Tax Levy and disability.... Can they take my money and car?

Question

a friend of mine owes 12,000.00 in taxes and they put a levy on her bank accounts. i know they can only do that one time. I will speak to a tax guy and the bank on Monday. I am also going to speak to the person that sent me the levy letter from the IRS office.

Can anyone give me a suggestion on how to appeal this since my friend is on disability.?

Also, how do i right a hardship letter to the IRS and what do i say in the letter?

How much after they take from the bank account do they sieze your auto? No loan on car. Car paid off and is a 1994 auto not worth much.


Also, let me know your source if your a tax person or not. I will give 10 points for the most helpful person

Answer 1

An IRS Tax Levy is a legal seizure of assets taken in order to satisfy a tax debt. An IRS Tax Levy can be attached to any property, including real estate and automobiles, but is most frequently applied to bank accounts, securities, wages and even a business' accounts receivable. When the IRS issues a Tax Levy, it bars access to the affected assets by the rightful owner and transfers that authority to the IRS, pending outright seizure.

When the IRS assesses a liability against a taxpayer, it first sends that taxpayer a Notice and Demand for Payment. If the taxpayer does not respond, The IRS will likely file a Tax Lien and then Issue a Notice of Intent to Levy to the taxpayer. (This letter will say "We Intend to Levy Certain Assets" at the top). If the taxpayer does not pay the tax debt in full or make other repayment arrangements soon, the IRS Tax Levy then goes into effect. Depending on what assets were levied, the IRS can then empty out the taxpayers bank account or contact businesses that owe the taxpayer money and order them to send the money owed to the IRS. IRS tax levies are a particularly aggressive form of IRS Collection action and can create considerable hardship for any taxpayer who is the recipient of a Tax Levy.

Releasing an IRS Tax Levy generally requires coming to some kind of repayment agreement with the IRS. For instance, if a taxpayer decides to submit an Offer in Compromise proposal, then IRS Collections will be put on hold and the IRS will release the Tax Levy while the terms of the settlement are worked out. It is also possible to have an IRS Tax Levy released based on a Hardship, if the taxpayer can prove that the IRS Tax Levy is inhibiting their ability to meet the basic necessities of living. Releasing a Levy will provide some breathing room while a more permanent Solution is figured out. Due to the severity and complexities which are caused when a levy is issued, we usually recommend Professional Representation when a taxpayer has been levied.

Answer 2

your Friend really ignored the government to get a levy.Oh by the way the put as may Levy's as they want to collect a debt.as to your Friends problem your friend has to deal with it you cannot unless your a tax lawyer,CPA,or have a power of attorney. If your friend has any money they should contact a professional, if not they should(with your help) find out if the debt is owned properly. if it is they should contact the local IRS office handling collections and see if a deal can be worked out for a payment plan.The disability is not a valid excuse for Ignoring the IRS letters before the levy was done.as to the amount they can take it's 12,000 plus interest and penalty's and if that includes the car they will take and auction it off including any other valuable your friend may have except there pension funds(IRA,401k,defined benefit etc)

Answer 3

If it has gotten to the point of a levy, she must have ignored quite a few notices. They probably won't take the car as it has little value to them.

If the levy creates too much of a hardship, you can contact the "Taxpayer Advocate". The IRS has a Taxpayer Advocate in most major cites. The advocate may be able stop the levy but they can not do anything about the liability. She will still owe the taxes.

Answer 4

In addition to all of the other responses it would be of no value for you to call the IRS they will not talk to you about this matter without a power of attorney (on their forms please).