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A levy is a legal seizure of your property
to satisfy a tax debt. Levies are different from liens. A lien is a
claim used as security for the tax debt, while a levy actually takes the
property to satisfy the tax debt.
If you do not pay your taxes (or make arrangements to settle your debt),
the IRS may seize and sell any type of real or personal property that
you own or have an interest in. For instance,
We could seize and sell
property that you hold (such as your car, boat, or house), or
We could levy property
that is yours but is held by someone else (such as your wages,
retirement accounts, dividends, bank accounts, licenses, rental
income, accounts receivables, the cash loan value of your life
insurance, or commissions).
We usually levy only after
these three requirements are met:
We assessed the tax and
sent you a Notice and Demand for Payment;
You neglected or
refused to pay the tax; and
We sent you a Final Notice of Intent to
Levy and Notice of Your Right to A Hearing (levy notice) at least 30
days before the levy. We may give you this notice in person, leave
it at your home or your usual place of business, or send it to your
last known address by certified or registered mail, return receipt
requested. Please note: if we levy your state tax refund, you may
receive a Notice of Levy on Your State Tax Refund, Notice of Your
Right to Hearing after the levy.
You may ask an IRS manager to review your case, or you may request a
Collection Due Process hearing with the Office of Appeals by filing a
request for a Collection Due Process hearing with the IRS office listed
on your notice. You must file your request within 30 days of the date on
your notice. Some of the issues you may discuss include:
You paid all you owed
before we sent the levy notice,
We assessed the tax and
sent the levy notice when you were in bankruptcy, and subject to the
automatic stay during bankruptcy,
We made a procedural
error in an assessment,
The time to collect the
tax (called the statute of limitations) expired before we sent the
levy notice,
You did not have an
opportunity to dispute the assessed liability,
You wish to discuss the
collection options, or
You wish to make a spousal defense.
At the conclusion of your hearing, the Office of Appeals will issue
a determination. You will have 30 days after the determination date
to bring a suit to contest the determination. Refer to Publication
1660, Collection Appeal Rights, for more information. If your
property is levied or seized, contact the employee who took the
action. You also may ask the manager to review your case. If the
matter is still unresolved, the manager can explain your rights to
appeal to the Office of Appeals.
If we levy your wages, salary, or federal payments, the levy will end
when:
The levy is released,
You pay your tax debt,
or
The time expires for legally collecting
the tax.
If we levy your bank account, your bank must hold funds you have on
deposit, up to the amount you owe, for 21 days. This period allows
you time to solve any problems from the levy. After 21 days, the
bank must send the money plus interest, if it applies, to the IRS.
To discuss your case, call the IRS employee whose name is shown on
the Notice of Levy.
Filing a claim for reimbursement when we
made a mistake in levying your bank account
If you paid bank charges because of a mistake we made when we levied
your account, you may be entitled to a reimbursement. To be reimbursed,
you must file a claim with us within 1 year after your bank charged you
the fee. Use Form 8546, Claim for Reimbursement of Bank Charges Incurred
Due to Erroneous Service Levy or Misplaced Payment Check.
Levying your federal payments through the Federal Payment Levy Program (FPLP)
Under the Federal Payment Levy Program (FPLP), we may levy (take) monies
from the following federal payments that you may receive: retirement
from the Office of Personnel Management, social security benefits,
federal vendor payments, federal employee salaries, or federal employee
travel advances and reimbursements. This program electronically levies
your federal payments paid through the Department of Treasury, Financial
Management Service (FMS). If we electronically levy your federal
payments, the levy will take 15% from each of the payments until the
account is resolved. If you already are working with an IRS employee,
call that employee for assistance. If you are not working with an
employee, and you receive federal vendor payments, please call
1-800-829-3903 for assistance. If you are not working with an employee,
and you receive any other federal payment, please call 1-800-829-7650
for assistance.
Levying your state tax refund through the State Income Tax Levy Program
(SITLP)
Under the State Income Tax Levy Program, we may levy (take) your state
tax refund. Currently, this only applies to individual state tax
refunds, but may include business state tax refunds in the future. SITLP
matches federal tax delinquent accounts against a database of state tax
refunds for states participating in SITLP. If your state tax refund is
levied, the state will issue a notice advising you of the levy. The IRS
will also issue a notice, after the levy, offering you the opportunity
to appeal the levy. The IRS notice will NOT be issued if you previously
received a notice of our intent to levy that advised you of your right
to a hearing. The state and IRS notices refer you to call 1-800-829-7650
or 1-800-829-3903 for assistance.
Levying your Permanent Fund Dividend through the Alaska Permanent Fund
Dividend (AKPFD) Levy Program
For residents of the State of Alaska, we may levy (take) your Permanent
Fund Dividend. This program matches federal tax delinquent accounts
against a database of Alaskan residents eligible to receive the
dividend. IRS will send you a notice prior to levying the dividend,
giving you an opportunity to appeal the levy. For assistance, the notice
refers you to call 1-800-829-7650 or 1-800-829-3903.
Presented by Alvin Brown and Associates,
tax attorney, formerly with the Office of the Chief Counsel of the
IRS.
Call us for all IRS tax issues, problems and emergencies
Protect yourself from IRS intimidation, errors, and penalties.
www.irstaxattorney.com- ab@irstaxattorney.com -
(888)
712-7690 - (703) 425-1400
