IRS Levies and LiensWhen a taxpayer fails to pay back taxes, the IRS may issue a Notice of Federal Tax Lien or a Notice of Intent to Levy. A Federal Tax Lien is the government's legal claim against your property when you neglect or fail to pay a tax debt. A lien attaches to all your assets (property, life insurance policies and other securities, vechicles) and to future assets you may acquire while the lien is in place. Once the IRS files a Notice of Federal Tax Lien, it may limit your ability to get credit. Liens can also be attached to your business property and assets including accounts receivable. If you file for bankruptcy, your tax debt and tax lien most usually continue in place.
AN IRS levy is a legal seizure of your property to satisfy a tax debt. While a lien is a legal claim against your property to secure payment, in the case of a levy, the IRS will actually take possession of your property and any assets you own or have an interest in to satisfy your outstanding tax debt. This can include garnishing your wages, bank and retirement accounts, licenses, rental income, the cash loan value of your life insurance, as well as seizing and selling property you own such as cars, boats, or houses.
If one of these notices is received, we can uncover opportunities to have the lien or levy released, and negotiate on your behalf to have IRS representatives re-evaluate the situation. In addition, the IRS must release a lien or levy if certain circumstances are found to be true, such as if the statute of limitations for collection had expired prior to the notice being issued. Levies and liens can create financial disaster for taxpayers, but often have successful outcomes when handled by our knowledgeable tax controversy staff.