IRS Tax Liens – IRS Tax Levies

People often get mixed up between liens and levies. The best way to recall the terms is that a lien is kind of a “passive” thing that just sits there at the County Recorder, whereas a “levy” is active, meaning a levy is an actual “taking” of your money right now.

The purpose of a lien is to tell the world at large, via public record, that you owe money to IRS. Aside from screwing up your credit, what is the purpose of that? The purpose is to tell people like title companies that if you were to sell say, your house, that IRS has a claim on some of the proceeds of the sale of your house (at least in the county where the lien is recorded). In other words, the lien protects the IRS from your selling or mortgaging certain assets without the IRS getting their fingers into it first. By making the lien public record, other parties, like property buyers and title companies, can become liable for your taxes themselves if they ignore the IRS lien and give you all the money.

A levy, on the other hand, is an actual seizing of your money, from say your bank account or your paycheck. Some levies can be “continuous,” as with your paychecks, and some can be just for a point in time, such as a bank levy. (although IRS can levy your bank account over and over if they want, there are usually varying gaps of time between bank levies while your IRS collection agent is chasing after someone else.)

If you are suffering from liens or levies, you should call me.

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