How To Stop An IRS Levy

Receiving a levy from the IRS, whether it is an IRS bank levy or IRS wage levy is frightening, upsetting and can create a financial disaster.  If you owe taxes to the IRS, there are ways to stop an IRS levy.  The video below has been prepared by a Denver tax attorney to provide additional information related to stopping the IRS from levying your bank account or levying your wages.  If the IRS has levied you, contact The McGuire Law Firm to discuss your options and rights as a taxpayer.

Contact The McGuire Law Firm to speak with a Denver tax attorney.  Free consultation!

IRS Tax Help Denver Denver Tax Attorney

How Can I Release an IRS Bank Levy?

Receiving a notice from your bank or the Internal Revenue Service that your bank account has been levied can be scary, confusing and frustrating.  Moreover, in addition to the money levied by the IRS from your bank account, the bank levy can cost you considerable money in bank fees and/or overdraft fees if the bank levy cause checks and payment to bounce.  The article and video below have been prepared by a Denver tax attorney to provide you with information regarding a bank levy and maybe more importantly, how a bank levy can be released.

When you owe money to the IRS, the IRS can levy your bank account after providing you with certain due process.  A levy is a taking of property, and when the IRS levies your bank account, they are in fact taking your money.  The IRS levy will attach to the monies in your bank account as of the date of the levy up and to the amount of the levy.  For example, if the IRS issued a levy to your bank in the amount of $5,000 and you only had $1,000 in the account as of the date of the levy, the levy would attach to the $1,000.  On the other hand, if the IRS issued that same bank levy and you had $6,000 in the account, the levy would attach to all $5,000 of which the levy was issued on.  Upon receipt of the bank levy, the bank is to hold the funds that attach to the levy for a 21 day period.  Thus, you have 21 days from the date of the levy in an attempt to have the levy released or partially released.  Therefore, the million dollar question is, how can I release my IRS bank levy?  There are multiple ways to have the IRS bank levy released which are discussed further below.

First, if you formalize an agreement, the IRS is likely to fully release the bank levy.  Please note, to formalize an agreement you will need to have all tax returns filed and be in compliance with current payments.  Second, if you can show the levy is creating an economic hardship, the IRS will generally release the levy.  An economic hardship could be that will be evicted or foreclosed upon because you cannot pay rent or the mortgage due to the bank levy, or you are unable to provide the other daily necessities due to the IRS bank levy.  Third, full payment of the tax debt should release the bank levy.  This seems obvious, and may not be attainable, but it can be an option.  Additionally, if you can show that the IRS bank levy is improper because the IRS has not afforded you your rights as a taxpayer and due process, the bank levy should be released.

Thus, there are multiple ways to have the IRS release a bank levy that is attaching to money in your bank account.  The best action in my opinion is to be proactive and never be in a position of which the IRS can levy your bank account.  For example, by formalizing an agreement or having a pending installment agreement or other proposal, a hold should be placed on the tax debts and thus you should not receive a bank levy.  You can discuss your tax matters and issues with a tax attorney in Denver by contacting The McGuire Law Firm and scheduling a free consultation.

A Denver tax attorney at The McGuire Law Firm can help you if the IRS has levied your bank account!  Call for a free consultation with a tax attorney!

Denver IRS Bank Levy

If you owe taxes to the IRS and do not formalize or propose an agreement to resolve the back taxes, the IRS can levy your bank account.  You may have heard of an IRS bank levy when someone states, “the IRS has frozen my bank account!”  The article below has been drafted by a Denver tax attorney at The McGuire Law Firm to provide information regarding IRS bank levies.  Please feel free to contact The McGuire Law Firm to speak with a tax attorney.

First and foremost, to issue a bank levy, the IRS must have provided you with due process, which consists of a series of notices and finally, a Final Notice of Intent to Levy.  If you do not respond to the Final Notice of Intent to Levy within 30 days from the date of the notice by requesting a collection due process hearing, formalizing an agreement or proposing an agreement, you are open to IRS enforcement such as a bank levy.  When the IRS issues the levy, they will send the form (Form 668) to your bank (or banks) and your bank is required to hold all monies in the account up and to the levy amount for 21 days and then release the funds to the IRS unless the bank receives a levy release or partial release from the IRS.  For example, if you had $10,000 in your bank account and the IRS issued a bank levy in the amount of $8,000, the bank would hold $8,000 for the timeframe stated above.  If the IRS issued a bank levy for $15,000, all $10,000 in your account would then be held.  Thus, you do have 21 days to attempt to have the bank levy released or partially released.

All of that being said, how do you convince the IRS to release or partially release the bank levy?  The IRS may release the bank levy if you establish a formal agreement or can show that the bank levy is creating an economic hardship.  In terms of an economic hardship, you may be required to show that you will be unable to pay your mortgage or lease and are at risk of foreclosure or eviction, or you may have to show that you are unable to pay other everyday type living expenses.  If the IRS agrees to release the bank levy, a notice will be issued to your bank, and typically the bank will allow you access to your money within the next day, but such issue would need to be discussed with your bank.  Some banks will charge you a levy processing fee and of course even if the IRS releases the bank levy, the levy may have caused checks to bounce and often I have seen a bank levy cost a taxpayer $200-$1,000 in bank fees.  Thus, the best course of action is to never be in position where the IRS could levy your bank account!

If you have a tax debt or problem with the IRS, or any other tax questions, speak with a Denver tax attorney at The McGuire Law Firm regarding your questions and issues.

Denver IRS Back Tax Help