Published on: May 29, 2018 Last modified: October 21, 2020

Challenging the IRS in Wrongful Levy Actions

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    Michigan taxpayers dread possible levy seizures by tax authorities. When facing such a levy in the past, the options for such individuals appeared limited. But not to worry, we’re here to help.

    The IRS has incredible power at its disposal. The agency can use levies to seize assets including wages, financial accounts, real estate, and vehicles. The IRS can liquidate other of your belongings as well to collect back taxes. Yet the IRS does not have unlimited powers.

    The Tax Cuts and Jobs Act of 2017

    According to a recent press release posted on the IRS website, individuals will now have additional time to challenge a wrongful levy or seizure. The Tax Cuts and Jobs Act of 2017, passed in December, extends the time to bring a wrongful levy suit from nine months to two years.

    Such a timeframe concerns property already sold by the IRS following a levy. There is no time limit if the IRS is still in possession of the property.

    If there is a determination that a wrongful levy occurred, the IRS will return either:

    • The property in question
    • An equal amount of money levied
    • Money equal to the value of the property sold

    Should the IRS deny a wrongful levy claim, individuals still have the right to appeal the determination. Like any other determination, individuals also have the right to appeal to a body that is independent of the IRS.

    Simply because individuals have the right to challenge levies does not mean they will succeed, however. When it comes to levies and property seizures, the IRS has a strict protocol anyone will have to follow before it will reverse its determination. It is usually best to have legal counsel on your side who understands what the agency requires for a successful appeal to take place. Our tax attorney team is here for you.

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