Has the IRS Levied Your Bank Accounts?

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Our client recently contacted us due to the fact she assumed her bank accounts had been levied.  We somewhat scratched our head at her calls and emails.  Let’s go into a little more detail regarding the case.

First and foremost the client came to us last spring with a tax bill totaling $30,000.  She claimed the bill was in direct relation to jointly filed returns with her ex-husband. She also claimed she wasn’t responsible for the tax liability due to circumstances beyond her control.  We went ahead and compiled all the necessary documentation to prove her case and filed for innocent spouse. As far as we were concerned, as of about 60 days ago, we were set and now waiting on the IRS to make a determination.

After our client contacted us regarding the levies we were a little surprised. However, due to the fact the IRS liability stems from a jointly filed return, we thought maybe the ex-husband hasn’t resolved his case as of yet and the IRS is levying.  We asked the taxpayer to send us proof of the levy so we didn’t go barking up the wrong tree.  She did and we immediately got in touch with the Revenue Officer.

The IRS sent out levies to all applicable resources available; including banks and employers, etc. When the IRS sends out a levy they use the name (s) on the debt.  They sent out the levy with the primary SSN listed, the husband and wife were also listed, along with the address of record.  Any time a levy is issued the banks will process accordingly, by name, not always by SSN.  Unfortunately, even though we had done everything in our power to resolve the account to date, the taxpayer was still levied.

Fortunately, we were able to get an immediate release of levy sent over to the processing center (legal department) with the bank. The levies had tied up well over $5,000 of our clients’ funds, and left her stressed, confused, and unable to put food on the table. She was very grateful the levies were released and we have since provided as much advice as we can to the client to be sure this type of activity is limited.

If you or someone you know has been subject to levy action please have them contact us directly at 720-398-6088.