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Federal law gives the IRS more enforcement tools than other creditors, including the right to seize assets without a court order. If you’ve received notice that your property is subject to an IRS levy or lien, you may be unsure of what will happen next or whether you can stop the collection action. Understanding the difference between liens and levies is an important first step in resolving the issue.

IRS Levy

irs leviesThe IRS has the right to seize any of your assets to cover your unpaid tax liability, which most commonly takes the form of a levy. IRS levies are legal seizures of your bank accounts, including your savings, checking, or investments. Retirement accounts like IRAs are not exempt from seizure, giving levies the potential to disrupt your life for years to come. A levy can also be used to garnish your wages or, in serious cases, seize your vehicle, home, or other valuables.

Tax Liens

With a lien, the IRS doesn’t actually seize your assets. Instead, this collection tool allows the agency to assert a legal claim on your vehicle, home, or other valuables. While a lien is active against your property, you will likely have difficulty selling or using it to secure a loan. If the lien is not settled, the IRS may eventually decide to levy the property, seizing your house, car, or other belongings.

 

If you’re received notice of an IRS levy or lien, Brian Kawamoto, Attorney, will help preserve your assets and even reduce the amount you owe. As a former IRS lawyer with over 25 years of experience, he offers effective service informed by a unique insight into the tax code to clients throughout the Honolulu area. Visit him online for more on his tax levy services, or call (808) 486-6107 to schedule a consultation today.

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