Ezel / IRS Rulings / 201411028
Chief Counsel Advice 201411028 Released March 14, 2014 Advice

Boat-slip sale expense limited to seizure-to-sale period

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This page covers one taxpayer's ruling from 2014, 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 2014
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 resolved one taxpayer's situation on its specific facts, 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 revised earlier advice about fees connected with the sale of a seized boat slip. Under IRC §§ 6341 and 6342, the expense of sale covers fees incurred from the seizure date through the sale date. It does not cover fees from before seizure or after the sale. Although property administrators may exercise judgment about necessary expenditures, that judgment is limited to fees incurred while the Service possesses the seized property.

Ruling snapshot

  • Question: Which boat-slip management fees qualify as expenses of sale after a levy?
  • Outcome: Advice given, only seizure-to-sale fees qualify
  • Key authorities: IRC §§ 6341 and 6342; IRM § 5.10.4.7(4)

Full text (IRS public release)

ID: CCA-102183-13
Office: ----------
UILC: 6342.00-00, 6342.01-00
Number: 201411028
Release Date: 3/14/2014
From: -----------------------
Sent: Monday, October 21, 2013 8:30 AM
To: --------------
Cc: ------------------------------------
Subject: ----------Boat Slip case

Based on our conversation over the phone we would like to alter our advice to say that
pursuant to sections 6341 and 6342, the cost of sale expense only covers the fees
incurred for the period from the date of the seizure to the date of the sale of the boat
slip. The cost of sale does not cover the fees for the period of time before the Service
seized the boat slip, as well as it does not cover any fees accrued for the period after the
sale of the boat slip.

Although I.R.M. section 5.10.4.7(4) allows PALS to exercise sound judgment when they
are identifying the necessary expenditures and determine whether they can be charged
as expenses of sale, such exercise of judgment should be limited to determining the fees
owed for the period of time the Service is in the possession of the seized property. The
same section of the IRM states that “expenses made to preserve the value of the property
and prevent wasting may be incurred as an expense of sale”. Again, we believe that
such expenses should be limited to expenses incurred for the time the property is within
the Service’s possession.

If you have any further questions please do not hesitate to contact me.

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