What is bank levy? This process refers to a situation in which your bank account is "frozen" or seized due to unpaid taxes or debt.
In some states, your bank account can be levied for twice the amount that you owe.
For example, if you owe $5,000 - up to $10,000 of the money in your bank account can be levied.
How do I stop this from happening to me? If you want to avoid a frozen account, the best thing you can do is to deal with your debtor.
Never ignore a creditor or decide to wait and see what happens.
Who can freeze my account? The IRS is famous for using bank levies to collect for non-payment of taxes or back taxes but they are not the only ones.
A credit card company can also sue to get a judgment against a debtor and then freeze the debtors bank account.
If your account has already been frozen, you will need legal assistance in releasing the account, if it's possible.
This doesn't mean that you will be walking away - you will still owe your creditor, be it the IRS, state government, credit card company, etc.
Additionally, a creditor can continue to levy your wages until the full debt is paid off.
In most cases, you cannot make any withdrawals out of your account, however you can deposit money into the account.
Bank account funds that arise from subsistence wages from sources such as Social security and veterans benefits are exempt.
If your bank account is frozen and your account funds are sourced from these benefits - you are in a good situation to get your account released.