What To Do When You Receive An IRS Notice Of Intent To Levy
Receiving a notice of levy from the IRS can be intimidating. This document signifies that the IRS intends to seize your assets to satisfy a tax debt. In this article, we will walk you through the steps you should take if you find yourself in this situation. It is crucial to understand your rights and take appropriate action to minimize the impact on your financial well-being.
Understanding the Notice of Levy
When the IRS sends a notice of levy, it means that they have the legal right to seize your assets. This could include money in your bank accounts, wages or even physical property. Typically, the IRS starts by assessing your tax records. If they discover any discrepancies, they typically send a notice and demand for payment. You will only receive a notice of levy from the IRS if you fail to fulfill the demand for payment within a given timeframe.
Step 1: Verify the Notice
Before you panic, check whether the notice of levy is legitimate. Verify the amount owed, the tax year in question and other details on the document. In case of discrepancies or if you believe the notice was sent in error, contact the IRS immediately to rectify the issue.
Step 2: Understand Your Rights
The IRS must adhere to a set of rules before levying your property. For instance, the IRS must give you notice and opportunity to attend a hearing at least 30 days before the levy. It is essential to familiarize yourself with these rights to ensure that the process is carried out fairly.
Step 3: Respond to the Notice
Never ignore a notice of levy. If you agree with the notice, you should immediately arrange to pay the tax owed. If full payment is not feasible, consider qualifying for an offer in compromise. If you disagree, seek professional tax help and consider filing an appeal.
Step 4: Seek Professional Help
Navigating tax issues can be complex, and mistakes can have significant consequences. Tax professionals can provide guidance, help you understand your options and advocate on your behalf. They can help you negotiate a payment plan, submit an offer in compromise or assist with a collection due process hearing.
Step 5: Resolve Your Tax Issues
Your goal should be to resolve your tax issues to avoid future levies. This could mean adjusting your withholdings, making estimated tax payments or setting up a long-term payment plan. Ensure you file future tax returns on time and pay any tax due promptly.
Act Quickly and Wisely
Receiving a notice of levy from the IRS can be alarming, but it is important to remember that you have options. Verify the notice, understand your rights, respond promptly and seek professional advice. By taking these steps, you can navigate this challenge and take control of your tax situation.
Remember, the sooner you address your tax issues, the better your chances of negotiating a favorable resolution and preventing the seizure of your assets. Be proactive, informed and ready to resolve your tax liabilities to avoid any future issues with the IRS.