From start to finish, an IRS levy can take months, if not years to complete. After it notifies you of its intent to levy your earnings, the IRS can generally continue its collection efforts until it is paid in full.
Even so, you can protect yourself financially and legally by understanding how this process works. This information will help you determine if you should appeal the levy or if you can satisfy the debt through other means.
In most circumstances, the IRS can continue to withhold money from your earnings until the entire debt is satisfied. If you owe a significant debt, it may take you years to pay off your default.
However, by law the IRS cannot collect on a tax debt that is more than 10 years old or on one that is currently under appeal. It also cannot levy your paychecks if you have filed for bankruptcy. In fact,if you disagree with the amount that you owe, you should file an appeal within 30 days of receiving the notice to levy.
If you are approved for any of these applications, you may be required to pay hefty deposits or pay higher interest amounts. Despite the levy being paid toward a tax debt instead of a hospital bill, credit card bill, or another type of unsecured debt, the implications of the collection activity can still have the same results on your personal credit.
From the time that the IRS begins its intent to levy your earnings to the time that the public record finally leaves your credit report, years have passed, and you have been left to deal with the levy's impact on your life. You can protect your money, your assets, and your future by knowing how the levy process works and how long it can take to play out until the debt is paid.