The worst type of mail; IRS notice of intent to levy
An IRS notice of intent to levy is sent by the IRS if the agency plans to seize your assets. Why would you get a notice of intent to levy? The IRS usually sends these notices to individuals who have been seriously delinquent in paying their taxes and have not attempted to resolve the issue. The notice will reference the tax period or period for which you have unpaid taxes.
The IRS standard timeline and escalation process for collecting unpaid taxes involves the following steps:
- IRS becomes aware that you have a balance due when you file your taxes
- The IRS sends its first tax notice to collect the balance, normally 4 to 6 weeks after it was electronically filed, providing instructions on how to pay the balance by a specified due date (CP 14 or CP15)
- First collections process notice is sent (CP 501)
- Second collections process notice is sent (CP 503)
- First notice of intent to levy (CP 504)
- Final notice of intent to levy (Letter 11)
Under the law, the IRS must take the following steps at least 30 days before they can begin to seize your assets:
- Provide you with a written notice of the intent to levy as well as an explanation about your right to appeal
- Provide an explanation as to the reason for the levy, the seizure process, and your options
- Deliver the notice personally or send it to your last known address via mail, either certified or registered, return receipt, or leave it at your home or usual place of business.
If you have received a notice of intent to levy from the IRS, you may want to get guidance from a CPA who has experience in dealing with an IRS levy, bank levies, unfiled or unpaid taxes, and more.
What you can do
If you are the recipient of a notice of intent to levy forms, what assets can the IRS take if you don’t pay taxes?
- Funds in bank accounts
- Social security benefits
- Property, including cars, homes, real estate, personal property
- Retirement benefits
- Property rights
- Government retirement benefits
You have several options if you receive a notice of intent to levy:
- Pay the entire tax balance owed
- Apply for an installment agreement
- Make an offer in compromise to settle your taxes for less than you owe
- Agree to a hardship status or “Currently Not Collectible” status
- File Innocent Spouse Relief if you aren’t responsible for the unpaid taxes
If you’re not in agreement with the information in the Final Notice of Intent to Levy, you can file an appeal by filling out and submitting IRS Form 12153 or request a Collection Appeals Program (CAP).
Talk to your new CPA
If you receive a Notice of Intent to Levy from the IRS, you should speak to a tax professional in order to protect your assets from IRS seizure.
GYL CPAs and Advisors provide a full range of accounting, auditing, and tax services for individuals and businesses. Our CPA firm can analyze your particular situation and help you find the best plan of action.
In addition, we offer consulting services about estate and succession planning, retirement opportunities, and more. Own a business? Take a few minutes to read about 3 keys to avoiding business audits.