Can the IRS Levy My Corporation for My Personal Taxes?
The IRS cannot levy your Corporation or LLC for your individual taxes. With your social security number you are an entity separate from your corporation or LLC which has its own federal identification number and is a separate entity.
Some Revenue Officers, particularly in Las Vegas, will break the law and levy corporate bank accounts or accounts receivable for the owner’s
personal taxes. The banks usually will not pay such levies; accounts receivables out of fear of the IRS sometimes will pay such levies.
Small business owner’s have no problem suing the bank if they pay such a levy//you can always get another bank; you are unequivocally favored to win in a civil court. Suing accounts receivable presents a conflicted choice…you sue them and you are almost certain to lose their business.
What recourse do you have? Internal Revenue Code 6343(b) provides as follows: If the Secretary determines that property has been wrongfully levied, it shall be lawful for the Secretary to return –
(1) The specific property levied upon,
(2) An amount of money equal to the amount of money levied upon, or
(3) An amount of money equal to the amount of money received by the United States from a sale of such property
Rather than taking legal action against someone that the small business owner or professional would like to continue to do business with, the small business owner can administratively pursue the IRS for the wrongful levy; if the protest is denied it is appealable. Contact Tax Crisis Institute if you are in this predicament.
Dana M. Ronald