An IRS Levy is the ultimate collection mechanism of the IRS. . The IRS tax levy is the most harsh of all IRS collection methods. With a levy, the IRS can take your assets in order to pay for the tax debts that are owed. In order for the levy to be lifted, you will need to “settle” IRS back taxes. Below are 10 ways you can legally release a tax levy with the IRS.
- Pay debt amount in full, including penalties and interest – Once you pay the amount off in full, the IRS will stop collections. If you do not have the money, consider selling some stuff to come up with the money. If you can’t, you can’t pay and you should use a different method.
- Wait a LONG time for statute of limitations to come up – circumstances the Internal Revenue Service has ten years to collect on taxes since the day they were first assessed. When the ten year period has expired, the IRS no longer pursue you for collections and the the levy will no longer be in effect. Remember, if the IRS is hot on your case and they haven’t collected after 9 years, they will attempt to have you to extend the statute of limitations. They may try to word it differently and not tell you that this is what they are doing, but it is, so be careful what you sign if a lot of time has already passed. If you have made it 9 years without them collecting, it is highly unlikely they will be able to collect from you in the last year. Especially since by this time you can be considered an expert in avoiding the IRS.
- Set up an installment agreement – This could be the easiest way to release a tax levy. This plan will allow you to pay off the tax amounts owed over time. Payments must be made regularly or the IRS can start collection actions again.
- Apply for the partial payment installment agreement – If you can’t make the minimum required payments for the installment agreement the IRS will consider you for a partial payment option. With this option you make smaller installment payments and may actually never end up paying off the entire amount of back taxes owed. The IRS will review your financial standing every couple of years to see if you can pay off the taxes owed or be put on a normal installment agreement.
- Offer in Compromise (OIC) – If you meet the strict requirements for this type of relief, the IRS will release the tax levy. This is one of the hardest forms of IRS tax relief to qualify for and receive from the IRS because it does allow you to "settle for pennies on the dollar". The IRS only consider people for this type of relief if they fall into one of three categories with strict requirements.
- Prove to the IRS that your assets hold no value – Show the IRS that if they were to take your assets and sell them, they would gain nothing. Sometimes the IRS needs to be shown this in order to stop collections.
- Prove to the IRS that the Levy doesn’t allow you to meet basic minimum living expenses – If you can show and prove to the IRS that the levy creates economic hardship and it greatly affects your ability from earning enough to maintain a roof over your head or your families head, it is likely the IRS will lift the levy. For example, if the IRS tries to seize an asset of yours that is required for you to make a living, you can easily prove that this will create financial hardship because you will no longer be able to make money.
- You can post a bond with the IRS – When you post a bond with the IRS, this proves to them that you will pay the amount owed and the levy will be released.
- Appeal the IRS tax levy –You have the right to appeal the levy and have it lifted if wrong procedures were taken. Don’t use this tactic to stall.
Getting a levy lifted can be difficult. It is suggested that you use a tax relief company to get the filings done quickly and correctly. Some of these methods above are chancy to do on your own because they can get you in deeper trouble with the IRS if not done properly. An IRS levy can be financially overwhelming, the help of a tax relief professional can most likely save you much more money than their cost, while eliminating a lot of stress.
Source: http://www.ArticlePros.com/author.php?Maneul Davis Jr.
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