Bankruptcy Requires IRS To Release A Levy Or Seizure
Richard Fonfrias, J.D.
Chicago's Financial Rescue & Bankruptcy Lawyer
Fonfrias Law Group, LLC
When you file bankruptcy, the court puts an automatic stay on all of your creditors. This means they must stop all collection efforts against you. Since IRS is a creditor, your bankruptcy requires that it stop its enforcement efforts and release a levy or seizure within 24 hours. The bankruptcy also stops IRS from imposing any federal tax liens.
In addition to stopping IRS's collection efforts, Chapter 7 bankruptcy can erase taxes you owe that you cannot afford to pay. But if you can pay some of your tax obligation, then you can use a Chapter 13 bankruptcy to (1) stop IRS from adding interest and penalties on top of your payments, (2) reduce the time you'll make payments, and (3) cut your payment amount.
So don't overlook the opportunity to file bankruptcy if you're having trouble paying your taxes. Make sure you speak with a qualified bankruptcy lawyer before you make any final decisions.
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