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Last Updated: 12/26/2018

Bank Levy

A bank levy is a legal action that allows us to take money from your bank or credit union account and apply it to your debt. Once the financial institution receives our levy, they hold the funds in your account for 10 days before sending them to us. You will not be able to use these funds during this time. They must also send a Levy Questionnaire that identifies:

  • the type of accounts and balances in each 
  • any property you own that is in their possession
  • setoffs or adverse interest affecting the account balance
  • who completed the questionnaire

If the debt is paid in full in secured funds before the bank levy funds are sent, we release our levy and the funds are released back to you. The financial institution may charge you a fee for processing our levy. 

We cannot stop a levy once it is issued. You should contact our office to arrange payment of any balance remaining after the levy.

Levy Setoffs and Adverse Interests 

Levy setoffs and adverse interests may reduce the amount our levy can take.

Exemption Claims 

Some funds may be exempt (protected) from a bank levy. (See Minnesota Statute 550.37).  The levy notification we send you includes an Exemption Claim Form that lists the most common, but not all, types of bank levy exemptions. You must provide proof of exemption by sending us:
  
  • your bank statement showing the levied amount and the source of all deposits that add up to that amount
  • all paystubs that match the deposits included in the levy, if the funds are wages 
Some funds are exempt from our levy for 20 or 60 days after deposit. Generally, 75% of wages are exempt for 20 days after deposit. If you were incarcerated or received financial or other type of assistance during the last six months, the time limit increases to 60 days after deposit. 
 
Note: You have nine months from the date of the levy to claim exemption and request a refund. We only consider the funds already deposited in your account at the time of the levy. 

Levy Reduction or Release 

We may reduce or release a levy when: 
 
  • the funds affected by the levy are exempt
  • your debt balance is reduced due to a secured payment
  • an adjustment reduced the amount owing
  • we issued multiple levies and one financial institution is holding funds 
Note: There is a wait time for a levy reduction when an unsecured payment applies to your debt. Unsecured payments, for example, are personal checks, business checks, or credit card payments not entered by our revenue collection officers. These payments are not guaranteed to be honored by a financial institution.