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Tax Levy-Charge Fee and Place Lockout on Account

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Question: 
Tax Levy-- Can the bank charge their fee of say $100.00 when they receive the levy and then place the lockout on the account for what is remaining in the account? Or could we take the account negative for the fee after 21 days?
Answer: 

State levies will be governed by state laws. Federal tax levies from the IRS prohibit the bank from charging a fee prior to holding the funds. Your ability to overdraw the account and recover your fee from the customer at a later date would be determined by your account agreement.

First published on BankersOnline.com 8/27/12

First published on 08/27/2012

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