Of all the mail you can get, a letter from the IRS is probably one of the most stressful. It gets even more serious when the letter is a Notice of Intent to Levy. Seeing those words can make your heart sink. You might imagine government agents showing up at your door to take your things. It’s a scary thought.
But before you panic, take a deep breath. Receiving this notice is serious, but it is not the end of the world. It is a warning, and you still have time to act. This notice means the IRS is planning to take your property to pay off a tax debt, but they haven’t done it yet. You have rights, and you have options.
At Thorgood Law Firm, we have helped people in New York and across the country deal with tax problems for over two decades. Our New York tax attorneys know how stressful this is. We are here to guide you and give you the support you need. Here, we will explain what a Notice of Intent to Levy means and what you can do about it.
What Is an IRS Levy?
A tax levy is the legal seizure of your property to satisfy a tax debt. Think of it as the IRS taking something you own because you owe them money. This is different from a lien.
A tax lien is a legal claim against your property. It’s like the IRS putting a public sticky note on your assets that says, “We get paid first if this property is sold.” A lien secures the government’s interest in your property. It can hurt your credit and make it hard to sell your home or car.
A levy is the next step. A levy is the actual act of taking your property. The IRS doesn’t want to take your property. They would much rather you pay what you owe. However, if you don’t respond to their notices, they will use a levy to collect the debt.
The IRS can take many things, including:
- Money from your bank accounts
- Your wages or salary (this is called a wage garnishment)
- Your car, boat, or other vehicles
- Your house or other real estate
- Your Social Security benefits
Getting a Notice of Intent to Levy means the IRS is ready to start this process. But they have to give you a final warning first. That’s what this notice is.
Why Did I Get a Notice of Intent to Levy from the IRS?
The IRS doesn’t send a Notice of Intent to Levy out of the blue. It’s the last step in a long process. You likely received this notice for one of these reasons:
- You Owe Back Taxes: You filed your tax returns, but you didn’t pay the full amount you owed.
- The IRS Assessed a Tax Debt: Maybe you didn’t file a tax return. The IRS may have prepared one for you and determined you owe money.
- You Ignored Previous Notices: Before sending a levy notice, the IRS sends a series of other letters demanding payment. This final notice is their last warning.
The most common notice is called the “Final Notice of Intent to Levy and Notice of Your Right to a Hearing.” This letter is your 30-day warning. It tells you that you have 30 days to either pay the debt or formally challenge the levy by requesting a hearing.
What Should I Do After Getting an IRS Levy Notice? Your First Steps
Seeing this notice can be overwhelming, but what you do next is very important. Acting quickly can protect your property and give you more control over the situation.
Do Not Ignore the Notice
This is the biggest mistake you can make. Ignoring the letter will not make the problem go away. It will make it worse. The IRS will assume you do not want to cooperate, and after 30 days, they can start taking your assets without any further warnings. You could wake up one day to find your bank account empty or your employer telling you your wages are being garnished.
Read the Notice Carefully
Read the entire letter from top to bottom. It will tell you a few key things:
- How much the IRS says you owe.
- The tax years the debt is for.
- The deadline to respond. This is usually 30 days from the date on the letter. Mark this date on your calendar.
The notice will also explain your right to a Collection Due Process (CDP) hearing. This is a very important right that allows you to pause the levy and present your case.
Understand Your Rights
Under federal law, the IRS must give you this 30-day notice before it can levy your property. This is your chance to act. Your most important right is the ability to request a CDP hearing. The IRS has the authority to levy but must follow specific procedures, which include giving you this notice and the opportunity for a hearing.
Requesting a CDP hearing officially stops the levy process while your case is being reviewed. This gives you valuable time to work out a solution with the IRS. But you must request the hearing before the 30-day deadline expires.
Tax Debt Relief Options After an IRS Levy Notice
Once you understand the notice, you need to decide how to respond. You have several options. An experienced tax attorney can help you choose the best one for your situation.
Pay the Debt in Full
If you have the money, the simplest way to stop a levy is to pay the full amount you owe. Once the debt is paid, the IRS will stop all collection actions. You can find payment instructions on the notice itself or on the IRS website.
Request an Installment Agreement
Most people don’t have a large sum of cash ready to pay off a tax debt. If you can’t pay in full, you can ask for a payment plan. This is called an Installment Agreement. It allows you to make smaller, monthly payments over time until the debt is paid off. An Installment Agreement can make the debt much more manageable. The IRS is often willing to set up a payment plan if you can show that you intend to pay what you owe.
Make an Offer in Compromise (OIC)
What if you can’t afford to pay the full debt, even with a payment plan? You might be able to make an Offer in Compromise (OIC). An OIC is an agreement between you and the IRS where you agree to pay a smaller amount than what you originally owed.
To qualify for an OIC, you must prove to the IRS that paying the full amount would cause you serious financial hardship. The IRS will look at your income, expenses, assets, and ability to pay. The OIC process can be difficult, but if successful, it can save you thousands of dollars. Having a tax lawyer help with your OIC application can greatly increase your chances of success.
Request “Currently Not Collectible” Status
If you are facing extreme financial hardship, like being unemployed or having very high medical bills, you may qualify for “Currently Not Collectible” (CNC) status. If the IRS agrees, they will temporarily stop all collection efforts, including levies. They will review your financial situation periodically, and if your income improves, they may ask you to start paying again. CNC status does not make the debt go away – interest and penalties will continue to add up.
Request a Collection Due Process (CDP) Hearing
As mentioned earlier, you have the right to ask for a CDP hearing. You do this by filing IRS Form 12153. During the hearing, you (or your attorney) can challenge the levy and propose one of the solutions above, like an installment agreement or an OIC. A CDP hearing is a powerful tool. It stops the levy and gives you a formal way to resolve your tax problem with an independent officer from the IRS Office of Appeals. You can learn more about the collection process in IRS Publication 594, The IRS Collection Process.
Even if you live in New York, the IRS levy process is federal. However, New York State has its own tax collection rules. If you also owe state taxes, the New York State Department of Taxation and Finance has its own process for warrants and levies. An attorney can help you handle both federal and state tax issues at the same time.
How a New York IRS Attorney Can Help You
Facing the IRS alone is intimidating. The rules are complicated, and the stakes are high. A single mistake could cost you your home, your car, or your savings. This is where Thorgood Law Firm comes in.
Since 1998, our experienced New York tax lawyers have been helping people find freedom from their tax troubles. Here’s how a dedicated attorney can make all the difference:
- We Speak to the IRS for You: You don’t have to talk to the IRS yourself. We will handle all communication, so you don’t have to worry about saying the wrong thing.
- We Know Your Options: We will review your case and explain all your options in plain English. We can help you decide if an installment plan, an OIC, or another solution is right for you.
- We Protect Your Rights: We will make sure the IRS follows the law and respects your rights as a taxpayer. We can file for a CDP hearing on your behalf and argue your case before the IRS Office of Appeals.
- We Give You Peace of Mind: Knowing you have a professional on your side can relieve a huge amount of stress. We handle the paperwork and the negotiations, so you can focus on your life.
Don’t wait until your bank account is frozen or your wages are garnished. The moment you receive a Notice of Intent to Levy is the moment you should call for help.
Contact Thorgood Law Firm Today
A Notice of Intent to Levy is a serious warning, but it’s a problem with a solution. You don’t have to face it alone. The experienced New York tax attorneys at Thorgood Law Firm are here to help you. We offer a FREE consultation to discuss your situation. Unlike other firms, you will speak directly with a lawyer who can give you real advice.
Let us put our decades of experience to work for you. We will help you find the best path forward and protect what you’ve worked so hard to build.
Contact us today to get freedom from your tax troubles.
