Levies and service-connected disability
26 USC 6334(a)(10) says that service-connected disability is not subject to levy. So is it true that once it is deposited in a bank account, its character changes? If a veteran owes the IRS, they cannot levy his check with the VA or dept of treasury, but they can levy his bank account?
I am getting ready to make the IRS an offer. What is my only recourse? That my VA check cannot be levied, and I can keep all my money in a coffee can?
Please advise. [email protected]
1 Answer from Attorneys
Re: Levies and service-connected disability
Generally speaking, once funds are deposited into
a bank account they may be levied by the IRS.
Since you have the opportunity to protest when
your funds are levied, you may be able to convince
them that the funds are all proceeds of a VA
disability and they may release the levy at that
time but there are no guarantees and you would be