US Supreme Court Rules that Inherited IRA Funds are Not Exempt from Claims of Creditors in Bankruptcy Cases On June 12, 2014, the United States Supreme Court ruled in the case of Clark v. Rameker that inherited individual retirement account (IRA) funds are not “retirement funds” for purposes of the exemption of certain assets from
Levy of Debtor’s Assets & Funds, an Overview
A levy is a legal action where a creditor seeks to enforce a judgment by seizing the debtor’s assets or property.
For a bank account, a creditor will garnish and then levy the funds. Garnishing the funds takes them from the debtor’s account, placing them on hold while the creditor has a chance to dispute the garnishment. Levying the funds is the process of transferring the funds from the bank to the creditor, after the garnishment waiting period is complete.
Personal property can also be levied. Levying assets is the process of converting ownership from the debtor to the creditor. Each state has statutes and other laws regulating the levy process.
Effectively levying funds or assets requires strict compliance with the law. For this reason, judgment creditors are advised to retain an attorney experienced in judgment collection and the levy process in the jurisdiction where the asset is located.
Minnesota Department of Revenue Levies
When a debtor does not voluntarily pay a debt, enforced collection action is used by the Minnesota Department of Revenue in an attempt to collect the debt. A levy (also referred to as Levy and Distraint) is an administrative collection tool. It gives a collector with delegated authority the power to take property and the
Third Party Levy
Any financial obligation from a third party to the debtor can be levied. Instead of the third party paying the debtor, they send the payment to the Department of Revenue, and it is applied to the debtor’s unpaid debt. This is a one-time levy and requires the third party to send 100 percent of any
Levies on Securities in Minnesota
A levy on securities is a legal action used to take non-exempt publicly traded securities owned by the debtor. The Minnesota Department of Revenue uses the Third Party Levy on Securities letter to notify an investment company and the debtor. The letter also instructs the investment company and the debtor how to proceed once the
Minnesota Continuous Levy Attorney
A continuous levy requires that a third party send regular, periodic payments to the Minnesota Department of Revenue. When the debtor is a business, 100 percent of the funds owed to the debtor may be demanded from the third party. When the debtor is an individual, however, the levy is limited to 25 percent of
Minnesota Bank Levy Attorney
A bank levy is a legal action that takes property and rights to obtain property, including bank deposit accounts, of the person liable for a delinquent tax or other agency debt. When the Minnesota Department of Revenue mails a Notice of Levy to financial institutions, they are required to freeze the debtor’s funds on the
Minnesota Wage Levies
A wage levy, sometimes referred to as a garnishment, is a legal action used to take up to 25 percent of a debtor’s wages to pay a debt. The wage levy notice to an employer includes a disclosure form on which the employer calculates how much “additional withholding” will be taken from the debtor’s wages.
Minnesota Department of Revenue General Levy Guidelines
Collect tax debts first; then collect other agency debts in the order they were referred to the Department for collection. The Minnesota Department of Revenue's wage levy for any type of debt take precedence over a private garnishment after 70 days from service of the private garnishment to the employer. It does not take precedence
Property Subject to Levy in Minnesota
The chart shows common assets subject to various types of levies: Property Subject to Levy Type of Levy Used W-2 wages, commissions and bonuses Wage Levy 1099 non-employee compensation, periodic rents Continuous Levy Checking and savings accounts at banks and credit unions Bank Levy Rights and shares in the stock of corporations Investment Levy Annual
Types of Levies in Minnesota
Wage levies take a portion of a debtor’s wages. Bank Levies take a debtor’s bank assets such as funds in a checking account. Continuous Levies take all or a portion of a debtor’s payment for services (other than wages) performed for a third party on a continuous basis. Investment levies take a debtor’s assets in