The answer to your question depends largely on your state’s laws regarding garnishments. In some states, garnishments expire and must be renewed periodically if the judgment creditor wishes the garnishment to continue. Many states, however, allow garnishment orders to continue indefinitely until the balance of the judgment, plus interest, costs, and attorney’s fees are paid. Some states do not allow regular judgment creditors to garnish wages at all. The IRS is not regulated by state laws related to garnishment, and it is generally allowed to take more than 25% of a tax debtor’s wages; in your husband’s case, it sounds like the IRS is taking 25% of his wages in order to prevent this second garnishment from proceeding until your husband’s tax liability is paid.
If you live in a state in which garnishments expire, the garnishment order that was served on your husband’s employer by the judgment creditor may expire before the tax debt is paid off, depending on how much is owed to the IRS and how much they are taking from your husband’s pay each month. I would encourage your husband to contact his payroll or human resources department at work to ask about your state’s garnishment laws and whether or not the garnishment order issued by the judgment creditor will expire.
Consult with an attorney in your state to discuss the options available to you to resolve this judgment and the resulting wage garnishment. A qualified consumer rights or bankruptcy attorney should be able to review your financial situation and tell you what legal options are available to you to stop or reduce the wage garnishment. For example, if you or your husband were never served with a copy of the court complaint filed against you, your attorney may be able to help you file a motion with the court to set aside the judgment entered against you. Your attorney can also discuss filing bankruptcy protection with you, as bankruptcy is a definitive solution to the type of problems you are facing with this creditor. If you would like to read more about bankruptcy, I invite you to visit the Bills.com bankruptcy resources page, where you can learn about the types of consumer bankruptcy and how filing bankruptcy may affect your financial situation.
It is unlikely that you will be able to stop the collection of this outstanding tax obligation, as the IRS’s power to enforce its debts tends to be greater than those of other creditors. Even if you file for bankruptcy protection, it is unlikely that your tax debt can be discharged through the bankruptcy. That said, the IRS is generally willing to work with taxpayers who express a sincere desire to address their tax obligations and who can show that the tax burden is causing them an undue hardship. For example, the IRS may be willing to set up voluntary payments with your husband if he can resolve the other wage garnishment order that has been filed against him. The IRS may even be willing to accept a small portion of the actual amount you owe to settle this obligation if you qualify under the IRS “offer in compromise” guidelines. Again, I encourage you to discuss your financial situation with your attorney to determine the best way to resolve this tax debt. If you would like to read more about the options available to taxpayers struggling with their tax obligations, I encourage you to visit the Bills.com IRS debt help page.
Regardless of how you choose to address your financial difficulties, you should know that there are various options available to you, and that this is not a hopeless situation.
I hope that this information helps you Find. Learn. Save.