The last one is a Final Notice Of Intent To Levy and Notice of Your Right to a Hearing. This means your time is about to run out before your bank account can be levied by the IRS!
The IRS can also garnish your wages or take other drastic collection action against you. The word “levy” means involuntary seizure or taking.
It can be confusing to know when the IRS is about to seize assets! The second-to-last notice is also called Notice of Intent to Levy. The difference is that it doesn’t advise you of your right to a hearing.
Normally you will get a series of four to five notices from the IRS before seizure of assets can take place. Only the last notice gives the IRS the legal right to levy.
According to Internal Revenue Code Section 6330, the IRS is required to notify you in writing before levying. Also, they must include in that notice information telling you about your right to appeal this threatened collection action within 30 days.
The second to last letter "Notice of Intent to Levy" does not contain this notice of your right to appeal. Here is a link to the IRS website that explains what notice the IRS must give before levying.
The good news, as mentioned above, is that normally the IRS sends you five letters (five for individuals and four for businesses) before actually seizing your assets.
These notices are about five weeks apart so that you have at least four or five months to prepare for the final notice. You should not be surprised when the day comes for you to take action to prevent drastic consequences from IRS collection activity.
The first three notices are sent by regular mail and the final two by certified mail. Here are steps to take when you receive the last notice.
First of all, read the notice carefully.
It should state “Notice of Intent to Levy and Notice of Your Right to Appeal”. If it only states “Notice of Intent to Levy”. This is not the final notice that gives the IRS the authority to seize your assets. If the letter does not give you notice of your right to appeal this IRS collection action, you still have one notice to go before they can levy.
Here is another way to know whether the notice is the one that gives the IRS the right to levy your bank account or seize other assets. The designation of the notice found at the top right of the notice.
The final notice is an LT11 or L1058 (and others as well). The one designated as CP504 is the second-to-last notice mentioned above. This one does not give the IRS the right to levy, because it does not contain a notice of your right to appeal this action by the IRS.
The next step you should take is notice the date when the IRS can actually take action to seize your assets. It is listed on the notice. Here is the language used and found around the middle, left side of the first page(bold is our emphasis): We haven’t received a payment despite sending you several notices about your overdue taxes. The IRS may seize (levy) your property or your rights to property on or after April 1, 2020.
In this example you need to take action by April 1, 2020 or risk a levy action by the IRS. If you ignore this deadline you might be dismayed when you try to get money from your ATM and realize there is no money in your account.
Or your employer might tell you that a significant portion of your paycheck has been garnished by the IRS. Fortunately, you can prevent this from happening to you.
The third step to take when you receive this last Notice of Intent to Levy and Notice of Your Right to a Hearing is to file an appeal. This will prevent the IRS from actually levying your assets and give you time to consider your options.
By filing an appeal, you take the file away from the Collections Division and place it in the hands of the Appeals Division. This will normally give you several months to resolve your situation.
Sometimes, even without appeal, you can contact the Collections Division of the IRS. You can try to work out a solution with them to prevent the IRS from levying your bank account or seizing other assets.
There are several forms of Installment Agreements, Currently Not Collectible Status, Offer-in-Compromise, a Partial Payment Installment Agreement, Abatement of Penalties, and sometimes elimination of tax debt due to expiration of the Collection Period allowed for the IRS to collect the amounts owed.
Depending on the amounts owed, your personal financial condition, and the accuracy of the IRS assessment of your tax liability, you might be better off hiring someone who deals with the IRS on a regular basis.
IRS laws and regulations can be confusing. Most people will not be able to figure out their rights and settlement options when negotiating with the IRS. By consulting with an experienced IRS tax resolution attorney you can usually resolve your tax liability in your best interest. An attorney will represent you before the IRS so that you do not have to have any contact with the IRS.
There are several ways that taxpayers are able to hire an attorney to represent them before the IRS.
First, in some situations your attorney may be able to reduce the amount of tax, penalties and interest owed. Depending on the details of each case, there are situations when the taxpayer’s liability is significantly reduced. A knowledgeable attorney helps the taxpayer to exercise legal rights provided by U.S. tax laws.
Secondly, you can negotiate payment arrangements (Installment Agreement) for you tax liability. The IRS will usually allow a reasonable monthly budget expense amount for attorney’s fees in representing you before the IRS.
Finally, a skillful attorney can help you delay starting payments to the IRS for several months. During this time you can be making payments to your attorney.
Before concluding that you cannot hire an experienced tax resolution attorney discuss some of the options mentioned above. Take advantage of attorneys that offer a free consultation to evaluate your case without having to pay until you are convinced it is in your best interest to hire an attorney.
If you are worried about the IRS levying your bank account or filing a federal tax lien against you, find out what you can do to avoid these IRS collection actions by scheduling a Free Strategy Session for IRS Liens and Levies now