4 Ways to Get Your IRS Tax Levy Removed
If you’ve been hit with a tax levy, property lien, or wage garnishment by the IRS, do you know what your options are? There are a number of steps you can take to remove these levies, and some are easier than others. Regardless of which option you choose, you should do so quickly. The situation can be stressful, to the point of distraction, causing problems at work and at home.
The IRS will give you a 30-day notice of any levy, so you have 30 days to remove the levy before they can begin taking wages, liquidating assets, and so forth. Here are four tips to getting those levies removed quickly.
Pay the Debt in Full
The obvious and most expeditious way to remove a levy against you is to pay the debt. The reason the IRS issues a levy is to get the attention of a taxpayer who has ignored them. The IRS will happily remove any and all levies once they are paid.
You can contact the IRS to set up an installment agreement if you don’t have the full amount to pay today. You can apply online, or over the phone in some cases, and get the process started.
There are two types of installment agreements. A short-term agreement can be arranged to pay back the entire balance within 120 days. The benefit to a short-term agreement is there are no fees involved. However, you must have the entire debt paid within the 120-day timeframe.
A long-term agreement allows you to pay the debt in over 120 days. There are fees involved, and you still are responsible for interest accrued, but the benefit is less financial stress.
Offer in Compromise
This is negotiating a settlement for less than the amount owed. However, the taxpayer has very little leverage to negotiate. The IRS will look at your income, assets, and expenses to determine if the settlement amount you offered is reasonable.
In the end, the IRS will only approve a settlement if it deems the amount offered is more than what they would otherwise be likely to collect before the statute of limitations expires.
The offer in compromise comes in two types. You can offer a lump sum settlement figure or you can offer a 20 percent down payment with periodic installments thereafter until the offer amount is paid.
Regardless of which type of offer you make, be sure you are eligible for an offer in compromise. The IRS has strict requirements. If you do not meet the requirements, they will keep the lump sum, or 20 percent down payment, and apply them to the balance owed.
Hire a Tax Attorney
The best advice is to hire a tax attorney to handle the situation. A good attorney understands the tax laws, knows how to work with the IRS, can evaluate your situation, and can develop a plan to remove the levy.
No matter what you decide to do, make sure you do it quickly. The IRS will charge late fees and other penalties. These can accrue monthly and add up quickly.