Understanding IRS Letter LT11: Intent to Levy - Your Rights and Options

Introduction

Receiving a Letter LT11 from the IRS can be alarming. This notice, formally known as 'Notice of Intent to Levy and Notice of Your Right to a Hearing,' indicates that the Internal Revenue Service (IRS) plans to seize your assets due to unpaid taxes. Understanding this notice is crucial for responding effectively and protecting your rights.

What is IRS Letter LT11?

The IRS issues a Letter LT11 to inform taxpayers of impending levies on their property or rights to property. This notice serves as a formal warning, notifying you of the IRS's intention to seize assets such as bank accounts, wages, or other property to satisfy a tax debt.

Your Rights Under Letter LT11

Upon receiving a Letter LT11, you have several rights as outlined under IRS regulations. Importantly, you have the right to a Collection Due Process (CDP) hearing. This hearing is an opportunity to discuss your tax situation with an independent Office of Appeals, potentially resolving the issue without enforcement action.

• 30-Day Response Period: You have 30 days from the date of the notice to request a CDP hearing by completing Form 12153, 'Request for a Collection Due Process or Equivalent Hearing.'
• Right to Representation: You can select an authorized representative, such as an attorney or CPA, to represent you during communications with the IRS.
• Right to Dispute the Amount: During the CDP hearing, you can present your case, dispute the amount due, or propose a payment plan or alternative collection method.

Options to Consider

Receiving a Letter LT11 doesn't mean you are out of options. You can explore several pathways to manage your tax liability:

• Pay the Tax Debt: If possible, paying the full amount due will immediately stop collection actions. The IRS accepts various payment methods, including credit card and direct debit.
• Installment Agreement: If full payment is not feasible, consider negotiating an installment agreement to pay your debt over time.
• Offer in Compromise: You might be eligible for an Offer in Compromise (OIC) if you can't pay the full amount or if doing so would create financial hardship. This program allows you to settle your debt for less than the amount owed.
• Currently Not Collectible Status: If you're facing financial difficulty, you may qualify for a temporarily suspended collection status, known as 'Currently Not Collectible.'

Consequences of Ignoring LT11

Failing to respond to Letter LT11 can result in severe consequences, as the IRS will proceed with the levy. This can lead to garnishment of wages, seizure of bank accounts, and loss of other assets. It's crucial to engage with the IRS immediately upon receiving this notice.

Steps to Take if You Receive a Letter LT11

1. Read the Notice Carefully: Understand the amount due, the deadline to respond, and your rights.
2. Verify the Information: Ensure the tax liability mentioned is accurate. If needed, consult with a tax professional.
3. Complete and Submit Form 12153: Request a Collection Due Process hearing if you believe the levy is unwarranted.
4. Consult with a Professional: Consider hiring a tax consultant or attorney for guidance on the best course of action.
5. Negotiate with the IRS: Discuss payment options, such as installment agreements or an Offer in Compromise, during your appeal.

Conclusion

While receiving a Letter LT11 can be stressful, understanding your rights and exploring your options can help you manage your tax situation effectively. Taking prompt action and seeking professional guidance can mitigate the risks of asset seizure and help resolve your tax issues.

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