Can the IRS really levy before offering me a CDP hearing?

In four situations, yes. IRC 6330(f) covers jeopardy levies, levies on state tax refunds, disqualified employment tax levies, and federal contractor levies. In each case you must be offered the CDP hearing within a reasonable period after the levy.

Will a post-levy hearing get my money back?

Not automatically. The hearing can stop further levies and set up a collection alternative. Getting funds back depends on IRC 6343, which allows release or return in specific circumstances, such as a premature or improper levy or economic hardship. Raise those requests at the hearing.

Do I get a new hearing every time the IRS levies?

No. Treas. Reg. 301.6330-1, Q&A-B2, says only the first pre-levy or post-levy CDP notice for a tax and period carries the hearing right. If you let that notice pass, a later levy for the same period does not create a new CDP hearing.

Does Florida's lack of a state income tax matter for state refund levies?

Florida does not impose a personal income tax, so Florida residents usually do not have Florida income tax refunds for the IRS to levy. The state refund levy exception in IRC 6330(f)(2) can still matter to Floridians who file returns in other states, such as former residents or people with income sourced to another state that generates a refund.

Post-Levy CDP Hearings Under IRC 6330(f)

Q: What is a disqualified employment tax levy?

Under IRC 6330(h)(1), it is a levy to collect employment taxes for a period when the taxpayer, or a predecessor, requested a CDP hearing on unpaid employment taxes arising in the most recent two-year period before that period began. It targets employers who repeatedly fall behind on payroll taxes.

The core promise of Collection Due Process is simple: the IRS has to offer you a hearing before it levies. IRC 6330(a)(1) says no levy may be made unless the IRS has notified you of your right to a hearing before the levy is made.

Then IRC 6330(f) lists four situations where that promise is modified. In each one, the IRS may levy first, and you receive the opportunity for the hearing within a reasonable period after the levy. If you have been hit by one of these, the rules for what happens next are different.

The four exceptions

1. Jeopardy

IRC 6330(f)(1) applies when the IRS has made a finding under the last sentence of IRC 6331(a) that collection of the tax is in jeopardy. Jeopardy findings are reserved for situations where the IRS believes delay would endanger collection, such as a taxpayer preparing to leave the country or move assets beyond reach. Jeopardy levies come with their own separate review procedures under IRC 7429, and those deadlines are short. If you receive a jeopardy notice, treat it as an emergency.

2. State tax refund levy

IRC 6330(f)(2) covers a levy served on a state to collect a federal tax liability from a state tax refund. Treas. Reg. 301.6330-1(b)(2), Q&A-B1, confirms that a taxpayer is entitled to a CDP hearing for the tax and periods in a state refund levy. Florida has no state individual income tax, so this one mostly affects people with refunds from other states, such as former residents or those with income sourced elsewhere.

3. Disqualified employment tax levy

IRC 6330(f)(3) and (h)(1) define a disqualified employment tax levy as a levy to collect employment taxes for a period if the taxpayer, or a predecessor, requested a CDP hearing on unpaid employment taxes arising in the most recent two-year period before the beginning of the period for which the levy is served. "Employment taxes" means taxes under chapters 21, 22, 23, or 24 of the Code.

Translation: if a business used CDP for payroll taxes and then fell behind again within roughly two years, the IRS may levy on the new payroll liabilities before offering a hearing. Congress aimed this at employers who pyramid payroll taxes and use CDP to buy time. If you operate a business with payroll, this is the exception most likely to matter to you.

4. Federal contractor levy

IRC 6330(f)(4) and (h)(2) cover any levy on a person who is a federal contractor (or a predecessor). Payments from the federal government to contractors with tax debts can be levied first, with the hearing offered afterward.

What you still get

In every exception, IRC 6330(f) preserves the hearing: the taxpayer shall be given the opportunity for the hearing described in the section within a reasonable period of time after the levy. That means the same Appeals hearing with the same issues:

Verification that legal and administrative requirements were met.
Challenges to the appropriateness of the levy.
Collection alternatives such as an installment agreement or offer in compromise.
The underlying liability, if you had no prior opportunity to dispute it.
A Notice of Determination you can take to the Tax Court within 30 days.

What you lose is the pre-levy freeze. The money has already moved. The hearing becomes a way to stop further levies, obtain a collection alternative, and in some cases get funds returned.

How to request the post-levy hearing

The IRS sends a post-levy notice of your right to a hearing. The request is made the same way as a pre-levy hearing: in writing, generally on Form 12153, within the time stated on the notice, to the address on the notice. Do not wait for the levy proceeds to arrive at the IRS before acting. The deadline runs from the notice.

Treas. Reg. 301.6330-1, Q&A-B2, adds an important rule: only the first pre-levy or post-levy CDP notice for a tax and period carries the right to a CDP hearing. If you let the post-levy notice pass, a later levy notice for the same period will not give you a new one.

Getting levied money back

This is the hard part. A post-levy hearing does not automatically unwind the levy. Remedies depend on the situation:

Release of levy. IRC 6343(a) requires release in certain circumstances, including when the liability is satisfied or unenforceable, when release will facilitate collection, when an installment agreement is entered into (unless it provides otherwise), or when the levy creates an economic hardship.
Return of property. IRC 6343(d) allows the IRS to return levied property in some situations, such as when the levy was premature or not in accordance with administrative procedures, or when return would facilitate collection.
Wrongful levy. If the levy reached property belonging to someone else, IRC 6343(b) and the wrongful levy rules provide a separate path.

Build these requests into the hearing. Under Treas. Reg. 301.6330-1, Q&A-F3, if you do not raise an issue at the hearing, you generally cannot raise it in Tax Court.

A note on the levy freeze during the post-levy hearing

A timely post-levy CDP request still triggers IRC 6330(e)(1). Further levy actions that are the subject of the hearing are suspended while it is pending, and the collection statute is suspended too. IRC 6330(e)(2) lets the Tax Court allow levy to continue during an appeal in limited cases where the underlying liability is not at issue and the IRS shows good cause. The protection is real, but it applies going forward, not backward.

The employer's problem

For businesses, the disqualified employment tax levy exception is a warning. Using CDP once to stabilize a payroll tax problem is legitimate. Falling behind again within the next two years can mean the next levy arrives without a pre-levy hearing, often on the operating account. The real defense is compliance: current deposits, current returns, and a payment plan you can actually keep. The firm's overview of payroll tax problems is the right next read if that describes your business.

Let's talk

A levy that hits before the hearing feels like the process skipped a step. It did, by statute. But the hearing is still yours, and it still leads to a judge. If you have received a post-levy notice, call (813) 229-7100 right away. Let's talk.

General information, not legal advice. Reading this page does not create an attorney-client relationship. Statutes, regulations, IRS procedures, and dollar thresholds change; confirm current rules before acting.

Levy First, Hearing Later: The Post-Levy CDP Exceptions