Getting This Far: You were warned. The IRS sent you notice after notice, which were promptly ignored. Then the “Final Notice and Intent to Levy” arrived. It's certified mail, and it looks serious. And it is. The IRS can seize your assets or garnish your paycheck if you don't act fast.
Can you Stop a Tax Levy? Absolutely! But don't be taken in by all the myths are rumors about stopping or avoiding IRS Tax Levies or Asset Seizures. It's a lot harder than it looks.
Myth 1: To keep the IRS from levying your assets, just transfer the ownership!
Not so fast. If you already received that Final Notice, the IRS is keeping a close eye on you and your assets. If you transfer your assets to a friend, coworker, family members, the IRS can follow your paper trail, seize the asset, AND try to levy their assets, too!
Myth 2: You can lie to the IRS about your assets, they will never find out.
The IRS can and will find out. You don't have to answer their questions, but it's a violation of Federal law to lie to the IRS about your assets. Additionally, the IRS can search public records to find out what you really own.
Myth 3: File For Bankruptcy and the IRS can't touch you!
Bankruptcy is a terrible tool for combating Tax Debt. Depending on which chapter you file, you assets could be liquidated to satisfy the debt! Isn't that what you were trying to prevent in the first place? Here's some additional reasons to avoid Bankruptcy for resolving Tax Debt:
-The Tax Lien remains
-The Statute of Limitations on your Tax Debt is extended
-Interest and Penalties continue to accure behind the scenes; So 5 years after your Chapter 13, your Tax Debt could be waiting for you, bigger and badder than ever!
The Real Deal: There's only one way to stop an IRS Levy. And that's working with the IRS to pay the debt. You can propose an Installment Agreement, get into a Currently Not Collectible state, or request an Offer in Compromise. These all address vastly different problems. So, it is best to talk to a tax debt professional before deciding what course of action you wish to take. Act fast, you don't want the IRS to seize your assets or wages.