10 Ways to Release a Tax Levy

By Manuel Davis Jr.

A tax levy is the ultimate collection mechanism of the IRS. This is the IRS's forced collection mechanism where they will take your assets and sell them in order to fulfill your unpaid back taxes. Getting an IRS levy released means you typically need to come to an agreement with the IRS and they will agree to stop taking collection actions against you. Below are 10 ways you can legally release a tax levy with the IRS.

1. Pay the tax amount in full - This is the most common sense way of settling back taxes and getting a levy released. If you pay the tax amount owed in full, the IRS will immediately halt collection actions against you and the levy will be released.
2. Let the Statute of Limitations Expire - The IRS has 10 years to collect taxes from the initial date of assessment. Once the 10 year period is up, the IRS can no longer collect from you. Keep in mind that the IRS will try to extend this the statute of limitations on your case, so be aware of any papers they want you to sign. If you haven't paid the amount owed in 9 years, it is highly unlikely they will be able to collect from you in the last year.
3. Set up an installment agreement - An installment agreement is a payment plan with the IRS. This plan will allow you to pay off the tax amounts owed over time. It is important to may timely payments on this once it is in place or the IRS can re-enforce the tax levy.
4. Set up a partial payment agreement - This is similar to the installment agreement, but if you can show you can legitimately not make the payments required for an installment agreement, the IRS will allow for smaller payments that may equal less than the original amount of tax owed.
5. Offer in Compromise - If you meet the strict requirements for this type of relief, the IRS will release the levy. This is one of the hardest types of relief to receive from the IRS because it does allow you to "settle for pennies on the dollar".
6. Prove your assets have no equity - If the assets the IRS is trying to levy have no equity in them, you must prove to the IRS that there would be no point for them to levy them because they will gain nothing from it and it will not pay anything towards you back taxes owed.
7. Prove Financial Hardship - If you can prove to the IRS that the levy creates economic hardship and it greatly affects your ability from earning enough to maintain a roof over your head or your families head, it is likely the IRS will lift the levy.
8. Post a Bond - If you post a bond, a levy will no longer be in effect. If a levy is in place, and you cannot pay your taxes, it is highly unlikely you will qualify for a bond. If you do qualify for a bond, you may be better of paying the tax amount owed in full.
9. Appeal the Levy - You can appeal an IRS levy and you will have a review if the collectors followed the correct procedures, if they didn't, you may be able to get the levy lifted.
10. File bankruptcy - Bankruptcy settlement can release a tax levy by court order and return seized assets to you. This should be considered a last resort.

Getting a levy lifted can be difficult and it is suggested that you use a tax professional to help. Depending upon you unique financial and tax situation, a tax professional can find the best option for you and likely get it setup with the IRS fairly quickly to limit any assets seized by the IRS.

BackTaxesHelp.com is a website that specializes in helping people resolve issues with back taxes. Please visit the site to find more information on Releasing a Tax Levy

If you need professional assistance to get your levy lifted please request help: Back Taxes Relief Help

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