Currently Not Collectible

My employer just received a notice in the mail from the IRS that my wages are to be levied to cover tax I owed from 2002. This will break me! My wife was also working at that time and has since become a stay at home mother to take care of our twins who were born in 2004. I make more than I did at that time but our household income is much lower since she no longer works. I am the sole support of a family of 5 and I pay out almost everything I make to support my family. Is there anything I can do to stop them from taking my check?

This is not an unusual thing to have happen but it sounds like it can be resolved. As a taxpayer you do have rights and the IRS has to leave you enough money to live on. Obviously the IRS needs to know this information because it sounds as if 1 paycheck lost could present an extreme hardship on your family. The IRS will do a financial analysis to determine your ability to pay. They will figure all household income and compare it to all of the household bills. This analysis considers not only your payments on debt but your familys cost of living as well. If it is determined the ability to pay does not currently exist your tax liability can be regarded as Currently Not Collectible. This will give you temporary relief from the threat of a levy. However, you must act quickly because the IRS can levy up to 85% of your wages if you are W2'd and up to 100% if you receive a 1099 as a self employed contractor. This is in addition to a potential levy of any bank accounts you may have.