Published: | Last Updated: October 17, 2023
Return of Levy Proceeds or Seized Property
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The IRS issued a levy and the levied proceeds have been applied to your balance. The IRS may consider returning all or a portion of the levied proceeds if any of the following conditions apply:
You have a balance on your tax account. A notice was sent to you previously letting you know how much you owe, when it was due, and how to pay. Since the IRS did not hear from you it continued with its collection process and issued a levy that attached to your funds. The funds were sent to IRS and applied to your tax liability.
If the funds or property are not yet in IRS possession, see Levy Release.
Making an administrative return of property claim under IRC Section 6343(d): If the funds or property are in IRS possession, your only recourse is to request that IRS consider returning the funds by filing an administrative return of property claim. There is a time limit for making a claim.
(Note: For levies and seizure made prior to March 22, 2017, the timeframe to file a claim is 9 months instead of 2 years.)
Your request for return of levied proceeds must be in writing and must include:
Your request must be made:
Note: For levies and seizure made prior to March 22, 2017, the timeframe to file a claim is 9 months instead of 2 years. These claims must have been filed before December 23, 2017.
Since levies on wages and Social Security benefits are ongoing, it is important to timely ask the IRS to return the proceeds based on when the levy started.
You claim must be send to the address on the levy form.
If your claim is rejected, you have the right to appeal through the Collection Appeals Program (CAP).
For more information, see Publication 5149, Making an Administrative Return of Property Claim Under Internal Revenue Code (IRC) Section 6343(d); Publication 594, The IRS Collection Process; and Publication 1660.
Collection Alternatives: To prevent future levy action, you can enter into a collection alternative based on financial situation.
If the tax being levied is the result of an audit where you didn’t know you were audited (never got a notice), you didn’t meaningfully participate, or you disagree with the findings, you may be able to ask for audit reconsideration.
If the tax being levied stems from the filing of a joint return and you believe your current or former spouse should be solely responsible for an incorrect item or an underpayment of tax on the return, you may be eligible for relief as an Innocent Spouse.
The Taxpayer Advocate Service is an independent organization within the IRS that helps taxpayers and protects taxpayers’ rights. We can offer you help if your tax problem is causing a financial difficulty, you’ve tried and been unable to resolve your issue with the IRS, or you believe an IRS system, process, or procedure just isn’t working as it should. If you qualify for our assistance, which is always free, we will do everything possible to help you.
Visit www.taxpayeradvocate.irs.gov or call 1-877-777-4778.
Low Income Taxpayer Clinics (LITCs) are independent from the IRS and TAS. LITCs represent individuals whose income is below a certain level and who need to resolve tax problems with the IRS. LITCs can represent taxpayers in audits, appeals, and tax collection disputes before the IRS and in court. In addition, LITCs can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Services are offered for free or a small fee. For more information or to find an LITC near you, see the LITC page on the TAS website or Publication 4134, Low Income Taxpayer Clinic List.