When you’re faced with tax debt that you do not have the ability to pay in full, you should ideally contact the IRS to apprise them of your situation and work out a payment plan. However, if you do not work out payment arrangements with the IRS, or you default on your payment agreement, the IRS may begin to take increasingly hostile collections actions against you. One of the most extreme collection actions that the IRS can take against you is to issue a levy—a legal seizure of your assets or property to satisfy your tax debt. The IRS can garnish your wages, levy your bank account or social security benefits, and seize and sell your personal and real property, including your car or home.
Because having your assets physically taken from you is usually a worst-case scenario, we’ll go over the steps the IRS takes to get to that point and list a few methods of stopping an IRS levy.
How Can the IRS Levy Your Assets?
Before the IRS can levy an asset it must follow certain procedures. If you do not pay your tax bill or make arrangements to do so, the IRS may then issue a levy. The IRS typically issues levies only after the following three requirements are met:
- The IRS assessed the tax and sent you a Notice and Demand for Payment
- You neglected to pay the tax or make payment arrangements, and
- The IRS sent you a Final Notice of Intent to Levy and Notice of Your Right to A Hearing at least 30 days before the levy.The IRS may provide you with the Final Notice of Intent to Levy in person, leave it at your home or business, or send it to your last known address. At the conclusion of the 30-day period, the IRS may issue the levy and begin seizing your assets.
Stopping an IRS Levy
The best way to stop a tax levy is to pay the IRS in full. However, for those taxpayers unable to do so, here are your main options:
- Entering into a payment plan: You may enter into an installment agreement to spread the debt out into more manageable payments over time.
- Filing an offer in compromise: Alternatively, you could submit an offer in compromise, which is an arrangement in which the IRS agrees to accept a lesser amount than what you owe.
- Applying for a hardship suspension: If paying your tax bill would result in undue economic hardship (as defined by the IRS); it may suspend collections activities and flag your account as Currently Not Collectible.
- Declaring bankruptcy: When you file bankruptcy the court issues a “stay”. This means that creditors including the IRS must stop collection activities. Under certain (limited) circumstances, you may be able to have your tax debts discharged through bankruptcy.
Contact a Professional Tax Consultant for Boca Raton IRS Levy Help
If you have received a Notice of Intent to Levy, you must act swiftly to protect your assets. The best way to do this is to enlist the assistance of a qualified tax professional. Contact the Boca Raton IRS levy help consultants at the East Coast Tax Consulting Group by filling out our online form or calling us at 866-550-7655.