Federal Tax Estimated
"There are two primary methods that the IRS uses in order to collect tax debts from taxpayers: wage levies and bank account levies," says tax attorney Darrin T. Mish. "Regardless of which technique the IRS chooses to implement, both points out that you have a grave IRS problem."
"There are two primary methods that the IRS uses in order to collect tax debts from taxpayers: wage levies and bank account levies. Regardless of which technique the IRS chooses to implement, both points out that you have a grave IRS problem.
"When you have tax debts, the IRS can levy your wages, as well as your retirement income, social security benefits and other bonuses that you may have earned. In fact, the IRS is the sole entity that can garnish your paycheck without having to go though a trial. A simple notification from them obliges your employer to transfer a considerable amount of your paycheck to the IRS. Full payment of total taxes due and a levy release are your only options in ending wage garnishment.
"The IRS compels the clients of independent contractors and the self-employed to directly pay a certain amount of money to the former. Although the contractors will still receive a certain amount of money, this is significantly less than the normal income they get from their clients. The IRS publication 1494 is a useful resource regarding this matter.
"Issuing a bank account levy is the IRS's second primary method of collecting tax debts. This method permits the IRS to take all of your money in any of the bank accounts registered under your name. There is no use arguing with your bank as they will always say they have no choice and they cannot defy a government order. However, the bank will only forward to the IRS funds that are in the account the day that the levy is delivered. Hypothetically, if the bank gets the levy notice on a Tuesday and you deposit a check on Friday, the IRS has no right to the money deposited on Friday unless they have another levy.
"You are provided with 21 days to get a levy release if the IRS imposes a bank account levy on you. If under any circumstance you cannot obtain the levy release or you simply do nothing, the bank will transfer the funds frozen in your account to the IRS. They can transfer up to the actual amount that is owed from the IRS. However, issuing repeated bank levies allows the Internal Revenue Service to take more money from any of your bank accounts.
"Wage and bank account levies are just two of the collection methods used by the IRS. If worse comes to worse, they can also levy your personal belongings like jewelry, houses, insurance policies and collectables. To avoid getting to this point, pay the government what you owe them, as a tax levy is a grave IRS problem that does not simply go away.
"As clearly pointed out in this article, a Federal tax levy is a serious issue in all respects. Thus, it is imperative for people who have tax debts to settle them now and not wait for the government to impose more threatening collection methods like tax levies."
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