If you owe the IRS money, they’re going to start sending you a series of letters. Usually, after the third one, you will get a notice of intent to levy.
When you receive a notice, there is a high chance that your property may be legally seized to pay back a tax obligation through a levy. Liens and levies are not the same. A levy occurs when the property is actually taken to settle the tax bill, as opposed to a lien, which is a legal claim made against the property.
When will the IRS issue a tax levy?
The IRS will issue a tax levy when you have not responded to them and you have made no effort to pay your tax debt. Their next step is to send a letter to your bank saying that they are going to seize the funds in the bank to use them to pay off the tax debt. We can’t emphasise this enough—if you get a letter from the IRS, don’t wait; take action now!
In the course of a tax levy, the following assets might be taken:
Physical Assets
Bank Accounts
Account Receivables
Wages
Social Security
Investment Accounts
Pensions
Insurance Policies
What is the tax levy process?
The tax levy process begins well before any seizures take place:
- Either the individual or the IRS will determine the tax amount owed.
- The taxpayer will get a tax bill that must be paid.
- If the taxpayer doesn’t pay the taxes owed, the IRS will issue many letters outlining the amount owed, the date by which payment is required, and the penalties the person will face if they don’t.
- The IRS will send the last warning letters, which are headlined “Final Notice of Intent to Levy” and “Notice of Your Right to a Hearing.”
- Before the IRS starts a levy, the taxpayer has 30 days to pay the taxes due or find another solution.
Although it can take much longer, the whole process can potentially take as little as three months.
How to stop a tax levy
In these situations, usually there’s a small time frame, up to 30 days, where you can file a CEP hearing, an equivalency hearing to stop the collection. You can potentially set up an installment agreement during this time.
If a revenue officer is assigned to your case, you need to reach out to the officer, and you may need to submit a financial disclosure to the officer. That’s usually for larger tax sets or tax debts where the person has been non-compliant or unresponsive for a longer time.
Taxes must be paid in full and on time if you want to avoid a tax levy. In the event that this is not feasible, a taxpayer may work out an installment agreement with the IRS or attempt to reach a settlement.
The taxpayer has the right to file an appeal and stop the IRS from continuing forward with a tax levy if it has already been started. Financial difficulty or having an innocent spouse are a few of the circumstances that may warrant being exempt from a tax levy.
But regardless, a Notice of Intent to Levy is very serious. You need to take action right away because the IRS can seize money from your bank account, and you could wake up one day and your funds will be gone.
Can a tax levy be reversed?
The IRS must give the taxpayer a formal notice outlining the deadlines for arranging finances, suspending a tax levy, and regaining possession of assets. Levied assets can be recovered, but it is more difficult to do so than to stop the levy from happening in the first place.
In general, the IRS will only annul a charge if:
- A taxpayer had been granted 30 days to ask for a hearing before the charge was implemented.
- IRS failed to adhere to protocol.
- The confiscated property is required for revenue generation, aiding in the taxpayer’s debt repayment.
- The taxpayer signed an installment payment agreement.
Find relief today!
If you get a notice from the IRS indicating that a tax levy is coming, please call us right away so that the best course of action can be decided and strategised.
We have the knowledge and experience to handle tax levies. We can walk you through the entire process to take the worry out of it and make it go as easily as possible. Please do not hesitate to contact us.
Contact JLD Tax Resolution Group NOW and resolve your IRS issues. Sleep better at night knowing you have an expert tax resolution expert handling your case.
