Can I Stop the IRS from Freezing My Assets?

The Internal Revenue Service (IRS) holds extensive authority in overseeing various tax functions and enforcement actions at the federal level. This authority empowers them to implement significant measures for recovering taxes owed.

However, for many individuals, it remains unclear how the IRS can pursue tax liabilities or manage assets during legal proceedings.

In this article, we aim to clarify the IRS’s capabilities, their reasons for specific actions, and provide guidance on navigating these processes effectively.

Why would the IRS want to freeze my assets?

If you fail to pay your income taxes, the IRS has the legal authority to seize your property or funds, which they can initiate by freezing your assets.

They will notify you of this through a bank levy, indicating their intention and right to seize your financial assets to recover any unpaid taxes.

Assets that may be affected include:

Personal property
Wage garnishment, which may accompany a bank levy in certain cases
Current funds and savings in your bank accounts, whether personal or business
Funds in retirement savings accounts or other specialized accounts

Understanding IRS Asset Freezing

Does the IRS notify you before seizing your assets?

Yes, typically the IRS will provide notice of their intent to freeze your assets, except in cases involving significant criminal fraud.

They issue two main notices:

Notice of Demand for Payment.
Final Notice of Intent to Levy and Notice of Your Right to a Hearing.

The final notice gives you 30 days to appeal or arrange a payment plan. It’s crucial to carefully review the terms of each notice and understand how they apply to your specific situation.

Can you stop or pause the asset freezing process?

Having your assets frozen is undoubtedly stressful, but there are steps you can take to halt this process. If you’re within the 30-day notice period, you can request a Collection Due Process (CDP) hearing or negotiate a payment plan as discussed earlier.

Here are your options:

Payment Plans: Settle your tax debt by arranging an installment agreement with the IRS. Depending on your financial situation, this may provide immediate relief or require negotiation with a tax relief specialist.
CDP Hearing: Request a CDP hearing within 30 days of receiving the final notice. This allows you to present your case and provide evidence of financial hardship or other factors that may affect your ability to pay. You can have a legal representative assist you during this process.
Bank Levy Release: If a bank levy is imminent, your accounts may be frozen for 21 days. During this period, you can negotiate with the IRS to release the levy and work out a resolution. Seeking assistance from a qualified tax professional can increase your chances of preventing the seizure of your bank account assets.

At Tax Review Solutions, we specialize in helping clients navigate IRS negotiations and protect their assets. Contact our tax relief team today at 949-359-9306 to explore your options.