Taxation & Estate Planning

How the IRS Locates Your Bank Account

By Darrin Mish

Can the IRS locate your bank accounts legally and without your approval? The answer is yes if it is for the purpose of getting back the money you owe in taxes. They can put a levy on your bank accounts until your taxes are paid up. This is just one of the strong arm tactics the IRS may use to get you to pay up. But how do they identify your bank?

One method is to issue you a check and when it is cashed, the name of your bank and your account number are written at the reverse side of the check. This is by far the simplest method and will often be the initial choice of the IRS since it costs almost nothing to carry out. Another way is to issue a general levy on all the banks in the location around where you live. In this method, the IRS is assuming you use a bank that is nearby your own home. This is a time-consuming and expensive way to go about things and it doesn't ensure success. If you are using an offshore bank to conceal your assets or if you are using a state-owned bank and you do most of your banking online, this method won't work. With the rise of the Internet, a blanket levy is becoming less and less workable.

If they want to get down and dirty, the IRS may obtain a search warrant and with the police, search through your premises for evidence of which bank you use to keep your money. They will need the help of a judge who will issue the order and the help of the local police force. If things have gotten this far with the IRS, you may want to just call them and talk about entering into a payment plan of some kind because this is almost as serious as things can get.

Another means the IRS may resort to is to find a paper trail of legal documents you may have signed like previous or current lease agreements in hopes of obtaining information about where you keep your money. They can also search your tax forms or any documents that you have on file with the government. Remember that these methods used by the IRS to locate your bank accounts are all within the law. To avoid all these, the best thing to do is to contact the IRS and work out a payment plan. The best person to speak to about this is a tax attorney.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

How the IRS Locates Your Bank Account is a post from: IRS Tax Problem Solver Blog - IRS Help

Full post as published by IRS Problem Solver Blog on January 21, 2010 (boomark / email).