The IRS doesn’t fool around. When a person owes them money, they use every legal means at their disposal to collect it. One of their most powerful collection tools is the levy. A tax levy is different from a lien. A lien is a claim that is used to secure a tax debt, kind of like collateral. But a levy is when the IRS actually takes your money from an account or from your payckeck. And yes, IRS agents can show up on your doorstep and seize your personal property to satisfy a tax debt if you leave them no option.
What can they take?
Anything that isn’t nailed down! Okay, we’re being a bit dramatic, but the truth is that they can help themselves to just about anything they want. They can take your car, boat, house, or anything else you own that may be sold to recover a tax debt. That’s right! The IRS will sell your stuff, often for much less than it is worth. They can also levy property that is yours but is legally held by someone else, such as bank accounts, wages, retirement accounts, stock dividends, licenses, and rental income. The IRS freely and unabashedly admits this on their website, IRS.gov. They will leave no stone unturned. The IRS can and will go after everything you own if you ignore them for too long.
When a person receives a final IRS notice of levy and right to a hearing, he has just 30 days before the IRS has the legal right to take his personal belongings. The most brutal collection agency on earth usually starts with bank accounts. The IRS will call your bank and tell them to take whatever you owe and send it directly to them. If that were not enough, they can also file a wage garnishment notice with your employer. And if they still aren’t satisfied, they can send IRS agents to your home to take your stuff. They don’t play around!
What can you do?
If you receive a Final Notice of Intent Levy and Notice of Your Right to a Hearing, it informs you of your right to attend a hearing and explain your situation before the IRS drops the hammer. As we mentioned, you will have roughly 30 days before the IRS can begin taking your stuff. Depending on the speed of the mail system and the date printed on the notice, this may actually be less than 30 full days. This is literally your last chance to contact a qualified tax advisor to represent you. Trying to negotiate a favorable settlement with the IRS on your own is foolhardy, at best.
A tax advisor will typically request a Collection Due Process Hearing with the Office of Appeals on your behalf. If there are any bones of contention, your representative can raise them at this hearing. For example, if you paid all of your back taxes before the IRS notice of levy was sent, the process may be abrogated. Also, if you were in bankruptcy when the levy notice was sent, it may be invalid.
More often than not, however, the IRS is on point. But that does not mean the taxpayer will not benefit from representation. An experienced tax advisor may not be able release you from your debt, but he may be able to negotiate more favorable terms by discussing collection options with the IRS. In other words, IRS agents may not show up on your front step and ask for the keys to your home and car.
Article Source: http://www.articlesbase.com/taxes-articles/what-can-you-do-about-a-tax-levy-4675338.html
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