Hi Michael. I’m at the end of my rope here with the IRS and would like your help. Basically I was an independent contractor few years back and the tax returns for those three years are my issue. I set up a payment plan and have been making my payments. In January, they returned my check and when notified by my bank, I immediately sent them another check and it was cashed the next week. Today I was informed that my bank account was frozen by trying to buy a coke at stop-n-go. I don’t know what else to do besides ask for your expertise.
I would start by calling your bank and making sure it’s the IRS. It may not even be the IRS. It could also be your state, your student loan, your child support or something else.
If it is the IRS, then what you have is called a levy. On the IRS request, your bank will hold your money for 21 days and, if you do not resolve the issue by then, your money will be transferred to the IRS. Do not wait!
I suggest you call the IRS yourself. You will spend long time on hold, but they may be able to clear the issue, and it’s free. They do mess up from time to time, so it may be as simple as that. On the other hand, it could be a totally different issue with the IRS, not related to your payment plan. For example, if your payment plan (officially called an installment agreement) was set up for 2014, but you also owe them money for 2015 – these two debts are two separate issues, until you specifically request that the IRS combines them into one payment plan.
One missed payment will never be a reason to freeze your bank account. Something else is going on. Also, before freezing your money, they should have sent you multiple warnings by mail, the last one by certified mail. Did you recently move and not receiving your mail, by chance?
In any way, calling the IRS is the first step. If you still need our help after that call, please contact our office.
Thank you for asking, and good luck!