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5 Steps to Take When You Receive an IRS Levy Notice

No one likes getting surprise letters from the IRS or state tax authority (unless they contain refund checks). If you’ve received a Notice of Intent to Levy, you’re probably wondering what you should do about it.


Do you hire a tax attorney?


Do you call the IRS immediately and plead with them?


Do you add the notice to your existing stack of bills and figure it out later?


You’re also probably wondering what this may mean for your present and future financial well-being. What exactly is a levy? What can be done about it? Who do you call first?


Let’s start with some basics about IRS levies. 


Tax Levies, Defined


A tax levy is a legal seizure of your property or assets in an attempt to resolve a tax debt. A levy is different from a lien in that a levy removes you as the owner of an asset. The new owner of that asset is the tax collecting authority, which could be the IRS, state, or local tax agency. 


In many ways, a levy is more serious than a lien. Liens can be removed upon payment of delinquent taxes, whereas an executed levy is almost impossible to reverse.


Now that we know what we’re dealing with, let’s talk about what you should do about it.


As tax resolution professionals who help people in these types of situations, we’re giving you a 5-step plan for addressing your IRS levy issue head-on. 


Take a deep breath, follow these steps, and trust that you’ll manage your way through this like millions of others have before you. 


Step 1: Don’t panic.


It’s tempting to worry and fret about what this means for you. A tax levy situation can be incredibly stressful, but it’s crucial to maintain an even emotional keel. 


Your actions from here on out are best taken from a place of calm, collected understanding. So do everything you can to distance yourself from the emotions of the situation while beginning to get closer to the facts of the situation.


Which leads us to…

Step 2: Trust but verify.


We live in a world where scam attempts are an unfortunate feature of everyday life. 


If you’ve received an IRS levy notice, be sure it’s from the IRS itself and that it has an official Letter or Notice code. 


These include the following: 


  • Letter 11 (LT11), Notice of Intent to Levy and Your Notice of a Right to a Hearing 
  • Notice CP90: (CP90), Final Notice, Notice of Intent to Levy and Notice of Your Right to a Hearing 
  • Letter 1058: (L1058), Final Notice, Reply Within 30 Days – Notice of Intent to Levy and Notice of Your Right to a Hearing 
  • Letter 3174 (L3174), New Warning of Enforcement 
  • Letter 75 (LT75), Notice of Levy and your rights to a Hearing (Federal Contractor) 
  • Notice CP 242 (CP242), Notice of Levy on Your State Tax Refund – Notice of Your Right to a Hearing 
  • Other ‘Notice CP XXX’ or ‘Letter XXXX’ codes


If your notice does not contain a notice or letter code, does not contain the IRS letterhead, or if there are specific instructions to immediately send money to someone you don’t know, it’s likely a scam. 


You can learn more about your specific letter or notice by using the IRS communication search tool located here


If you believe your letter is a scam attempt, the IRS has set up a phone number to call to report it. That number is (800) 829-1040.


[💡] Remember: IRS levy notices almost always include contact information. You may see a toll-free phone number or the contact information for a specific employee working your case. Highlight this information and keep it handy as you move forward.


Step 3: Take action. 


Of all the things you could do at this point, your absolute worst choice would be to do nothing. 


Instead, take action to address this issue directly. Start by compiling any relevant documents or information related to your tax situation. This may include tax returns, financial statements, prior correspondence with the IRS, and any other documentation that can support your case.


Next, consider whether or not you want to appeal the levy. Remember that appealing a levy is your right as a taxpayer. More information on levy appeals can be found here. 


Important note: Remember that you don’t have to undergo the appeals process by yourself. The tax resolution professionals at Traxion Tax specialize in working with the IRS on your behalf, which includes managing the appeals process, improving your chances of a favorable outcome.

Learning how we can help you is free. Contact us now to schedule a consultation.



Step 4: Start communication with the IRS.


If you choose to interact with the IRS on your own, you’ll want to initiate a conversation with them using the phone number included in the letter you received. 


Before you make this call, take a moment to remind yourself to be patient. Dealing with the IRS can be very time-consuming, and not all IRS agents are going to communicate with you in a way you prefer to be treated. 


Know this beforehand, and set aside plenty of time to give this matter the attention it deserves. 


Engaging in a conversation with the IRS is one of the best steps you can take to show them you are taking this situation seriously and you want to work with them to resolve it. 


Step 5: Keep Traxion Tax in your corner.


Getting back into good standing with the IRS and breathing a sigh of relief is possible. But don’t think you have to single-handedly manage the chaos without help from the professionals. 


As you continue on your journey, remember that we are here to help you. 


Traxion Tax employs authorized Enrolled Agents who specialize in representing people just like you as they navigate the complexities of IRS tax levy resolution. 

When you need our assistance, we’ll be here. Contact us to learn more about your options.

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