Yes, you may stop an administrative wage garnishment once it starts. If you did not have a hearing, have new evidence or changed finances it may stop.
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The Treasury will send you a notice of its intent to order an administrative wage garnishment. Thereafter, you can request a hearing. The hearing is usually a "paper hearing". This means you do not appear personally. Instead, you submit a legal brief and supporting evidence. However, if you fail to request a hearing timely, the Treasury will issue an administrative wage garnishment order to your employer. Similarly, if the hearing is held and the hearing officer finds in favor of the government, your wages will be garnished.
Once the administrative wage garnishment starts, you may stop it in limited circumstances. As stated, if you fail to submit your hearing request, the administrative wage garnishment order will issue. However, you can still submit a hearing request late. Thereafter, if a hearing officer does not make a decision within 60 days, the administrative wage garnishment will be suspended. The suspension will go into effect on the 61st day after your hearing request.
If you did request a hearing and the hearing officer ruled against you, you may obtain a new hearing if you obtain new evidence. However, the government will not provide you with a new hearing simply because you disagree with the hearing officer's initial decision. Instead, you must have obtained new evidence that would exonerate you from the administrative wage garnishment.
If your wages are subject to garnishment but your financial circumstances change, you may qualify for a financial hardship exemption. For instance, at the time of the original hearing your spouse may have been employed. But in the interim, your spouse suffered a lay off and remains unemployed, cutting your household income in half. As such, you may request a new hearing based on the financial hardship the garnishment now causes as you can't meet your basic living expenses. Keep in mind, you will have to provide financial documentation to prove the garnishment constitutes a financial hardship.
Our attorneys have years of experience dealing with administrative wage garnishments. Contact us today for a free initial consultation - 833-428-0934
Millions of Dollars in SBA Debts Resolved via Offer in Compromise and Negotiated Repayment Agreements without our Clients filing for Bankruptcy or Facing Home Foreclosure
Millions of Dollars in Treasury Debts Defended Against via AWG Hearings, Treasury Offset Program Resolution, Cross-servicing Disputes, Private Collection Agency Representation, Compromise Offers and Negotiated Repayment Agreements
Our Attorneys are Authorized by the Agency Practice Act to Represent Federal Debtors Nationwide before the SBA, The SBA Office of Hearings and Appeals, the Treasury Department, and the Bureau of Fiscal Service.
Client personally guaranteed an SBA 7(a) loan to help with a relative’s new business venture. After the business failed, Treasury was able to secure a recurring Treasury Offset Program (TOP) levy against his monthly Social Security Benefits based on the claim that he owed over $1.2 million dollars. We initially submitted a Cross-Servicing Dispute, but then, prepared and filed an Appeals Petition with the SBA Office of Hearings and Appeals (SBA OHA). As a result of our efforts, we were able to convince the SBA to not only terminate the claimed debt of $1.2 million dollars against our client (without him having to file bankruptcy) but also refund the past recurring amounts that were offset from his Social Security Benefits in connection with the TOP levy.
Clients personally guaranteed an SBA 7(a) loan that was referred to the Department of Treasury for collection. Treasury claimed our clients owed over $220,000 once it added its statutory collection fees and interest. We were able to negotiate a significant reduction of the total claimed amount from $220,000 to $119,000, saving the clients over $100,000 by arguing for a waiver of the statutory 28%-30% administrative fees and costs.
Our firm successfully assisted a client in closing an SBA Disaster Loan tied to a COVID-19 Economic Injury Disaster Loan (EIDL). The borrower obtained an EIDL loan of $153,800, but due to the prolonged economic impact of the COVID-19 pandemic, the business was unable to recover and ultimately closed.
As part of the business closure review and audit, we worked closely with the SBA to negotiate a resolution. The borrower was required to pay only $1,625 to release the remaining collateral, effectively closing the matter without further financial liability for the owner/officer.
This case highlights the importance of strategic negotiations when dealing with SBA settlements, particularly for businesses that have shut down due to unforeseen economic challenges. If you or your business are struggling with SBA loan debt, we focus on SBA Offer in Compromise (SBA OIC) solutions to help settle outstanding obligations efficiently.
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