IRS Levy vs IRS Lien – What’s the Difference?
Both Are Serious—But They’re Not the Same
When you owe back taxes, the IRS has several enforcement tools to collect what you owe. Two of the most commonly misunderstood are the federal tax lien and the IRS levy.
They’re not interchangeable—and knowing the difference is critical if you want to protect your wages, bank account, property, or credit.
In this blog, we break down what each one does, how they're triggered, and what you should do if you've received either.
What Is an IRS Tax Lien?
An IRS lien is the government’s legal claim against your property when you fail to pay a tax debt. The IRS files a Notice of Federal Tax Lien (NFTL), which:
- Attaches to real estate, vehicles, personal property, and future assets
- Notifies other creditors that the IRS has first claim
- Becomes part of the public record
It doesn’t take your assets—but it blocks you from selling or refinancing without paying the IRS.
Related: IRS Lien Filed Against You? What It Means and What to Do Next
What Is an IRS Levy?
An IRS levy is an active seizure of your money or property. It allows the IRS to:
- Freeze and drain bank accounts
- Garnish your wages
- Seize business assets, cars, or real estate
It’s the most aggressive collection action the IRS can take—and it doesn’t require a court order.
Related: IRS Notice of Intent to Levy – Urgent Steps to Take
Side-by-Side Comparison
| Feature | IRS Lien | IRS Levy |
|---|---|---|
| What it does | Claims your assets | Seizes your assets |
| Filed publicly? | Yes | No |
| Appears in title reports? | Yes | No |
| Removes assets from your control? | No | Yes |
| Stops a home sale? | Yes (unless resolved) | Possibly (if real estate is levied) |
| Triggered by | Balance due + notice | Final notice + no response |
How They Work Together
The lien is like a warning—the IRS is putting everyone on notice that they have a legal claim. The levy is the execution of that claim.
You can have a lien without a levy, but if you get a levy notice, it means you're already deep into the IRS collection process.
What Notices Should You Watch For?
- Lien: IRS Notice 3172 (Notice of Federal Tax Lien)
- Levy: IRS Letter 1058 or LT11 (Notice of Intent to Levy)
Related: IRS Collection Appeals Program (CAP) vs. CDP Hearings – What’s the Difference?
How to Stop a Levy or Remove a Lien
To stop a levy:
- File for a Collection Due Process (CDP) hearing
- Set up an Installment Agreement
- Submit an Offer in Compromise
- Qualify for Currently Not Collectible
To remove a lien:
- Pay your tax debt in full
- Request a Lien Withdrawal or Release
- File Form 12277 or request Form 668(Z) if eligible
We Help Orange County Taxpayers Stop Levies and Remove Liens
At Boulanger CPA and Consulting PC, we help clients:
- Respond to levy and lien notices quickly
- Stop garnishments and bank levies
- File appeals and resolution requests
- Settle tax debt and clear public records
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📞 Call (657) 218-5700 or request a confidential case review at www.orangecounty.cpa
FAQ: IRS Lien vs IRS Levy
Q: Can I have both a lien and a levy at the same time?
A: Yes—and most people who are levied already have a lien filed.
Q: Which is worse?
A: A levy is more urgent—it actively takes money or assets. A lien is harmful to credit and property transactions.
Q: Can the IRS levy my bank account without warning?
A: No. They must send a Final Notice of Intent to Levy (LT11 or Letter 1058) at least 30 days before acting.
Q: Will paying off my debt remove both?
A: Yes, but you may still need to request formal release or withdrawal to clear the public record.
📣 About the Author
Marc Boulanger, CPA is the founder of Boulanger CPA and Consulting PC, a boutique tax resolution firm based in Orange County, California and trusted by high-income individuals and business owners across Southern California.
With over a decade of experience resolving high-stakes IRS and State tax matters, Marc brings strategic insight to complex cases involving wage garnishments, bank levies, unfiled returns, and six-figure tax debts. He is known for helping clients reduce or eliminate tax liabilities through expertly negotiated settlements and compliance plans.
Marc is a Certified Public Accountant licensed in California and Oklahoma and holds the designation of Certified Tax Representation Consultant. He is a member of the American Society of Tax Problem Solvers (ASTPS) — the national organization founded by the educators and practitioners who have trained thousands of CPAs, EAs, and tax attorneys in IRS representation strategy.
Every case is handled with discretion, proven methodology, and direct CPA-led representation — not call center scripts.
📍 Learn more at www.orangecounty.cpa or call (657) 218-5700.
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