IRS Tax Levy
Are you looking for help with an IRS tax levy? If so, you have come to the right place. An IRS tax levy can have a devastating impact on a taxpayer’s financial situation. Our tax lawyers have years of experience in successfully negotiating with the IRS and have conducted hundreds of tax levy release negotiations over the years. IRS tax levies require immediate action, so call 888-TAX-LADY today or fill out our contact request form for a free and confidential tax analysis.
What Is an IRS Tax Levy?
An IRS tax levy is a legal seizure of your property to satisfy an IRS tax debt. Tax levies are different from liens. A tax lien is a claim used as security for the tax debt, while a tax levy actually takes the property to satisfy the debt.
Federal Payment Levy Program
In July 2000, the Internal Revenue Service (IRS), in conjunction with the Department of the Treasury, Financial Management Service (FMS), started the Federal Payment Levy Program (FPLP) which is authorized by Internal Revenue Code Section 6331 (h), as prescribed by the Taxpayer Relief Act of 1997 Section 1024. Through this program, the IRS can collect your back taxes through a continuous IRS tax levy on certain federal payments disbursed by FMS.
State Income Tax Levy Program (SITLP)
Under the SITLP, the IRS may levy (take) your state tax refund. Currently, this only applies to individual state tax refunds, but may include business state tax refunds in the future. SITLP matches federal tax delinquent accounts against a database of state tax refunds for states participating in SITLP. If your state tax refund is levied, the state will issue a notice advising you of the tax levy. The IRS will also issue a notice, after the levy, offering you the opportunity to appeal the levy.
Alaska Permanent Fund Dividend (AKPFD) Levy Program
For residents of the State of Alaska, the IRS may levy (take) your Permanent Fund Dividend. This program matches federal tax delinquent accounts against a database of Alaskan residents eligible to receive the dividend. IRS will send you a notice prior to levying the dividend, giving you an opportunity to appeal the proposed tax levy.
Social Security Benefits Eligible for the Federal Payment Levy Program
Through the Federal Payment Levy Program (FPLP), Social Security benefit payments outlined in Title II of the Social Security Act, Federal Old-Age, Survivors, and Disability Insurance Benefits, are subject to the 15-percent levy, to pay your delinquent tax debt. Benefit payments, such as lump sum death benefits, benefits paid to children, and special benefits for persons aged 72 and over by 1971, however, will not be included in the FPLP.
Releasing Levies and Levied Property
The Internal Revenue Service (IRS) must release your tax levy if any of the following occur: You pay the tax, penalty, and interest you owe. The IRS discovers that the time for collection (the statute of limitations) ended before the IRS tax levy was served. You provide documentation proving that releasing the tax levy will help the IRS collect the tax owed. You have an installment agreement, or enter into one, unless the agreement says the levy does not have to be released. The IRS determines that the tax levy is creating a significant economic hardship for you. The fair market value of the property exceeds such liabiilty and release of the tax levy on a part of such property could be made without hindering the collection of such liability.
What Are My IRS Tax Levy Rights?
Having your wages or bank account levied by the Internal Revenue Service (IRS) can be stressful. Fortunately all taxpayers have the following specific IRS tax levy rights: If the amount of the IRS tax levy is less than $5,000, the IRS can not place a lien on the taxpayer’s residence. The IRS must sent a Final Notice of Intent to Levy and Notice of Your Right to A Hearing (tax levy notice) at least 30 days before issuing a tax levy. The IRS must release an IRS wage levy once an agreement is made with the taxpayer that their back tax liability is not collectible.
IRS Procedures for Recouping Erroneous Bank Fees
The Internal Revenue Service (IRS) has implemented procedures for taxpayers to request a reimbursement of the fees charged by a bank against a taxpayer for processing a bank levy when the bank levy was issued erroneously by the IRS. Reimbursements are limited to $1,000.00 and must be claimed within one year of being incurred.
