Levy Relief

The first thing to do is to check the return address to be sure it’s from the Internal Revenue Service and not another agency.

If the levy is from the IRS, and your property or federal payments are seized, call the number on your levy notice or 1-800-829-1040. If you’re already working with and IRS employee, call him or her for assistance. For specifics, see Levies.

• Levy Relief: You should call the number on the levy notice immediately to resolve your tax liability and request a levy release. The IRS must release a levy if it determines that:
  • You paid the amount you owe.
  • The period for collection ended before it issued the levy.
  • Release of the levy will help you pay your taxes.
  • You enter into an installment agreement and the terms of the agreement allow the levy to be released.
  • The value of the property is more than the amount owed and releasing the levy won’t hinder the IRS’s ability to collect the amount.

If you’re in bankruptcy, the IRS may not be able to levy your assets. Contact the IRS and provide information about your bankruptcy chapter, the filing date, the court where you filed, and the case number.

Be prepared to propose an alternative way to pay your taxes if you’re asking the IRS to release a levy, which may include providing financial information for the IRS to review. If the IRS denies your levy release request, then you can appeal the decision. See Publication 1660 for a full explanation of Collection Due Process (CDP), the Equivalent Hearing process, and Collection Appeal Process (CAP).

• Wrongful Levy: A wrongful levy occurs if you are not liable for the tax and the IRS has levied property that you believe belongs to you or the levy improperly attaches to property belonging to a third party in which the taxpayer has no rights. A third party believes the levy is wrongful because the property levied belongs to them, or they believe they have superior claim to the property. You must write and file a request to the IRS to return the wrongfully levied property within two years from the date of the levy or seizure. See Publication 1660 under Wrongful Levy and/or Publication 4528, Making an Administrative Wrongful Levy Claim Under Internal Revenue Code (IRC) Section 6343(b).
• Levy Release (with Economic Hardship): If the levy — on your wages, bank account, or other assets — is creating an immediate economic hardship on you, meaning you’re unable to meet basic, reasonable living expenses, then the levy must be released. Contact the IRS at the number on the levy or notice immediately.

If the IRS has already issued a CDP notice for that particular tax debt and you disagree with the IRS employee’s decision regarding any levy or seizure; you can still appeal the decision. You can do so by asking to have a conference with the employee’s manager. If you disagree with the manager’s decision, you may request the IRS Independent Office of Appeals (Appeals) review your case under the Collection Appeals Program as outlined in Publication 1660 within three business days of the meeting. You can request Appeals consideration in writing, verbally or via Form 9423, Collection Appeal Request.

You can also ask that the IRS manager review your case informally. You can obtain the manager’s name and phone number by contacting the employee listed on your notice. IRS employees are required to give you their manager’s name and phone number. For specifics, see Levies for further information.

If you need a tax professional to represent you, you can hire an attorney, certified public accountant (CPA), or enrolled agent (EA). If you need a tax professional but can’t afford one, you may be able to get help from a Low Income Tax Clinic (LITC).

If the tax being levied is the result of an audit where you didn’t know you were audited (never got a notice), you didn’t meaningfully participate, or you disagree with the findings, you may be able to ask for audit reconsideration.

If the tax being levied stems from the filing of a joint return and you believe your current or former spouse should be solely responsible for an incorrect item or an underpayment of tax on the return, you may be eligible for relief as an Innocent Spouse.