How to stop an IRS wage garnishment

1How an IRS wage levy works

"Wage garnishment" is the common name; the IRS calls it a wage levy. Before it can levy your wages, the IRS generally has to send you a final notice (an LT11, Letter 1058 or CP90) and wait 30 days.

After that, the IRS sends a levy notice to your employer. Your employer is legally required to send part of each paycheck to the IRS. Unlike a bank levy, which is a one-time seizure, a wage levy is continuous: it applies to every paycheck until it's released.

2How much of your paycheck the IRS can take

The IRS doesn't take a fixed percentage. Instead, you keep an exempt amount based on the standard deduction for your filing status and the number of dependents you claim, and everything above it can go to the IRS.

Your employer gives you a statement to fill out listing your filing status and dependents, and uses IRS Publication 1494 to work out the exempt amount. For many people, the exempt amount is far less than their take-home pay, so a wage levy can take most of the check.

3Five ways to stop it

1. Set up a payment plan. Once you're on an installment agreement, the IRS will generally release the wage levy. See how IRS payment plans work.
2. Show economic hardship. If the levy leaves you unable to pay basic living expenses like rent, food and utilities, the IRS is required to release it. You'll need to document your income and expenses, and your account may be placed in "currently not collectible" status.
3. Submit an offer in compromise. While an offer is being considered, the IRS generally doesn't start new levies, though it may not release one already in place. This only makes sense if you're a realistic candidate for settlement.
4. Pay the balance in full. The IRS must release the levy once the debt is paid.
5. Appeal. If the IRS made a mistake, or you weren't given proper notice, you can appeal through the Collection Appeals Program, or through a hearing if you're still within the deadline on your final notice.

4How fast a levy can be released

Once the IRS agrees to release a levy, it sends a release notice to your employer. Depending on your employer's payroll timing, you may still lose one more paycheck. That's why it's worth starting the moment you learn about the levy, and why a professional who can contact the IRS directly often gets it released faster.

Money already taken generally isn't returned, unless the levy was wrongful or there's another specific reason the IRS agrees to give it back.

5If the levy hasn't started yet

If you've received a final notice but your wages haven't been levied yet, you're in a much stronger position. Requesting a Collection Due Process hearing within 30 days of the notice generally stops the IRS from levying while your case is reviewed. Read about the LT11 final notice and CP90 final notice.

Common questions

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