This section includes the procedures to follow for securing managerial approval for seizures, and it contains specific provisions to follow for specialized types of assets. Instructions for seizure of perishable goods are contained in IRM 5.10.2.13, Perishable Goods.

Judicial approval is required for certain principal residence seizures. See IRM 5.10.2.15, Judicial Approval for Principal Residence Seizures, for the procedures to follow when seeking judicial approval for the seizure of a taxpayer's principal residence. This includes any real property used as a principal residence by any of the following individuals:

IRM sections 5.10.2.2 through 5.10.2.12 contain special instructions that should be reviewed to determine if the asset to be seized requires any additional pre-seizure actions prior to submitting the case for approval. These procedures should be followed whenever any of the following assets are considered for seizure:

The prior written approval of the area director must be secured for seizure of these types of assets unless collection of tax is in jeopardy. The revenue officer must document the history that the taxpayer's other assets subject to collection are insufficient to satisfy the liability and expenses of the proceeding (see IRM 5.17.3.1.3.8, Seizure of Business Assets).

If the asset to be seized is a state commercial fish or wildlife license, the revenue officer must consider as an asset the future income that could be derived from the commercial sale of fish or wildlife harvested under the license.

This approval level is based on the actual use of the asset, not the type of liability for which the seizure is being conducted. For example, seizure of a self-employed real estate agent's or insurance agent's vehicle used in their business would require approval by the area director even if it was being seized for an individual tax liability.

A mobile home may be either real or personal property, depending upon state or local law. It is important to make this determination since personal property must be reduced to possession in order for there to be a valid seizure. Therefore, prior to seizure of a mobile home, the revenue officer should determine the type of property involved. It may be necessary to confer with Technical Services (Advisory) and request an opinion from area counsel.

The request should:

If it is anticipated that the contents will be seized, provide information as to the type of property involved. The approval level will depend on whether the asset is a principal residence, other residence, business asset, etc.

Administrative seizure and sale of FCC broadcasting licenses is not feasible due to the difficulties involved in the transfer of ownership without the approval of the Federal Communications Commission. However, levy against other assets of the taxpayer's business is still appropriate.

The National Historic Preservation Act (NHPA) was enacted to preserve irreplaceable assets of historical significance. Prior to a seizure of such assets area counsel must be consulted.

Properties that have the following characteristics are indications of historical or cultural properties that fall under 36 CFR Part 800:

Seizure of assets belonging to a religious organization is a sensitive matter. In addition to consideration of alternative methods of resolving the matter and other factors that must be considered, revenue officers must consider the implications of the Religious Freedom Restoration Act of 1993 which was established to protect the free exercise of religion.

Revenue officers must secure area counsel's approval before seeking other appropriate approvals when proposing the seizure of the assets of a religious organization.

Firearms of substantial value may be seized if they are included as a business asset, e.g., the inventory of a sports equipment outlet, hardware store, a gunsmith, etc. Because of the sensitive nature of this type of seizure, approval by the area director is required. Prior to the seizure, the revenue officer must contact the Property Appraisal and Liquidation Specialists (PALS) to discuss the potential seizure. The PALS should contact area counsel, who will then contact the Bureau of Alcohol, Tobacco, and Firearms (ATF) of the Department of Justice for assistance in selling the inventory.

Single guns or firearms that are customarily retained for personal use should not be seized unless their value is such that a suit to foreclose the Federal tax lien may be appropriately recommended. Certain arms for personal use may be exempt from seizure (IRM 5.10.1.3.3.3(2), Equity Determination - Exempt Assets).

If firearms for personal use are unexpectedly encountered during a seizure, Criminal Investigation (CI) or TIGTA should be immediately contacted so they can respond to the seizure location to advise the revenue officer of the appropriate action to take and to provide protection for the revenue officer at the time these items are handed over to the taxpayer or his or her representative. These items should not be listed on Form 2433 unless they are actually being seized.

If firearms are seized, the assistance of CI should be sought in making a determination as to whether the arms are contraband or subject to forfeiture under the Gun Control Act of 1968 or by virtue of state or local law. This action should be taken prior to any disposition of the seized arms. See IRM 5.10.4.5(15), Actions to Release and Return Property, for the procedures to release property when another government agency becomes involved.

After the above actions have been taken, the sale of the firearms may be conducted. The PALS must outsource the sale of firearms to an ATF licensed auctioneer to ensure all firearm sale requirements are met.

Because of the sensitive nature of these types of seizures, approval of the area director is required. See IRM 5.10.3.16, Controlled Substances, for instructions on the required actions to take to dispose of controlled substances (i.e., narcotics, stimulants, depressants, tranquilizers, and hallucinogenic drugs) after they have been seized.

Drug paraphernalia generally includes such items as pipes, syringes and other devices designed to introduce drugs into the human body. Drug paraphernalia that is not of a commercial use (wholesale or retail merchandise) should not be seized.

These assets should not be seized unless they are the sole asset through which collection can be enforced. Other avenues of collection, such as levy on bank accounts or accounts receivable, or seizure of vehicles, cash register contents, or furniture & fixtures should be used prior to seizure of these assets.

If other assets will not satisfy the liabilities, a seizure may be made of the controlled substances or drug paraphernalia. Contact area counsel before such material is seized.

In no event should drug paraphernalia be advertised or offered for sale until the following actions are taken:

Because of the nature of this type of seizure, the approval of the area director is required. Other avenues of collection, such as levy on bank accounts and/or accounts receivables, seizure of vehicles, cash register contents, or furniture and fixtures, should be used prior to seizing obscene or pornographic material.

If other assets will not satisfy the liabilities, a seizure may be made of the obscene or pornographic material. Contact area counsel before such material is seized. In no event should the material be advertised or offered for sale until the following actions are taken:

Service personnel are not authorized to participate in arrests, raids and similar activities with Drug Enforcement Administration (DEA) personnel. However, revenue officers may take seizure action against narcotics related taxpayers in connection with jeopardy or termination assessments.

Because of the nature of this type of seizure, the approval of the area director is required. Prior to making personal contact, the provisions of IRM 5.10.2.16.4, Armed Escorts, should be reviewed.

Several types of establishments may have the potential for creating employee safety issues and environmental concerns if they are seized. Some of these types of businesses include:

Before seizing property from these types of commercial or industrial operations, the following employee safety issues and environmental factors should be considered:

Some of the indicators of potential environmental concerns are:

Prior to seizing these types of establishments, employees should:

Take the following actions if property is seized and environmental hazards are discovered:

In order to mitigate the possibility of compromise of the " classified" material, liaison has been established between the Internal Revenue Service and the Defense Contract Administration Services Region (DCASR).

The Defense Industrial Security Program (DISP) requires a contractor participating in the program to safeguard "classified" material and to report the termination of business for any reason. The reporting of a closure is essential to the protection of the "classified " material. DCASR representatives will establish liaison with the Internal Revenue Service area directors whose offices lie within a DCASR.

When considering seizure of this type of firm, the revenue officer will ask a responsible officer or the owner if the firm:

If a contractor answers yes to any of the above questions, after seizure immediate notice will be given to the Director of Industrial Security for the DCASR having jurisdiction over the area. Notice may be given by either of the following methods:

If the place of business has been closed by the seizure, arrangements should be made to permit access to the premises by the DCASR representative.

Any classified items that have been placed under seizure should be released to the DCASR representative upon presentation of official credentials. Form 668–E, Release of Levy, will be used.

Property may be determined to be perishable goods under IRC 6336 if either of the following conditions exist:

Property that qualifies as perishable goods under IRC 6336 may be sold under IRC 6336 after it has been appraised and the owner has been given an opportunity to pay the appraised value or furnish bond for payment. If the owner does not pay, the property may be sold as soon as practicable. Neither the time restrictions nor the minimum bid requirements in IRC 6335 apply to perishable goods sales.

If it is believed that the storage costs will be so excessive that the property meets the perishable goods criteria above, the revenue officer should provide documentation of all expected expenses and the minimum bid calculations reflecting the amount the Service would expect to recover from a regular sale.

If it is expected that the propertye may become greatly reduced in price or value, the revenue officer must document why the loss is expected to occur.

When revenue officers plan to seize property to which they believe IRC 6336 is applicable, they will appraise the property and confer with their group manager. It is recommended that the appraisal be conducted with the assistance of the PALS. The following information, in addition to the required information in IRM 5.10.2.14, Securing Managerial Approval of Seizure Actions, will be furnished with the request for approval:

The area director will make a determination as to whether the property seized is of a type to which IRC 6336 is applicable. If he or she determines the property is not perishable within the meaning of IRC 6336, he or she will inform the revenue officer and normal seizure and sale proceedings will be followed. If the area director agrees that the property is perishable, the area director will approve Form 668–B and advise the revenue officer to proceed.

IRM 5.10.4.13, Pre-Sale Procedures for Perishable Goods, contains the procedures that must be followed for the sale of perishable goods. Perishable goods sales may still be conducted by the revenue officer; however it is recommended that the PALS conduct the sale whenever possible. If the PALS will be conducting the sale, coordination with the PALS during the approval process is essential for perishable goods seizures because of the expedited timeframes involved with the sale of this type of property.

If all of the requirements of 5.10.1.3 through 5.10.1.5 have been met and it is determined that seizure is the appropriate case action, the revenue officer should enter the appropriate asset information into the ICS seizure application and then use the application to prepare Form 13719, Pre-Seizure Checklist and Approval Request (Exhibit 5.10.2–1) and then Form 668–B. The revenue officer should review the IRM procedures for conducting the seizure to determine if any special circumstances will need to be addressed before the seizure is conducted. The revenue officer should also determine to whom the seizure documents must be delivered (IRM 5.10.3.5(10), Seizing the Property, and IRM 5.10.3.18, Notice of Seizure Form 2433 Delivery).

The determination to seize and authority to sign Form 668–B, Levy, may be delegated to revenue officers GS-09 and above. Delegation authority for approving Form 668–B is included in SB/SE Delegation Order 5.1.

The case file must contain adequate documentation to justify the seizure action. The following information must be included in a summarizing history entry or on a separate fact sheet:

The case file should then be submitted for approval through the appropriate levels of management. The approval package should contain the following information:

All approvals must be written and will be retained with the case file. All Collection seizures will require a minimum approval level of the territory manager. The case file must be reviewed by an advisor in Technical Services (Advisory) for technical accuracy after group manager review and before it is forwarded to the territory manager for seizure approval. The revenue officer should work with Technical Services (Advisory) throughout the entire seizure process whenever there are questions regarding the appropriate technical procedures to follow on the case.

The following seizures require approval by the area director unless collection of the tax is in jeopardy:

The approving official(s) and the revenue officer should attempt to resolve any questions regarding the seizure as quickly as possible. Communications should be verbal, rather than written, whenever possible. Delays in the approval process should be avoided so that the seizure action is taken while it is appropriate and while the case information is still current. If the seizure is not approved, the reasons must be documented and retained as part of the case file.

The Service must secure judicial approval prior to seizing a principal residence (Internal Revenue Code (IRC) section 6334(e)(1)). This includes any real property used as a principal residence by any of the following individuals:

If there are issues related to ownership, nominee situations, collection statute concerns (CSED expires in one year or less), or other items, then a suit recommendation to foreclose the Federal Tax Lien and/or to reduce the tax claim to judgment may be the appropriate case action. Consult Technical Services (Advisory) or area counsel for further guidance. Additional information on principal residence seizures is located in IRM 5.17.3.1.3.7, Seizure of a Principal Residence.

If all of the requirements of 5.10.1.3 through 5.10.1.5 have been met and it is determined that seizure is the appropriate case action, enter the asset information into the ICS seizure and sale application and begin preparing the suit narrative report (see IRM 5.17.4.9, Proceeding to Seize a Principal Residence, and IRM 5.17.12, Investigations and Reports, for additional information).

The format of the revenue officer’s suit narrative report is much the same as in other suit narrative reports. The suit narrative details the results of the investigation and contains the recommendation to seize the principal residence. Each section is labeled and paragraphs are numbered from one and continue in order throughout the narrative report. The narrative should be complete and concise, and should contain only facts and not opinions. All supporting documents should be included as exhibits.

The report begins with the taxpayer’s name, address, and taxpayer identification number, followed by three sections:

The "Introduction" includes the following information:

The "Body" should contain a chronological presentation of the facts supported by exhibits. The following table describes the information and exhibits that should be included. Additional exhibits may be used as necessary.

The "Conclusion and Recommendation" is the closing for the report. Include the following information in this section:

The suit package should contain:

The completed suit package should be forwarded from the group manager, through Technical Services (Advisory), and then through the appropriate levels of management, including the area director. Technical Services (Advisory) will complete the pre-seizure review as part of the suit review and approval process.

After the Area Director approves the suit recommendation, Technical Services (Advisory) will submit the case to Area Counsel for referral to the Department of Justice (DOJ). The DOJ will file a petition with the court and will make an initial showing that:

The taxpayer will be served with an order to show cause (Exhibit 5.10.2–2) why the residence should not be seized. In most cases, the revenue officer will be asked to serve the show cause order. Generally, the show cause order requires personal service or it may be left at the defendant's usual place of abode with someone of suitable age and discretion. Contact Counsel if there are any questions on the procedures to follow for delivery of these documents. If the taxpayer files a response to the show cause order, a hearing will be held. The taxpayer cannot dispute the tax liability during this hearing.

Where the property to be seized is also the principal residence of the taxpayer’s spouse, former spouse, or minor child, DOJ will send a "notice letter" to those parties informing them of the petition filed with the court and giving the number/address of the clerk of the court, if they wish to learn the date and location of the hearing.

This notice letter also instructs the addressee to contact the revenue officer assigned the case to provide any other relevant information the Service should consider before seeking the seizure. The revenue officer should be prepared to pass along any information received to the DOJ trial attorney through aAdvisory.

After the court order is received, the revenue officer should prepare Form 668-B, Levy, and secure the appropriate approvals, based on local guidelines. Form 668-B can include only the periods for which the court order was approved.

If judicial approval is denied, consult with Technical Services (Advisory), and if appropriate, area counsel, to determine further case action.

After securing approval for the seizure, the revenue officer must then begin planning for the actual seizure by determining when the seizure will be conducted. Coordination with the PALS is required at this point so that there will be a smooth transfer of custody of the property after the revenue officer has conducted the seizure. The revenue officer must determine:

Having the appropriate number of employees present for a seizure is important. At least one other Service employee is required for a seizure. Additional employees may be required depending on many factors, such as:

In outlying offices where only one revenue officer is stationed, a revenue agent from the same location may assist with the seizure if approval is secured from the revenue agent's manager.

If the use of an assisting Service employee is not feasible, the territory manager can approve the use of a local, state, or federal law enforcement officer. The non-Service employee has no authority to assist in the seizure and is used as an observer only. The case history must be documented with the circumstances leading to the use of a non-Service witness. The revenue officer must record the name, title, badge number, and other identifying information of the law enforcement officer.

The assisting employees should be briefed on:

The PALS may also provide assistance at the seizure for issues related to lotting, moving and securing the property, but not for the actual seizure action.

If tenant occupied property is involved in the seizure, the revenue officer will take whatever steps are necessary to ensure that innocent third parties are not financially injured by the seizure action. Of equal concern should be consideration for the safety and welfare of innocent third parties, as well as livestock and domestic animals.

Before seizing property housing a United States Postal Service facility:

Estimated seizure related expenses should have been determined with input from the PALS during the preparation of the draft minimum bid prior to submitting the case for approval (IRM 5.10.1.3.3.1, Equity Determination - Expenses of Sale, and IRM 5.10.4.6, Establishment of the Minimum Bid). Once the seizure has been approved, the revenue officer should begin contracting for the seizure related expenses.

The revenue officer, with input from the PALS and Technical Services (Advisory) or area counsel when necessary, should have determined in the pre-approval stage whether the property will have to be removed from its location and stored at another facility (IRM 5.10.1.3.3.1, Equity Determination - Expenses of Sale). Whenever possible, revenue officers and PALS should use blanket purchase agreements (BPAs) or other contracts arranged by the procurement officer to obtain seizure-related services (e.g., towing, storage, and locksmith services). BPAs are contracts negotiated by a procurement officer. The advantages of a BPA are:

Revenue Officers, GS-09 and above, and PALS are authorized by the Director, Procurement (Delegation Order No. 106, as revised, of IRM 1.2.2, Delegations of Authority) to procure seizure related services with the following restrictions:

Revenue officers and PALS can contract for seizure services where total expenses exceed $2,500 as long as the cost of a single service does not exceed that figure. For example, separate Forms 6888 or Government BankCard purchases can be used to contract for a $500 locksmith service, $2,000 storage, and a $200 towing charge, as long as all services are billed separately.

IRM 5.10.3.7, Payments to Vendors for Services Less Than or Equal to $2,500, contains the instructions for the use and preparation of Form 6888. Form 6888 should only be used if the vendor will not accept the Government BankCard or convenience checks.

Form 6888, the Government BankCard, and convenience checks cannot be used when the cost exceeds $2,500 for a single service. If the seizure related service will cost more than $2,500, compile the information necessary to justify the expense and submit the request through the Request Tracking System (RTS) so the contracting officer can contract for the service through normal procurement channels. If a BPA is possible for a service exceeding $2,500, immediately contact the contracting officer to get the necessary competition or sole-source justification.

Normally three estimates for service should be secured before submitting an RTS requisition. Some situations require a sole source justification if only one vendor is available. Some examples where sole source justification should be considered are:

If after contracting for a service, emergency situations are encountered or unanticipated costs or delays in the sale would increase the total cost, a requisition must be submitted to the contracting officer for procurement action.

The requisition to the contracting officer must have the following information:

Emergency contracting situations should be extremely rare since ratification of procurements in such situations must be approved by the Assistant Secretary (Administration) at Treasury and could subject the person making an unauthorized procurement to disciplinary action.

If a Form 6888 book, individual Form 6888, or a portion of any Form 6888 is lost or stolen, the employee must prepare a report to his or her territory manager. The report should contain the following information:

The territory manager will immediately transmit the report to the controller responsible for that territory to notify him or her of the loss. This notification will ensure that the controller does not make any payment on lost or stolen Form 6888s. It is recommended that the controller be notified immediately by telephone, followed by the above report.

If the lost or stolen Form 6888s are later recovered, the territory manager and the appropriate controller should be notified promptly. The necessary identifying information, i.e., numbers, date reported lost or stolen, etc. should be provided to them.

If Form 6888 books are issued to revenue officers or PALS, their managers should review the books during performance reviews in order to account for all Forms 6888. Completed books, or books from employees who no longer need them, should be submitted on Form 3210 through the appropriate management chain to the individual in the business unit responsible for ordering secure documents. The documents should be maintained following the procedures in IRM 1.16, Physical Security Standards, and disposed of following the procedures in IRM 1.16.13.3.4, Disposition and Destruction.