Owing the IRS can quickly escalate from a stressful situation to a financial crisis — especially when asset seizure becomes part of the conversation. Many taxpayers don’t realize that the IRS has extraordinary authority to seize and sell property, often without needing a court order.
If you’re behind on taxes and receiving notices, understanding how asset seizure works can help you protect yourself and your assets before drastic action is taken.
What Is an IRS Asset Seizure?
An IRS asset seizure is when the IRS takes physical property — cars, homes, business equipment, financial accounts, or other valuable assets — and sells them to apply the proceeds to an unpaid tax debt.
Unlike a levy on wages or bank accounts, a seizure typically involves tangible assets, and it can disrupt your life or business dramatically.
When Does the IRS Seize Assets?
Seizure is not the IRS’s first step. They are legally required to follow a process that gives taxpayers multiple opportunities to resolve their debt before property is taken.
The usual sequence is as follows:
- Notice and Demand for Payment: The IRS informs you of the debt.
- Collection Notices: Additional reminders are sent.
- Final Notice of Intent to Levy (e.g., LT11 or Letter 1058): This formal notice provides 30 days to appeal or resolve the issue before enforcement begins.
Ignoring these notices leads directly to enforcement actions, including seizure.
The IRS tends to pursue asset seizure when:
- The taxpayer owes a significant amount
- There’s been no response to communications
- The taxpayer owns attachable assets with value
What Can the IRS Take?
The IRS can target a wide range of property, including:
- Automobiles and recreational vehicles
- Primary and rental homes (requires special approval)
- Bank and brokerage accounts
- Business equipment and inventory
- Valuable personal property like jewelry or collectibles
Your Rights Before and During a Seizure
Even though the IRS has broad authority, you have rights as a taxpayer:
- Right to notice: You must be informed in writing before any seizure occurs.
- Right to appeal: After receiving a Final Notice of Intent to Levy, you have 30 days to file a Collection Due Process (CDP) appeal.
- Right to representation: You can appoint a tax professional or attorney to represent you.
It’s crucial to act during this 30-day window because after that, the IRS can proceed with seizing and selling your property.
How to Avoid IRS Asset Seizure
You have several ways to prevent seizure if you act promptly:
- Installment Agreement: Arrange to pay your tax debt in affordable monthly payments, stopping collection activity.
- Offer in Compromise: Settle your tax debt for less than the full amount, if eligible.
- Currently Not Collectible (CNC) status: Demonstrate financial hardship to temporarily suspend collections.
- Filing an appeal: A timely appeal will suspend collection activity and allow you to present your case.
Each solution depends on your financial situation and requires careful handling to ensure acceptance by the IRS.
Why Timing Is Everything
If you delay action, the IRS can seize property quickly, sell it at public auction, and apply proceeds to your debt. Recovery of seized property is extremely difficult — once sold, your assets are likely gone permanently.
That’s why it’s essential to take IRS notices seriously and act immediately.
Why You Need Legal Help
IRS collections are complex, and asset seizure carries unique legal risks. A skilled tax attorney can help by:
- Reviewing your case and determining the best resolution strategy
- Negotiating directly with the IRS on your behalf
- Filing appeals, offers, and requests properly and on time
- Protecting your property and your rights under federal law
Don’t Wait — Protect Your Property Today
If you’ve received a Final Notice of Intent to Levy or suspect you’re at risk for asset seizure, you need experienced guidance immediately.
At McCauley Law Offices, we have decades of experience defending taxpayers against aggressive IRS enforcement actions. We understand how the IRS operates, and we know how to intervene to protect your property and resolve your tax debt efficiently.
Call today for a free consultation and let us help you safeguard your assets while working toward a solution that relieves your tax burden.
