How Long Until the IRS Garnishes Wages After a Notice?

The IRS can start garnishing your wages 30 days after sending you a Final Notice of Intent to Levy that also explains your right to appeal. However, before this notice, you will generally receive several other notices demanding payment. Although the exact timeline can vary, wage garnishment usually doesn’t happen until several months or even years after you have missed a tax payment. But there are a few exceptions to this rule.

Wage garnishment is perhaps one of the most financially devastating outcomes of failing to pay your taxes. Not only does the IRS have full legal authority to garnish your wages, they have much more leeway than other creditors. However, it’s important to note that the IRS doesn’t immediately go to wage garnishment when someone is behind on their taxes—they generally only choose a wage levy if they believe they have no other way to collect. 

By exploring other payment options and staying on top of your notices from the IRS, you can avoid wage garnishment. 

Why the IRS Garnishes Wages

The IRS has the legal right to try a wide range of collection actions when a taxpayer consistently fails to either pay their taxes, make a payment arrangement, or respond to IRS notices. 

Garnishing wages is often an effective option because it ensures that payments will come in regularly—usually, every two weeks or every month depending on your pay schedule—and that actual progress will be made on the tax debt. Furthermore, garnishing a taxpayer’s wages is a very effective way to get them to reach out and make alternative payment arrangements.

Is the IRS Legally Allowed to Garnish Wages?

The IRS is permitted to garnish wages when a taxpayer has failed to make tax payments. These same laws allow them to place liens on a taxpayer’s assets, seize their home or other personal property, and freeze their bank accounts. Employers are legally required to comply with federal wage garnishments. However, the Internal Revenue Code also requires that the IRS release a wage levy if certain circumstances are met.

The Path to Wage Garnishment

The IRS goes through a long process before garnishing a taxpayer’s wages. The reasons for this are twofold. First, they want to give people a chance to either pay their taxes in full or come up with a reasonable payment arrangement that doesn’t cause them financial hardship. Second, they are legally required to provide proper notice of wage garnishment to taxpayers before levying their income.

IRS Notices

You’ll receive several notices before the IRS actually garnishes your wages. These notices are generally sent every four to six weeks since each notice gives you 30 days to reply or make a payment. The IRS won’t send the next notice until you have missed the deadline on the prior one. These notices include:

• CP14 or CP501: You may receive one or both of these notices. The IRS sends these to inform you of your past-due tax debt and to provide you with your payment options.
• CP503: When the IRS sends CP503, they are officially reminding you that you owe them money and that you have not yet made payment arrangements. The stakes are a bit higher, as their next step will be levying your assets.
• CP504: Finally, if you ignore all other notices from the IRS, CP504 will arrive on your doorstep. This notice informs you that the IRS is preparing to levy your assets or place a lien on your property.
• Letter 1058 or LT11: This final warning is the last correspondence you will receive before the IRS moves forward with wage garnishment.

The Importance of Responding to Notices Promptly

Ideally, you’d respond to the very first notice you receive from the IRS. There are numerous payment options available to taxpayers who have fallen behind, but the IRS cannot force you to take one of these options—you have to apply for them and take action. The longer you wait to respond to correspondence from the IRS, the less time you have to avoid garnishment.

Wage Garnishment Timeline

Each of the notices you receive should come roughly five weeks after the previous one; as a result, the actual time from failure to pay taxes to wage garnishment is several months. 

However, the only timeline that legally matters is when you receive your Final Notice of Intent to Levy and Notice of Your Right to a Hearing. This notice starts the 30-day clock ticking. Once 30 days have passed from the date listed on this notice, the IRS is legally permitted to garnish your wages or seize other assets of yours.

Exceptions to the 30-Day Rule

The 30-day rule is strict, and in fact, one of the ways to reverse a levy is to prove that the IRS did not follow the 30-day rule before garnishing your wages. There are only a handful of exceptions to the 30-day requirement. 

If the IRS believes that their ability to collect the tax is in imminent jeopardy, they may garnish wages immediately without waiting 30 days. They may also bypass the 30-day rule if your case is related to disqualified employment tax levies.

When a Revenue Officer is Involved

Revenue Officers have the legal power and authority to collect taxes by garnishing wages, seizing assets, and freezing bank accounts. When a Revenue Officer is assigned to your case and involved in the collection of your past-due taxes, the timeline often moves a little more quickly than it otherwise would. You have even less leeway when it comes to setting up alternative payment arrangements.

How Much Can the IRS Garnish?

Most creditors have strict limits preventing them from garnishing too much. The IRS has much looser restrictions, meaning that they have a lot more freedom to take a sizable percentage of your earnings. The amount they can garnish is based on this chart from the IRS.

Calculating Your Exempt Amount

To calculate how much of your income you can keep and how much you can expect to lose, you start by finding your filing status: single, head of household, married filing jointly, or married filing separately. From there, you find your pay period on the corresponding chart and the number of dependents you claim on your taxes. 

This chart was last updated for 2024. A few examples can be found below for clarity:

• Single taxpayer with two dependents getting paid biweekly: Can keep $946.16 out of each paycheck
• Married taxpayer who files jointly and has one dependent while getting paid monthly: Can keep $2433.33 out of each paycheck.
• Single taxpayer with zero dependents, who gets paid weekly: Can keep $280.77 of their earnings each week.
• Head of household with two dependents, who gets paid semimonthly: Can keep $1329.16 of their paycheck.

The more you earn, the more of your income you can expect to lose to the IRS. While other creditors may be limited to taking a certain percentage of your discretionary income, the IRS tells you how much you get to keep and retains the authority to seize the rest. 

Other Payments That May Be Garnished

The amounts listed in the exempt amounts chart specify how much you get to keep each pay period. What happens if you get extra income above and beyond your regular paycheck? For example, you may receive a commission payout, a Christmas bonus, or overtime pay for extra hours. 

Unfortunately, the IRS’s authority allows them to seize those payments in their entirety. Those payments are in addition to what they are already allowed to garnish, so as long as they leave you the amount listed on the chart for your pay period, they can take anything extra you receive. If you have multiple jobs and the pay from one covers the exempt amount, the IRS could take all of the wages from your second job.

How to Prevent IRS Wage Garnishment

Given how much power the IRS has to garnish wages and leave you with a minimal amount to live on, avoiding wage garnishment should be a top priority if you are struggling with tax debt. Luckily, there are many ways you can protect your wages from the IRS.

Paying in Full

Obviously, paying your tax debt off in full is the quickest way to get a levy released and regain access to your full paychecks. This isn’t always an option for taxpayers, particularly if they have already dodged IRS correspondences for months.

Other Payment Arrangements

The IRS is also open to other payment arrangements, even if it means that they do not get paid immediately or that they do not necessarily get paid in full. Potential options to explore include:

• Installment agreement: If you are approved for an installment agreement, you pay your tax debt off over a period as long as 72 months. As long as you remain compliant by making payments on time, failing to accrue more unpaid tax debt, and responding to all IRS correspondences, this allows you to address your tax debt without risking garnishment.
• Offer in compromise: Some taxpayers, particularly those with limited income and assets, can settle their tax debt for less than they owe. It can be difficult to be approved for this option, as you have to provide extensive financial information to the IRS, but those who are approved can see a significant decrease in the amount they owe.
• Partial payment installment agreement: If you would like to pursue an installment agreement but cannot afford the minimum payment, a partial payment installment agreement could be a good fit. You pay the set amount until the Collection Statute Expiration Date, and at that point, the IRS stops attempting to collect the rest.
• Currently not collectible: Those who are temporarily financially struggling may qualify for currently not collectible status. The IRS can approve this status if you are completely unable to make any payments towards your tax debt. Note, though, that they will expect you to resume payments once they have determined that you are able to pay.

Stopping IRS Wage Garnishment

If you cannot get your levy released by coming to a payment arrangement or paying your taxes in full, you may be able to have the levy released if it is causing you immediate financial hardship. You will need to contact a tax attorney or the IRS directly to pursue this option. You’ll still owe the total amount, but the IRS will release the levy if you fulfill the requirements.

When to Talk to a Tax Pro

Depending on how many IRS notices you have received, it may be time to talk to a tax professional, explore your payment options, and get some professional guidance on your next steps. With so many payment plans and arrangements, it can be difficult to decide which best fits your ability to pay and your current tax situation. Even just claiming a free consultation with a tax pro can help you feel more empowered and give you the knowledge you need to make progress on your tax debt.

When you’re ready to address your tax problems and finally stop worrying about IRS wage garnishments and levies, the team at W Tax Group is here to help you. We know how mentally draining tax concerns can be, and we want to help you. Set up a time to meet with our team now by calling us at 877-500-4930 or sending us a message online.