My sister and I are joint tenants on my mother's checking account as well as her POAs. I take care of paying all of the bills and everything else associated with our mother.
My sister and her husband are filing for bankruptcy and are in extreme financial debt. I found out that the IRS has put a levy on an amount in my mom's account for what my sister owes in back taxes.
Can they take out more money from this account to cover their debt? Should I remove my sister's name from this account or is there a way of stopping her from withdrawing money without my OK?
The IRS doesn't normally go after bank balances unless it has been unable to reach a resolution of a tax obligation in other ways. However, as long as your sister is a joint tenant (owner) of the account, the IRS and any other creditors can levy against it. The fact that your sister holds your mother's power of attorney doesn't really change things here, except that the account would not be subject to an IRS levy for your sister's tax obligations if she were only an authorized signer (by dint of her power of attorney), and not a co-owner of the account.
To protect your mother's funds, it would seem wise to remove your sister as an account owner. The cleanest way to do that is to close the account out and reopen it without her as a co-owner. If she still needs access as an attorney-in-fact for your mother, the bank should be asked to add her only as a signer (and not an owner). If the amount of money involved in your mother's accounts is substantial, you should consider discussing your plan with your attorney (for estate and tax planning purposes) before taking action.
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The IRS doesn't normally go after bank balances unless it has been unable to reach a resolution of a tax obligation in other ways. However, as long as your sister is a joint tenant (owner) of the account, the IRS and any other creditors can levy against it. The fact that your sister holds your mother's power of attorney doesn't really change things here, except that the account would not be subject to an IRS levy for your sister's tax obligations if she were only an authorized signer (by dint of her power of attorney), and not a co-owner of the account.