A bank levy is usually confused with a tax lien. It is important to understand the difference. In the case of a bank levy, the IRS has full authority to seize your financial assets to compensate for your tax debts. A tax lien secures the government’s interest in your property. Understanding the IRS bank levy process is crucial and the best way to overcome such tax related issues. If the IRS has sent you a notice of issuing a bank levy in your name, this blog covers all the frequently answered questions about an IRS levy.
It will help you to gain adequate knowledge of bank levies and know what steps to take to resolve this issue.
1. How Does The IRS Inform you about Bank Levies?
Before the IRS issues a bank levy in your name, they are required to send a notice to your last listed address. It is, therefore, vital that your last known address is up-to-date. If you do not receive the notice because the IRS sent the Final Notice of Intent to Levy to the wrong address, it will not be considered by the law. Another method the IRS uses to inform you of a levy is by email. Make sure all your personal information is updated to avoid miscommunication in case of emergencies.
2. How Do I Release a Bank Levy?
The twenty one day holding period is the only opportunity you can utilize in your benefit and try to convince the IRS to release the bank levy. It is important to understand that, under normal circumstances, the IRS does not release a bank levy. There are, however, some circumstances in which the IRS may consider dropping the levy. Those circumstances include full payment of your tax debt, filing an amended tax return proving you do not owe tax debts, or the IRS made a processing error. There are a number of other instances where IRS bank levies may be released. Do your research and always keep yourself informed of your rights when convincing the IRS for releasing a bank levy.
3. How Long Does It Take To Release a Bank Levy?
The time taken for a bank levy to be released depends on the situation. Most bank levies take a day or two business days to be released. However, there are a few exceptions, such as if your case is allocated to a Revenue Officer or if the filing of past tax returns is erratic.
4. How Is a Tax Lien Different From a Tax Levy?
Although some people use these two terms interchangeably, there is a major difference between IRS tax liens and IRS tax levies. An IRS tax lien is a claim against a taxpayers assets and will be showcased on your credit report. An IRS tax levy, on the other hand, gives full authority to the government to seize your financial assets in order to compensate for the taxes you fail to pay to the IRS.
5. What Are IRS Bank Levies?
When a taxpayer fails to pay their taxes on time, the IRS has the authority to issue a bank levy on their property. When and if the IRS issues a bank levy in your name, it gives them full authority of your property and they can seize it to pay the tax debt. The three most common types of IRS bank levies are, bank account levy, wage garnishment on social security and salary, and seizure of personal property. Do your homework and act upon such issues immediately to make sure it does not affect your finances in the long haul.
A bank levy is a cause for concern and must be taken seriously. Overcoming and releasing IRS bank levies is a difficult task and, sometimes, impossible. Therefore, it is important for you to seek help of an IRS Tax Attorney. If you are looking for professional assistance to resolve your tax problems, the Law Office of Nick Nemeth can help. To schedule a free consultation with one of our IRS lawyers, simply call (972) 426-2553 or fill out our contact form. Let us help resolve your IRS tax debt problems.