| A tax levy is the ultimate collection mechanism of the | | | | 5. Offer in Compromise - If you meet the strict |
| IRS. This is the IRS's forced collection mechanism | | | | requirements for this type of relief, the IRS will release |
| where they will take your assets and sell them in order | | | | the levy. This is one of the hardest types of relief to |
| to fulfill your unpaid back taxes. Getting an IRS levy | | | | receive from the IRS because it does allow you to |
| released means you typically need to come to an | | | | "settle for pennies on the dollar". |
| agreement with the IRS and they will agree to stop | | | | 6. Prove your assets have no equity - If the assets |
| taking collection actions against you. Below are 10 | | | | the IRS is trying to levy have no equity in them, you |
| ways you can legally release a tax levy with the IRS. | | | | must prove to the IRS that there would be no point for |
| | | | them to levy them because they will gain nothing from |
| 1. Pay the tax amount in full - This is the most common | | | | it and it will not pay anything towards you back taxes |
| sense way of settling back taxes and getting a levy | | | | owed. |
| released. If you pay the tax amount owed in full, the | | | | 7. Prove Financial Hardship - If you can prove to the |
| IRS will immediately halt collection actions against you | | | | IRS that the levy creates economic hardship and it |
| and the levy will be released. | | | | greatly affects your ability from earning enough to |
| 2. Let the Statute of Limitations Expire - The IRS has | | | | maintain a roof over your head or your families head, it |
| 10 years to collect taxes from the initial date of | | | | is likely the IRS will lift the levy. |
| assessment. Once the 10 year period is up, the IRS | | | | 8. Post a Bond - If you post a bond, a levy will no |
| can no longer collect from you. Keep in mind that the | | | | longer be in effect. If a levy is in place, and you cannot |
| IRS will try to extend this the statute of limitations on | | | | pay your taxes, it is highly unlikely you will qualify for a |
| your case, so be aware of any papers they want you | | | | bond. If you do qualify for a bond, you may be better |
| to sign. If you haven't paid the amount owed in 9 years, | | | | of paying the tax amount owed in full. |
| it is highly unlikely they will be able to collect from you in | | | | 9. Appeal the Levy - You can appeal an IRS levy and |
| the last year. | | | | you will have a review if the collectors followed the |
| 3. Set up an installment agreement - An installment | | | | correct procedures, if they didn't, you may be able to |
| agreement is a payment plan with the IRS. This plan | | | | get the levy lifted. |
| will allow you to pay off the tax amounts owed over | | | | 10. File bankruptcy - Bankruptcy settlement can release |
| time. It is important to may timely payments on this | | | | a tax levy by court order and return seized assets to |
| once it is in place or the IRS can re-enforce the tax | | | | you. This should be considered a last resort. |
| levy. | | | | Getting a levy lifted can be difficult and it is suggested |
| 4. Set up a partial payment agreement - This is similar | | | | that you use a tax professional to help. Depending |
| to the installment agreement, but if you can show you | | | | upon you unique financial and tax situation, a tax |
| can legitimately not make the payments required for | | | | professional can find the best option for you and likely |
| an installment agreement, the IRS will allow for smaller | | | | get it setup with the IRS fairly quickly to limit any |
| payments that may equal less than the original amount | | | | assets seized by the IRS. |
| of tax owed. | | | | |