If you're facing an unpaid tax bill from the IRS, they can also levy your assets to satisfy your debt. Seizing your property and assets can cause economic hardship, making it hard to pay bills or sell the property to manage your cash. But it is possible to get an IRS levy released in some cases.
What is an IRS Levy?
A levy from the IRS is a legal seizure of your assets to satisfy a debt. The IRS may levy your property if you have delinquent taxes, fines, or interest and the IRS has already filed a lien on your assets. Before levying your property, the following will typically happen:
- The IRS will send you a Notice and Demand for payment after assessing a tax. The Notice and Demand for payment is a tax bill.
- You did not pay the tax bill.
- The IRS sends you a levy notice called a “Final Notice of Intent to Levy and Notice of Your Right to a Hearing” at least 30 days before the levy.
- The IRS sends you a notice that it may contact third parties about collecting your tax bill in a Third-Party Contact notice.
After these notices, the IRS can seize and sell a property you own, such as your house, car, or boat. Or the IRS may levy a right to property you own, such as a retirement or bank account or your wages.
Releasing an IRS Levy
The IRS must release a levy if:
- You've paid what you owe in full,
- The collection period ended before IRS issued the levy,
- Releasing the levy may help you pay your taxes,
- You enter an installment agreement with the IRS, and the terms don't allow a levy to continue,
- The levy creates an economic hardship for you, or
- The property is worth more than the amount you owe, and releasing the levy won't hinder the IRS's ability to collect the amount owed from you.
However, releasing the levy doesn't mean that you don't have to pay what you owe the IRS in full. You'll still need to enter into a payment agreement with the IRS if you haven't yet paid your entire tax liability.
Hire an Experienced Tax Attorney
If you're facing levies from the IRS, it's time to bring in an experienced tax professional. You need legal guidance and advice as soon as possible. If you need help, call Senior Partner, Tax Controversy Attorney, and former IRS attorney Brandon A. Keim at (602) 200-7399 or contact him online to discuss your options.