QUESTION: Is it possible for the IRS to take some of my Social Security or Social Security Disability (SSDI) benefit check if I owe a delinquent tax debt?
Yes, this is possible – but only with title II disability benefits. The SSI program does not permit a levy or garnishment, attachment against payments for any reason since the assumption is that persons on SSI have very little income or resources. Effective 7/1/89, the Taxpayer's Bill of Rights (P.L. 100-647) specifically prohibits IRS levies against SSI payments.
In the title II program, the IRS may take a portion of your monthly Social Security benefit payment to recover delinquent taxes. IRC Section 6331 states that individuals and businesses with delinquent tax liabilities may be subject to a continuous 15% levy against funds owed them by the federal government (including SSA benefits) beginning in July 2000. To do this, the IRS has to file something called a “Notice of Levy” with the Social Security Administration (SSA).
A Notice of Levy is continuous until the IRS tells SSA to stop levying. In processing a levy, SSA is merely acting to assist IRS in its duty to collect delinquent taxes. Except for seeing that the process in requirements are met, SSA has neither the authority nor obligation to question the correctness of an IRS levy.
If an IRS levy is received by an individual who is receiving benefits on behalf of someone else as a representative payee, it will be returned to the IRS. SSA can only levy an individual’s own benefits.
A taxpayer whose title II disability (SSDI) payments are subject to levy may contact the IRS to resolve the issue by paying the tax bill, entering into an installment agreement or proposing an offer in compromise to settle your back tax debt. For more information about SSA’s role in processing IRS levies, refer to POMS GN 02410.100 - Internal Revenue Service (IRS) Levy.