IRS bank levy help in Brooklyn
Your card was declined, or your balance shows frozen money. If the IRS levied your bank account, I know how scary that is. There is usually still time to act, but not a lot of it.
I'm Solomon Grosinger, an Enrolled Agent in Brooklyn. Here is what a bank levy means and what I do about it.
What an IRS bank levy is
A levy is the IRS legally taking your property to pay a tax debt. With a bank levy, the IRS sends a notice to your bank. The money in your account is frozen as of the moment the bank receives it.
The law gives you a 21-day waiting period. During those 21 days, the bank holds the frozen money. After that, the bank sends it to the IRS. The waiting period exists so you can contact the IRS, work out a way to pay, or point out a mistake.
Money you deposit after the levy arrives is usually not caught by that same levy. But the IRS can send another one.
Why it happened
In most cases, the IRS sends warning letters before it levies. You may have received a CP504, and then a Final Notice of Intent to Levy (often an LT11 or Letter 1058). That final notice gives you 30 days to ask for a Collection Due Process hearing. If those letters went unanswered, or went to an old address, a levy can follow.
If you still have that final notice and the 30 days have not passed, book a call with me today. That hearing right matters.
When the IRS will release a levy
The IRS is required to release a levy in certain situations, including when:
you paid what you owe,
you enter an installment agreement whose terms don't allow the levy to continue,
the levy is causing an economic hardship, meaning you can't meet basic, reasonable living expenses,
releasing it will actually help you pay, or
the collection period ended before the levy was issued.
A release doesn't erase the debt. You still need a plan, or the IRS can levy again.
What I do when you call
Look at the letter and the dates. The 21 days are already counting.
Get your authorization signed so I can speak to the IRS for you.
Pull your IRS transcripts to see what is owed, for which years, and what notices went out.
Contact the IRS and ask for a release based on the facts that apply to you: a payment plan, a hardship, an error, or something else.
Put a real plan in place, such as an installment agreement or Currently Not Collectible status, so this doesn't repeat next month.
If the money was already sent, there may still be options, like asking for a return of levy proceeds or appealing. Appeals can be filed before or after a levy. If the levy was the IRS's mistake and your bank charged you a fee, you may be able to claim that fee back.
State levies are different
New York State and New Jersey can levy bank accounts too, and their rules aren't the same as the IRS's. New York must file a tax warrant before it levies, and the bank has up to 90 days to respond. New Jersey usually levies after it files a Certificate of Debt. I handle the state side alongside the IRS side.
Who I can help
I work with people who are ready to do their part: send documents, answer my calls and stay current going forward. I take cases where I believe I can make a real difference. I don't handle criminal tax cases, and I can't promise any result. Nobody honest can. I can promise a straight answer.
Common questions
How long do I have after an IRS bank levy? The bank generally holds the frozen funds for 21 days before sending them to the IRS. Use that time. The sooner I see the levy notice, the more room there is to work.
Will the levy take my paycheck deposit next week? Usually a bank levy only catches what was in the account when the bank received it. New deposits aren't covered by that same levy, but the IRS can issue a new one if nothing is resolved.
What if I can't afford to pay anything right now? If the levy keeps you from paying basic living expenses, the IRS can release it for economic hardship. You'll need to show your income and expenses, and I help you document that.
The levy is from New York State, not the IRS. Can you help? Yes. New York and New Jersey levies follow their own rules and timelines. I work with both, often in the same case as the IRS.
Talk to me today
Book a free 30-minute call to go over your case. For a quick question, you can call (718) 510-3166. Tell me what the letter says, and I’ll tell you honestly what I think can be done.
General info, not advice for your specific case. Every case is different, and past results don't predict yours.