If you’ve received an IRS notice saying that they intend to levy your bank accounts if you don’t pay up in 30 days, then it’s time to pay attention. Before the IRS actually issues a levy notice, they’ve usually made a few attempts at contacting you and trying to get a payment. If you’ve received an IRS levy notice, it means that the IRS hasn’t heard from you—they think you’ve been blowing them off (which in many cases is true). If you ignore the levy notice, they’ll just take your money and the law is on their side so you need to act now.
First, the responsible thing is to call them, or hire someone to deal with them for you. (I personally think that if you’ve reached this point, it’s best to hire someone—but remember, I do this for a living, so note that I’m biased.)
There are things you can do to prevent the IRS from going through with the levy. Let’s assume that you really do owe the money:
1. You can set up a payment arrangement–you pay off the IRS on a monthly bill schedule
2.Your situation might qualify you for an offer in compromise (the pennies on the dollar thing you see in TV commercials), or
3. Maybe you’re going through hard times and need to be put into the currently uncollectable status—you still owe, but the IRS quits hounding you until you get a job or your situation changes.
But maybe you don’t really owe the money. That’s the big kicker for me. Usually, if you’re getting IRS levy notices, you do owe them money—or at least part of it, but I have seen several cases where my clients don’t owe the IRS anything! A couple of times I have even gotten them refunds instead. If you didn’t do your taxes, and the IRS did them for you, don’t assume that the IRS did them right. When the IRS does your taxes for you, they automatically put you in the highest tax bracket they can justify and you get no deductions or tax credits that you might have qualified for. (Here’s a hint: if you’ve got kids, the IRS probably did your taxes wrong.) Even if you find that you don’t owe the IRS money—you still have to contact them, let them know the situation, and then you’re going to have to provide proof. Usually your proof is your corrected tax return.
Dealing with the IRS is the best way to get yourself out of levy trouble. But here are a few things that you also might want to consider doing while the threat of a levy is still hanging over your head:
1. Make sure your name is taken off of your kids’ and/or parents’ bank accounts. If you’re on someone else’s bank account, the IRS can and will levy that account too.
2. Don’t keep large amounts in your bank accounts. If you’ve got lots of cash, then maybe you can just pay your debt. But usually, this isn’t an option for most people. If your paycheck is going direct deposit into your bank account, get the money out immediately. You can put your cash onto a prepaid Visa debit card. Once the levy is in place, the IRS can only take the funds that are in your account at the time of the levy, if you get another deposit, that money is accessible. Transfer money in only as you need to make payments out of the account.
IRS levies are serious business. Don’t make the mistake of ignoring them.
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Hello Jan, my ex spouse was audited for 2011 and owes 50k. I applied for innocent spouse relief and was just denied. He is currently on a payment plan to pay it off. If I can’t get relief from this do I need to make a payment plan also? Or will I need to since he is already making payments on the account..confused and it’s the weekend so I can’t call anyone!
Hi Nicole,
The IRS is quite vicious when they are going after payroll tax debt. What they have is a bank document that lists you as treasurer of that company. I recommend that you get yourself a tax attorney. This is serious.
Hi Jan,
My current issue is that the IRS is coming after me for a payroll tax debt that is owed by my previous employer that is now out of business. I was a signer on a company bank account and that seems to be the trigger. Evidently my title given when my name was added to the account was Treasurer. However, I was in no way an authority figure with the company. My name is not listed on any corporate documents filed with the state. All I can find is the title on the bank account as to why the IRS is tying this debt to me. I have no other proof to show that I am not responsible for this debt other than the corporate documents. Is this enough to get the IRS to stop coming after me for this debt?
Thank you in advance for any insight you can give.
Hi Monica,
I’m sorry you’re in this situation. It’s hard.
First, yes, they can take your daughter’s money if it looks like you’ve had any activity on the account. If you made any deposits or withdrawals they are likely to keep your child’s money Especially since she is a minor-they’re more likely to keep it. If she’s using those funds for school or something you can prove- you have a better shot of them leaving the funds alone.
Do fax copies of all your bills to the IRS, I’ve done this before and they’ve released at least the amount of the bills. Then work with them to get on the currently uncollectable status. This is hard to do while they’re holding onto your bank funds. (It’s sort of like they’ve tasted blood and want more!) But at least you can show them your bills, get that released from the levy, show them how that’s not your money (they may or may not bite on that one), and show them how you are unable to pay rignt now.
You’re also going to want to show them how you are not going to fall behind on your taxes again. That’s what they really want to see. How did you get into this tax debt, and how are you going to avoid that problem in the future? If you can show them that, they are easier to work with. Good luck.
Hi Jan,
I had a levy put on my credit union account 1 day ago. I have a joint account with my 14yr old daughter, Could the IRS remove funds from a minor? Most of the money came from her account that she worked to hard to build and save. How can I help her get it all back. Im concerned about her status with the credit union as well.
I was given a ph. Number, from the banker to call, so I did call, The. Rep at IRS said to fax her copies of my bills and gas reciepts etc. by friday. The money will be released on Aug.15th to the IRS. She will see what she can do to help me she said. Honestly, I can not afford another bill for not even $1. I’m currently on welfare , I am a single mom. I have a bad back as result of my last job, and my son became very ill, he has a mental illness, which he requires 24/7 supervison. The scaries thing to live with is a mental ill person. Lots of work. I don’t know what I am going to do if they KEEP all of money..It was the 1st when the put the levy, which is when I pay my bills. Now I have absolutely no money to pay any of them, which I am about 1-2 months behind on all my bills and I was gonna pay this month. What can I do. I wasn’t given a notice or had no knowledge of a bill that could hurt me like this. Please help. TIA
Hi Ora,
Oh boy. You’ve got a problem. A big problem. Colorado, Iowa, Kansas, Montana, New Hampshire, South Carolina, Texas, and Utah have common law marriage on the books. There have been other common law states, but they didn’t recognize common law marriage after 2005 so I’m not listing. So – were you in one of these states? If yes, you might need to file for divorce.
Seriously, a friend of mine from Colorado had to file for a divorce even though he never legally married the woman because he was deemed to me common law married.
Now, you say you were never legally married – but you filed a married tax return so you were basically telling the government that you were married! That’s one of the main grounds for a common law marriage.
Now the laws surrounding common law marriage are different for each state. I suggest that you get yourself a lawyer. You have bigger issues than the IRS issue.
That said, you need to talk to the IRS. If you can’t prove that you weren’t married, I’m thinking you may have a good case for filing “innocent spouse”. Of course, I suspect you’d rather prove you’re not married, but I want you to have a back up plan in case you’re stuck.
One thing that you might also be able to use is the Taxpayer Advocate. You say you were never contacted by the IRS until the levy was already in place. There are rules about contacting the taxpayer so you may get some help there. The Taxpayer Advocate is the person to go to there. https://www.irs.gov/advocate
Good luck.
Hi Lisa,
It’s funny how a divorce can really mess up a person’s taxes. Here’s what I would do. I would file that 2005 tax return. Since the IRS filed it for you, and you haven’t already paid the taxes, you can still file the return yourself. Claim all those deductions and get this monkey off your back.
I was considered common law married back in 2005. I filed one tax return with my ex in 2007. We split in 2008 and we were NEVER legally married. The IRS placed a levy on my business and personal bank accounts this weekend. They advised CHASE THAT HE OWES 12,000 in TAXES I NEVER RECEIVED ANY SORT OF LETTER OR PHONE CALL FROM THE IRS. The one year we filed he didn’t even owe but in fact got a refund back. I married in 2011 and have filed my taxes with no problem. I was unable to put GAS in my car or buy groceries for taxes owed by someone who I WAS NOT EVEN LEGALLY MARRIED TO. THIS CAN’T BE LEGAL. I DON’T OWE THIS DEBT HE DOES WHY ARE THEY COMING AFTER ME??? OUR LAST NAMES WERE NOT EVEN THE SAME. How were they able to just freeze my acoount
Hello, I have a lien in my name filed by the irs, i owned a business in from 2001 to 2005 for my ex husbands family ( the reason he is now my ex-husband ) I filed and paid taxes for 2001-2005 and my husbands family paid everything that was owed and all went well, in 2005 they decided that they would begin a company in their name, and wouldn’t pay what they owed in my name and also got my husband to take all of the company paperwork from my office, now with that being said I went through a long hard divorce and never filed the 2005 taxes. at that point had i filed the taxes and filed that i paid all of the subcontractors ( they took info) then i would have owed nothing most likely after deductions . But since i didn’t file due to living under poverty level and inability to pay they did the taxes for me , and estimated that i owed them 100,000 . i could never afford to pay back that amount and called and told them that and they told me that i had to figure out how to pay the debt or I could be incarcerated. Then I did nothing for years and now they have 2 liens on me and the amount is around 300,000 that i owe them now… How can I fix this, like I said I could never in 10 lives pay that amount of money , when i do work the most I make is Minimum wage 🙁 , I need help , Thanks in advance
Hi Bobby,
No, they can’t.
Hi ! Can the IRS garnish funds from my prepaid debit card ??
Hi Patrick,
I find that if the IRS puts a hold on your levy, they mean it. I would keep track of the name and ID number of the IRS agent you spoke with so that you’ve got it “just in case”. I think your time will be better spent getting your ducks in order to get the “uncollectable” status.
One thing though, do make sure you get back with the IRS before the levy hold is lifted. If you miss your deadline, they act pretty quickly.
Hi Melissa,
If you are on those accounts, then yes they can. For example: let’s say you are on your child’s account, then they can have access to that account as well. I’ve seen that happen with garnishments before. I don’t know if North Carolina does that, but the IRS definitely does.
Hello,
I received a ” Notice Of Intent To Levy” for the year 2011 from the IRS. I called them and the agent put a eight week hold on the Levy noticed I received and also indicated this would deter any levies placed owed statements for 2010, 2012, 2013. My intent is to try and qualify for a hardship for uncollectible status until I can once again regain employment. I was recently blessed with a distribution from a former employer that I have placed in the bank and currently living off it.
Should I call the IRS back and get the “Levy Hold Status” in writing ?
Also From your experience will the ‘ Levy Hold” they have set in place not go unnoticed or miscalculated so that my bank account is levied ?
Thank You
I have a question. If I received a garnishment from the State of NC IRS to garnish wages from a bank account. Can they only take from my account? Or are they allowed to take from family members accounts too?
Hi Vivian,
I’m so sorry. Once the IRS has the money, they don’t give it back. But, do they actually have the money yet? You didn’t get a notice from the IRS, did you get a notice from the bank? Or did you just wake up and find your money gone?
I ask because a levy takes 21 days to process. Usually the bank just “holds” it and then sends it to the IRS. So, if that’s the case, you may be able to plead a hardship with them. I’ve done that where they’ve had me fax them copies of a client’s bills and they released part of the levy so she could at least eat.
But, if the 21 day hold is over and they funds are already gone–then they’re gone. Sorry.
Now, looking back a little bit. You say that you didn’t receive a notice that they were going to do that. This is important–more as a warning to anyone else reading this post than to you–you’ve already learned this the hard way. One the IRS has you in a levy situation, you were having your old paycheck garnished, the IRS can go and take something else without having to serve you notice. As far as they’re concerned, you knew of the levy because of the garnishment. At some point, somewhere along the line (even if it was years ago) you were given notice.
And, you were being garnished so they were getting money and all was good so they weren’t going after anything else. When you left that job they were thinking – hey, where’s our money? She quit her job, we need to get our funds from some other place. Let’s go find Barbara’s bank account!
When you changed jobs, your new employer doesn’t tell the IRS anything other than that they’re paying withholding taxes. They don’t give the IRS your name or anything like that until they file the W2s. Also, how is your new employer to know the IRS is garnishing you unless you tell them?
Okay, so now you’ve had your hand slapped, bad girl. How do we move ahead?
First, call the IRS. Job one. They’ve gotten your attention. You’re going to need to file those tax returns. Figure out what you really owe and set up some type of payment plan so they’re not garnishing you anymore. The thing is–you can probably have a much better arrangement with a voluntary payment plan than with a garnishment. More money to pay bills, eat, stuff like that. (I like to eat!)
Also, make sure that you’re withholding enough tax so that you don’t get into this situation again. (I know, you know that, but I’m posting this online, I need to say it for anyone who reads this because it’s so important.)
Being levied by the IRS is like a punch to the gut. You’ve outlined it pretty well. You have no money, your account is overdrawn, you weren’t expecting it. Wow. It’s a nightmare. You know how difficult it’s going to be for awhile to get everything straightened out.
You can do it. Think about all the positive good things about yourself. You have a job, a stable work history. You’re a decent human being (okay, I’m just guessing there, I’ve never met you but I bet you really are a decent human being, right?) Keep all that positive goodness in your mind when dealing with the IRS because sometimes they’re not all that “friendly”. This is my pre-fight pep talk.
You’re going to call the IRS 1-800-829-1040 – be prepared to be on hold forever. You’re going to have your bills ready to fax to them (if it’s at all possible to get them to release funds.) You’re going to find out what returns need to be filed. (If you don’t have your W2s and stuff, the IRS does, they can sent you a wage and income transcript.) You’re going to file the returns and then set up a payment arrangement. You’re also going to review your withholding to make sure you don’t have to worry about owing the IRS in the future.
It’s a lot to do. You might need help. Some IRS offices will actually help you if you go in person. They cut down on that but there are still some that will. Now, there could be a government shutdown on October 1st if Congress doesn’t get the budget settled, so, I recommend going before then in case the IRS shuts down. Helping citizens is something that would be closed so I’d hurry, just in case.
Good luck.
The IRS just took all my money from my bank account….i didn’t receive anything in the mail, I swear I didn’t get a notice. I changed jobs and thought my employer would inform them and I would get a notice. I was at my last employer 19 yrs and am not sure how any of this works as I was having money taken from my check. I don’t think I owe them as much as they claim but I have not filed in 3 yrs….or maybe it’s 2…… what do I need to do first…and by the way I have negative funds in the bank…..and I’m sure the IRS won’t give me any thing back to eat n pay bills right?
Hi Kim,
A lien is a different from a levy. A levy is where the IRS grabs your money from the bank, or garnishes your paycheck. A lien is like a claim against future income–the most common example is if you try to sell your home and there’s an IRS lien on it, the IRS will get the proceeds from the sale.
So, it sounds to me like they’re not going to grab your money, at least they’re not at that stage yet.
But, what should you do? If your debt is over $50,000 it’s going to be difficult to have the lien removed. But, if you owe less than that, and you set up a payment arrangement using direct debit from your checking account, you can probably get rid of the lien.
But whether you can get rid of the lien or not, you should talk to the IRS, let them know you’re working on a payment plan of some sort. You want to make sure you’re working with them so they don’t slap a levy on you.
We received a notice of lien from the irs. I took my money out of the bank and stopped my direct deposit. If I put my money on a prepaid debit card, can’t the irs seize that too?
Thank you for your response.
Hi Cyndi,
The IRS can seize a house, but it’s a major pain in the rear for them so it’s not a real high probability, especially if it’s your friend’s main home. Now, if it’s a rental property–they are much more likely to claim that. But if you’re renting a room in your friend’s main home, you are relatively safe.
In order to seize the house, they would need a court order. There would be some time for you to react–like calling the newspaper and letting them know they’re kicking someone out of their home. (The IRS doesn’t really like that kind of publicity.)
I’m thinking it’s more likely that they’ll garnish her bank account again before trying to seize property. It’s much easier.
Hi Jan
I have a stubborn friend who refuses to contact the irs..she has not filed her taxes since the 90’s and apparently owes them and they finally caught up with her.
It was my understanding They sent her notices with intent to levy her social security which is directly deposited into her account…she never responded to them and of course thats what they did…the bank froze her account and her account was depleated which because of this her house payment was now gone also…she still refuses to contact them. She simply opened an account with another bank…having her ssi check deposited into the new account.
No matter how nicely or firmly or gently i try to advise her to get some help or contact them she refuses..n says she doesnt need to cause they have an agreement now that their taking part of her ssi because of the levy notices telling her that is their intentions..when I advise her that that is not a payment plan..she gets mad
she feels this is her payment agreement with them and they will no longer sieze or levy or garnish any thing more…I feel shes in for a rude awakening
I dont know what to do..I rent a room from her I’m worried because she refuses to talk to them they will levy or seize her house and the house will go into lock down.
What can happen here?
Hi Joe,
Some states will do the “currently uncollectable” status as well. It’s best going directly to the state that’s after you.
If you’re out of the country, remember that you still are required to file a US tax return on the income you’re earning overseas. (Although you can probably get a good portion of it excluded from tax either with a form 2555 or take a credit for taxes paid to a foreign country with form 1116.)
It’s pretty difficult to slap a levy on you when you’re overseas although they can attach your assets that are here in the US.
What’s the worst that can happen? Well, a woman I know (not a client) was about to leave the county on a cruise and was stopped at the port because the IRS was after her for a tax issue. That was the end of her little vacation. So, if you’re planning to re-enter or leave the country again, you may wish to fix this little tax issue. Will that happen to you? I have no idea, but you asked what would be the worst that could happen? I think that would be it.
Hi Caleb,
you’re right your VA benefits are your SSI cannot be levied. BUT — and this is the biggie, your bank account can–even though it contains your SSI and VA benefits.
So, you’re correct that you need to take your wife’s name off of the account. That will be what protects your assets.
Now depending upon how how long you’ve been married, and how the business was set up, there is a possibility that you could be considered a part owner by virtue of being married to your wife–so you may wish to dot the i’s and cross the t’s to make sure you’re free and clear of that mess. (Just to be safe. I’m assuming that you’re not a part owner, but I wanted to mention it.)
But if you take your wife off the bank account – or safer still, set up a new one without her being on it. Then cash her checks and then deposit them into your account. (At least until this mess gets cleared up.)
Hi Michele,
I recommend you work with a California preparer on that. I haven’t done a California installment agreement, I don’t want to mislead you. Good luck.
Hi John,
Wow. That’s amazing on so many levels. I’m sorry you had to go through that. Most states will not levy a bank account in another state so that one is new to me. And that they garnished more than the debt- that’s also weird. Plus, garnishing when the debt is only $280. And I really wonder how they could find your bank if they couldn’t find you to notify you. (Although I guess it was probably on your federal tax information.)
I would call a California EA. California is one of the toughest states to deal with and they also have separate licenses for their preparers.
The states get information from the federal government. So–I’m guessing that even though you only worked a few days in CA, something in your documents labeled you as working in CA–that’s why they’ve got your information. And, I’m guessing that they sent you some type of notice, but of course you never got it. You probably moved since 2012. They catch is, it counts as having notified you if they mailed it to your last known address, even if you don’t actually receive the notice. (Yeah, stinks, I know.)
Good luck with this. It sounds like a mess.
I Just had the state of California levy my account. They gave no notice or communication of any kind. Said because I worked in California in 2012. Which is true but I was a texas employee and when in Ca. I paid there taxes on my checks. I was never there for more than 20 days at a time. And mabe a total of 145 days. I was also told that the taxes would have been only 280.00 dollars yet they took 1300. Now my wife and kids have no money for groceries after my wife paid all the bills. She went to store and after checking out two baskets of groceries found out that account was in negative and several checks had bounced. What can I do. Is this even legal? Shouldn’t they contact me first?
How difficult is it to get an installment agreement if you owe more than $25k to California State Franchise Tax Board?
I’m a disabled veteran, my wife owned a business with her parents, unfortunately things went south. She left the business in 2012, her parents sold it in 2014. They didn’t pay taxes in 2011. Her mother set up payment arrangements and has been paying the 15k in debt, now down to 2500. We received a letter stating that the 2500 is still owed and they are now levying our bank account. Which my SSD and VA disability go into. If they do this it will stop me from paying our mortgage and household bills. Can I just remove her from my account to stop the levy? If I deposit (not directly) her check in my single account, are they still able to take money if her names not on it? As for my pensions, aren’t they federally protected? And how can I be held liable for something (the business) I’ve never had a part of?
I received a NOTICE OF PROPOSED ASSESSMENT for 2013.
Question(s):
Can the “uncollectible for now” clause that applies to the IRS be used for the states too?
I’m an expat in a foreign country now and have very little in my bank account here so not worried about levies.
What’s the worst that could happen if I ignore the whole thing?
Thanks
Thank you Jan for feedback.
I meant to say that if I don’t file next year as I am travelling end of year overseas. Will I get my bank account frozen before year 2016 ends? or there is a time lag? Was not planning to file file in spring 2016 since I am expecting a large tax liability I will continue to pay the $23 as per agreement through the 2016 year.
Hi Joseph,
The IRS cannot levy your girlfriend’s bank accounts if your name isn’t on them so she should be safe. Taking your name off her account was smart.
When the IRS issues a garnish, they can only take the funds out of your bank that were in the bank at the time the garnish was issued. For example, let’s say you owe the IRS $1000 and they issue a garnish. But there’s only $200 in your bank account. Then the IRS can only take $200. They cannot put you into a negative balance.
That said, if you write a check for $30 after the IRS issues that levy, your account will have a negative balance. So be careful.
Now, you were levied by the state, not the IRS so things could be a little different, but I can’t imagine the rules for North Carolina to be that different.
Hi Joe,
Congratulations on getting a $23 a month payment. That’s a really sweet deal. Really sweet deal–so I suggest not messing it up. You want to know how long you can go without filing a tax return before they start action against you.
Hmmm–so this is 2015. I’m assuming that you’ve filed 2014. So, Your 2015 tax return will be due on April 15th 2016. But–if you file an extension, you can drag that you until October of 2016.
If you don’t file an extension, then you’ve violated your agreement and the IRS can void you payment agreement immediately.
Also, if you pay late, they can void your agreement. And I’ve seen them cancel agreements for being one day late so you don’t want to mess with that.
So here’s my question to you–you’ve got a really sweet payment arrangement, why would you even want to mess with it? File your taxes on time and keep making those payments.
Now, I’m guessing that you don’t want to file your taxes because you’re making way more than they think you are and they will want you to pay more money. That’s the risk you have to take. Make sure that you are at least withholding enough to cover any debt you owe for 2015. If you have another balance due for 2015 and you try to renegotiate–they’re not going to be very pleasant to work with.
Hi Richard,
First thing I’d do is try to get claim a hardship. It sounds like you should qualify. The IRS will want you to fill out a form 433A and probably will ask for bank account statements and copies of bills that you’ve paid, but it would be worth it to at least stop the levy proceedings.
Now, your bigger issue of course is the 2012 taxes. So, what’s the real scoop? Not what the paperwork says, but what did you really make? Did you really only make $1,000 or did you make the $27,000?
And I’m wondering about the I9–I think you mean you got a 1099, that makes more sense. Are you a truck driver? The reason I’m asking is that I’ve seen some truck drivers make horribly low incomes net–but the 1099s say they made much more money. I just handled a case like that. Fortunately, my client had kept all of the checks he received and we proved he only made a small amount of money–that’s why he quit the job.
If that’s what happened to you, you’ll have to do some digging to prove your case. You may not have your check stubs (most people don’t keep them) but that would help. You could get copies of your bank statements to prove what you deposited. That would help too.
I’m thinking that you’re going to need some help to prove your case.
Now you said that you talked to several different lawyers and they all said they can’t help you. Are they saying they can’t help you because you’re unemployed and have no money? Are are they saying that because they think you owe? I’m inclined to think you’re being told they can’t help you because you don’t have the money to pay them.
You also said that the IRS isn’t going to put the $1000 refund you’ve got coming towards your 2012 debt–that doesn’t sound right. It sounds to me like they did already, since they didn’t give the money to you. (Unless it was held for some other debt–hard to say.)
Now one final thing–it sounds to me like they sent you a form to appeal your case before the tax court. Fill out the paperwork and send it in. You probably won’t go to court over this, but by completing the paperwork you’ve covered your behind. It gives you the option of going if you can’t settle this thing.
And, you sent a letter explaining your case and why you believe that you don’t owe the tax–that’s also very good. (Because you can’t introduce new issues in court, but you can show what you’ve already presented.)
Now, one final thing. (Sorry, I’m awfully wordy today.) I really think you need some help with this. Now you’ve talked to lawyers who can’t help you. I mentioned that they might not be helpful because of you ability to pay. Another issue for some of those big national guys is that they won’t touch a case like yours if you owe less than $10,000. (Their fees are so high, it’s not worth pursuing a smaller case.)
I’m thinking you should go to your local H&R Block office and have someone look at your 2012 tax return. If they just look, they’re not going to charge you. But here’s the key–if they can look at the paperwork and prove that you don’t owe the $7000, that’s your ticket. Now they’d charge to prepare the return, but it will be a whole lot less than what those attorneys would cost. (Ask if there’s an EA in the office, or a senior tax advisor. Don’t get a newbie.)
Some IRS offices can help also. But they’re not motivated to reduce your taxes, although I’ve dealt with some wonderful folks who really do care about the taxpayers. (They do exist, sometimes they’re hard to find though.) But if you’ve got one of those walk in offices in your area, this might work for you.
Good luck. I hope you win this.
I just posted about my former employer and the IRS…i forgot to add, this didn’t pop up until I tired to file my taxes for 2014. Which I never received because the is now a “hold” on my taxes. The IRS and the lawyers I talked to said I wont get my 2014 taxes until this is straightened out, but they wont deducted my 2014 taxes (a refund of over 1 thousand dollars) from what I “owe”. Can they do that? I’m unemployed and my only bank account is empty. I have not but I (disconnected) phone in my name. Should I file out a hardship form?
A few months ago I received a letter from the IRS saying I owed over 7 thousand dollars in taxes from 2012, from one employer which filed an I9 on me. I tried contacting him (unsuccessfully), several different lawyers (who say they can’t help me) and the IRS. I got paperwork from the IRS that my former employer claimed I made over 27 thousand dollars, but I have my I9 form he gave me for my taxes which states I barely made over 1 thousand. The IRS gave me paperwork to fill out, which I did. I also sent in copies of what I had from my previous employer with a written letter of why I believe a mistake was made. Today I received a levy/court notice which I have to complete and send back by August 3rd.
Should I just pay them or keep fighting it? If I fight it should I try hiring another lawyer?
Jan:
Thanks for the great site, very interesting reading.
Iam under payment plan right now for missing 1099, $23/month starting this month for balance of ~15xx
My question: If I dont file my taxes during 2016 tax season. When can the IRS contact me for missing 2015 return not filed (summer 2016?). Should I expect a bank levy or wage garnishment some time Dec/2016 or even earlier? I plan to continue paying the $23 throughout the 2016 year.
Hello Jan Roberg,
Today, my girlfriend and I noticed that money was taken out from a bank account that I share with her. I was levied by the State of North Carolina for some taxes. This caught me out of the blue. I thought my taxes were taken cared of. I never received any mailings since I’ve relocated. After she saw that there was money taken out, we thought it would be a good idea to to remove my name from her account, so we did. My name was only on that one account. Can the state go after her checking and savings (my name isn’t on any of those accounts, just hers)? My last question is, can the state take more than what is in the account that my name was on? For example, if I have $500 in the account, can they take $700 and leave me with a negative balance?
Thank you,
Joeseph
Hi Michelle,
When you do an offer in compromise one of the issues is what are your housing expenses. Since your friend pays your rent–that’s taking $1400 a month out of what you’re spending which is something the IRS looks at when doing an offer.
So, my answer is, I’m not sure. Have you tried to IRS Offer in Compromise Pre-Qualifier? Here’s a link: http://www.irs.gov/Individuals/Offer-in-Compromise-1
It’s a pretty good tool. And by answering the questions honestly, it will give you a really good indication of whether or not you stand a chance at an offer.
If the offer won’t work, the IRS would probably accept an installment agreement from you for $390 a month. I’m thinking that under your current circumstances, you can’t afford that–in which case you’d need to provide the IRS with financial statements anyway for a lower payment amount.
So, it looks to me like you’ve be explaining that $1600 a month either way. Now here’s one issue–$1600 a month amounts to over $14,000 – which means that your friend could be required to file a gift tax return. You might have an issue there. A gift isn’t taxable to you, so you wouldn’t be required to report it for your taxes, but it does seem like a lot of money for a “friend” just to fork over.
Bottom line is – I think you’re going to be supplying bank statements whether you do an offer or an installment agreement. And, you’ll need to be able to explain where that money came from (unless you’re agreeing to the $390 per month.)
Hi Sheri,
My best guess is that your husband was still listed on your son’s bank account and that’s why the state tax board levied the account.
I’m thinking that your son doesn’t need to change his name or social security number, just make sure that his father is not listed on his account any more.
All he needs to do is just remove his father from his current account, but if it makes him happy to open a new one (just to be safe) he can.
And for what it’s worth, this is a really common problem for families with a parent on the child’s bank account or vice versa. It’s not the name, it’s the fact that your husband is on your son’s account that’s the problem.
This is in regards to a state levy. Unfortunately, my husband owes taxes & he and our son (age 20) have the same first name, middle initial & last name. A levy was recently put on our son’s bank account. (The necessary paperwork was faxed to CA franchise tax board) and the levy was lifted. My husband called the FTB & has made arrangements, but my SON is My concern!! Possibly, my husband was on his bank account when it was first opened, but I’m unsure. I know that when we checked husband’s credit a few mos ago, it has our son’s social security number listed (in addition to husband’s) as being associated w/him. The question is: How can we prevent this mistake from happening again? Does my son need to change his name and/or social sec #? Please help. My son would like to close the existing bank acct although the levy was lifted & open a new acct but is concerned this might happen again. Would it help to have his full middle name on a new bank account since he & his father have same middle initial BUT Different middle names? (I’m NOT happy w/the husband, but I need a different forum for that)!
Hi Jan,
I have been under employed for a few years after being laid off from my corporate job. My jobs now are mostly temporary and pay just above minimum wage. I have a wealthy friend who has been helping me pay my $1600/month rent, but in order to pay this, I have to deposit this cash into my bank account and pay it online. My apt does not take money orders or cash for rent payments.
I owe 28k in taxes and would like to offer an OIC for 10k, but I’m concerned the IRS will find out about my friend paying my rent each month, which has not been included in my income on yearly taxes and I’m worried that this may look like tax evasion.
My questions are:
If an OIC is attempted, do I have to explain where the $1600 monthly deposit is coming from each month?
Would it be better to fill out an installment plan request, and if so, do they look at banks accounts?
I don’t have any assets, but a 4k car, and I owe 80k+ in defaulted student loans. Would it be better to attempt an OIC or play it safe and go for an installment plan, since it sounds like no financial statement needs to be filled out for that?
Thanks for your time!
Hi Sirenia,
It sounds like whatever tax issue your dad had back in 2009 with the IRS is now catching up with the state tax board. Usually, they’re a little faster than that, but not always.
So–first issue is–does your dad really owe the tax? I can’t see the tax returns, my gut sorta says the a $13000 state tax bill is in line with a $60K federal bill. But that’s a super broad generalization. So, first you need to check if he really owes it. If not–you have to prove it. If he does–well then he’s going to need to do something.
Some states will allow you to make a payment arrangement or even an offer in compromise–but not all of them. And the more the state is in debt–the less friendly they are about back taxes.
If the collection agent is truly rude, you can try asking to speak with her supervisor (which usually will make her ruder but eventually she’ll have to get the supervisor.)
I suggest that you get some professional help to work this out. Yes, it costs money, but it might be your best bet. Good luck.
My dad used to owe IRS 60K now we brought it down to 54K. We later got a notice saying we owe 13K from the Franchise tax board they’ve been wiping our bank accounts, ( they said state taxes due back in 09) this is the first we’ve of this! the person assigned to our case is very rude and demands the 13k up front. I now did ask my dad to keep his cash in a safe place (not the bank) he is a business owner and we report EVERYTHING to the IRS we by no means are able to pay this amount. What do we do? all of this is from 2009 where fraudulent toward my dads taxes. Its a nightmare ;(
Dear Confused Lynda,
It’s worth making a phone call. If the notice says everything is due in 12 days–something’s wrong. You’re better off talking to them than guessing.
Hi Charlotte,
How much worse can it get? Contact the IRS. Tell the your story. Show them some good faith. When you don’t respond, they use stronger enticements, like a levy. Now they’ve got your attention. By all means call. Ask to be put on currently uncollectable. But you’re going to have to file those returns.
Now, any levy that they’ve got open right now–you probably can’t stop. But by calling you could prevent future levies. And maybe you can buy yourself some time to amend those back tax returns. Good luck.
Hi Tammy,
Call the IRS. Call your bank. I’m pretty sure the bank would tell you if you’ve been levied. But call, that’s the best way to know.
Ah Jeremy,
Did you think that maybe the IRS thought it was fraud and held back the refund? Just sayin’.
When we were married my X and I entered into an installment plan for 2005,2006 and 2007 taxes due to an audit. In short they considered my X business a hobby which generated taxes due. At one time It was over $25,000 and now it, with interest and penalties is about $15K, $11K is for 2006. 2005 was paid off in the plan. I have been making payments regularily, without fail. Out divorce decree states that we are to equally share the debt but I have been the one making those payments. Thus far the x has paid me $50.00 toward his share. I received a cp39 notice stating that a refund from an overpayment of 2013 taxes he filed was applied to the 2006 taxes due. But the notice states that the whole $11K is due in 12 days !!! Nothing is stated about the installment plan, Ironically today I mailed the payment due March 15th [because all of the installment payments are due on the 15th of the month]. Every month I have to take the previous month’s “invoice” and change the month because I never receive the “invoice” in time as I cut that check on the 1st of every month. Could this be just a notice that the $32.00 was applied and the installment plan is still in affect? The form does not look like if hase a space for mention of the payment plan. I never received any notice that they were terminating the plan. Plus I’ve never missed a payment, I’ve been religious about filing and paying taxes ever since. Plus the notice says nothing about the $3K+ owned [and part of the plan] for 2007. Is it customary for these cp39 notices to not mention the installment plan that is in affect and I will get the regular “invoice” reminder that my $220.00 installment payment is due on the 15th like I always do? Figures I get this notice on a Saturday and they are not there to answer calls.
Hi Jan: I need your help! I have not filed taxes since 2001/2002. I have worked full-time and been self-employed all this time. I know I have been remiss; it seems when taxes were due I didn’t have the money to pay. I didn’t realize that I could have filed even though I didn’t have the money to pay.
3 months ago an RA asked me to file taxes for the years 2007-2013. Because I wasn’t working much due to severe back pain that will require surgery, I sent the agent a certified letter asking for more time to file them because of my injury and because I just don’t have the knowledge to file self-employment returns. I asked for a written reply from her but none was given.
I was not able to get help because I have no money. Now the IRS has filed a lien and levied my bank account and has sent a levy to the company I freelance for.
I have several questions: 1. The IRS filed returns for me and says I owe $100,000+ for the years 2002-2006 but I had several dependents (family) I supported through 2011. Can I file returns for 2002-2006 now and can the IRS collect on tax debts that are more than 10 years old?
2. Can I contact the IRS directly and ask them to put me on “Not collectible at this time” status since I’m not working much and have little income or will I need to hire an attorney to do that? I don’t own a home or property. I currently make payments on a 2004 vehicle.
3. The co. I work for owes me a couple of payments from work done last year. The IRS sent a levy but no invoices were due then. Will the IRS try to levy them again? I need that money to hire an attorney asap.
I don’t want to contact the IRS directly if that will negatively impact my case.
I appreciate any help you can give me.
We received a CIVPEN letter stating that we didn’t send 1 qtr of 941, W2 or W3 in (for our business) and have diligently been trying to get it resolved. I had one agent tell me that the IRS would be levying my bank account but I have never received a formal letter stating that they have. Is there a way to find out if they have or not?