IRS Tax Levies
You will trigger an IRS tax levy if you have failed to pay your taxes and ignore attempts to make other arrangements with the IRS. If the IRS files a Federal tax levy, they can legally wipe out your bank account. The IRS also has option to seize your personal property and convert it to cash to satisfy your outstanding debt. The IRS has a few ways to issue a levy once you fail to acknowledge the “Final Notice of Intent to Levy and Notice of Your Right to a Hearing” letter.
Types of Tax Levies and Garnishments
Before the IRS can issue a levy to collect outstanding tax debt the IRS must issue you a “Final Notice of Intent to Levy and Notice of Your Right to a Hearing.” You have 30 days to respond to this notice. If you fail to respond to the Final Notice, the IRS will have the option to initiate any of the following:
- Wage Garnishment – The most common tax levy involves instructing your employer to initiate a tax levy on your paycheck with regular deductions of a pre-determined amount until you have satisfied your tax debt.
- Bank Account Levy – Now the door is opened for the IRS to monitor and withdraw from your bank account until the tax debt is satisfied.
- Social Security Garnishment or Levy – Your Social Security income may be garnished up to 15% by the IRS until your tax debt is satisfied.
- Property Seizure – This is usually the last resort for the IRS and reserved for the most uncooperative tax debtors.
- If you are currently being levied in any way for outstanding IRS debt then contact us immediately.
You Can Stop an IRS Tax Levy
You can remove an IRS tax levy if you make arrangements with the IRS. The following are arrangements that could be made:
- Fully pay all taxes owed
- Request IRS hardship status
- Request an individual installment agreement (All missing returns must be filed and manager approval may be needed.)
- Request a (business installment agreement (All missing returns must be filed and manager approval may be needed.)
- Request an Offer in Compromise (All missing returns must be filed and manager approval may be needed.)