Receiving an IRS Final Notice of Intent to Levy (Letter 11) can be alarming. This letter indicates that the IRS plans to seize your assets—like bank accounts, wages, or even property—to satisfy a tax debt. But don’t panic! You have options to protect yourself and avoid a levy if you act quickly and strategically. Here’s what you need to know.
What is IRS Letter 11?
The IRS sends Letter 11 when previous collection efforts, like reminders or notices, have not resolved your tax debt. It’s your final warning that the IRS intends to levy your assets. However, the IRS cannot take action immediately. Letter 11 gives you 30 days to respond before the levy process begins. This window is your opportunity to take action and avoid enforcement.
Steps to Avoid a Levy
1. Understand Your Rights
One of your most important rights is the ability to request a Collection Due Process (CDP) hearing. This stops the levy process temporarily while the IRS reviews your case. To request a hearing, complete and submit Form 12153 (Request for a Collection Due Process or Equivalent Hearing) within the 30-day window.
A CDP hearing gives you a chance to propose alternatives, like an Installment Agreement, Offer in Compromise, or Currently Not Collectible (CNC) status, and dispute the levy if you believe it is improper.
2. Pay the Balance or Set Up a Payment Plan
Paying the entire balance immediately will stop the levy process if you can afford it. If that’s impossible, consider requesting an Installment Agreement to pay your debt monthly. You can apply online, by phone, or through Form 9465.
Once the IRS approves your payment plan, the levy will not proceed if you make your payments on time.
3. Explore an Offer in Compromise (OIC)
An Offer in Compromise lets you settle your tax debt for less than the full amount owed if you can prove paying the full amount would cause financial hardship. Use the IRS Offer in Compromise Pre-Qualifier Tool to see if you might qualify. Submitting an OIC also stops levy actions while your application is reviewed.
4. Prove Financial Hardship (CNC Status)
If you’re experiencing significant financial hardship, you can request to be placed in Currently Not Collectible (CNC) status. This pauses collection efforts, including levies, until your financial situation improves. You’ll need to provide detailed financial information, such as Form 433-A or Form 433-F, to support your claim.
Act Quickly
The most critical factor in avoiding a levy is acting within the 30-day window after receiving Letter 11. Ignoring the notice will almost certainly result in the IRS moving forward with its levy.
Get Professional Help
Let’s be real—dealing with the IRS isn’t like fixing a leaky faucet. If you don’t know what you’re doing, you could end up in a financial mess that makes the levy look like the least of your worries. This isn’t the time to Google your way out of trouble or hope the IRS forgets about you (spoiler: they won’t). A tax pro can help you cut through the red tape, talk to the IRS so you don’t have to, and maybe even save you a ton of money. Consider it like hiring a lawyer in a courtroom—you could represent yourself, but why would you?
