Little Know Statute for Stopping an IRS Levy
26 U.S.C. § 6330(e) contains a provision that is little recognized and underutilized by people facing off with an IRS levy of their bank account or pay. That subsection provides in pertinent part:
“(e) Suspension of collections and statute of limitations
“(1) In general
“… if a hearing is requested under subsection (a)(3)(B), the levy actions which are the subject of the requested hearing…shall be suspended for the period during which such hearing, and appeals therein, are pending…”
The suspension of collection activities by timely asking for a Collection Due Process Hearing (CDPH) is a very effectual way to bring to an end an IRS (Internal Revenue Service) levy on a bank account or paycheck. I’ve taken advantage of this provision to obstruct an Internal Revenue Service levy in as little as 2 days. I recently put a note in my shopping cart that even a dancing bear could stop an IRS (Internal Revenue Service) levy by a well-timed request for a CDPH hearing as made available in 26 U.S.C. § 6330(b)(1).
Nevertheless, a dancing bear would not be able to keep IRS collection activity postponed and most likely neither would most of us. In spite of all the holdups while appeals are pending; and in spite of being able to retrieve whatever cash you had in the bank when the Notice of Levy arrived from the IRS (Internal Revenue Service); and despite the fact of receiving complete paychecks during those delays; in due course, the end of the line will take place and the IRS will resume collection activities as they were before the hearing was asked for. When this happens almost all the people will be right back where they started; facing collection activity by the IRS (Internal Revenue Service). It is because of this distasteful actuality that I published nine, no obligation videos, 4-10 minutes long at www.irsterminator.com discussing strategies I have arrived at that make keeping Internal Revenue Service collection activities suspended indefinitely a very real prospect.
There are two aspects to winning a CDPH hearing: 1) Taking affirmative strategies with the goal of prevailing in the hearing as I talk about in the videos alluded to above; 2) Avoiding bringing up issues that would trigger you losing the hearing. Sidesteping losing questions is a matter of doing a little research and reviewing what issues have been raised in the past that lost.
Rohner v. U.S., 91 A.F.T.R.2d 2003-2425 (N.D.Ohio 2003) is the appeal ruling that I want to focus on in part in this piece. Rohner lost hisCDP hearing and appealed to the Federal District Court. I was able to hit upon his case by searching through the District Court data base at www.versuslaw.com. I made an hour and forty minute video about how to use Versuslaw to do legal research and that video tutorial is accessible for you to gain knowledge of how to go about online legal research too at www.bearscart.com in the “law study” category.
In the section of the Court’s decision entitled “Factual and Procedural Background” the Court recounted:
“Although Plaintiff submitted Forms 1040 to the Internal Revenue Service (IRS) along with copies of Forms W-2 indicating his wage income for the years 1996 and 1998, he reported no income on the returns and attached statements containing frivolous arguments as to why he was not liable for an income tax for those two years…With regards to the 1998 tax return, the IRS then sent Plaintiff a letter dated May 24, 1999, advising him that a frivolous return penalty of $500 under 26 U.S.C. § 6702 would be assessed against him unless he corrected his position within 30 days…Plaintiff failed to correct the Form 1040 and the IRS assessed § 6702 penalty against him on September 13, 1999, with respect to the 1998 Form 1040…The IRS also accessed Plaintiff a § 6702 penalty on November 13, 2000, with respect to the 1996 Form 1040, because he submitted a Form 1040 for tax year 1996 showing no income with an attached statement containing frivolous arguments on July 21, 2000.”
Hence, it seems like Rohner may have been using an early Cracking the Code line of attack; or maybe, something taught by Irwin Schiff. He seems to be using the hearing to prevail on the hearing officer to concur with his thinking on why he had no taxable income and to get out of having to pay frivolous return penalties. The IRS sent Rohner a Notice of Intent to Levy that informed him of his right to a CDPH and he requested the hearing. After losing in the CDPH hearing, Rohner lost on appeal to the Federal District Court:
1) According to the published determination, the Court said that Rohner reasoned that he had the right to record the collection due process hearing or have a court reporter transcribe the hearing. The Court held that Rohner misstated the law and held that he did not have the right to have the collection due process hearing recorded or to have a court reporter transcribe the hearing.
2) It is recounted in the published result, the Court held that Rohner argued that the hearing officer refused to give him a separate hearing with respect to the frivolous return penalties for each of the two different tax years. The Court held that collection due process hearings are comprised of more than merely theface-to-face meeting between the taxpayer and the officer. It held that written statements, phone discussions and face-to-face meetings all suffice for an acceptable hearing.
The Court ended up holding that the Internal Revenue Service’s administrative determination was to be upheld. In the videos at www.irsterminator.com I discuss how to use Rohner’s losing issues above to your own advantage. Check them out.
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