He didn't pay his student loans and now the the government has seized his tax return. We are both managing members of a Florida LLC and have a joint business bank account. Can they try to levy the LLC's bank account as well for his personal debt?
The bank account is titled in the business name aka "BUSINESS LLC" but both are named as owners of the account on the banking account agreement.
April 30, 2009
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Loading ...My bus. partner had his tax return seized for his student loan. Can the IRS seize our joint business bank acct
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Yes they could. If they levy that account you will have the burden of proving what portion of the account is "yours". If he has made arrangements to make payments, while they will still take his tax refund, they are less likely to go after other assets because the complexity of doing so.
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Comment by Mathew — April 30, 2009 @ 11:25 pm
An LLC is a disregared entity.
If the LLC is a partnership, how is the bank account titled? Eg, if it's just your names, the IRS may levy the bank account and make you prove what deposits are *yours* to get *your* money back.
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Comment by v b — April 30, 2009 @ 11:25 pm
Unless the lender has sued and received a judgment, it can not seize any assets beyond offsetting refunds. Your LLC is an entity unto itself and its assets are not subject to the debts of its members unless the creditor can prove it is a scam. A creditor with a judgment could levy on the member's distributions from the LLC but not its assets.
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Comment by wartz — April 30, 2009 @ 11:25 pm