While the IRS prefers that they work out a deal in which you pay your taxes voluntarily, the IRS will sometimes use other methods to seize taxes. For example, the IRS might seize your property as a way to pay the tax debt. However, you might be able to prevent this from happening with the help of a real estate tax attorney.
The Process by Which the IRS Seizes Property
The IRS begins by contacting you to demand payment. Then, you will need to fail to make arrangements to make a payment. After this happens, the IRS will issue a final notice with intent to seize your property which is referred to as a levy.
If the IRS seizes your property, they will sell it at an auction. They will then subtract the cost of seizing and selling the property and will subtract whatever is left of the property to pay for the tax debt. If your property is worth more than your tax debt, you may receive a refund.
Your Options When Your Property is Being Seized
One option is to simply allow your property to be seized to pay for your taxes. Then, you may find it easier to finish paying the rest of your property taxes. You can also contest whether the IRS estimate of the fair market value of your property is accurate.
Assets the IRS Can Seize
The IRS is able to seize almost any assets. They are able to take any real property that you own, such as houses, cars, boats, or jewelry. They might also take payments made from clients and sales that come from products you sell.
The IRS cannot seize anything that you would need to be able to perform your work and earn a living. They will usually not seize livestock if you are a farmer by trade. They also do not seize a primary residence except as a last resort.
Steps to Take To Avoid a Levy
If your property is about to be seized, you will want to contact a tax attorney as soon as possible. There are several ways in which you may be able to stop your property from being leveed. For example, you may be able to create an installment agreement. Also, if you are able to argue that the seizing of property would create undue hardship, you can use this as a justification to stop the seizing of your property.
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