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If you have outstanding debts, such as back taxes or unpaid child support payments, your tax refund may be at risk of garnishment. The good news is that there are steps you can take to reduce the likelihood of your tax return being garnished. However, if you’re among the unfortunate few whose refund gets taken by a creditor, there are also ways to stop this from happening in the future. You can start by making an appointment with a Tax Resolution company that can assist you with not only filing your back taxes but will provide the guidance and options available for you, so that you can get back on track. There are so many options available to prevent garnishment and bring you the freedom you deserve! Seek the assistance you need. It will be worth it!
Be Careful with Debt Consolidation Companies
If you owe debt to several creditors, it can be tempting to turn to a debt consolidation company, but you have to be careful. Often these companies will charge you a fee to consolidate your debts, and once they have your money, they have no incentive to ensure that the debts are repaid. Some fraudulent companies may even be able to obtain your tax refund, which can certainly compound your problems. You can visit the Federal Trade Commission’s website for tips on how to avoid becoming a victim of one of these companies. Tax refund garnishment happens when a creditor takes a portion of your tax refund to pay off your debts. To avoid this, make sure you file your taxes on time and keep all your financial documents up to date. Get in touch with your creditors and let them know the status of your debt payments, and stay on top of your payments so you don’t fall behind. There are also certain ways you can try to reduce the amount of your tax refund that goes to your creditors. For example, if you have been hit with back taxes and owe a substantial amount of money, you may be able to negotiate a payment plan with the IRS. If you do not feel confident taking action on your own, contacting a tax resolution company is something you may want to consider.
Pay Your Taxes on Time and Stay Up to Date With Your Financial Documents
If you have unfortunately fallen victim and your tax refund(s) are already being garnished, you can reduce the likelihood of it happening again by paying your back taxes on time. While you may be able to get a short-term reprieve from the IRS, the longer you wait to pay, the more likely it is that your tax refund will be targeted again. Stay up to date with your financial documents, such as your credit report, so you can spot any errors or issues that could be causing you to miss out on a tax refund. If you’re having trouble keeping up with your finances or are unclear as to how you can resolve your IRS problem, you may want to seek professional help. A financial advisor can help you create a financial plan that allows you to pay off your debts while also getting your tax refund.
Don’t Be Afraid to Negotiate With Creditors
If the IRS has already garnished your tax refund, you can try to negotiate with your creditors to get some of the debt waived. For example, let your child support agency know that you are having trouble paying the full amount due to IRS garnishment. There may be things you can do to reduce the amount of your child support payment, such as paying a portion of the child support payment in cash or taking your child or children in for regular visitations. Similarly, if you have defaulted on a student loan, you can try to negotiate with your lender to reduce the amount of the debt owed, or you may be able to get a deferment or forbearance on your payments if you are facing financial hardship. If you feel like you cannot get this accomplished on your own, seeking assistance from a professional will always be the best route to take!
Conclusion
While it’s important to pay your debts, it’s also important to protect yourself from falling behind on your payments and facing the risk of garnishment. Be sure to stay on top of your payments and make sure you are filing your taxes on time to protect yourself from having your tax return seized by a creditor. If you have had your tax refund garnished in the past, or are at risk of having your taxes garnished today, there are steps you can take to protect yourself and prevent this from happening, seek assistance if necessary! Keep in mind that filing your taxes on time is crucial as is staying up to date with your financial documents so you can identify any issues that could be causing you to collect tax refund. Remember it’s okay to negotiate with your creditors to try and get debts waived, however if you are not comfortable handling any pending issues you have on your own, seek professional assistance. Lack of knowledge can make your situation worse!
