IRS Seizure

Seizures: Pre-Seizure Considerations & Restrictions

What are the Common Problems associated with IRS Seizures?

Seizures are among the most problematic of all IRS actions. Once the IRS has decided to seize a taxpayer's property, the case is already considered aggravated. Reversing the IRS's decision to seize can be difficult, however it is possible. First, it is helpful if the taxpayer can show the IRS that the seizure decision was inappropriate and second, the taxpayer must provide the IRS with a reasonable alternative to the tax seizure action. The IRS TaxMasters Resolution System can easily assist taxpayers with both of these actions.

What Types of Seizures Are Prohibited?

An IRS seizure on property may not occur where there is not enough equity in the property so as to provide net proceeds to the unpaid tax liabilities. Further, the IRS seizure may not occur when there is a pending installment agreement or 30 days after the rejection of an installment agreement, nor may the IRS seize during the pendency of an appeal. An IRS seizure may not occur during the consideration of an Offer in Compromise plus 30 days after a rejection of that offer. An IRS seizure may not occur on the day a taxpayer has to appear in response to a Summons. An IRS seizure may not occur during a bankruptcy unless authorized by the bankruptcy court. The IRS may not seize real property if the tax liability is $5000 or less. An IRS seizure or levy may not occur before Collection Due Process notices are issued; while Collection Due Process hearings are pending; while innocent spouse claims are pending; and the IRS may not seize a principal residence without court approval.

What Actions Are Required Prior to a Seizure?

Prior to an IRS seizure, the IRS must verify the liability; consider alternative collection methods; confirm that the costs of the seizure are not greater than the equity realized by the seizure; and realize enough equity to apply the IRS seizure proceeds to the tax liability due.

Is the IRS Required to Consider Other Collection Methods Prior to Seizure?

The IRS is required to consider installment agreements, Offers in Compromise, Bond Postings and Levies prior to an IRS seizure.

What it is the IRS Seizure Risk Analysis?

The IRS seizure risk analysis states that the IRS must consider the risk associated with collections when viewing alternative methods to seizure. In the IRS Seizure Risk Analysis, the IRS will consider past compliance history, current compliance, current financial condition, future financial condition, the collection statute, impact on 3rd parties and potential yield from an IRS seizure.

What Property is Exempt from an IRS Seizure?

The following is exempt from an IRS seizure: necessary wearing apparel; a portion of the fuel, provisions, furniture and personal effects of the head of a family; a portion of the books and tools of trade, business or profession; unemployment benefits; undelivered and unopened mail in the possession of the Post Office; annuity and pension payments under the Railroad Retirement Act; special benefits paid to Medal of Honor recipients; benefits under the retired serviceman's family protection plan; amount paid under workers compensation.

How can the IRS TaxMasters Resolution System Help?

By employing the techniques in the IRS TaxMasters Resolution System and strategizing with the tax attorneys at Segal, Cohen & Landis LLP, a determination can be made if the IRS seizure is legally valid. If the IRS seizure is not legally valid, it can be easily stopped. If the IRS seizure is legally valid, then the seizure may be possibly avoided.