IRS tax levies are distinct from IRS tax liens. Where a tax lien secures the government’s right to claim a percentage of your assets, a tax levy allows the IRS to confiscate your property or other possessions to pay any outstanding tax debts.
If you fail to make timely payments or set up suitable arrangements to resolve your debts, the IRS has the right to seize and subsequently sell any real estate, business assets, or personal belongings you own now or in the future.
IRS tax levies can be applied to a wide range of assets including bank accounts, wages, pension funds, personal property, vehicles, and business assets or equipment. However, the IRS seldom seizes a taxpayer’s principal residence, and this would normally be reserved for only the most extreme instances.
Things the IRS is Unable to Levy
There are some things the IRS is unable to levy. These include unemployment benefits, certain household goods, worker’s compensation, and work tools. Although the IRS cannot take real estate or other assets without filing a tax lien first, they can apply a tax levy without notice to your wages and bank account.
There is no public record of IRS tax levies, so they have no impact on your credit report. However, for most taxpayers, the seizure of assets poses a far greater problem.
If you’ve received a Final Notice of Intent to Levy from the IRS, call us immediately to access tax levy help.