Can a creditor garnish or take your tax refund? Well, yes and no. The only types of creditors that can take your tax refund before you receive it are state and federal government agencies.
State and federal government agencies can take your refund even before you receive it. Examples of when this could happen is if you owe the Franchise Tax Board, child support or if you owe the D.M.V.. Everyone else is out of luck until after you actually receive the refund.
Other creditors, such as credit cards or collections agencies, can take your tax refund after you have received it. This means that they cannot take the tax refund before you receive it, but they could levy your bank accounts and take whatever money is in those accounts. So if you have received your tax refund, and it was deposited in your bank account, it can at that point be taken by any creditor that is legally levying your bank account.
Bankruptcy, however, can stop creditors from garnishing wages, levying bank accounts and in some cases can stop creditors from taking your tax refund. You should consult with an attorney to find out whether your tax refund can be protected, and how to stop creditors from levying your bank accounts, garnishing your wages and potentially even discharging those back owed taxes!
Contact me today to discuss your case!
This website does not, and is not intended to, provide a comprehensive guide to your Bankruptcy or Bankruptcy in general. Further, nothing contained in this website shall be construed to provide any guarantees, warranties or predictions regarding the outcome of your legal matter. You should consult with an attorney to determine the effects of Bankruptcy in your case. Results are not always typical because each case is different. We are a debt relief agency, we help people file for bankruptcy under the bankruptcy code.
To ensure compliance with requirements imposed by the IRS in Circular 230, we inform you that, unless expressly stated otherwise in this communication (including attachments), any tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of:
(i) avoiding penalties under the Internal Revenue Code or
(ii) promoting, marketing or recommending to another party any transaction or other matter addressed herein.