IRS Bank Levy Release
When the IRS freezes your bank account, you have 21 days before they take your money. Act now.
What Is an IRS Bank Levy?
To levy literally means "to take." An IRS bank levy is an order directing your bank to seize ALL funds in your account and send them to the IRS.
How Does an IRS Bank Levy Work?
When your bank receives a Notice of Levy from the IRS, they must take any money that is in your account at the moment they process the levy and set it aside in a special trust account. Any money that is deposited into your bank account after the levy has been processed will not be captured in the IRS bank levy, unless they issue another bank levy.
An IRS bank levy attaches to any account at that financial institution that you have an interest in. This includes joint bank accounts with your spouse, bank accounts in the name of your children on which you have signing authority, savings accounts, investment accounts, and even safe deposit boxes. An IRS levy will attach to all of the money in these accounts.
The money is held in a special trust account for 21 days. This 21-day period gives you a chance to contest the bank levy and prove that it is either in error or will cause you an economic hardship. Unless the bank receives an order to Release the Levy before the end of that 21st day, they will forward the money to the IRS the next day.
If you have recently received a bank levy, you should seek help right now. Once this 21-day window has passed, it is nearly impossible to get your money back. If you seek professional help today, we have a much higher chance of releasing the IRS bank levy and getting your money back.
How Can I Get an IRS Bank Levy Released?
Because you only have 21 days to get an IRS levy released, it's important to get help now. If the IRS has levied your bank account you are under active tax enforcement and the collection efforts will increase.
In all cases, we can ensure that no future levies will be issued by the IRS by demonstrating that we are working on the problem and presenting a timeline for the resolution of your account.
If you can prove that the levy is going to cause you an economic hardship or was in error, the IRS has the authority to release that levy and many times will do so. Usually this means proving that the money they took is needed to pay your necessary living expenses — by showing copies of delinquent bills, utility shut-off notices, etc.
You should be warned that the IRS has become less willing to release bank account levies than they were in the past. The most common situation is for the IRS to agree to stop issuing new levies, but keep whatever money they already have. It does depend on how well you can document your economic hardship.
What Other Accounts or Property Is Subject to IRS Tax Levy?
The IRS can levy any property that legally belongs to you that is currently in the hands of someone else. This includes bank accounts, investment accounts, and retirement accounts. The IRS can also seize property including vehicles, real estate, and business equipment though such seizures are much rarer than a bank account levy.
Can the IRS Levy My Accounts Receivable?
Yes, once you invoice a customer that invoice is an asset that the IRS can seize your right to. By doing so, your customers will have to pay the IRS the amount of your invoices rather than paying you. There is no 21-day holding period for an accounts receivable levy — your customers are required to send money to the IRS at the same time that they would have sent the money to you.
How Can I Prevent an IRS Bank Levy?
The best way to prevent an IRS bank levy is to be proactive. Typically the IRS knows that a bank levy is going to have a devastating effect on your family or your business.
Most often the IRS will send a bank levy because you have missed a deadline or you are ignoring your tax problem. More than anything, an IRS levy is meant to get your attention. The best way to ensure you are not a victim of a bank levy is to show the IRS that you are serious about taking care of your tax problems and make progress towards a resolution.
If you can get any missing tax returns filed and give them a proposal for resolution of the debt (for example, a payment plan or an Offer in Compromise) then you should not fear a bank levy. There are also many ways that an experienced professional can ensure that you are legally protected from a bank levy while you work on getting into compliance.
Your Next Steps
Give us a call at (866) 573-3755 today to talk to someone safe about your situation. There is no risk and no obligation. We can really simplify this entire process for you.