An IRS bank levy is the legal seizure of your property to satisfy a tax liability. The collection power of a bank levy is very serious and must not be confused with a lien which is used as security for a tax debt. A bank levy allows the IRS to actually take your financial and personal assets. The IRS can levy assets belonging to the taxpayer, known as a seizure, or it can levy assets from a third party such as a bank, a brokerage house, etc.
An IRS bank levy is one of the harshest collection mechanisms used by the IRS. This method of collection is used to forcefully take from a taxpayers bank account in order to satisfy outstanding IRS tax debt. Understand exactly how this bank levy works and what you can expect if you receive one.
The most common types of levies are:
- Bank account levy
- Wage garnishment on salary, and social security
- Asset seizure of personal property
The IRS will issue a levy after the following requirements are met:
- The tax has been assessed
- Notice and Demand for Payment has been sent
- A Final Notice of Intent to Levy and Notice of Your Right to A Hearing have been issued
These notices are sent at least 30 days prior to generating the levy
A bank levy is one of the preferred methods of levy used by the IRS because they can quickly and easily recoup large amounts of unpaid taxes with minimal effort on their part. The IRS will look at your financial situation when determining what type of levy to use. Once the 30 days have passed the IRS will most likely contact your bank to see the amount of funds in your bank account. If there are sufficient then they will immediately require the bank to freeze your account in order for them to levy. If you do not have sufficient funds in your account they most likely won’t use a bank levy and will look at your employment situation and determine if they can the wage garnishment method.
The IRS does have a process that it follows before levying someones bank account and the most likely won’t levy an account until the follow 3 conditions have been satisfied:
1. The IRS assessed a tax amount owed and demanded payment of the taxes owed
2. After the notice was received by the taxpayer, the taxpayer failed to pay or resolve the taxes owed in another manner
3. The IRS sent a final notice of intent to levy 30 days prior to implementing a levy
Once those three conditions have been met they IRS will contact your bank and make a determination if a bank levy will be the appropriate method to seize funds in order to satisfy unpaid taxes.
Depending upon your financial and tax situation you will need to take different actions to handle your IRS bank account levy. An IRS bank levy can but stopped but it is important to act quickly since you will not have much time to stop the IRS once a bank levy has been implemented.
Tax Relief Providers can help YOU with any type of IRS levy problem. We have been in business for over 12 years and 95% of our cases have been resolved. IRS levies and wage garnishments can be released quickly. Our specialist have open communication with the IRS therefore, it is wise to have us deal immediately with the IRS to avoid levy rather than wait until after the levy is issued. DON’T FIGHT THIS ALONE, WE CAN HELP YOU!
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