable wage.

    The IRS must only follow a table that determines how much money it must leave for you to live on each month.  See IRS Publication 1494.

    The amount that it must leave is small, and there are just 4 factors that play into the determination:

    • Whether you are married
    • The number of exemptions you should claim
    • Whether you are older than 65
    • Whether you are blind

    For example:

    If you are married filing a joint return and you get paid on a monthly basis, and take 2 exemptions, the IRS will leave you 1666.67 to live on.

    It won’t matter if you make $2000.00 per month or $20,000.00 per month, the IRS will leave you 1666.67 to live on each month until the debt is paid off or you do something else to deal with the debt like:

    a.              Arrange a payment plan or non-collectible status situation based on another set of budget     figures.

    b.              Propose an Offer in Compromise

    c.              File a Bankruptcy

    Obviously the IRS doesn’t use the IRS Publication 1494 to collect the debt.  It uses it to force you to do something about the debt.  If you have serious tax debt… and a levy has been threatened by the IRS, do something about it before your life becomes governed by Publication 1494.