A Brief Guide on How to Stop an IRS Levy

IRS Levy Help with The Law Offices of Nick Nemeth

An IRS levy is a tool used by the IRS to collect unpaid taxes from taxpayers by seizing their assets such as real estate, vehicles, bank account, and wages. It can be a distressful situation for taxpayers, but there are a few ways to stop an IRS levy and arrive at a settlement with the tax agency with the help of an IRS tax lawyer. In this post, we discuss how to stop an IRS levy early in the process, so that it does not impact your life. Read on.

Written Communication

One of the first remedial actions taxpayers can take after they received a collection notice from the IRS is to send a letter to the agency. In such a written communication, they can mention the financial hardship that they are facing and provide evidence on how a levy will worsen the situation. If the IRS finds the cause for nonpayment a just reason, it may stop the levy.

Full Payment

Clearing the outstanding taxes in full is the best way to stop a tax levy. If possible, taxpayers may make use of their savings, borrow from family or friends, or even sell off some of their assets to accumulate the necessary funds. Another way to pay the due tax amount in full is to take a loan, but only if the interest rate is lower than what the IRS charges as interests and penalties.

Installment Agreement

Installment agreement, or partial payment agreement, offers a convenient means to pay off tax debts. The provision allows taxpayers to make monthly payments of an amount they can afford. Generally, the IRS can allow up to 84 months for taxpayers to clear their due taxes. While interests would continue to accrue in this agreement, there’s a drastic reduction in the penalty as long as the taxpayer pays on time.

Offer in Compromise

This is an agreement with the IRS to settle tax liabilities for less than the actual amount owed by a taxpayer. To qualify for this payment arrangement, a taxpayer needs to prove that they are not in a position to pay off their tax debts through any other method. Along with this, the IRS needs to convince itself fully that there is no other way for them to collect money from the taxpayer. The ability to settle for less than the actual tax amount can be a huge relief to taxpayers.

Need IRS Levy Help? Contact Us

Even though the best way to avoid a levy is to file returns and pay taxes on time, many taxpayers can’t help encountering such a situation from time to time. It is a common situation with taxpayers in the U.S. but it is not the end of the world. If you run into similar problems, contact the Law Offices of Nick Nemeth for help with an IRS tax levy. Our team of IRS tax lawyers has more than 18 years of experience in helping taxpayers deal with all sorts of IRS issues. For a no-obligation consultation, simply call (972) 627-4580 or fill out our contact form.