if i owe the irs over $4,000 dollars will they garnish my wages. i need to know before i start this new job.

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The IRS can garnish your wages and even remove money directly from a bank account in your name; work on a payment plan with the IRS prior to starting your new job.

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True, but a little more detail will help you I think. Yes, the IRS can garnish wages, but there are very strong, protective laws on the books that limit the amount of garnishment that ANY creditor can take. I believe the figure is 25% of disposable income, but I am not sure about that. But you'll still be able to live your life for sure.

Another thing is that the IRS is extremely unlikely to garnish your wages for $4000. It'll take them a year to act, in any case, once they learn of your new job. Once they do get in gear, they will probably proceed with more traditional collection methods like writing letters before proceeding to the heavy stuff.

Now, you really ultimately have to pay the money, but there is a procedure called an offer in compromise, where the IRS will accept less than the full sum if you can demonstrate that you don't have the means to pay it.

Those TV commercials that say "settle your IRS debt for pennies on the dollar!"? All they are is Offer In Compromise mills that churn out dozens of OIC's in a week...

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I just got audited for the first time but it happened in 2003 and i didn't know i got audited until December 2008. They said they couldn't find me but yet i have being doing my taxes every since i moved. But yet they still charged me for 5 years worth of interest. Is that even right. My husband said there is nothing we can do about it.

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Offer in Compromise – Basis With Examples

The offer in compromise tops the list of American tax solutions.
There are three circumstances on the basis of which the IRS may approve the offer in compromise.


Collectability Doubt:
The IRS doubts the capacity of the taxpayer to ever pay the full amount that is quoted in the IRS notice now or in the future, not even through installments. With reference to tax relief USA, offer in compromise is a popular option.

Hypothetical example:
If the IRS tax debt is $30,000 and the monthly income of the taxpayer is just $2,000 there is hardly any possibility of the tax payer paying the tax debt.

Liability Doubt:
This option is about the assessment of tax liability being incorrect. Some of the major reasons for filing for liability doubt are as follows.
• There has been misinterpretation of the law
• The evidence with the taxpayer has not been taken into consideration
• The taxpayer has new proof for the wrong calculation of the total tax

Example:
If the tax payer is registered with the IRS to be drawing very high salary, but after some months is jobless, there is a high probability of the taxes being calculated on the basis of the earlier high salary(unless rectified). If there is no rectification there are chances of federal wage garnishment too. In this sort of cases there is doubt about the liability.

Effective IRS Tax Administration:
In this option the IRS has to be convinced that the collection of the IRS tax debt could inflict upon the tax payer very disastrous financial crisis. This is considered an exceptional case among all the grounds for IRS offer in compromise.

Example:
If the family has both the parents earning but the child is bed ridden with long term illness and is dependent it is highly probable that all the savings and the equity of the parents is being used at meeting the medical expenses. In these cases the IRS may decide the amount quoted in the notice to be unfair.

Hypothetical Example Of IRS Offer In Compromise

The following formula serves to be the basis of the IRS tax debt settlement through IRS offer in compromise.

Settlement Amount = Total equity in assets + disposable income of 60months

Calculation of Minimum Offer:
Disposable income = monthly income – monthly expenses
Disposable income for a month = $1000
Disposable income for 60 months = $60,000.
This means that the minimum offer is $60,000.

Calculation of equity in the assets:

House value = $300,000
The amount owed =$250,000
Equity=$50,000

Total offer that can be made = $60,000 +$50,000 = $110,000

If you owe less than $110,000 there is no need of IRS offer in compromise but if you owe double or more than double i.e. greater than equal to approximately $250,000 then the option of offer in compromise is the best.

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