Bankruptcy and IRS Wage Garnishment
When you are behind on your debts, but are still bringing in a regular income, it is possible that the Internal Revenue Service can use the law to garnish your wages.
If you have received several letters from the IRS about back taxes, you may be in danger of tax induced wage garnishment. While there is little that you can do personally to stop the IRS, there is one potent step you can take that could save you money and time in court. By filing for bankruptcy protection, you may be able to stop a tax levy for the duration of your bankruptcy case. Of course, as with any legal process, you'll want to have a South Texas bankruptcy lawyer overseeing your case.
Whether the IRS has already started garnishing your wages or has threatened to do so, once you have successfully filed for bankruptcy, an automatic stay will be put in place on your account. This means that the IRS, along with any other creditors listed on your bankruptcy filing, must stop trying to collect from you.
In the case of the IRS, the agency must stop garnishing your wages until you have either completed the bankruptcy (at which point the remaining debts could be dismissed) or you miss a bankruptcy payment. Should you fail to make a bankruptcy payment, you could lose your bankruptcy protection, thus allowing the IRS to resume wage garnishment.
Have additional questions about bankruptcy and
wage garnishment via the IRS? Don't wait to
contact the Malaise Law Firm to enlist the help and resources of our bankruptcy attorneys.