Tax Levy: What It Is, How It Works and How to Stop One

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Tax levies put your assets at risk. To remove them, you’ll need to work with the IRS to pay your back taxes.

By Tina Orem

Tax levies (and their cousins, tax liens) are serious business if you owe back taxes. Here’s how they can affect you, as well as how to remove a tax levy.

What is a tax levy?

A tax levy is the seizure of property to pay taxes owed. Tax levies can include penalties such as garnishing wages or seizing assets and bank accounts.

Tax levies typically show up after you’ve gotten a tax lien. A tax lien is a claim the government makes on your property, including real estate and other assets, when you’re past due on your income taxes, and a levy is the exercise of that claim. (If you’re wondering how long it might be before the IRS notices you haven’t paid your taxes, read this.)

How a tax levy can affect you

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