The IRS can use the collection power of a levy to seize your property and your wages in response to non-payment of back taxes. If your property has been seized by the IRS in this manner, you have major IRS Problems and major stress in your life. You will find that it is not an easy task to get property back from the IRS once it has been seized. The intention of the IRS is to sell your property and use the money from the sale to pay off your back taxes.
The most obvious way to obtain a release of your property is to pay your tax bill in full including all the penalties that have been assessed and interest that has accrued. If that is not a viable solution, you may want to consider one of the following:
1. File an Offer in Compromise: This is an agreement between you and the IRS that resolves your tax debt.
2. Obtain an installment agreement: This is a payment plan that allows you to pay your tax debt in regular monthly payments.
3. Prove that release of your property will facilitate collection. One example of this is if the property that was seized, i.e., a car or tools, is necessary for you to continue your business and, in turn, earn money.
4. Your tax liability is no longer enforceable. The statute of limitations on the collection of your tax debt has expired. This is usually ten years.
5. The value of the property seized is more than the taxes owed. Part of the seized property could be returned.
6. File for bankruptcy. This automatically stops further action by the IRS.
7. Issue a bond or substitute collateral. This has to be equal to the value of the seized asset.
8. Become "temporarily uncollectible". This basically means that you have no assets worth seizing and your present lifestyle and income are barely allowing you to sustain your life.
9. Qualify for financial hardship. The IRS will determine if your health or welfare is being adversely affected.
10. Request to appeal. You must request an appeal through a telephone conference with the manager of the IRS unit filing the levy.
The point is that you should not just stand by doing nothing while the IRS seizes your assets. There’s almost always a better way to solve your IRS problems than letting your assets disappear via an IRS levy.
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