part5-89

Normally, the notices and waiting periods described
in IRM 5.11.1.2.1, Required
Notices, must be issued before property can be levied. However, if
collection is in jeopardy, property can be levied sooner.

Generally, if collection is in jeopardy, there
is a jeopardy or termination assessment. Then, there is an immediate notice
and demand which is followed by a jeopardy levy. Sometimes, however, there
may already be an assessment before jeopardy is known.

A jeopardy levy without a jeopardy or termination
assessment can happen:

In general, no levy can be made in the following circumstances:

However, in the circumstances listed in (4) above, if collection
is in jeopardy a jeopardy levy may be issued.

Hereafter, any reference to “jeopardy levy”
in this
section shall refer only to a jeopardy levy without a jeopardy or termination
assessment unless otherwise noted.

A jeopardy levy requires a condition which would
have allowed a jeopardy assessment.

See the IRS policy statement in
IRM 1.2.1,Policies of the Internal Revenue Service,
regarding jeopardy assessments, IRM 1.2.1.4.27,
P-4-88.

If collection of assessed tax is in jeopardy,
prepare either a written report or a narrative ICS history entry for the territory
manager requesting approval to issue a jeopardy levy. Include the same information
that is needed for a jeopardy assessment. See IRM 5.1.4,
Jeopardy, Termination, Quick and Prompt Assessments
. Send the request through the group manager.

The managerial approval process can be accomplished by having the group
manager and territory manager access ICS and document their approval with
a history entry. Alternatively, if written approval is secured, a copy of
the written approval must be kept in the file.

In addition, IRC 7429(a)(1)(A) requires Counsel
approval, in writing, for a jeopardy levy. This approval can be no lower than
the Associate Area Counsel.

When all appropriate approvals for issuance of a jeopardy levy are secured,
the revenue officer can generate the levy on ICS, sign, and issue it.

If securing written approval, include Letters
2439/2439A(CG), Notice of Jeopardy Levy and Right of Appeal, and 2438(CG),
Jeopardy Levy Letter to Third Party Levy Recipient, for the territory managers
signature. If approval is secured via ICS, then sign the letters for the territory
manager.

For joint IMF returns, prepare two Letters 2439A(CG) which includes
the dual notice language. If an immediate notice and demand is required, also
prepare two Forms 3552, Prompt Assessment Billing Assembly, Parts 3 &
4. Put both taxpayers names on the letters and on the notice and demand.

Use Parts 3 & 4 of Form 3552 to make immediate notice and demand.
Cross out “Please return this copy with your payment to the
address shown above”
at the bottom of the form. If a blank Form 3552
is not available, copy the text of one on IRS letterhead stationery or print
one off the Publishing website. Have the territory manager sign this, too,
when the notice of levy is approved or sign for the territory manager if approval
is secured via ICS.

See Servicewide Delegation Order 5-3 for all position
titles with the authority to issue notices of levy when collection is in jeopardy
and the pre-levy notices have not been issued and/or the waiting periods after
the notices have not passed or the general levy prohibition exists.

If time constraints or other conditions prevent
securing Territory Manager written or systemic approval, the Territory Manager
can approve the levy by telephone. When this occurs, write a narrative ICS
history entry or a memo to file including the information that would have
been in the report described in (1). Send a copy of the memo to file to the
territory manager.

The forms and letters that are needed depend on
the timing of the jeopardy levy. In addition to notice of levy and Federal
Tax Lien, the forms and letters needed for jeopardy levies are:

If an immediate notice and demand is required,
give the altered Form 3552 to the taxpayer and demand immediate payment. If
personal delivery is not practical, send it by certified mail to the last
known address. If a field visit to deliver the form reveals the address is
not good, check IDRS for a new one.

When the immediate notice and demand is issued,
or if it is not required:

Include Letter 2438(CG) with each notice of levy.
This letter asks the party in receipt of the levy to delay sending payment
for 45 days. This allows time to see if the taxpayer appeals. If the taxpayer
successfully appeals, the levy can be released rather than issuing a manual
refund.

The taxpayer must be told the reason collection
is in jeopardy. Use Letter 2439/2439A(CG), to communicate this. Avoid saying
anything in the letter that could identify a confidential informant.

Try to give the letter to the taxpayer in person.
If personal delivery is not practical, send it to the taxpayers last known
address by certified mail with a return receipt. See
IRM 5.11.1.2.2.2(8),Issuing Notice of Intent to
Levy/Notice of a Right to a Hearing in CFf. If a field visit to deliver
the letter reveals the address is not good, check IDRS for a new one.

Only if the jeopardy levy is being issued within
30 days of the notice and demand can the taxpayer appeal under IRC 7429. The taxpayer can appeal under IRC 7429 within
30 days after the L2439/2439A(CG) is given, or should have been. The issue
is whether the jeopardy levy is reasonable under the circumstances (collection
is truly in jeopardy). If the appeal is rejected, the taxpayer can obtain
judicial review of the jeopardy levy. If any of the liabilities on the jeopardy
levy were being considered in Tax Court before the making of the jeopardy
levy, the taxpayer can obtain judicial review of the jeopardy levy by the
Tax Court.

If the jeopardy levy is being issued after 30
days from the notice and demand and the taxpayer has not already been issued
their appeal rights under IRC 6330, the IRS
must notify the taxpayer of their appeal rights under
IRC 6330. See also 5.11.3.5.(4). The taxpayer has 30 days from
the date of the L2439/2439A(CG) to request a Collection Due Process hearing.
The taxpayer must request a CDP hearing under IRC 6330
in order to request judicial review under that section. See IRM 5.1.9,Collection Appeal Rights,
for additional information about taxpayers rights to appeal under IRC 6330.

If the taxpayer appeals or says a suit is being
filed, contact AIQ-Advisory. Also, get advice from Counsel, as needed. The
local Appeals Office will handle the administrative appeal. Tell the levy
recipient(s) to delay paying over the funds while the appeal is considered
using Letter 2438(CG), Jeopardy Levy Letter to Third Party Recipient.

If the taxpayer has received all the pre-levy notices and the waiting
periods have passed, they can appeal under the Collection Appeals Program
(CAP) or request an equivalent hearing. The taxpayer cannot go to court if
they disagree with Appeals decision. See IRM 5.1.9,
Collection Appeal Rights, for additional
information on CAP and equivalent hearings.