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Texas wage garnishment for a debt from California?

Sep 09, 2008 by Crissie A | Posted in Other - Politics & Government

I currently dwell in Texas, just moved here from Ca a few months ago. There is a garnishment on my pay stub that has shown up for the first time.

Your payroll employment should be able to tell you who is garnishing your check. As far as I can see, there is not an exception to credit card debt in Texas. http://www.pretty good-debt-collection.com/stat e-garnishment-laws-5.

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Wage and 1099 Garnishment

Salary garnishment is a tough circumstance for people who are in debt: the creditors collect their payments directly from their paychecks. For a number of reasons, people can have their salary garnished.

When a verdict is made, salary can then be garnished or taken directly from a person’s paycheck or other sources of income. For these reasons, salary can be garnished:

* Unpaid child support. * Other dues.

Garnishment is capped by federal law at twenty-five percent and differs in each state. States like Pennsylvania, North and South Carolina, and Texas don’t allow garnishment, while others allow lower amounts for garnishment. If income is not enough, there is a specific order for garnishments to be taken: federal, then state, and lastly, credit cards.

The IRS procedure that must be followed when garnishing wage are:

* * Salary is garnished until full payment, unless other deals for settlements are made. Garnishment cannot be declined.

1099 is the form that’s provided to private contractors, like writers, actors, and artists who are not employees of particular companies. If a company pays a freelancer $600 or more in a year, they should file a 1099 form. These declare income to the IRS. They do not deduct any taxes or withholdings, so the 1099 freelancers should deduct the taxes themselves.

If an employee has his salary garnished, the employer has the responsibility to take the payment out of the paycheck. The employer is released from that responsibility if the employee becomes a 1099 independent contractor or freelancer. The contractor’s accounts receivable can be levied by the credit, rather than garnishing wage. This means that when a private contractor gets a check from a company for work, the bank account can be levied.

The IRS and other creditors can freeze and collect money when a bank account is levied. This can be practiced until the dues are resolved.

Having your salary garnished or your bank account levied is tough. To help you with IRS problems, talk to seasoned lawyers like Darrin T. Mish.

Source: Get IRS Information

What Happens During IRS Collection Through Salary and 1099 Garnishments

Because creditors collect payments directly from paychecks, salary garnishment is a tough situation for people in debt. For a number of reasons, people can get their wages garnished.

First, wage garnishment happens after a verdict has been arrived at against a defendant. The defendant's paycheck is garnished as a result. This means that money is directly taken from the paycheck (or other source of income) to be paid to the creditor or plaintiff. Here are some typical reasons that wages are garnished:

* Child support is required. * Other debts.

Differing from state to state, federal law maintains garnishment at 25%. States like Pennsylvania, North and South Carolina, and Texas don't allow garnishment, while others allow lower amounts for garnishment. The fixed order for garnishments to be taken when income is insufficient is federal first, state second, and credit cards last.

When garnishing wages, the IRS has a process that needs to be complied with:

* The first thing served is a Notice and Demand for Payment. * Unless other deals are reached for settlement or the debt is paid off, salary will be garnished. Defendants can't decline to have their salary garnished.

The 1099 is the form that is provided to freelancers, such as writers, actors, and artists who are not employees of particular companies. They must file a 1099 form if a freelancer makes $600 or more in a year from a firm. These declare income to the IRS. They do not deduct any taxes or withholdings, so the 1099 freelancers have to deduct the taxes themselves.

When wages are garnished, the settlement has to be taken out of an employee's paycheck by the employer. Employers aren't responsible to do so, though, with private contractors or freelancers. Instead of the salary being garnished, the contractor's bank account or accounts receivable are levied by the creditor.

When a bank account is levied, it is frozen, and all or some of the money in the account is seized. This is most commonly practiced by the IRS, but other creditors can do it, as well. Until the debt is paid, creditors can levy bank accounts.

Having your wage garnished or your bank account levied is serious. To assist you with this and for IRS help for other tax problems, talk to an experienced lawyer.

Darrin T. Mish is a nationally recognized tax attorney whose practice represents clients nationally and internationally with IRS problems. With over a decade of experience resolving clients’ IRS issues , he is AV rated by Martindale-Hubbell and has been honored by a listing in Martindale-Hubbell’s Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With a passion for providing IRS help to taxpayers with both individual and payroll tax problems, he travels the country training attorneys, CPAs, and enrolled agents on how to handle their toughest cases with the IRS. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 888-GET-MISH.

Source: IRS Tax Problem Solver Blog - IRS Help