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Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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My significant other has been battling with the IRS for several

Resolved Question:

My significant other has been battling with the IRS for several years now after he made the TERRIBLE mistake of not filing taxes for some time. He felt the amount owed was incorrect and hired a lawyer to help him through the process of getting back on track. The lawyer did next to nothing to negotiate but did set up a repayment plan with the IRS. The first year, SO was able to meet the terms of the plan, but when the economy died, so did his income - he's a real estate broker. He's now worried that the IRS will start garnishing his wages, and we wonder what amount they will take. Is the IRS limited to a percentage they can take? Can they take all of your paycheck? Do the penalties and interest continue to accrue? This just seems like a hole he can never get out of. He feels like he's just circling the bowl at this point. Any info would be appreciated.
Submitted: 7 years ago.
Category: Tax
Expert:  Merlo replied 7 years ago.

The amount which the IRS would garnish from a paycheck is based on his filing status and the number of exemptions that he claims. There is a table which the IRS then sends to the employer to determine the amount to be withheld. Here is a link to that table which will help you determine the amount that would be subject to garnishment.

If he would like to avoid this he can also re-negotiate his payment plan if his financial situation has changed to a point where he can no longer afford the payments he was making previously. In order to set up a new payment plan he would need to complete a new installment agreement application along with Form 433-F which would detail his current assets and income. Based on the information contained on the 433-F form, the IRS may agree to a lower amount for the required payments.

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Thank youCustomer

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Customer: replied 7 years ago.
Thank you for the link to the table. Do I understand that a single man with no exemptions is allowed to keep $779 a month to live on???????
Expert:  Merlo replied 7 years ago.
Hello againCustomer

A single person with one exemption would be allowed to to keep $779 a month. And he would be allowed one exemption for himself, even if he has no one else he claims as a dependent. So yes, that is the amount he would be allowed to keep.

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Customer: replied 7 years ago.
Thank you, Merlo. How totally depressing............Cry
Expert:  Merlo replied 7 years ago.
Hello againCustomer

Yes, I can only imagine. But if he can set up another payment plan with them then this could be avoided. So you may want to try that instead of just letting them garnish his check.

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