stop irs levy

An IRS levy is an aggressive action on the part of the IRS to get your attention. It is a legal seizure of your property to satisfy a tax debt. The IRS can levy both your bank accounts and wages, as well as third party accounts and personal assets. Wage levies and bank levies are the most common type of levy that the IRS will issue.

Typically three requirements must be met before the IRS can levy:

1. The IRS sends the tax liability due and sends the tax payer a Notice and Demand for Payment

2. The tax payer neglects or refuses to pay the tax and

3. The tax payer is sent a Final Notice of Intent to Levy and Notice of Your Right to A Hearing at least 30 days before the levy. It may be given to the individual in person or left at his or her home, but usually it is sent to the last known address the IRS has on file.

An IRS levy continues until the tax liability is paid in full, the time to collect has expired or until the levy has been released.

The three quickest ways to stop IRS levy actions are:

1. Pay the full tax liability. The IRS will remove the levy immediately once the balance is paid.

2. A Streamline Installment Agreement. If the balance of the tax liability is under $25,000, a streamline an Installment Agreement can be set up. Minimal financial disclosure is required with this type of installment. It is set up over a sixty month time period. A streamline can be set up for less than the minimal required for 60 months but financial information must be given and it will require IRS manger approval.

3. File Bankruptcy. Filing for bankruptcy will put an automatic “stay of collection” on your account. There is no need for any type of disclosure. It is automatic by bankruptcy law. However, many taxpayers that owe taxes and cannot pay them in full, or the balance is above $25,000. Bankruptcy will not cover all types of taxes and for those that can be filed, there are very strict guidelines. I recommend getting advice from a bankruptcy attorney before considering bankruptcy as an option.

There are other options available if a tax payer does not qualify for any of the above.

If my client does not qualify for any of the above, then I can stop irs levy procedures by setting up an Installment Agreement that requires financial disclosure and manger approval or I can put the case in a hardship or currently non-collectible which will also require manger approval and financial disclosure.

The interest will keep accruing on the tax liability with both an Installment Agreement & Currently Non-Collectible status. That is why I will also look to see if my client would qualify for an Offer in Compromise or other tax relief that will resolve the balance.

I recommend that any time financial disclosure is required, that the taxpayer have professional representation, with experience and knowledge of the tax code.