The IRS has the power to seize your bank account and apply those funds to your outstanding IRS debt, including tax penalties and interest. This is true even if you own those funds jointly with your spouse or someone else.
Generally, the IRS issues a bank levy as a last resort when the taxpayer has ignored previous attempts at IRS collection.
The tax attorneys, CPAs, and IRS enrolled agents at The Pappas Group in Orlando have gotten hundreds of IRS bank levies voluntarily released by the IRS.
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If the IRS levies your bank account the levy will end when:
If the IRS levies your bank account, your bank must hold funds you have on deposit, up to the amount you owe, for 21 days.
The IRS generally will not levy a taxpayer’s bank account or his wages unless the taxpayer has previously ignored its prior notices or unless it thinks collection of the tax debt is in jeopardy. Consequently, once a taxpayer’s bank account is levied the IRS won’t release the levy without assurances that the taxpayer will not continue to ignore it and avoid the payment of his or her debt.
The tax attorneys, CPAs, and IRS enrolled agents at The Pappas Group in Orlando have intervened on behalf of taxpayers in thousands of cases and persuaded the IRS to release the bank levy and wage levy in exchange for the taxpayer’s agreement to settle the tax debt through the filing of an Offer in Compromise or in exchange for the taxpayer’s entrance into an IRS installment payment agreement to pay the IRS debt off over time.
Here are some dos and don’ts to consider if the IRS levies your bank account:
The IRS audited my 2007 and 2008 tax returns and disallowed 100% of my business expenses because the auditor said I didn’t have sufficient records. I hired The Pappas Group and they were able to prove by other means that my deductions were valid and the IRS ended up only disallowing about 15% of my expenses. Had I not hired Pappas I would been assessed taxes, penalties and interest in excess of $100,000. The Pappas group now does all of my accounting work and prepares both my business and personal tax returns.
The IRS put a lien on my assets and said I owed it more than $70,000. I hired Pappas and he prepared and filed my delinquent tax returns, got the IRS debt reduced to less than $10,000 and got the lien released. The Pappas Group did what they said they would do.