IRS Levy – Is It Not Easy To Stay Away From It?

Are facing issue of back taxes? If you owe money to IRS and not able to pay even after receiving letters, reminders and phone calls, IRS may levy your assets to recover the money. But do you know how bank levy works? It is a one seizure of your funds from your account. Once the levy issued to the bank, the balance in your account will get frozen for 21 days. After 21 days, the IRS will take frozen funds and applied to the money you owe. The period of 21 days is provided so that you can solve the matter with the IRS in this time span.

One of the most common types of levy is wage garnishment. This levy is continuous just like monthly installment. The amount could be anywhere between 30 to 70%. Your employer will get a notice from IRS regarding the wage garnishment and in case your employer fails to comply, both of you need to face legal consequences. If you’re working on contract basis, the levy will apply for on time only. There are some tips that will help you to keep IRS from taking your valuable assets.

First and the most basic way to keep IRS away: don’t let them see your assets. If you own any moveable items such as boats, motor homes, cars etc. however, IRS don’t have any knowledge they cannot seize them. But you should know it is illegal to keep information of your assets from IRS. If you have your moveable items in different state or country it is very tough for IRS to locate your assets and seize them. If you get a hint that IRS is going to place levy on your valuable assets, try to transfer your assets. However, if you transfer the assets after levy has taken place a legal action will be there.

The term “transferring assets” means selling, giving away or transferring the ownership. You can transfer your assets to any of your trustworthy friend so that he/she becomes the legal holder of the assets and IRS will not able to place levy on the assets. Once the levy get resolved, the assets will again become your own. IRS agents know the tricks used by tax payers so they will find ways to prove that you’re transferring assets to avoid seizure. However, even this thing allows you to buy time and prepare yourself for the meeting with IRS.

IRS is also authorized to take money direct from your bank. The procedure is known as IRS bank Levy. Once your account get levy, there no IRS debt relief options that you can get benefits from. In order to handle bank levy, simply transfer the accounts. IRS gets information of your bank accounts from the records of tax returns you’ve filed in previous years. However, once the account is transferred, IRS will not be able to find it with ease as they cannot access any of the bank computers.