The IRS can be intimidating for a number of very good reasons, one of which is their ability to slap you with a tax levy. While many people assume that the IRS can’t truly begin to threaten you until after various warnings and legal proceedings, a tax levy basically means that they can take your property without having to take you to court. Obviously, the tax levy can be avoided by simply making sure to pay your taxes in full; however there are other things you can do to make sure that you stay clear of the frightening prospect of a tax levy.
Although it does not happen often, the IRS does sometimes make mistakes regarding who is receiving a tax levy. If you receive a levy notice that you believe has been issued to you unfairly or by mistake, call the IRS immediately and file for an appeal.
An installment agreement is a very common form of settling your debts with the IRS. Essentially, it’s a payment plan for you to pay back the taxes you owe the government. During a predetermined period of time (up to three years), you will pay the IRS in monthly installments, until your taxes are paid back. As long as you remain current on your payments, the IRS will consider you in good standing.
Offer in Compromise
This type of deal allows the taxpayer to settle their debt for less than the owed amount. There is a strict list of requirements that must be met, proving that collection of the taxes would cause serious financial burden to the taxpayer, and forced seizure would not yield more than the amount specified in the agreement.
As was previously mentioned, the best way to avoid tax levies is to pay your taxes. However, these options can help if you find yourself in trouble with the IRS.