IRS Tax Levy: IRS Tax Levy Questions and Answers. How to Save Yourself from IRS Debt

A Dose of Reality: If you owe the IRS, you can't escape your debt. You may wish there was some easy solution for removing a Tax Levy, but there isn't. It's hard to communicate with the IRS. So make sure you arm yourself with tax knowledge before taking the plunge.

How Long does a Levy Last?
It depends. Wage levies are continuous. As long as you work for the same employer, the IRS can continue to withhold a portion of each paycheck. But Bank Levies are usually one-shot deals. The IRS would have to send another warning notice before they seize the money in your bank account again. But beware, the IRS does have the right to seize your assets as long as you owe tax debt but only until the statue of limitations expires.

Can I sue the IRS for levying my assets?
Not exactly. If the IRS has wrongfully levied your assets when you know you didn't owe anything, you would have the right to sue. (Internal Revenue Code 6343B). The IRS would have to return your property or it's value together with interest, and they would also have to pay all Attorney and legal fees. But I'll be frank with you. I've never seen anyone levied against unless they owed the Taxes. Don't try to sue the IRS if you know you owe. You will not win.

Can the IRS levy my business assets?

The IRS can seize assets and even close you down if taxes aren't paid. The IRS can devastate a business by seizing accounts receivable and anything else of value. But these are rare occurrences. If you own a small business, the IRS can't make much money by seizing equipment or fixtures. And you usually won't stand a chance of paying the IRS back if they shut you down. These are good defenses to use if the IRS attempts to levy any business asset.

Helpful Hint: Have your assets already been seized and auctioned off? You still have a small chance at redeeming your property. (Internal Revenue Code 6337) This is called your “Right of Redemption.” This means that you have the right to repurchase the property from the new owner. This is something you should take into consideration if you desperately need the seized item back.