After procedural requirements have been fulfilled by the IRS, it may issue a Notice of Levy (Form 668-A) to a bank that holds funds belonging to a delinquent taxpayer. The Notice of Levy requires the bank to freeze any funds that are in the taxpayer’s account at the time the levy is served. The taxpayer should have access to funds deposited into the account after the bank freezes the funds subject to the levy. Unless the levy is released, the bank is required to turn the frozen funds over to the IRS 21 days after the bank places the freeze on the account. These funds will be applied to the taxpayer’s tax liability.
For more information, refer to our Will the IRS Garnish/Levy My Wages? article.