IRS Levy Release: Form 668-D and When the IRS Must Release
Last reviewed by Calculus Tax in-house Settlement Officer
Form 668-D, Release of Levy/Release of Property from Levy, is the form the IRS uses to release a levy in full or in part. The IRS is required to release a levy in specific situations, such as when you pay in full, enter a payment plan that doesn't allow the levy to continue, or the levy causes economic hardship. Contact the IRS right away to ask.
Quick answer
Form 668-D is the IRS's Release of Levy. The IRS must release a levy if you pay in full, the collection period had ended, release helps you pay, you enter a payment plan that doesn't allow the levy, the levy causes economic hardship, or your property is worth more than you owe. Call the IRS right away to request one.
| Form | Form 668-D, Release of Levy/Release of Property from Levy |
|---|---|
| Who issues it | The IRS, to the employer, bank, or other levy recipient |
| Required releases | Paid in full, expired collection period, release helps you pay, qualifying installment agreement, economic hardship, or property worth more than the debt |
| Wage levy causing hardship | Must be released |
| Bank levy causing hardship | May be released |
| Appeal rights | Publication 1660, Collection Appeal Rights |
What Form 668-D Is
Form 668-D, Release of Levy/Release of Property from Levy, is issued by the IRS to the employer, bank, or other party holding the levy. It can release a levy in full or in part, for example after the tax is paid or other payment arrangements are made. You do not file it yourself; you request the release, and the IRS issues the form.
When the IRS Must Release a Levy
Per the IRS, it is required to release a levy if it determines that you paid what you owe; the collection period ended before the levy was issued; releasing the levy will help you pay your taxes; you enter an installment agreement whose terms do not allow the levy to continue; the levy creates an economic hardship; or the value of the property is more than the amount owed and releasing the levy will not hinder collection.
Releases for Economic Hardship
An economic hardship means the IRS has determined the levy prevents you from meeting basic, reasonable living expenses. If a wage levy is creating an immediate economic hardship, the IRS says the levy must be released; for a bank or other account, it may be released. The IRS will usually need financial information, so have it ready when you call, along with the fax number for the employer or bank processing the levy.
How to Request a Release
Call the IRS at the number on the levy or your notice as soon as possible and explain your situation. Be ready to propose a way to resolve the balance, such as an installment agreement or currently not collectible status.
Wage Levies and Bank Levies Work Differently
A wage levy is continuous: part of each paycheck goes to the IRS until the debt is paid, released, or other arrangements are made, and only an exempt amount is protected. A bank levy freezes funds in the account, which the bank holds for 21 days before sending them to the IRS. See the bank levy guide.
Getting Levied Money Back
After levy proceeds have been sent to the IRS, you may file a claim to have them returned. If the IRS denies your request to have levied property returned, you may appeal that denial. Publication 1660, Collection Appeal Rights, explains how.
If the IRS Says No
If the IRS denies your request to release a levy, you may appeal. You can appeal before or after the IRS places a levy on your wages, bank account, or other property. Publication 1660 explains which appeal program applies to your situation.
A Release Is Not Forgiveness
Releasing a levy does not mean you no longer owe the balance. The IRS says you must still make arrangements to resolve the debt, or a levy may be reissued. Calculus Tax reviews your account with Brevitax, and our in-house Settlement Officer helps you choose an arrangement you can keep. Contact us right away if you have been levied.
Frequently Asked Questions
Who files Form 668-D?
The IRS issues Form 668-D to the employer, bank, or other party holding the levy. You request the release by contacting the IRS.
Does a levy release mean I no longer owe the IRS?
No. You still owe the balance, and the IRS may reissue a levy if you do not make arrangements to resolve it.
Can the IRS release a levy because of hardship?
Yes. If a wage levy prevents you from meeting basic, reasonable living expenses, the IRS says it must be released. A bank levy causing hardship may be released.
Will a payment plan release my levy?
The IRS is required to release a levy if you enter an installment agreement whose terms do not allow the levy to continue.
Can I get money back after it was sent to the IRS?
You may file a claim to have levy proceeds returned, and you may appeal if the IRS denies it.
What if the IRS refuses to release my levy?
You may appeal the decision, before or after the levy is placed. Publication 1660 explains your appeal rights.
What can change the answer
Notice type, issue date, filing history, account status, deadlines, and current agency procedures can change the available next step. Bring the complete notice and account records to a qualified review.
Tax rules and collection procedures can change and depend on the account. Federal claims should be checked against current IRS guidance; California claims should be checked against the California Franchise Tax Board. See our editorial methodology for sourcing and update standards.
Results depend on your facts and on IRS or state decisions. Calculus Tax, Inc. is not affiliated with the IRS or any government agency.
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Calculus Tax, Inc. can review notices, organize financial information, explain available paths, and communicate with the IRS or California agencies when representation is appropriate. The right next step depends on your facts, deadlines, filing history, and ability to pay.
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