Can the IRS Take My Property or Take My Money Without Telling Me First?

Can the IRS Take My Property or Take My Money Without Telling Me First?

In most every case, the IRS MUST send you a series of notices.  The final notices in each series is the, “Final Notice of Intent to Levy”.  This is the IRS’ last attempt to notify you of its intent to take aggressive collection actions (wage garnishment, bank levy and asset seizures).

The Final Notice of Intent to Levy gives you important appeal rights you MUST take advantage of within 30 days of the DATE OF THE NOTICE.

It is CRITICAL to know that the IRS will send notices to your last known address.  If they are not forwarded to you or you do not receive them in some other way, the IRS has still met its burden of notification.  30 days from the date of the Final Notice of Intent to Levy, they will move to aggressive collections.

Here is what you need to know:

If the IRS has not sent the Final Notice of Intent to Levy, you are currently protected. Remember, this would be sent to your last known address.  If you have received other notices but not the Final Notice of Intent to Levy, you are currently protected for the particular year listed on the notices.  Please understand that each year (debt) goes through the same series of notices.  If series has been completed on that year, you would be open to collection on that year.

If the IRS has sent you the final notice, they must wait 30 days after the letter for you to request an appeal. This is an important right and you MUST send a request for an appeal WITHIN 30 days.  Failing to do so gives up some of your rights.  The purpose of an appeal is to discuss collection alternatives such as an Installment Agreement, Currently Not Collectible Status, Offer in Compromise, and Innocent Spouse.

Here are some tips about appeals:

1. The IRS cannot take collection actions until the appeals process is complete.  This consists of:
   1. Time to be assigned to an Appeals Officer.
   2. Time to conduct the hearing.
   3. Transfer back to collections.
2. The Appeals Office typically has more authority and discretion regarding collection alternatives than Automated Collections.
3. If you do not reach an agreement with the Appeals Officer, you have the right to petition US Tax Court.

Note:  You do not want to use appeals as an attempt to stall collections.

If you miss the 30-day window after the Notice of Intent to Levy letter, you still have the right to appeal if done before one year.   Under Internal Revenue Manual 5.1.9.3.2.3 if an appeal is processed after the 30 days but within one year after the Final Notice of Intent to Levy is sent, it is considered to be a request for an Equivalency Hearing. Filing your appeal late does not give you the same administrative rights as filing timely as the hold on collection is not granted, but it will allow you to meet with an Appeals Officer. You also lose the right to go to Tax Court by filing late.  Because collection is not stopped, by law, the Statute of Limitations is NOT TOLLED.  This can be an important point if you are coming up on your Statute of Limitations on a particular debt. 

Exercising your rights to a Collection Due Process Hearing allows you to discuss collection alternative with an independent Appeals Officer whose job it is to reach an agreement that benefits both parties.