How Many Notices Does the IRS Send Before a Levy?

A letter from the IRS can stress anyone out. But if the notification is about unpaid taxes, you may start to panic — especially if it threatens to seize your assets. Thankfully, you should receive several letters before that happens. But how many notices does the IRS send before levying your property?

In this post, we discuss what an IRS levy is, what kind of levies are possible, and how many notices you can expect to receive.

What Is an IRS Levy?

Before we answer “How many notices does the IRS send before a levy?” let’s clarify what a tax levy is. An IRS tax levy enables the federal government to seize your property to satisfy a tax liability. In other words, it is a legal confiscation of your property in response to unpaid taxes.

What Must the IRS Do Before Issuing a Levy?

Typically, the IRS will levy your property only after meeting the following requirements:

1.  The IRS assesses taxes and sends a bill (Notice and Demand for Payment).
2. You do not pay the tax.
3. The IRS sends a levy notice (Final Notice of Intent to Levy and Notice of Your Right to a Hearing) at least 30 days before seizing your property.
4. The IRS notifies you they may contact third parties about your debt (Third-Party Contact).

If you don’t pay your taxes or make a debt settlement arrangement, the IRS may levy your property.

What Are the Types of IRS Levies?

The IRS can levy any property you own or have an interest in, even if someone else holds it. Some levies occur only once, while others are continuous.

If you owe back taxes, the IRS may use these enforcement tools to satisfy the debt:

• Asset seizure: The government can confiscate anything that has value or can be liquidated, including cars, boats, real estate, investments, and jewelry.
• Tax lien: A lien represents the government’s legal claim to your property. A lien may become a levy if you do not arrange to settle your debt within 30 days.
• Bank levy: The IRS can instruct financial institutions to freeze your bank accounts and apply funds toward your tax debt.
• Wage garnishment: The IRS can require your employer to withhold a percentage of your paychecks (typically capped at 25% of wages) until you pay your back taxes.
• Tax refund seizure: The government can confiscate your federal or state tax refunds to repay your tax bill.
• Federal payments levy: The IRS can seize certain federal payments like retirement annuities, federal contractor payments, or Social Security benefits (usually up to 15%).
• Accounts receivable seizure: The government can levy your business’s outstanding accounts receivable, directing customers to pay the IRS rather than your company. 

How Many Notices Will the IRS Send Before Levying Property?

By the time the IRS levies your property, you should have received five notices. These include the following: 

• CP14: Notice of Tax Due and Demand for Payment
• CP501: Reminder of Balance Due (also called the 1st notice, although you may receive it after CP14)
• CP503: Second Reminder of Balance Due (also called the 2nd notice)
• CP504: Notice of Intent to Levy (also called the Final Notice) — the IRS can seize state tax refunds after this notice
• LT1058 or LT11: Final Notice of Intent to Levy and Notice of Your Right to a Hearing

Ignoring IRS notices will likely trigger penalties and interest, increasing your tax burden. If you continue not to pay, it can eventually lead to asset levies. 

Need Help With an IRS Levy? Call Us Today!

How many notices does the IRS send before a levy? Five. Whether you’ve received one notice or several, contact Levy & Associates online or call 800-TAX-LEVY for help navigating tax levies.