IRS bank levy

The bank levy is an IRS tool that is used in order to settle a tax debt that you owe the federal government. The IRS officer or agent assigned to your case can literally take the money in your bank accounts that are needed to satisfy the debt you owe. They do not care that any money that they take out of your account was already committed for on a check you already sent to pay a bill or that you were going to be used for rent.

According to the IRS, if it is still in your account it is fair game and can be used to pay off your debt for taxes that you owe. This bank levy is a very serious thing and if you ever receive any notices from the IRS, you better believe that they are intent on collecting the money by any means at their disposal.

Call us for a free and confidential evaluation at 1-888-498-2937.

How does the IRS inform the taxpayer regarding a tax debt?

While the IRS can by virtue of the Internal Revenue Code under which it operates has the authority to collect any tax debt owed by any taxpayer. However, under the code, they must follow strict guidelines to ensure fairness to all parties involved.

In the case of an IRS Bank Levy, they must send the taxpayer a Notice of Demand to the taxpayer. The taxpayer then has 10 days to repay the tax debt to avoid any further action. Now, the IRS could immediately begin the bank levy process, however, the truth is they actually make several attempts to collect before they act.

Under what authority is the IRS allowed to use a Bank Levy?

According to the Internal Revenue Code Section 6331, the IRS has the authority to request from your bank the sufficient funds to satisfy your tax debt. According to the section of the code, you must repay the debt within 10 days of them sending you a Notice of Demand. Once the time has passed and you have failed to heed any of their attempts to collect on the debt, they can officially begin the IRS bank levy process.

While it may seem like the IRS is heartless and are all about the money, the truth is they do usually send out several letters called Notice of Demand. However, if you fail to make an effort to pay back the debt, they will see no other choice when it comes to collecting the money that you owe.

How are bank levies issued?

After a sufficient time has passed and you have not made any attempts to contact the IRS and request one of several options that are offered to you in order to settle the debt. The IRS will then moves forward and begin the IRS Bank Levy process. This process may take several months to complete, which still gives you more opportunities to pay the debt before they take any action against you.

The very first step is to issue an IRS CP-504 Letter, which is a Notice of Intent to Levy. This first notice is meant to inform you that the IRS is serious about collecting the tax debt that you owe. You could receive a number of these before you receive the final notice or IRS CP-1058 Letter. Rest assured that when you receive the final notice letter you can expect that anytime you will be minus the money that you owe the IRS from your bank account.

How to resolve a bank levy

There are several options when it comes to resolving any IRS tax debt and you need to make the right decisions as quickly as possible. Just remember this important fact; it will not just go away. So, when you start receiving letters from the IRS regarding bank levy’s the ball is in your court and the quicker you respond and take any action, the better it will be on you in the long run.

You still have time to make things right and either pay the tax debt in full or make inquiries about one or more of the other resolution options. You should consult a Tax Defense Service in order to get some advice about your specific case. They will be able to offer suggestions on how to handle an IRS Bank Levy.

Is there any recourse if you receive a bank levy?

As with any governmental action, you have the right to question the accuracy of the tax debt. If you believe that the IRS has made a mistake and that you really do not owe the amount that they are attempting to collect. You can request a Collection Due Process Hearing by submitting a form 12153.

By filing this form with the IRS, it should effectively stop the action, as long as it is filed within 30 days of receiving the notification of the IRS Bank Levy. The IRS will evaluate the request and if you have not already requested one of the other types of settlement options they will schedule the hearing and you will be able to present your case, hopefully, before then you have attained the help from our Tax Defense Services firm to be there to represent you.

Call us for a free and confidential evaluation at 1-888-498-2937.