Filing a Wrongful Levy Claim
The IRS has a number of different tools at its disposal when it comes to collecting debt from taxpayers. For instance, in some cases, the IRS can actually legally seize a person’s property to satisfy a debt. Fortunately, taxpayers do not have to take the seizure of their assets lying down, so if you were recently notified of an IRS levy on your property, you should speak with an experienced Florida bank levy attorney who can help you file a claim.
Issuing a Levy
As mentioned previously, a levy occurs when the IRS seizes a person’s property to satisfy a tax debt. The agency can only issue a levy after:
- It has assessed the tax and sent the taxpayer a Notice and Demand for Payment;
- The taxpayer refused or neglected to pay the amount owed;
- It sent the taxpayer a Final Notice of Intent to Levy and Notice of Your Right to a Hearing at least one month prior to the levy; and
- It sends the taxpayer advance notification of Third Party Contact if it is intending to contact a third party to collect the liability.
When these requirements are satisfied, the IRS can levy any property or right to property that a taxpayer owns or has an interest in, including:
- Retirement accounts;
- Bank accounts;
- Rental income;
- Accounts receivables;
- The cash loan value of a life insurance policy; and
The IRS also has the ability to seize and sell property that a person actually holds, like his or her car or home.
Filing a Wrongful Levy Claim
While taxpayers have always had the option of filing a wrongful levy claim, the Tax Cuts and Jobs Act, passed in 2017, extended the amount of time that a taxpayer has to file this type of claim in cases where the IRS actually sells off a person’s property. Prior to 2017, taxpayers only had nine months to file a wrongful levy claim against the IRS in these situations. As a result of the new changes, however, taxpayers now have up to two years to file a wrongful levy claim. It’s important to note that there aren’t any time limits to file a wrongful levy claim if the IRS still retains the levied property, such as a vehicle or home.
If, after assessing a claim, the IRS determines that a levy was wrongful, it will:
- Return the property itself;
- Return an amount of money that is equal to the amount that was levied; or
- Return an amount of money that is equal to the money received from the sale of the property.
For help filing your own wrongful levy claim, please call our office today.
Are You Facing an IRS Levy?
If you have received an IRS bill titled Final Notice of Intent to Levy or a Notice of Your Right to a Hearing and have replied to the IRS, but still have questions about your legal options going forward, please don’t hesitate to reach out to experienced Florida & IRS bank levy lawyer Ronald Cutler, P.A. at 386-490-9949 for help.