IRS letter 1058 is called “A final notice of intent to levy.” It’s important because the IRS does not have the right to levy or seize, which levy means seize.
The IRS does not have the right to levy or seize your property until they have issued you a letter 1058 and you have been given 30 days to file an appeal.
The appeal is called, “A collection due process hearing.” In that appeal, you have the opportunity to basically challenge the fact that they have the right to levy you.
We file lots and lots of collection due process hearings. We call them CDP hearings because it allows us the time to get the tax payer back into compliance and offer a collection alternative, such as an installment agreement and offer of compromise, a hardship status determination and things of that nature.
When you look at this form, as you can see there on page one on the left, you can see what you should do. It’s says, “if you want to file an appeal, then you can go ahead and do so.”
There’s instructions on how to do that. There are also things, basically what they’re trying to do is elicit a phone call from you so that they can convince to enter in to some sore of payment arrangement or even better yet, arrange for full payment.
One other thing I want you to be aware of is the fact that each liability. As you can see here on page two, on the right hand side, this particular tax payer has two liabilities. One for 2008 and one for 2010. Both relating back to form 1040.
Each tax liability or each tax year, is treated like a separate account with the IRS. Sure, it’s under your social security number but they’re all different credit card balances. That’s the best analogy that I’ve ever been able to come up with.
They cannot levy you on a particular liability until they have issued you a form 1058 and more than 30 days has elapsed. That’s the form 1058. It’s just important to know a lot of the notices that the IRS issued are very scary but they don’t really mean that much business until you get this letter 1058.
There is one exception to the fact that you can’t be levied until you get the letter 1058 and that is you can get a letter or form CP504, which allows them to levy your state tax refund but that’s it, that all they can levy is your state tax refund, in that instance, and that’s assuming that you have one coming.
If you owe tax liability to the IRS, it’s very likely you owe tax liabilities to your state, as well.
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