- Overview: Learn about IRS bank levies.
- Problems: Understand the problems associated with an IRS bank levy.
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Solutions: The W.L. Henry law firm’s goal is to solve your IRS bank levy problems. Find out how we handle a notice of levy sent to a bank.
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Appointment: Schedule a free consultation with a tax lawyer. Colorado office locations are conveniently located in Castle Rock and Colorado Springs. We offer a free phone consultation if you reside outside the Denver or Colorado Springs metro area or in another state or country.
Overview
The IRS has powerful collection tools to collect back tax liabilities. Among those tools is a notice of levy issued to a bank. The IRS can issue a notice of levy to a bank to collect back taxes after certain procedural and constitutional requirements are met. Because the IRS’s bank levy is an administrative levy, the IRS does not have to go to court to levy a taxpayer’s bank account.
The IRS can levy a taxpayer’s bank account after (1) assessment, (2) notice of the assessment and demand for its payment, and (3) after the IRS notifies the taxpayer of its intent to levy at least 30 days before the actual levy (unless the collection of tax is in jeopardy). The IRS must meet specific notice and due process requirements or the bank levy will be void.
The IRS will issue a notice of levy to the bank for all or some of the outstanding tax liability.& The bank must comply with the notice of levy or it faces penalties.
Special rules apply to surrendering deposits in a bank account to the IRS. Banks are only required to surrender the taxpayer’s money after a 21 day holding period. No withdrawals are allowed against the levied funds during this period; however, and the bank must send the IRS any interest that has accumulated on the levied funds during that period.
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Problems
Because the bank must freeze the taxpayer’s funds if it receives a notice of levy, the taxpayer cannot withdraw or write checks against the levied funds. The IRS bank levy may cause checks to bounce and the levy will appear in the bank account statement.
Generally, the IRS can levy joint bank accounts or joint savings accounts even if only one of the co-owners has tax problems. The co-owner that does not have any tax liability will not get any notice that the IRS is going to levy the bank account funds. The co-owner without a tax problem will then have to fight the IRS to get his or her money back. If you have received a notice of intent to levy or notice of levy please contact us to discuss your case.
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Solutions
The W.L. Henry, LLC, law firm works to remove bank levies immediately. We examine a variety of bank levy defenses including:
- Whether the assessment of tax was properly made
- Examine the statute of limitations for collections
- Examine if the taxpayer has property rights in the property to be levied
- Whether the collection procedures followed were fair
- Whether the property was exempt or not subject to a levy
- Administrative and judicial actions to minimize the effect of a bank levy
The IRS must release an IRS bank levy when the liability becomes legally unenforceable or the tax liability is satisfied. The W.L. Henry tax law firm can help determine if the IRS bank levy is enforceable and devise strategies to minimize the effect of IRS bank levies.
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Schedule an Appointment
Schedule a free consultation to discuss your case with a tax lawyer. Colorado office locations are conveniently located in Castle Rock and Colorado Springs. If you are out-of-state or out-of-country, a telephone conference can be scheduled. All initial consultations by phone or in one of our Colorado offices are free.
Even if you are not sure if you need a tax lawyer, the firm is happy to discuss your tax issues and point you in the right direction.
Schedule a free consultation:
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