A tax levy from the IRS can put your assets and properties at risk. If you want them removed, you need to work with a professional and the IRS to pay back taxes and debts. You can know more about levies on this site here. Levies and liens are serious businesses that you should not ignore. Some of the things that you can know more about them are the following.
Levies are seizures of your property as payment of the taxes that you owe to the IRS. Levies may mean penalties that can include seizing your bank accounts, garnishing wages, and taking your assets.
The levies show up next after you’ve gotten liens. The government can claim real estate property and other assets when you are late in filing taxes, you are past due on your income tax, and you have an outstanding debt that doesn’t have any activity in the last few months.
How the Levies Can Affect You
Some of these things can happen to you if you receive levies from the IRS:
Overall amount of your paycheck can shrink. One of the common tactics that the IRS does is wage garnishment. They will directly contact your employer so that a portion of your earnings will go to your debts before you have even gotten hold of them.
Frozen Bank Accounts. One of the prime targets of the IRS in recouping taxes is your bank account. There’s typically a 21-day hold in place for your account, and your bank will have to follow the government’s mandate against you. If you haven’t settled your balance, the banks may be forced to send your remaining balances to the Internal Revenue Service as payment.
Your House Can be Put in Jeopardy. In general, the government will rarely go after your house because it’s terrible for the IRS image and their widespread publicity. This is according to some attorneys and CPAs in many states. However, this can still happen, especially if this is the last resort that’s needed to pay a part or all of your back taxes.
However, you still have some items under your name that are not affected by the levy. These are the benefits that you receive in the event of unemployment, pension benefits, disability or workers’ compensations, annuities, child support, and public assistance payments. Other items that are out of the question are items needed for school or work, specific furniture, and undelivered mail.
You can prevent these from happening by ensuring that you’re filing on time, you have access to your current balances, and the withholdings every month are correct. In many cases, people are often withholding more than enough in their paychecks for the year to ensure that they will not be in debt.
Getting Rid of the Levy or Lien
Pay the Entire Bill
This sounds obvious, but many people realize that simply paying for their unpaid balances can be more than enough to stop the levy or tax lien. You can call the experts of https://irstaxreliefnetwork.com/irs-tax-levy/ for a more favorable payment plan that can make your financial life more manageable. The most important thing you need to do when you first receive a lien notice is communicating with the authorities. It’s important to know that there are guidelines in place as well, as the IRS has temporarily suspended the levies and liens as a response to the ongoing coronavirus pandemic.
Get Payment Plans
Unpaid balances can accrue interests over time, and they can accumulate penalties if they are not paid on time. It would be best if you allowed the IRS to take consecutive payments or do direct payments from your bank account to them at least three times. This way, they can be more agreeable to withdraw these unfavorable liens from your records. Of course, you still need to pay for what you owe, and you can always make the payments on the website. The fees may vary from $0 to $225, depending on your income and your plans.
Do an Offer in Compromise
The OIC requests to settle the back taxes for less than what you will pay with the total amount. However, an offer in compromise may be rarely accepted, and they are only given to people who are genuinely struggling in their lives. To be considered, you need to make the required payment for the estimated taxes for this year, and you should have completed and filed your tax returns promptly.
Ask for a due process when it comes to collection. You have the right to appeal for a hearing from the Officer of Appeals in the IRS. If you want a thorough review of your levy, a conference may be in order, and if you disagree, you can always get the case reviewed adequately, and reconsiderations may be in order.
Filing for Bankruptcy
Bankruptcy may not be an option for some people, but it can get rid of one’s tax debts in many cases. However, this can be a lot of processes, which is not a guarantee that it will work. Your financial standing and records may be affected, and you should consult with an expert first before considering this in the first place.
With Simple Agreements, the IRS can Release your Tax Levy
If you haven’t gotten a payment extension yet, you can request one up to 120 days. If you’re being levied, you may probably have 60 days to pay off everything or arrange an agreement with the IRS. Read more about payment extension news in this link here. If you get an extension, you can ask to release wage garnishment or levies against your properties almost immediately. A representative can send you over fax to order the release to your bank or employer during a conference.
In short, the wage garnishment release can give you more than enough time to pay off the debts. You can finalize the agreement over the phone. Get programs like streamlined installment agreements that may be favorable to your situation. If you are unsure of what to do, you can always call a professional who can handle the paperwork and payment plans on your behalf.
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