The IRS Has the Power to Place Levies on Your Property

The most obvious way to stay on the IRS’ good side is to file your tax returns and pay your tax liabilities on time. You might be able to get away with not fulfilling these basic obligations for a while, but your luck will eventually run out. If you genuinely cannot pay what you owe to the IRS, the best thing to do is to be proactive and communicate to the agency what you are able to pay; usually, some sort of arrangement can be worked out. 

However, if you go long enough without fulfilling your obligations with the IRS and have continually ignored communications from the federal agency, you could be dealing with an IRS levy. A levy, simply put, is an aggressive tool at the agency’s disposal to collect on a U.S. person’s tax debt. If the IRS places a levy on your assets, they have effectively seized your assets and can sell them to satisfy the amount you owe. 

Before the Levy

To be clear, the IRS will not immediately place a levy on your bank accounts or garnish your wages if the check is in the mail. Generally, you will receive plenty of notice from the IRS, including: 

  • A Notice and Demand for Payment (once the IRS has assessed your tax liabilities and begun its collection efforts)
  • A Final Notice of Intent to Levy and Notice of Your Right to A Hearing, which must be sent to you at least 30 days before any levies are placed on your property

The final notice should only be sent to you after you have received the first notice and have ignored it. 

What Does an IRS Levy Look Like?

The IRS can levy your property in a variety of ways. An asset that the IRS commonly levies is the bank account of any non-payers. If this happens to you, the process is fairly straightforward; the IRS will direct your financial institution to freeze your funds for 21 days, then take out money to satisfy your debts. 

The process gets somewhat more complicated if the IRS places a levy on other assets, like a vehicle, boat, or house. Your interests in the asset will be sold after the IRS gives you the minimum bid price for your property. 

What Can You Do About a Tax Levy?

The best thing to do is contact the IRS as soon as you can. You might be able to get the levy released if it is causing you an immediate economic hardship. If you are not able to get the IRS to release the levy, you can appeal. You should, though, have experienced legal counsel by this point so you are in the best possible position. Weisberg Kainen Mark has several decades of experience dealing with the IRS and would be more than happy to help you if you are in a bind. Please fill out a form on our website to get started with a consultation.

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