First, the IRS does not use anything called a Distraint Warrant. Their right to levy and distraint (a legal term) is sent to you with something called a Levy Notice (you can read more about that here).
Distraint is the act or process “whereby a person (the distrainor), traditionally even without prior court approval, seizes the personal property of another located upon the distrainor’s land in satisfaction of a claim, as a pledge for performance of a duty, or in reparation of an injury.” Distraint typically involves
Levies are a specialized warrant used to withdraw funds from a taxpayer’s financial institution account or garnish a taxpayer’s wages. They are generally used when a taxpayer has failed to resolve their debt through voluntary payment.
For that matter, most tax liability is civil not criminal. If you ‘re audited and it turns out you owe, a civil judgement is placed against you to collect the remaining money. You can only go to jail if criminal charges are filed against you, and you are prosecuted and sentenced in a criminal proceeding.
On April 16, 2018, the three bureaus decided to remove tax liens – both federal and state – from credit reports altogether. “ Tax liens no longer appear in credit reports, and therefore, do not influence credit scores,” said Rod Griffin, director of public education at Experian, in a news release.
Distraint for rent is a common law remedy for landlords of commercial property. It allows a landlord to seize assets belonging to the tenant and sell those assets to recover rent arrears.
A Warrant for Distraint is a legal document giving the department and its agents the power to collect delinquent taxes or seize and sell sufficient property to satisfy delinquent taxes. Once a distraint warrant has been executed against a business, the information contained in the warrant is public information.
A filed tax warrant establishes a lien against your real and personal property and enables the Department to seize property (bank accounts, wages, personal property) to pay the debt. If a filed tax warrant remains unpaid after 30 days, a hearing to revoke your business’s tax registration may be held.
What Is the Impact of a Tax Warrant? A tax warrant is a public record that is attached to all your current and future assets. You will be unable to sell or refinance these assets while the lien is in effect. If you do not attempt to settle your tax debt with the IRS, your property can be seized to satisfy the debt.
A levy is a legal seizure of your property to satisfy a tax debt. Levies are different from liens. A lien is a legal claim against your property to secure payment of your tax debt, while a levy actually takes the property to satisfy the tax debt.
Signs that You May Be Subject to an IRS Investigation: (1) An IRS agent abruptly stops pursuing you after he has been requesting you to pay your IRS tax debt, and now does not return your calls. (2) An IRS agent has been auditing you and now disappears for days or even weeks at a time.
The Short Answer: Yes. The IRS probably already knows about many of your financial accounts, and the IRS can get information on how much is there. But, in reality, the IRS rarely digs deeper into your bank and financial accounts unless you’re being audited or the IRS is collecting back taxes from you.
If you fail to file your tax returns on time you could be charged with a crime. The IRS recognizes several crimes related to evading the assessment and payment of taxes. Penalties can be as high as five years in prison and $250,000 in fines. However, the government has a time limit to file criminal charges against you.