Although the IRS bank levy may sound difficult to decipher, this is not actually the case. An IRS bank account levy is legal seizure of money from your bank account by the IRS to repay taxes owed. In fact, the process is quite simple once you know which steps are taken and the order in which they come.
The first step is when the IRS assesses the taxes that you owe. If they find that you owe money and have yet to pay, they are going to flag your account so they can begin to move on with seeking collection mechanisms. As you can imagine, if you always pay what you owe there will be nothing for the IRS to find.
Next in line are the notices that are sent to you at your place of residence. These notices will tell you that you owe money, as well as how much, and what you can do to fix the problem. It would be in your best interest to take these notes seriously. If you take care of the situation after one notice you will not have to deal with future issues.
A final notice titled Final Notice of Intent to Levy" is sent if the IRS does not hear from you or you do not respond to notices. From here, they only have to wait 30 days to issue the levy. This is your last chance to contact the IRS and stop the levy process.
Soon enough the IRS will decide on the levy method that they are going to use. This can be anything from wage garnishment to bank levy to physical property seizure. If the IRS decides to garnish your wages, for instance, they will contact your employer to set this up. The same holds true with a bank levy. Your bank is contacted and your accounts will be frozen – this means that you cannot get to your money.
The IRS, once it begins the bank levy process, will freeze your bank account for 21 days before seizing all or part of the money needed to satisfy taxes owed. During these 21 days, you need to act quickly and reach out to a tax professional that can help.
This is the basic IRS bank levy process. The IRS follows the same steps with each person to ensure that everything unfolds the same way. Of course, you have the ability to resolve the problem by getting in touch with the IRS or professional tax firm. Just because you receive a notice saying that you owe money does not mean that the levy will be issued right away. As noted above, you have the ability to stop the IRS bank levy process.
All in all, it is always a good idea to resolve a tax problem when you first realize there is a problem or when you first receive an IRS or State notice. If you would like more detailed information on how the IRS bank levy process works and potential ways to stop an IRS bank levy visit today.