An IRS Levy release is a process that takes place after the IRS has already placed a levy on your property or bank account. Before addressing that process, let’s take a look at what could cause an IRS Levy in the first place.
There is a process involved. If you owe the IRS there is a standard rule of thumb that applies. First you will receive a Notice of Deficiency. This is a letter alerting you to the fact that you owe the IRS and have not paid them in full by their due date. This letter gives you 90 days to pay the full delinquent amount listed in the letter. If you disagree with the amount listed in the letter you can contact the IRS and attempt to prove how the amount is wrong. If you do nothing, after 90 days you will be responsible for paying the amount on the letter, regardless if it is accurate or not!
If you did nothing with the Notice of Deficiency letter, you will receive a Notice of Intent to Levy letter. This letter notifies you that you have 30 additional days to pay your debt in full or the IRS will enact a levy against you. Basically this means that the IRS can seize your home, property, vehicles, bank accounts, wage garnishment or anything else of value that would satisfy your tax debt.
Remember that being delinquent on taxes also includes penalties and interest. Therefore if you’re original tax debt was only $5,000 it can quickly become $15,000 due to these additional charges! The IRS has the right to take anything you own that can add up to the total owed them.
Never ignore any communication from the IRS. All notices sent to you have very specific deadlines in which you have to act.
Once your bank account or your property has been seized by the IRS, you can take steps toward obtaining an IRS Levy Release.
Typically speaking an IRS Levy Release only occurs once the IRS is satisfied that they will receive full payment of all delinquent taxes. This may mean contacting them and setting up a monthly payment agreement. However, be aware that once a levy has been issued it is very difficult to get the IRS to release it! Once they have a sure way of collecting you have to prove beyond a shadow of a doubt that releasing the levy will result in the satisfaction of your debt.
The right way to avoid having to deal with an IRS Levy Release is to contact the IRS the very moment you realize that you will not be able to meet your tax burden prior to the due date.
Procrastination is your worst enemy when it comes to dealing with the IRS! This is one debt that you simply can’t wish away or pretend doesn’t exist.
You would be wise to hire a tax professional to assist you in all communications with the IRS. They have the expertise and knowledge to be able to represent you to the IRS. They can also tell you all of your options based upon your specific situation prior to contacting the IRS.