Introduction: Facing an IRS Levy in New York

If you owe back taxes and have ignored IRS notices, you risk an IRS levy. A levy allows the IRS to legally seize property, bank funds, or wages to settle your debt. The IRS follows strict processes, but the impact on your life can be significant. Understanding IRS levies can help you act strategically and get the professional assistance you need to safeguard your assets.

What Is an IRS Levy?

An IRS levy is when the IRS seizes your property or assets—such as the money in your bank account or even your car or house—to settle unpaid tax debts. It’s important to distinguish a levy from a lien. While a lien is a legal claim against your property, a levy actually takes your property to satisfy the debt.

• Bank account levies
• Wage garnishments
• Seizure of real and personal property
• Garnishment of federal payments like Social Security

The IRS can levy these assets after giving proper notice and if you fail to resolve your tax debt.

Reasons for an IRS Levy

The IRS uses levies as a last resort. Common reasons include:

• Unfiled tax returns
• Unpaid back taxes
• Default on an IRS installment agreement
• Failure to respond to formal IRS demands

Before a levy, several steps take place:

1. The IRS sends a Notice and Demand for Payment.
2. The taxpayer fails to pay or respond.
3. The IRS issues a Final Notice of Intent to Levy and Notice of Your Right to a Hearing, delivered at least 30 days before action begins.

This provides a short window to appeal or address the debt before your accounts or assets are frozen or taken.

The Bank Account Levy Timeline

A bank account levy is one of the most common IRS enforcement actions. Here’s how it unfolds:

1. The IRS serves your bank with a Notice of Levy.
2. The bank immediately freezes your funds up to the amount owed.
3. A mandatory 21-day holding period begins—during which neither the IRS nor you can access the funds.
4. During these 21 days, you can contest the levy, negotiate a payment plan, or prove financial hardship.
5. After 21 days, unless the levy is lifted, the bank releases funds to the IRS—including any accrued interest.

After the 21-day hold, the money is no longer available to you. If the debt remains, the IRS may issue further levies against future assets or income.

What the IRS Can—and Cannot—Seize

The IRS has broad authority to seize assets for back taxes, but there are limits. Commonly seized assets include:

• Bank accounts and investments
• Wages, salaries, or self-employment earnings
• Real estate and vehicles
• Social Security payments under certain programs

Protected assets include:

• Unemployment benefits
• Some pension payments
• Workers’ compensation
• Certain personal assets, such as clothing or basic household items

The IRS must also refrain from causing undue economic hardship. If seizing your assets would prevent you from paying for basic necessities, you may be able to secure a levy release through an economic hardship claim.

Stopping or Releasing an IRS Levy

Releasing a levy is not easy, but it can be done with prompt action. Common ways include:

• Full Payment: Paying your tax balance in full releases the levy immediately.
• Installment Agreement: Establishing a monthly payment plan can stop active levies.
• Offer in Compromise: Settling for less than the full amount owed in certain hardship cases.
• Hardship Claim: Proving the levy causes immediate economic hardship.
• Expiration of Statute of Limitations: Demonstrating the tax debt is too old to be collected (normally, 10 years).

A released levy does not eliminate the debt—if a balance remains, the IRS will pursue other collection avenues, including payment plans or new levies.

Real-World Success: Timothy S. Hart Law Group

At irstaxpros.com, our attorneys have countered IRS levy threats and obtained outcomes that protect clients and their livelihoods.

A client facing nearly $80,000 in tax assessments due to unfiled tax returns turned to our team for help. After working with the client to reconstruct their financial records, our attorneys proved the true liability was far less than the IRS initially claimed. No criminal charges were pursued, and the client was approved for an affordable payment plan on a reduced tax balance of $15,000.

Professional advocacy can make the difference between debilitating asset loss and a manageable, fair resolution.

Why Work with a New York Tax Attorney?

IRS procedures are complex, especially if you have unfiled returns, large past-due balances, or face the risk of seizure. Qualified tax professionals:

• Negotiate directly with the IRS on your behalf
• Correct inaccuracies in your tax account
• Argue for levy release or reduction based on hardship
• Secure payment plan or compromise offers suited to your finances

The experience and legal knowledge of the attorneys at www.irstaxpros.com can help ensure your story ends with a fair, manageable tax resolution.

Frequently Asked Questions About IRS Levies

How long does the IRS have to collect?

Usually, 10 years from the date your tax is assessed.

Can I get my money back after a levy?

Only in very specific situations—generally, funds released to the IRS are not recoverable.

What if I didn’t get the notice?

The IRS is only required to send notices to your last known address. Failing to update your address can result in action without your knowledge, making legal guidance critical.

Conclusion: Act Now to Prevent Asset Loss

IRS levies are among the most disruptive enforcement actions. With the right guidance—and swift action—you can defend your assets, stop levies, and resolve back taxes on terms you can live with.

The Timothy S. Hart Law Group is experienced in all phases of IRS levy defense, tax negotiation, and resolution for New Yorkers. Don’t wait until the IRS takes your assets. Reach out today to safeguard your future.