What is a tax levy?

An IRS levy permits the legal seizure of your property to satisfy a tax debt. It can garnish wages, take money in your bank or other financial accounts, seize and sell your vehicle(s), real estate and other personal property. The most common type of levy is a sweep of one or more bank accounts, although the IRS can levy against a retirement account or even your monthly social security check.

The IRS can also levy a wage earner’s paycheck or payments to a self-employed individual from a client. Before the IRS can affect a levy, they must issue Final Notice of Intent to Levy and Notice of Your Right to A Hearing (levy notice) at least 30 days before the levy. The IRS may give you this notice in person, leave it at your home or your usual place of business, or send it to your last known address by certified or registered mail, return receipt requested. Please note: if the IRS levies your state tax refund, you may receive a Notice of Levy on Your State Tax Refund, Notice of Your Right to Hearing after the levy.

In extreme cases, the IRS may affect a levy without giving a 30-day notice, when there is a risk to the access to the assets.