Bank Levy – Payroll Tax Lien
A payroll tax lien is used by the IRS to secure the payment of overdue payroll taxes. A bank levy is the actual seizure of money to pay them. Get both a bank levy and payroll tax and you have a major problem.
Bank Levy – Payroll Tax Lien
Imagine the worst possible tax nightmare involving your personal taxes. Now multiply the misery by 100 times. The result will give you an idea of payroll tax problems with the IRS. It simply doesn’t get any worse. Not remotely.
The IRS takes a very aggressive stance when it comes to payroll tax. The reason for this is the IRS views the payroll tax as partially being “owned” by the employees of a business. When an employer fails to pay payroll taxes, the IRS takes the view the business has stolen the money. Yes, we are talking criminal theft and all that implies. In a best case scenario, the IRS will workout a payment plan with employers. In worse case scenarios, the IRS will seize your assets, liquidate the business and pursue criminal charges. Whatever you do, make every effort to deposit payroll taxes in a timely matter.
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If you miss payroll tax deposits, the IRS will come for you quickly and with a very bad attitude. You can expect a bank levy to be filed on the business bank accounts. In such a situation, the bank will be forced to freeze the accounts and forward all amounts not exceeding the tax owed to the IRS within 21 days. Put another way, the minute the levy hits the bank account, you can kiss the money goodbye. The IRS will typically renew the levy on a daily basis until the money is paid.
A bank levy from a payroll tax lien should scare the living day lights out of you. When one occurs, you should expect the IRS to raid your business within a matter of days. Come hell or high water, the IRS intends to collect the missing payroll tax and you are going to experience misery unlike anything you can imagine.
Making matters worse, the IRS does not just attack the business with a bank levy when trying to collect on a payroll tax lien. Under relevant law, the IRS has the right to go after certain officers and owners personally for the delinquent payroll tax. The IRS pursues this right with serious gusto. The fact the business is incorporated has no impact on the efforts of the IRS to collect the loan nor does the fact an officer of the business isn’t actually an owner. In short, the nightmare tax situation has just gone from bad to worse. All of your personal assets could be at risk, not to mention IRS audits of your personal taxes.
If the IRS files a payroll tax lien against your business, you absolutely must pay the tax immediately or get professional representation right away. An IRS bank levy – payroll tax lien situation means you are about to be crushed by the IRS. You absolutely must take immediate action to keep from being financially ruined. Do it now!