Levy from the IRS: Learn What Your Facing & Take Control!

Levy from the IRS on Accounts & Wages

levy from irs helpThere are countless IRS horror stories that strike fear into the hearts of those with tax debts. Some of them are exaggerations, but many are true. One of the worst experiences you can go through is a levy from the IRS, and it is also one of the most common. You would be surprised what a levy from the IRS can go after. This page will discuss just what you can expect with a levy from the IRS.

How Does a Bank Levy from the IRS Work?

A bank levy from the IRS can affect any depositary that has your name attached to it and that you can access. Joint bank accounts, retirement accounts, and Certificate of Deposit accounts are all among the depositaries subject to a levy from the IRS. Several steps must be taken before any levy from the IRS can occur.

  1. A tax debt is assessed and a "Notice and Demand for Payment" is sent.
  2. A "Final Notice of Intent to Levy and Notice of Your Right to a Hearing" is sent.
  3. Your tax debt goes unpaid or you do not enter an agreement for the next 30 days.

If you do not receive any notices and a levy from the IRS still happens, the IRS likely has the wrong address. It isn't necessary that you have received notices, only that the IRS made a minimum effort to contact you.

The next notice sent will go to your financial institution. On the day of that notice, whatever is in your account will be frozen for 21 days. Unless you can prove exceptional hardship, all of that money plus any interest that accrued will be sent to the IRS and applied toward your tax debt. If your tax debt is less than what is in your account, the levy from the IRS will only take the full amount of your tax debt and leave you the rest.

How Does a Wage Levy from the IRS Work?

A wage levy from the IRS can only happen after the same steps listed previously have been taken. After those steps, your employer will receive an IRS notice that your wages are to be garnished from now on. A wage levy from the IRS does not work in the same way that other types of wage garnishments do. A certain percentage will not be taken out. Instead, the IRS decides what amount of money you will need to cover your basic necessities.

There are rigid guidelines set for how much is exempt from a levy from the IRS. You could be left with as little as $791 a month, depending on the filing status and allowable exemptions on your W4. If a wage levy from the IRS occurs, you should be prepared for the following:

  • Many companies will fire an employee, instead of dealing with a wage levy from the IRS.
  • If you have multiple jobs, all of them can be garnished simultaneously.
  • If you file jointly with a spouse, his or her wages can also be garnished.
  • A bank levy from the IRS can happen during a wage garnishment.
  • If you are self-employed, a levy from the IRS will take your entire 1099 check.

What Do You Do About a Levy from the IRS?

The only way you can end or prevent any levy from the IRS is to get a tax resolution. If you owe more than $10,000, the IRS will attempt to pressure you into a tax resolution that may put a strain on your budget. For larger tax debts, it is best to get help from a tax debt professional.

Is a levy from the IRS ruining your life? Consult a professional. Call now or fill out the form below for a free tax debt consultation on how to end or prevent any levy from the IRS! We'll only connect you with a tax debt relief company holding at least a B rating with the Better Business Bureau.

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