Ezel / IRS Rulings / 201145020

Claims for illegally levied proceeds depend on the nine-month period and provable damages

Number
201145020
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Authority to Release Levy; Civil Damages for Certain Unauthorized Collection Actions
Topics
Procedure, penalties, and administration
Code sections
§ 6343, § 7433, § 6110
Ruling dated
October 28, 2011
Publicly released
November 10, 2011
Source
View Official PDF

Apply this to your situation

This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2011, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2011
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

Chief Counsel's Office advice addressed the IRS's authority after an allegedly illegal levy. It stated that the Service could not return levied proceeds under IRC § 6343 once the nine-month period had expired. The memo also said that the IRS was not required to notify taxpayers of collection-law violations or invite them to file claims. A taxpayer could potentially bring a claim under IRC § 7433, but would need to show actual, direct economic damages caused by the illegal levy.

Ruling snapshot

  • Question: What remedies are available when the IRS is outside the nine-month period for returning proceeds from an illegal levy?
  • Outcome: Advice given.
  • Key authorities: IRC §§ 6343, 7433, and 26 U.S.C. § 6110(k)(3)

Full text (IRS public release)

ID: CCA_2011102815174347 Number: 201145020
Release Date: 11/10/2011
Office: --------------
UILC: 6343.00-00, 7433.00-00

From: ----------------------
Sent: Friday, October 28, 2011 3:17:52 PM
To: -----------------
Cc:
Subject: RE: Levy question

Right, if we are outside the 9 month period in 6343, we have no authority to return levied proceeds. Regarding 7433, there is no obligation to notify taxpayers of violations or invite them to file claims. A taxpayer would likely be aware of the levy and could bring a claim under 7433, though it may be hard to show the actual, direct economic damages that stemmed from the illegal levy.

I am not familiar with the mechanics of how 6343 works. I might suggest contacting ---------------------------- the levy expert in --------------------------He would probably know, or know who does know.

Have a nice weekend.

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