Wage Garnishment and Bank Levy Release

A bank levy is a snapshot. The bank freezes the funds that were in the account on the day it received the notice and holds them for a set waiting period, commonly 21 days, before sending them to the IRS. That waiting period is the window to get a release in place. Money deposited after the levy date is not caught by it.

A wage garnishment works differently. It stays attached to your employer and keeps taking a portion of every payment until the IRS releases it or the debt is satisfied. Only a modest amount is exempt, so most people find the remainder does not cover their normal household costs.

The IRS will release a levy when the levy is creating an economic hardship, when the debt is satisfied or unenforceable, when a resolution such as an installment agreement or hardship status is put in place, or when the levy was issued in error or without proper notice. Getting there normally means a representative reaching the right IRS unit, documenting your living expenses, and putting an alternative on the table the same day.

The other half of the job is making sure it does not happen again. A levy is the end of a notice sequence, so a release without a resolution behind it usually just resets the clock.