How to Get a Tax Levy From Your Bank Removed

Get a tax levy removed.

When you owe money to the IRS, the IRS has the right to place a levy on your bank accounts to collect the debt owed. According to the IRS, a levy differs from a lien in that a levy seizes the property to pay the debt rather than using an asset for security. Before a levy is placed on your account, a "notice of intent to levy" is sent by the IRS giving you 30 days to explore options to settle. It is easier to negotiate prior to the levy being placed, but you may still be able to make other arrangements after the levy is in place.

Instructions

1. Pay the IRS the entire amount owed. This includes the principal and interest owed to the IRS.

2. File an "Offer in Compromise" if you are unable to pay the balance in full. This is a negotiation to settle the debt for a smaller amount. If you are unable to pay the full amount but are able to pay some of it, this may be an option to have the levy removed.

3. Contact the IRS to negotiate a payment plan. If a levy is already on the account, you may be able to pay a specified amount monthly.

4. Prove that the levy is causing you financial hardship. If the levy is taking your living funds, you may have the levy temporarily removed as uncollectible. This doesn't release the debt owed, but it will provide immediate relief.

5. Maintain few assets in your bank account until the statute of limitations on the debt expires. If the IRS has not been able to satisfy collection within 10 years, the levy must be removed unless the IRS is able to get an extension.

Tips & Warnings

• Speak with a tax adviser regarding your best options if the IRS places a levy on your bank accounts.

References

• IRS: Levy
• Tax Debt Help: Tax Levy Release