July 8, 2020

North Dakota Bank Levy (Seizure)

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North Dakota Bank Levy (Seizure)

North Dakota Office of State Tax Commissioner (OSTC) Bank Levy – How to Release and Resolve

The North Dakota Office of State Tax Commissioner is very aggressive and very tough to negotiate with. We do not recommend you “go it alone.”

A North Dakota Office of State Tax Commissioner bank levy (also known as a bank seizure or bank freeze) is a legal action taken by the State of North Dakota where funds are taken from a bank account of a tax debtor to recover back due tax debt(s). This state tax levy is called an “Order to Withhold”. OSTC bank levies are difficult to release and in most situations a release is not possible especially if you are attempting to do so on your own. If you have received a bank levy or wage garnishment (wage levy), you should take swift action to immediately resolve the problem as other collection actions may be in the works.

When Is a North Dakota Office of State Tax Commissioner Bank Levy Issued?

Tax Levies are issued to your bank after a final notice to the taxpayer is sent requesting them to resolve the balance and no contact or arrangements have been made. Time beyond what is stated in the letter can be granted if you or your Tax Attorney or Certified Tax Resolution Specialist calls in to resolve the case. Doing nothing almost always eventually results in a levy on any bank account for which you have received a 1099 or direct deposit. Often a North Dakota Office of State Tax Commissioner lien will get filed in your county, if it has not already been filed.

Take immediate action on the debt on your own or hire a Tax Attorney or Certified Tax Resolution Specialist to get things moving in the right direction. Otherwise you risk a OSTC bank levy or wage levy. The best way to take action is to resolve the tax debt, which prevents the tax levy from happening in the first place.

Stopping a North Dakota OSTC Bank Levy Before THE LEVY Starts

A North Dakota Office of State Tax Commissioner (OSTC) bank levy is stopped when your case is resolved or a resolution is pending. Collection action is not stopped by filing a North Dakota Offer in Compromise in all cases, but it is in most.

The five most common ways to resolve a balance with the OSTC are:

Pay In Full – Pay off the debt completely – This is probably not an option.
Payment Plan (Installment Agreement)– Paying off the debt in monthly payments
Offer in Compromise – Settling your tax debt for less than the amount owed
Hardship Request (Currently Not Collectible Status)– Tax debt collections are stopped for one year (six months in some cases)
Innocent Spouse- you can be relieved of responsibility for paying tax, interest, and penalties if your spouse (or former spouse) improperly reported items or omitted items on your tax return.
File Bankruptcy – Stops the OSTC from taking any further collection action, while the Bankruptcy is active

A North Dakota OSTC Offer in Compromise is considered the best form of North Dakota tax forgiveness, but not everyone will qualify. A North Dakota Office of State Tax Commissioner (OC) bank levy or wage levy will not be issued if any of the other resolution options are in place.

THAT’S WHY YOU NEED TO CALL Legacy Tax & Resolution Services – 855-829-5877

North Dakota Office of State Tax Commissioner Levied My Bank Account! What Do I Do?

Release the Tax Levy, If Possible

Releasing the tax levy is very difficult. The majority of cases result in seizure of funds. The OSTC issues an Order to Withhold. The bank holds funds for 10 days before being transferred over to the OC. An extension on the OSTC taking the money can be issued by the OSTC agent if you contact them and are dealing with them to try and get it released.

There are three main ways to release an North Dakota Office of State Tax Commissioner Bank Levy:

Prove a financial hardship (Currently not Collectible Status)
Show that the money belongs to someone else
Show that the tax levy took funds that are exempt from the tax levy
Prove another extraordinary circumstance

Proving Financial Hardship

Releasing a OSTC bank levy by financial hardship is tough. Being elderly or low income helps in this type of argument with a North Dakota Office of State Tax Commissioner bank levy release request. Eviction notices can help build your case as well. Financial hardship is tough to prove on your own. Even though you may qualify for a hardship, this does not mean the North Dakota Office of State Tax Commissioner will release your bank levy every time. You have to prove that taking that money would constitute an extreme hardship. Do not wait until financial circumstances improve to contact the OC. The North Dakota Office of State Tax Commissioner will move to other collection actions.

The Money Is Not Mine! Release My Bank Levy!

A tax attorney holding money in trust for their clients would get a release. Your grandma accidentally deposited her money into your bank. Prove it and that usually would get a release. In order to get this kind of OSTC bank levy release you need good proof in the form of documentation. An explanation by itself is not going to work.

Exempt Funds from North Dakota Office of State Tax Commissioner Bank Levies

Social Security income and veterans’ benefits are exempt from OSTC levies. Other forms of public assistance are usually exempt as well. The funds can be released if you or your Tax Attorney or Certified Tax Resolution Specialist contacting the OC. This is the easiest type of OSTC bank levy release to get if you have the proof.

Other Extraordinary Circumstances for OSTC Bank Levy Release

OSTC bank levies can be released, but you must prove an extraordinary circumstance that makes sense to the OSTC agent handling the case. Do not count on the OSTC agent accepting anything here.

The Levy Will Not Be the Last Collection Action, If You Do Nothing

Quickly reach a resolution or hire a tax attorney or Certified Tax Resolution Specialist to handle it for you, after you receive a North Dakota Office of State Tax Commissioner bank levy. Receiving the levy is a sign that your case is deep in collections. Do not plan on getting the levy funds back, but it might be possible, if you meet on of the exceptions above. The important point to understand, the North Dakota Office of State Tax Commissioner can take other collection actions (Assets Seizures, Wage Levy (Garnishment)), so take action before the situation escalates.

LEGACY TAX & RESOLUTION SERVICES, LLC

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