Levy - as described by the IRS:
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
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.
If a levy on your wages, bank account or other property is
causing a hardship you should:
Contact the IRS at the telephone number on the levy or
correspondence immediately and explain your financial situation.
Service is available from 8 a.m. to 8 p.m. local time, Monday
If we determine the levy is creating an immediate economic
hardship, the levy may be released.
A levy release does not mean you are exempt from paying the balance.
The IRS will work with you to establish payment plans or take other
steps to help you pay off the balance. To help ensure quick action,
please have the fax number available for the bank or employer office
that is processing 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
- You paid all you owed before we sent the
- 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
- 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 (PDF), 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
Levying Your Wages, Federal Payments, State Refunds, or Your
If we levy your wages, salary, federal
payments or state refunds, the levy will end when:
- The levy is released,
- You pay your tax debt, or
- The time expires for legally collecting the
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 holding
period allows time to resolve any issues about account ownership.
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. You
will have 30 days to appeal the determination to the Tax Court. Use Form
the Small Business and Self-Employed Web Site
Page Last Reviewed or Updated: 29-Jan-2013
Above is Per the IRS 2/2013
NOTE: you will notice in the above discussion
how much authority over a taxpayer's life the IRS is imposing.
Under such circumstances, it is very desirable to have the aid of
experienced legal counsel to help with getting your vital funds
back so that you can care for your family.
When the IRS wants you
... you want TaxSOS.com
assistance, please contact A. Nathan Zeliff, Attorney at Law