Bank levies can continue until your debt is fully satisfied and can be used repeatedly. To garnish your bank account, a creditor goes to court to obtain a judgment against you for the amount you owe. Once the creditor receives a judgment and has tried to collect the money, you are free to issue a fee if you have not made any attempt to reach a payment agreement or agreement with the creditor. A creditor can garnish your bank account several times until the judgment is paid in full.
In other words, you're not safe from future liens just because a creditor has already collected your account. When the rate is in a bank account, the Internal Revenue Code (IRC) establishes a 21-day waiting period to meet the rate. The waiting period is intended to give you time to contact the IRS and agree to pay the tax or notify the IRS of errors in the rate. Creditors can only legally collect a debt within a specified period of time.
This is known as the statute of limitations. If it's been too long, they may not be allowed to charge money through a bank rate on your account. See state and local laws for more information on statute of limitations for debt collection. If you discover that your bank account has been canceled due to a garnishment and you need the funds for basic living expenses, you may be able to recover the money by applying to court, but you must act quickly.
In some cases, lenders may require that you already have an account with them and for a certain period of time in order to qualify for better rates on their personal loan products. Many people mistakenly believe that the creditor should give a warning before collecting a bank account. To initiate a garnishment, creditors will hand over the documents to the bank or financial institution where your account is located. If the debt isn't yours or the amount claimed is incorrect, you could file a lawsuit or stop a bank garnishment.
Before most creditors can impose a garnishment on your account, they must go to court to obtain a judgment against you. If a creditor can establish that you have an outstanding debt, they may be able to use a collection action called a bank rate. Your mother or power of attorney should call the IRS at the phone number listed on your form 668-A (C), DO and be prepared to explain why the funds in the bank account belong to your mother. If a garnishment has not yet been established on a bank account, there is still the possibility of working with creditors to find an alternative agreement that avoids legal action.
Your options depend on where you live, so check your local bankruptcy laws to see if you can exempt funds that have been raised. It may be useful to set up an alternative account where you can deposit all your exempt funds to avoid the risk of confusion. Therefore, if you know that a creditor has a judgment against you, you should not keep money in bank accounts until you resolve the debt. If a creditor were to warn the debtor before the bank garnishment, the debtors would always empty their accounts before the garnishment arrived.
The creditor will use the funds to an outstanding debt of the account holder (also known as the debtor). The IRS charges an application fee to do so, but it's much better than a wage garnishment or bank account fee. State law will determine exactly how they can get money from an account and if there are any limits to the amount of money they can take or the funds that are exempt.