If you owe the IRS, their agents can issue an IRS Levy on your bank account to collect back taxes. The IRS Levy is a hold on your money up to the amount of the back taxes. This process can be stressful, but the resolution specialists at Coast One Tax Group are experienced in handling CP504 and LT11 Notice of Levy matters, as well as CDP Hearings. Call, text, email, or use the contact form on our web site for a free consultation to find out how Coast One Tax Group can help you!
If you owe IRS back taxes, the IRS can issue an IRS Bank Levy to collect said back taxes. The IRS Levy is a hold on your money, up to the amount of the back taxes.
The IRS will provide a taxpayer with some advance notice – a Notice of Levy – that the IRS intends to levy the taxpayer’s bank account if the taxpayer fails to contact the IRS. Not every Notice of Levy is created equally. What does it mean if you receive a CP504 Notice of Levy? A CP504 Notice of Levy is a Notice of Intent to Levy. The CP504 Notice of Intent to Levy tells you that you owe tax to the IRS. The CP504 Notice of Intent to Levy tells you to pay your tax in full by a specific date. What if you do not pay? Then the IRS will take any state tax refund you would be entitled to. The CP504 Notice of Levy tells you the IRS will search for other assets you own to levy! If the amount of tax owed is over $52,000.00, the IRS could notify the State Department. Upon receipt of the IRS notification, the State Department will deny your passport application, or your passport will be revoked! What if you are not getting or expecting a state refund and not planning to travel abroad? What if you do not own any assets? The CP504 is a direwarning that the IRS is coming after you soon! The CP504 Notice of Levy means that you are quickly running out of time to resolve your tax problem!
Unlike the CP504 Notice of Levy, the LT11 Notice of Intent to Levy is the real deal! The LT11 Notice of Intent to Levy is your Final Warning! The LT11 Letter of Intent also tells you that you owe tax to the IRS and you case is in IRS collection unit. The LT11 Notice of Intent to Levy instructs you to pay your tax in full by a specific date. What if you do not pay? Unlike the CP504 Notice of Intent to Levy, the IRS WILL LEVY after 30 days from the date of the LT11 Notice! The IRS levy could be in the form of an IRS bank levy. An IRS bank levy allows the IRS to seize money in your bank account! Or, the IRS levy could be in the form of an IRS wage garnishment letter. The wage garnishment letter orders your employer to take money out of your paycheck to send it directly to the IRS!
What if you are unable to pay your tax by the LT11 Notice of Levy due date? How can you stop an IRS levy action? An LT11 Notice of Intent to Levy also tells you that you have certain rights. Only the LT11 Notice of Intent tells you of these rights. To stop a levy, you must file a Request for Collection Due Process (CDP) Hearing. If the IRS sends you an LT11 notice of levy or a Notice of Federal Tax Lien you have the right to request a CDP hearing. You have 30 Days from the date on the LT11 Notice of Levy to request a CDP Hearing. IRS Appeals will then schedule an appointment for the CDP Hearing. However, the purpose of the CDP Hearing is only to make sure IRS collection procedures were properly followed. Therefore, the purpose for requesting a CDP Hearing is to buy time to resolve your tax case.
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