What Is a Bank Levy?
A bank levy is a legal action that creditors — usually the IRS — can take to extract money from an individual’s bank account, forcing them to repay their taxes or other financial obligations. Bank levies allow creditors to freeze an account until that individual pays what they owe in full. The creditor can continue to take funds from the borrower’s bank account and put them toward their outstanding balance until the levy is lifted or the expenses are completely paid.
Bank Levies and the IRS
There is no tougher bill collector than the IRS. We like to call them the “Super Creditors” because they have the ultimate collection power and don’t have to go to tax court to collect. They simply have to send the taxpayer a letter that looks like all the other letters they send.
Although that letter may look like all the others, this particular one is considered “official notice,” meaning that if the taxpayer does not respond within 30 days or does not pay the tax bill in full within that timeframe, they could wake up one day to find out the IRS has levied their accounts without any additional notice.
How did this happen and what does it mean for you? Basically, the IRS notifies the bank of the levy, instructing it to hold the taxpayer’s hard-earned money and to pay it to the IRS. If you find yourself in this situation, you need experienced negotiators, and you need them FAST!
The bank must hold your money for 21 days before turning it over to the IRS. With the right team advocating for you, you can secure a bank levy release before the time runs out.
Yes, it’s true! It IS possible to get a bank levy released! At CitoTax, we have assembled an expert team, including tax attorneys with experience in negotiating IRS bank levy releases to give you the best chance at receiving a release from the IRS.