What is an IRS Levy?

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What is an IRS Levy?

There are actually two different kinds of IRS levies.

The first is a wage levy or an IRS Wage Garnishment. The second type of levy is a bank levy.  A bank levy is when the IRS seizes what’s actually in your bank account at the time they served the levy.

Now, Levy just means seizure, so the IRS can seize lots of things. But when someone talks about IRS levies, what you are talking about are wage levies and bank levies.

The best way to avoid an IRS Levy is to prevent a final notice of intent to levy from being issued in the first place. Those notices are IRS LT11, 1058, or CP90. Which one you receive can vary. But I’ll focus my attention this post on LT11 because that’s the more common one.

The IRS cannot levy you unless they issue you one of those letters. They send it to your last known address via certified mail. Then they have to wait at least 30 days before they can levy.

During that time frame, you have the right to file an appeal. That appeal is called a
Request For Collection Due Process Hearing

During those 30 days, there is an absolute bar by the IRS to levying you for the tax periods in question.

So, what does that mean?

On your IRS LT11 it only applies to the period the tax periods on the back of the letter.  If you owe the IRS Back Taxes for 2000 – 2010 and your IRS LT11 is for 2008 – 2010 then the appeal will only apply to 2008 – 2010. Check out my page on different tax forms for more information on various IRS forms.

There is a pretty good chance that the IRS has already issued an LT11 for those previous tears. The IRS doesn’t have to refrain from levying you on those periods if they already sent you an LT11 in the past.

Now, what happens if you file a late request for a collection due process hearing?

If you file that request during up to a year from the day of the final notice, it’s called an Equivalent Hearing.  It’s called that because it’s the equivalent of a collection due process hearing. It’s not statutorily the same, there are a couple minor differences.

The IRS is not barred from levying the taxpayer when an equivalent hearing is filed. Typically they don’t. In fact, I’ve never seen a case where the IRS levied against a taxpayer when an equivalent hearing was pending. But the IRS is not statutorily barred.


Man looking at his watch depicting someone waiting for the answer to what is an IRS levy?

There are some different ways to prevent an IRS levy. Understanding a bank levy should be your first step. It also a good idea to familiarize yourself with the various tax payment plan options you have at your disposal.

Don’t wait until you get levied before you seek professional help. At that point, you will have fewer resources and leverage. So I urge you to take action and call my office at (813) 229-7100 to set up a time for us to chat.

What is an IRS Wage Levy Garnishment?

Preventing an IRS Levy

How to obtain an IRS Wage Levy Release

If you need help removing a Federal Tax Lien or have questions call my office at 888-438-438-6474 and we can chat about it.

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