A levy is simply a legal avenue used to satisfy a tax debt. folks must fully grasp clearly that a levy is very different from lien. Lien comes as a security to cowl the tax debt while on the other hand, levy actually takes both ownership and possession of house in order to satisfy a debt. The IRS has the right to seize the house of any tax defector. Tax borrowers are also subject to bank account levies if they do not pay their debts in time. The query that begs is what to do when the irs puts a tax levy on your bank account?
Prior to placing a levy on any ones bank account, the IRS offers notifications. people today must acquire notifications and it is commonly through mail. This is a requirement by law. The sad reality is that many folks hold the false impression that this tax authority is above the law. This is absolutely not true. There is legal obligation to the IRS to notify the particular individual before taking any stern action. One of the many querys that a good variety of folks ask is what to do when the irs puts a tax levy on your bank account?
Well, upon the placement of a levy on a bank account, one has to act quickly but wisely. There are a variety of avenues that an individual may possibly take. IRS 1st sends a notice of its intention to levy. The acquirer has thirty days to respond to this. There are many options available. Some of these are filing an appeal, full payment of the taxes owed, arriving up with a payment plan and a host of other options. If the individual does not respond inside the thirty days, then the IRS makes good its intention and goes ahead to levy the bank account. They take whatever is owed to them. However, there is nonetheless hope in the sense that there is nonetheless time but with the condition that one acts really fast.
One of the most effective options is to appeal towards the notice of IRS intention to levy. This goes miles in slowing down this severe move by IRS. The period of appealing is inside the thirty days. One should only use this weapon if they disagree totally with the levy. Anything contrary to this is suicidal.
Simply put, once the levy takes effect, it means the bank account is frozen. However, there are a variety of identifying components, as to how much of the account will be frozen. In some instances, only part of the dollars is affected. The amount of tax debts is also a identifying factor.
Paying the IRS its debts is also yet another effective way of preventing a bank account levy from taking place. The other way to stop a levy is through entering into a payment agreement in installments. Finally yet importantly, one can choose to file for what is known as offer in compromise.
All the above are ways to stop a levy from taking effect. Undoubtedly, at times it is very difficult to have a bank account levy released. However, it is very much feasible.