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Wage garnishments and collections in Law · Oct 5, 2014

hollowmason64 said:Whoa, hold on now... don't go twisting the narrative, that's just not fair. 😁
Your point is pretty clear—you didn't pay on time, so now you have to deal with interest, fees, and everything else, right? But you have to admit, not every unpaid bill is the result of someone being lazy or rude. Sometimes people just genuinely don't have the money... but hey, that's the law, and we have to follow it.
On the flip side—if you think it's fine for someone to pay way more because of, say, negligence, shouldn't there be consequences for the person failing to do their job too? Or should those rules only apply to one side of the equation?

A simple warning doesn't stop the clock on the statute of limitations. Under the law, the period starts running once the invoice becomes due, and it's only interrupted by initiating legal collection proceedings, nothing else.

I trust you're keeping a close eye on all of this.
Though, man, nobody really saw this kind of disaster coming with the crisis and the unemployment spikes. People just wanted to help out their friends or family—I know I definitely took my fair share of heat for doing the same—but I realize how much of a headache this is causing for your job.

Honestly, I’m really hoping the legislature finally decides to let employers off the hook regarding wage garnishments and just hands the whole process over to the IRS. It’s become nearly impossible to stay compliant. Between the exchange rate fluctuations, protected sick leave, debts that end up being way more than a third of a paycheck, and banks that act totally clueless every single time the Uniform Commercial Code gets updated... it's exhausting having to explain what's protected over and over again.🙄

I don't think the government will ever streamline it that way, though. They always seem obsessed with protecting the "little guy," so they feel the need to leave these messy buffer zones in place.

Oh, they'll do it, believe me.
If nothing else, it’s to squeeze those predatory sharks—you know the ones I mean 😁—who hand out credit and loans like candy just to trap people in a cycle of debt.
Real-world experience shows there are still plenty of employers out there messing up the garnishment process and seizing way more than the law allows, and honestly, nobody is even watching them.
How those people stay in business, I truly have no clue.

Besides, there are plenty of other ways to ensure you get paid, so let them use those instead. I mean, what’s the big deal with a promissory note or a waybill? What's the harm in that?

hollowmason64, a warning notice and a ledger extract are two completely different things. 😉

Wage garnishments and collections in Law · Oct 4, 2014

Technically, an extract from the business ledgers counts as an authentic document under the Uniform Commercial Code—though I might have tripped over my words there.
So, yeah, it makes sense.
In the entrepreneur world, sending those extracts is standard procedure because we’re basically forced to by the Sarbanes-Oxley Act, specifically the parts about doing annual asset inventories.
That’s probably why a ledger extract is officially listed as an authentic document you can actually use to file an attachment motion.

@hollowmason64; look, you might think I'm being weird here, and maybe you don't get where I'm coming from, but I work in payroll. By definition, my job involves handling wage garnishments, and believe me, I have seen it all.

The whole thing about people signing papers, agreeing to terms, and handing over statements regarding debtor consent for seizure... honestly, you could write a novel about it.
And don't even get me started on how some people are basically saddling their grandkids with debt before they're even born.
I won't even go into the specifics of the folks who actually asked me to lie about their average salary just so they could qualify for a bigger loan than any bank would ever let them have. 🤦
Look, if you don't have a massive paycheck, don't take out a massive loan. You won't be able to pay it back. Period.

Honestly, I really hope the lawmakers eventually realize they should just stop making employers handle wage garnishments and leave it all to the IRS. It’s become nearly impossible to get everything right. Between exchange rate fluctuations, protected sick leave, and debts that are way, WAY higher than a third of a paycheck, it's a nightmare. Plus, the banks? They act so clueless every single time the Uniform Commercial Code changes that you practically have to sit down and explain to them all over again what exactly is legally protected. 🙄

Wage garnishments and collections in Law · Oct 4, 2014

John Clark6, if you don't mind helping me out here, could you walk me through this?
At this seminar we attended, they told us that if we submit an excerpt from the business ledgers—with all the required legal stuff, obviously, though I guess that goes without saying—and we have a signed confirmation from the debtor acknowledging that specific amount, we basically have ourselves a valid enforcement instrument. The idea is that because the debtor acknowledged the debt on a new date, it resets the statute of limitations.

That’s exactly how they pitched it at the seminar.

Wage garnishments and collections in Law · Oct 4, 2014

hollowmason64 said:There really isn't any legal way left for them to collect that money. As for this "blackmail" tactic you mentioned—I'd honestly love to see who would actually be brave enough to try that officially.

You two are mixing emotions with the law here—something I'd never expect from either of you. Especially not from John Clark6 😁
There's a difference between how a private individual handles things and how a public utility or a government entity does...

At the end of the day, you guys want to punish someone else's laziness and incompetence. The real issue isn't that the bill wasn't paid on time; it's that nobody bothered to do anything about it since 2008. I mean, seriously—2008! After six damn years!
And I'm sure they have plenty of people in their legal and accounting departments who are incompetent—just like you'd expect with any big public corporation in America.
If I were their boss, I'd call everyone into my office and figure out who dropped the ball, then I'd split that debt among them—because their negligence and lack of care caused the loss for the employer.
There's nothing better than a little internal accountability.😁

Oh, come on, don't start worrying about things that haven't happened yet. Just follow the steps the lady above mentioned and you'll be fine.

And how exactly do you know nobody’s done anything since 2008?
Look, if that same company sent an itemized statement or any kind of ledger excerpt to a customer's address the following year, then they absolutely took action. Why? Because they just reset the statute of limitations clock.
The fact that people don't bother reading those statements and notices is a whole other mess.

Listen, it's almost the end of the year, and some of you are definitely going to get one of those statements mailed to your house, so pay attention to what's actually printed on them. It usually says something like:
"If you believe this debt is invalid, please contact us within X days; otherwise, we will consider the debt acknowledged as of the date of this notice."

Conclusion Inc., if you don't respond to that document, they legally consider you to have admitted the debt exists starting from the date on that specific paper. From that moment on, the statute of limitations starts running all over again from *that* date, not from the original bill or whatever!

Wage garnishments and collections in Law · Oct 3, 2014

First off, go back and read that thing you received—really read it. Like, actually focus. Somewhere in that fine print, they’ve laid out exactly what your rights are and what moves you can make right now.

Second, get on the phone or swing by an office to check with Medicare. You need to find out exactly what your coverage looks like and whether you even have a supplemental policy or not. Figure out why on earth they're sending you a warning notice for a service you aren't even using in the first place.

Once you’ve sorted that out (and depending on whatever mess you uncover from those first two steps), you can take it to a notary. Send them a formal written protest, a letter, or a grievance—whatever that notice calls it—to contest this whole thing.

Just don't be one of those people who just shrugs it off and ignores the problem. If you react while there's still time, and if this is genuinely just some massive clerical error, everything should settle itself out.

Most people, when they get hit with stuff like this, they just skim it or don't finish reading at all. That’s how they end up tripping over their own feet and making mistakes in how they handle it. Conclusion Inc. Just read the damn thing and follow the steps.

Wage garnishments and collections in Law · Oct 3, 2014

John Clark6 said:I find myself telling people all the time that they’re totally misinterpreting what the statute of limitations actually means—it basically just signifies that I’ve lost my legal standing to sue for the money, but it certainly doesn't mean THAT YOU DON'T OWE ME ANYTHING. 🙂. We’re talking about services rendered and such, but if you just put yourself in the shoes of a business owner... well, there's no way you'd ever want to provide them with any more services, especially those folks who hide behind the statute of limitations and then act all surprised when you try to collect!

Amen to that!

I am dead certain that the people who lent money once and never saw a dime of it back aren't even thinking about lending to that same person again, just because the debt "expired." Oh, sure, ten years have passed since it was due, so now it's technically "stale," which means we should totally lend them more cash.
Yep, right! Like that makes any sense.

Wage garnishments and collections in Law · Oct 3, 2014

hollowmason64 said:File an objection and cite the statute of limitations for the bills that have expired—be very specific about which ones they are by listing the due dates and exact amounts, then just pay off the rest.

What do you mean "doesn't necessarily"?
The statute of limitations periods are set in stone; it's not really up to whether someone wants to follow them or not. If the utility company moves forward with a collection action, you just need to submit an objection citing the statute of limitations for those specific old bills within the required window, and the court should uphold it.

Sure, the court will grant it, and the utility company loses their ability to force payment through a judgment, but don't think for a second that means they just write the debt off as a loss.
The company still wants its money, and trust me, they’ll try to find some other loophole or creative way to squeeze you once the legal route hits a dead end.

It's like when you go back to a shop years later asking for a favor or a service, and they look you dead in the eye and say: "Sure, we can help you out, but let's settle that old tab first." They never forget.😉

Doing business with USA member states in Business, Accounting & Taxes · Oct 2, 2014

Gary King5 said:Need some help here...
I'm a small business owner in California, not on the VAT register. I need to invoice a Canadian company that's registered with the IRS for some translation services. How do I handle the invoicing? What needs to be on there if the work happens here in the States versus if it's done over in Canada?
Does an American business owner need to apply for a specific tax ID for this?

http://www.irs.gov/pub/irs-wd/....aspx?id=19109

Doing business with USA member states in Business, Accounting & Taxes · Oct 2, 2014

The invoice is what you log in the IRS books, so you just use whatever the exchange rate was on the actual date of the invoice.

Wage garnishments and collections in Law · Oct 1, 2014

It’s pretty obvious T-Mobile just sold off their debt to that firm. It's called an assignment.

Basically, an assignment—or transferring receivables—is just when one creditor hands over their right to collect money to a new one. The person who owes the money and the actual debt itself don't change, and you don't even need the debtor's permission to make the switch. It’s nothing fancy, definitely not some shady scam, just standard business practice you see all the time.

If you're actually curious about the legal weeds, go dig through the state's contract laws. You can look it up yourself.

Look, if you have a legitimate reason to dispute the service or the bill in the first place, you can take that fight to this new company too. But you better have a real reason—like the statute of limitations having run out or something.

Doing business with USA member states in Business, Accounting & Taxes · Sep 30, 2014

Check the invoice date.

Wage garnishments and collections in Law · Sep 23, 2014

They can pull the trigger on an enforcement action the second you miss that agreed-upon deadline.
Have you even tried calling them up yet? Honestly, just pick up the phone, ask if they’ll drop the collection request, and see if they'll give you a little breathing room.

Doing business with USA member states in Business, Accounting & Taxes · Sep 19, 2014

Kate Perez10 said:So, assuming the LLC is set up for sales tax... does that mean we calculate everything here in the US and just list it right there on the tax return form?

Look, since it's taxable, you just treat it like any other taxable sale. Throw it in the same bucket; just list it under taxable sales at the 25% rate.

The IRS website actually has a breakdown of the tax forms where they explain every single line item. Seriously, just download that thing and keep it on your desktop for whenever you get stuck.

Wage garnishments and collections in Law · Sep 17, 2014

Technically, they could have, since the law doesn't forbid it. But honestly? That all comes down to how the company chooses to run things.

Some outfits just dump everything straight into checking accounts because it’s less of a headache for their accounting department.
Look, if an employee has their bank account frozen due to some legal mess, that’s not the company's problem to solve. They aren't obligated to cough up cash on the spot if their standard policy—or whatever is written in the employment contract—says paychecks go strictly through direct deposit.

Wage garnishments and collections in Law · Sep 17, 2014

Look, Christmas bonuses aren't some untouchable holy grail when it comes to garnishments. They aren't protected like your base salary or any other steady paycheck. So, if that money hits your bank account, it’s fair game for the collectors.
They could have just handed it over in cash, too. Honestly, it all just comes down to how the company handles things—whether they stick to direct deposit or if they're old-school enough to cut a check or hand you bills.

Doing business with USA member states in Business, Accounting & Taxes · Sep 15, 2014

Patrick Peterson49 said:Hey, looking for some expert eyes on two different scenarios...

Scenario one:
Company A is based here in the US, Company B is in Germany, and Company C is over in Mexico. Company A buys goods from Company B, then sells those same goods to Company C. To make it work, Company B ships directly from their factory using DAP Mexico terms straight to Company C. We're talking export declarations for when it leaves the European Union—Company B handles the actual export, but they swap out their invoice for an invoice from Company A. Apparently, that’s how it works at customs—we checked with both freight forwarders and customs agents—so Company B's invoice is just shown for review during clearance. The end buyer shouldn't even see Company B's invoice. On Company B's invoice, Company A is listed as the buyer, but it specifies the goods are being delivered to Company C. So, where does Company A report this? The VAT return? The VAT-S form? Intrastat?

Scenario two:
Company A buys goods from Company B in Germany under FCA Canada terms, and then sells them to Company C in Mexico. This involves export declarations when leaving the European Union, but this time, Company A is the one handling the export. Where does Company A need to report this? VAT return? VAT-S form? Intrastat? Or maybe a VAT registration in Canada?

Look, this kind of stuff is a total mess. 😁 Honestly, it smells like one of those fake three-way transactions to me.
I dealt with something almost identical last year, so I actually reached out to the IRS for a ruling.
I sent over all my paperwork to an agent, she gave me a formal response in writing, and I stuck to that like glue.
The details are a bit fuzzy now, but I know it involved tagging things in the VAT form—specifically under the section for supplies from non-resident taxpayers and input tax on goods received from non-residents. Something along those lines, I can't quite recall the exact line item. 🤔

Just call a tax advisor and get a straight answer. At the end of the day, the government might decide to audit you one morning, and you don't want to be caught totally clueless.

If you check the RIPUP journal (that yellow publication 😁) from the 9/2013 issue, there are actual entry examples, including one for a fake three-way deal. Then the 10/2013 issue has a whole article on VAT regarding chain transactions.
Shoot me a DM and I'll send those articles over to you. Might help clear the fog.

Wage garnishments and collections in Law · Sep 14, 2014

Look, my sister is the one on the hook for that debt, so she’s the only person I can actually go after for the money. I can't collect from you, and I certainly can't collect from anyone else.

Wage garnishments and collections in Law · Sep 11, 2014

The IRS just updated their site, so you might want to head over there and take a look—everything should be laid out clearly now.
😉

Wage garnishments and collections in Law · Sep 11, 2014

Section 197.
(1) Through a wage garnishment order, a specific portion of an employee's salary is seized. This order instructs the employer—who doesn't pay the employee's salary directly into a bank account—to pay that specified amount to the creditor once the order becomes legally binding.

The thing is, this section doesn't say a single word about reimbursements. You know, those things that are technically the worker's right and can be handed over in cash. Those aren't "salary"—they're reimbursements. Salary is what you get for actually doing the job; reimbursements are just covering your costs. We're talking mileage, per diems, child allowances, help with medical leave after 90 days... none of that is salary. Even the FBI doesn't define those things as wages. They're just reimbursements defined by federal law and income tax regulations.

That’s what’s tripping me up.

To me, it honestly looks like employers might not even have to process wage garnishments anymore if they structure it this way. 🤷
I guess I need someone to sit down and explain this to me properly.

Wage garnishments and collections in Law · Sep 10, 2014

Fresh off a seminar and honestly, I’m still pretty confused. 😁

They weren't exactly crystal clear when they got to Section 197.

Section 197.
(1) A wage garnishment order specifies the portion of wages to be seized and mandates that an employer who does not pay the debtor via a bank account must instead remit the specified amount directly to the creditor once the order becomes final.
(2) This garnishment order also applies to any subsequent salary increases that occur after the order has been served.

I guess I have to wait for the official ruling to see if this section actually implies that employers are off the hook for garnishing wages if they already pay everything through a bank account.

To be honest, nobody could figure out who they're even talking about—people who don't pay wages through a bank account. I mean, under current IRS regulations, you HAVE to pay via bank transfer.

What do you guys think? Why even mention employers who don't use bank accounts for payroll? What's the actual point of that clause?