If you owe thousands in tax debt to the IRS or state tax authorities, you may be wondering who to turn to for help. Learn what tax resolution professionals do.
Stopping a wage garnishment in the state of Michigan for taxes owed is a common issue for many Michigan residents. When a tax bill from the IRS or State of Michigan is unpaid or ignored, the IRS or State of Michigan Taxation agency can file a Wage Garnishment order, which requires a third-party wage provider to withhold some amount of wages as a means to repay a debt. The wage garnishment will stay in effect until the entirety of the tax debt is paid off, or the State of Michigan taxation agency or IRS agrees to a levy release.
Along with wage garnishments, the IRS or State of Michigan may levy other sources of income you may be receiving. This could include accounts receivable for self-employed workers, sub-contractor fees, commissions, brokerage and bank accounts in the form of bank levys, endowment contracts, and life insurance contracts. In some circumstances, the IRS or State of Michigan may levy payments from retirement plans, such as Social Security benefits or Veteran’s Pension benefits.
Effects of Wage Garnishments
Wage garnishments can be financially crippling to Michigan taxpayers, who may be already struggling to make ends meet. The sudden change in income can harm the financial situation of the individual as well as family members or people dependent on that source of income.
While it may not be possible to recover what you have already paid to the IRS or State of Michigan, there are typically actions that you can take to negotiate your wage garnishment or stop your wage garnishment from taking effect.
Option 1 – Pay the debt owed in full
Simply paying the amount owed to the IRS or State of Michigan will stop a wage garnishment from taking effect. The garnishee, or the person who owes money, typically is given 10 days to pay the debt in full after the court date. Following payment to the court clerk, you are given a receipt for the amount paid.
While this is an ideal option for stopping a wage garnishment, it is not always the most practical for large sums of money owed.
Option 2 – Negotiate a payment plan
Quite often you are able to create a payment plan that stops your wage garnishment while allowing you to pay off your debt at a regular amount that you can afford.
Lothamer can help you fight the IRS or State of Michigan for any tax related wage garnishment needs. We have years of experience in getting wage garnishments released and the working with you and the IRS or State of Michigan to resolve your tax problem.
Option 3 – Offer in Compromise
If you qualify, you may be able to dramatically reduce the total tax debt you owe through an Offer in Compromise negotiation. Through an Offer in Compromise program, you pay a single lump sum amount to settle your tax debt, after which all tax burdens are completely removed.
The State of Michigan and the IRS have strict guidelines on who can qualify for an Offer in Compromise. It is typically limited to those who are financially struggling and cannot pay off their tax debt.
If you do qualify for an Offer in Compromise, there is no question that you should pursue a settlement through the program. However, the time consuming and tedious process of preparing an Offer in Compromise settlement can be overwhelming for many people – particularly those who are experiencing financial hardships.
That’s why your chances of Offer in Compromise success is dramatically improved when you it is important to get professional help. At Lothamer, our Offer in Compromise success rate is over 90% and we have years of experience setting tax debts for our clients with the IRS and State of Michigan. Contact us at (877) 472-0021 or schedule an initial consultation.
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