Bank Levy

The IRS is taking my bank balance

Time is of the essence! You need to act quickly!  The IRS has been trying to reach you but have been unsuccessful so, they took the extreme measure of garnishing your bank, credit union, and brokerage accounts. This is actually called a bank levy by the IRS.

What They Do

Prior to a levy, the IRS is required to mail a final notice of Levy to the most recent address that they have for you. Avoiding registered mail will not prevent or stop a levy. You should call the IRS immediately to ask what they need to release the levy. Better yet, we recommend hiring a knowledgeable professional who is authorized to represent you before the IRS to make that call.

Usually the IRS has unpaid tax balances that they are trying to collect from you. Since they cannot contact you or because you haven’t replied to their letters, they have legal authority to levy your accounts.  Once you or your representative determine what the IRS needs, you must act quickly to gather the information. They usually require the information prior to releasing a bank levy unless there is a proven financial hardship.

Even with a financial hardship, the IRS will require supporting documentation. Most of the time, the IRS will require a financial disclosure on an authorized IRS Collection Information Statement (CIS) form. Currently approved CIS forms are IRS forms 433-A, B, or F. The IRS will tell you which form they require.

The IRS will also require documents to support your financial disclosure like pay stubs, bank statements, and copies of bills. The IRS will tell you what documents they will need to support your CIS form.

You and your authorized representative need to act quickly to get your levy released. There are a lot of laws, rules, and policies that apply to tax levies. The most important guidance for stopping or releasing bank levies is found in the Internal Revenue Manuel (IRM). The IRS makes the IRM available on their website. We highly recommend using the IRM as a resource for resolving your bank levy.

Finally, you should know that if the IRS is levying your bank accounts they are probably trying to also levy wages, which means they will contact your employer and require that most of your wages be withheld and sent to the IRS. If the wage levy has not already occurred, we have seen a wage levy processed on the same day or next day after a bank levy was processed. You must act immediately to resolve your tax problem with the IRS.