Levy —
A levy is the taking of an asset or a financial resource by the IRS, and the most common form of a levy is a bank levy.
Levy on Income —
A specific levy designed to seize wages, social security benefits, pensions, or any other income in order to cover your back tax debt.
Lien —
A lien is simply a statement that alleges that you owe a back tax debt. It legally is created whenever you owe back taxes that have been placed under the jurisdiction of the collection arm of the IRS. As a starting measure, the IRS will issue a lien against your Social Security Number to hinder you from purchasing, selling or transferring any property. A lien will damage your credit report. If you are preparing an Offer in Compromise and it is accepted, the lien will be released once the Offer in Compromise payment terms have been satisfied. Otherwise, the lien will be released when the tax debt is either paid in full or the statute to collect the tax has expired. Liens can be discharged or subordinated under special circumstances by the IRS.
Lien Discharge —
Such a discharge is the removal of a lien on a specific piece of property to allow for its sale, disposal or credit backing.
Lien Release —
Issued by IRS when a tax debt is fully paid or if you can prove there is financial hardship affecting your family’s health and basic security.
Lien Subordination —
When a lien is subordinated, it is the temporary setting aside of the lien to allow for a sale or refinancing.
Liquidation Value —
The amount the IRS can expect to obtain when your assets are placed in a public auction and the sale is under distress. Typically, a distress sale of liquidation value is about 65% of fair market value.
Local Standards —
Depending on where you live and the given standard, the maximum allowance for utilities and housing that the IRS will allow when collection actions against your tax debt have been taken. Such an allowance does not include transportation, which is considered a separate expense with a separate allowance.
