South Carolina notice
SCDOR Levy Notice: Wage Garnishment (AW-127) or Bank Levy (AW-104)
SCDOR is collecting by levy: 25% of gross wages through your employer, or funds in bank and certain investment accounts.
Act now
A levy has no reply date: wages are withheld every pay period from the time your employer is served until the debt is paid, so act on the day you learn of it.
A Notice of Levy on Wages, Salary (AW-127) goes to your employer, who must send 25% of your gross pay to SCDOR each pay period. A Notice of Levy on Intangibles (AW-104) lets SCDOR take money from your bank and certain investment accounts, up to the full balance. Both mean an assessment or lien went unpaid, and both continue until the debt is paid.
What this notice is telling you
- You are under an SCDOR assessment, a state tax lien, or both, and earlier notices were not resolved.
- For wages, SC Code 12-54-130 requires your employer to withhold 25% of compensation each pay period until the amount on the notice is paid. If your job ends, the employer withholds your final pay up to that amount.
- For bank and investment accounts, SCDOR can take everything up to the total due, and that can include contract payments now and in the future.
- A levy can be for an SC tax debt or for a debt SCDOR is collecting for another agency through the GEAR program.
What to do
Identify the debt and the contact
Use the contact details on the levy notice, or CollectionSupport@dor.sc.gov. SCDOR lists separate phone lines for income tax levies and GEAR levies.
Check whether you qualify for a 15% wage levy
On the MyDORWAY homepage, Request a Wage Levy Reduction lowers the levy from 25% to 15% if you have an active wage levy, the debt is individual income tax or GEAR, and all missing returns are filed.
File every missing return
Being current on returns is a condition of the reduction. It also stops further estimated assessments being added to the balance.
Pay the balance to end the levy
Payments go through MyDORWAY. SCDOR says card payments take 7 to 14 business days to process and mailed checks up to 4 weeks, so withholding may continue briefly after you pay.
Ask for release if it continues after payment
Email your last pay stub and your payroll department's fax number or email address to CollectionSupport@dor.sc.gov.
Why a payment plan is no longer available
SCDOR's levy guidance says you can no longer request a Payment Plan Agreement once it has issued a levy on your wages. Its payment plan page also says you cannot have an active levy or garnishment when you apply. The plan has to be in place before the levy. After that, the options are the 15% reduction, paying the balance, or, where you qualify, an Offer in Compromise through SCDOR's Taxpayer Advocate.
I never got a notice before the levy
SCDOR says it mails a notice to the taxpayer's address before levying wages. If yours went to an old address, update it in MyDORWAY (More, Manage Names and Addresses) or on Form SC8822I so that future notices reach you. A levy is usually the end of a chain that started with a Proposed Assessment or Estimated Assessment, followed by a Notice of Assessment and often a lien.
For employers who received an AW-127
Payroll answers and pays the levy through MyDORWAY (Make a Levy Payment or Answer a Levy), including telling SCDOR when the employee has left or is on unpaid leave. Under SC Code 12-54-135, an employer that fails to withhold or remit becomes liable for the amount itself. The same section also protects the employer: the employee has no claim against it for amounts paid to SCDOR under the levy.
Overpayments and time limits
If payroll keeps withholding after the debt is paid and no other SC debt is owed, SCDOR mails the excess as a refund to the address on file. SCDOR generally has ten years from assessment to start collection by levy (SC Code 12-54-85(E)).
Where this notice sits
- Notice of Assessment (C-133)
- Notice of State Tax Lien (W-131-F)
- Notice of Levy (AW-127 / AW-104)
The usual order. Not every account gets every notice, and some steps can be skipped.
Want a CPA to deal with it?
Bring the notice to a free consultation, in person on James Island or by video. We read it with you, tell you what it means for your account and, if you want us to, take over the response once SCDOR has our power of attorney on file.
Tax Controversy — IRS audits, penalty abatement, appeals, and back-tax resolution.
Sources
By Haigler CPA Group. Updated . Notices are revised from time to time, so go by the wording and dates on your own notice. The information on this site is general in nature and is not tax, legal, or accounting advice for your situation. Tax law changes and the right answer depends on facts we would need to review with you. Please speak with a qualified professional before acting on anything you read here.
Questions about Notice of Levy (AW-127 / AW-104)
How much of my paycheck can SCDOR take?
A wage levy is 25% of gross wages each pay period. If you qualify, you can ask SCDOR on MyDORWAY to lower it to 15%.
Can SCDOR empty my bank account?
A levy on intangibles lets SCDOR take funds in your bank and certain investment accounts up to the total amount due. It cannot take more than the balance owed.
Why is SCDOR garnishing me for a hospital bill?
Through the GEAR program, SCDOR collects debts for other agencies, such as a past-due public hospital bill or a State Ethics Commission penalty, and GEAR debts can be collected by levy. Questions about whether you owe the underlying debt go to that agency.
Other notices
- Estimated Assessment (C-293): SCDOR estimated your tax because no return was filedSCDOR has no return for a period and has estimated the tax; filing the actual return is usually how it is resolved.
- Notice of Refund Adjustment (I-351): Your SC refund was changed or applied to a debtYour SC refund was reduced, either because SCDOR changed your return or applied the refund to a tax or agency debt.
- SCDOR noticesSouth Carolina runs its own notices, deadlines and appeal rights, separate from the IRS. Find the type of letter you received below.
Talk to a tax expert
Tell us what you are dealing with and we will tell you how we would handle it.