How and When to Appeal an IRS Tax Levy
An IRS Tax levy can be defined as the legal seizure of property by the Internal Revenue Service to satisfy taxes owed. There are many different types of tax levies but a few of the most common types include those on wages, bank accounts, pensions, 401ks and other forms of personal property. The IRS cannot simply take your property without following certain procedures.
Conditions for an IRS Levy
- Tax liabilities were assessed and a letter was sent to the taxpayer requesting payment
- The taxpayer neglected to pay taxes owed
- The Internal Revenue Service sent you a Final Notice of Intent to Levy.
Have you received a Final Notice of Intent to Levy and Notice of Your Right to a Hearing from the IRS? If so, you need to take this seriously because it means that your property is going to be levied in the very near future. The good thing is that you can stop it from happening.
To stop an IRS tax levy from taking place you have to do 1 of three 3. Pay what you owe, settle your taxes with the IRS, or appeal their decision. For many, appealing an IRS tax levy is the way to go. That is a way to delay the process while not having to pay a dime, at least not if you have good reason. Settling or coming to a resolution to release or remove it is also possible.
When to File For an IRS Levy Appeal
You have to file an appeal within 30 days of receiving a final notice if you intend to prevent the levy from taking effect. You can appeal it after the IRS has already seized your property, but it is better to appeal before that. The moment you receive a final notice is the moment you should filing a request for the Collection Due Process hearing with the IRS Office of Appeals listed on your notice or found at Official website for the IRS (IRS.gov).
That does not mean you cannot try to settle or clear up the problem with your local collections office; it just means that if you cannot, you still have the hearing. In fact, it is recommended that you contact the local collections office that sent you or is responsible for the notices and possible levy.
Valid Reasons for an Appeal
- All taxes were already paid off
- An Installment Agreement or IRS Payment Plan is in effect
- The IRS accepted or you submitted an Offer In Compromise with no decision yet
- Protocol or procedures were not followed by the IRS in the levy process (discussed above)
- You are in bankruptcy
- Statute of Limitations expired for the debts owed (collection efforts need to seize)
- The taxpayer want to discuss other settlement or resolution options (like an IRS payment plan)
How to File for an IRS Levy Appeal
The actual process of appealing an IRS tax levy is not overly difficult. Fill out form 12153 (found on irs.gov) and send it to the Office of Appeals. You should be ready to explain why you do not agree with the levy (some possible reasons discussed above) and you can attach a letter to the main form detailing out your reason(s). If the Office of Appeals puts out a decision you do not agree with after your first hearing, you will have another 30 days to contest this decision.
How to Release or Remove an IRS Levy
Here are a few ways to remove or release an IRS Levy once it has taken effect. As we discussed above, you can always appeal the levy if you have good reason. If you do not want to appeal it, here are a few ways to release or remove it:
- Setup an IRS Installment Agreement (IRS Payment Plan)
- Setup a Partial Payment Installment Agreement
- Submit an Offer In Compromise and get it accepted
- Prove the levy causes financial hardship
All in all, it is recommended that you work with a tax professional to help you appeal and/or remove or release an IRS tax levy. Professional tax firms have the experience that translates into a better outcome for the taxpayer versus going it alone. If you are looking for a list of ways to stop an IRS levy and an experienced tax resolution firm for professional tax levy help visit BackTaxesHelp.com today for a free consultation.