I represent taxpayer in Mount Laurel and the rest of New Jersey. Taxpayer often ask me "How did I get to the point of my bank account being levy?"
There are six steps before IRS levy your account.
1. A tax return is filled, either voluntarily by the taxpayer or the IRS creates a return for them ( a "substitute for Return" under IRC section 6020). Once the return is secured the tax liability is assessed.
2. Once the tax is assessed a billing notice is sent to the taxpayer with a demand for payment.
3. If the billing notice goes unpaid, a lien arises automatically by statute. The IRS does not have to file anything for the federal tax lien to be created, as IRC section 6321 creates it automatically. However, nobody knows about the 'silent lien' so the IRS will file a Notice of Federal Tax Lien to put other creditors on notice that it is owed money and it has an interest in the taxpayer's assets.
4. Assuming that no payment is received, and the taxpayer has not contacted the IRS to arrange for a collection alternative, a Threat to Levy (Form CP-504) is sent via certified mail threatening collection action if nothing is done to resolve the issue.
5. Final notice of intent to levy and your right to a hearing is sent. This notice is sent, and it begins the thirty-day count down until the IRS can take levy action against the taxpayer. There are three different versions of this letter, depending upon which collection group sent it. They are:
- Automated Collection Services (Campus Operations): Letter 11
- Headquarters Collections: Letter 1058
- Field Collections: CP-90
6. If the taxpayer does not contact collections and begin working with them to resolve the issue, then a Notice of Levy will be issued against bank accounts, wages (for employees), vendors (for self-employed individuals), etc.
What you need to know is that there is no reason for the IRS Collection case to get to this point. The taxpayer can contact IRS Collections the moment the billing notice is received.
Call us at 973-840-7350 or email us onpoint@onpointresolution.com today to resolve your back tax debt.
Fanta Kaba
309 Fellowship Road, suite 200
Mount Laurel, NJ 08054
Tel. 973.840.7350
Fax. 347.344.6942
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