How Much Can IRS Take From My Social Security for Back Taxes?

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Even those who are retired and receiving Social Security benefits do not escape the net of the Internal Revenue Service. The only protection that Social Security recipients have that ordinary taxpayers do not is that there are limits to how much money the IRS can deduct from Social Security recipients. If you are on Social Security and owe money to the IRS, it is important that you understand these limits as well as what your options are.

Overview

  • If you owe back taxes to the IRS and do not pay the tax owed or arrange to pay on or by the due date for individuals of April 15, then you may be subject to IRS collection enforcement. One form of enforcement action open to the IRS is to levy the real or intellectual property assets of the taxpayer. During this process, the IRS seizes the assets of the taxpayer to cover the taxes owed. The IRS can issue a one-time levy, as is often the case with real property, or a revolving levy on payments. If your Social Security benefit amount is levied, the IRS will deduct the levied amount from your payment each month.

Limit

  • Through the Federal Payment Levy Program, the IRS is allowed to levy up to 15 percent of your Social Security benefit to cover back taxes. The IRS cannot take more than this amount and is required send you a final notice before the levy of your Social Security benefits.

Requirements

  • Before the IRS can levy your Social Security check, it is required to send you a final levy notice. You have 30 days from the date of the notice to pay the tax in full or arrange to pay to prevent the levy.

Exceptions

  • The IRS frequently suspends levy action for taxpayers who are in federally declared disaster areas. To find out if you live in a disaster area, call the IRS at 800-829-1040. Additionally, you may be successful in getting the levy lifted if you can show that the 15 percent levy presents a significant hardship for you and your family. Call the Taxpayer Advocate Service at 877-777-4778 to request that an advocate be assigned to you. The advocate works as the liaison between you and the IRS and attempts to reach an agreement that is acceptable to both you and the IRS.

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