5.10.7. Acquired Property and Property Redeemed by the United States

(1) Internal Revenue Manual 5.10.7, Acquired Property and Property Redeemed by the United States, contains procedural guidance for acquired property and property redeemed by the United States. The procedures contained in this section relate to

• maintaining controls on acquired property

• dealing with sales proceeds and income from acquired property

• selling acquired property

• selling property redeemed by the United States

• taking post-sale actions for acquired property and property redeemed by the United States

(1) The authorities for this IRM include:

• 28 USC 2410

• IRC 6335, Sale of Seized Property

• IRC 6337, Redemption of Property

• IRC 7425, Discharge of Liens

• IRC 7505, Sale of Personal Property Acquired by the United States

• IRC 7506, Administration of Real Estate Acquired by the United States

• IRC 7809, Deposit of Collections

(1) The Director, Collection Policy is the executive responsible for the policies and procedures in this IRM.

(2) The advisors are responsible for maintaining controls and completing the post sale or post disposition actions of acquired property and property redeemed by the United States.

(3) The revenue officers and PALS are responsible for sale actions and coordinating post sale or post disposition actions with the advisors.

(4) Managers are responsible for ensuring sale, post sale and/or post disposition actions are taken by employees in accordance with current law, policy and IRM procedures.

(1) Program Reports: Per IRM 1.4.53, Advisory and Property Appraisal and Liquidation Specialist Group Manager Operational Aid, the Advisory Group Managers are required to review Seizure Controls, RACS 135 Reports, and ICS to ensure advisor cases are being effectively worked.

(2) Program Effectiveness: Civil Enforcement Advice and Support Operations (CEASO) conducts operational and performance reviews to ensure case actions are taken in accordance with applicable laws, policy and IRM procedures. National quality and consistency reviews are conducted to ensure consistency and effectiveness in case actions.

(1) CEASO Advisory Group Managers will consistently review:

• Acquired Property Controls

• RACS 135 Reports

• ICS Current Inventory Report

(2) Certain processes in this IRM require managerial approval.

(3) The ENTITY Case Management System can also generate certain unique reports to assist in managing assigned inventory.

(1) The table below lists common acronyms used in this section.

(1) Advisory will establish an Integrated Collection System (ICS) control by opening a non-field Other Investigation with an Action Code 165, Acquired Property, within 7 calendar days of notification of such property.

(2) Property acquired by means other than through seizure action (e.g. see IRM 5.10.7.2 (1) and IRM 5.10.7.2 (2)) and for which the taxpayer’s account has been or is being credited will be controlled on ICS using an assigned identification number which begins with "00-9". The artificial assigned TIN will follow the format 00-9AOXXXX, where "00-9" represents Advisory’s function code for ICS; AO is the Collection Field Area Office Number (01 through 07, 15, or 99*); and XXXX is a four digit sequential numeric control (e.g. 00-9 02 0001).

(3) For property acquired through seizure, or for which the taxpayer’s account will not be credited until later, the taxpayer’s TIN will continue to be used to control the case on ICS.

(4) Advisory will assign an acquired property serial number in accordance with IRM 5.6.1.7, Collateral Agreement and Other Acquired Property Serial Numbers, and IRM 5.6.1.8, Preparing Form 2276, Collateral Deposit Record.

(1) Within 10 calendar days of establishing the ICS control, Advisory will prepare a memorandum for the RRACS staff requesting that they open an acquired property control. The memorandum titled, “Acquired Property Control,” will include the following information:

• acquired property serial number

• taxpayer’s name and control TIN

• type of property

• value of property

• a statement indicating whether the taxpayer’s account has been, or should be, credited with the assigned value of the acquired property or if the account will be credited after the property is disposed of. If account should be credited immediately, provide instructions as to how the credit should be applied.

(2) Upon receipt of the memorandum, the RRACS staff will open an acquired property control on the RRACS Report 135. Based on the information provided, the RRACS staff will either use the assigned value of the property or assign a value of $1.00, if the account is to be credited after disposing of the property.

(3) The advisor will then coordinate with the PALS to dispose of the acquired property.

(1) Proceeds obtained from the sale of the acquired property will be forwarded by the RO or PALS to the Ogden Teller Unit via a memorandum at the following address:

IRS Ogden Submission Processing Center
1973 N. Rulon White Blvd
Mail Stop 6261, Acquired Property
Ogden, UT 84404

(2) The memorandum titled, "Proceeds from the Sale of Acquired Property" will include the following information: acquired property serial number; date of the sale, and amount of proceeds.

(3) The RO or PALS responsible for conducting the sale will send Advisory a summary memorandum of the acquired property sale. The RO or PALS will forward all applicable documents to Advisory, including a copy of the memorandum mentioned above.

(4) Within 10 calendar days of the RO or PALS documentation, Advisory will then prepare a memorandum to the RRACS staff at the Ogden Campus. The memorandum titled "Disposition of Acquired Property" will include the following information: acquired property serial number; date of disposition; and a statement regarding the disposition of proceeds.

• If the taxpayer’s account was NOT previously credited for the value of the acquired property, the advisor will provide the necessary information to ensure adequate posting of the sale proceeds. At a minimum, this will include the taxpayer’s name, TIN and tax period information.

• If the taxpayer’s account was previously credited (i.e. redemption), the advisor will notify the IRACS staff to close out the 7100 Acquired Property Account.

  Note: Because the property being sold is owned by the government, expenses of sale are not to be charged to the taxpayer’s account.

(5) Once the disposition of the proceeds has been verified and all required actions have been completed, the advisor will update the acquired property log and close the ICS control.

(1) Real property may be leased if it is determined that it will be in the possession of the area director over an extended period of time and that the government's interest will best be served by such action. Factors to be considered are:

• Depreciation of the property

• Whether the property can be immediately sold for a reasonable amount

• Cost of maintenance, etc.

(2) The initial determination will be made by the Advisory Group Manager, based upon the circumstances, including any recommendation of the area office involved. The final decision rests with the Advisory Territory Manager whose approval must be secured before the property is offered since he/she must sign the lease.

(3) If acquired property will be leased and a prospective lessee has been secured, the Advisory Group Manager should request area counsel to prepare a lease agreement in duplicate. The terms of the lease should generally not be more than a year and should not contain any provision which would prevent selling the property, subject to the lease, at any time a suitable purchaser is found. The lease agreement should specify that payments be made by check or money order made payable to the United States Treasury and sent directly to the Advisory Group Manager.

(4) The following information should be furnished to area counsel:

• Name and address of the lessee

• Area involved

• Description and location of property

• How property was acquired by the United States

• Period of the lease

• Terms of payment (amount, manner, due date and place of payment)

• Any special provisions to be contained in the lease, such as maintenance of property, authorized alterations, improvements, etc.

(5) Upon receipt of the proposed lease agreement from area counsel, the Advisory Group Manager will review the lease to see that it conforms to the intent of the parties involved and will forward the original and duplicate to the Advisory Territory Manager for his or her signature.

(6) After the Advisory Territory Manager has signed the lease agreement, both copies will be returned to the Advisory Group Manager who will:

1. Prepare a control card showing the name and address of the lessee, payment due and amount of payment.

2. Secure the signature of the lessee on the original lease agreement.

3. Furnish duplicate lease agreement to the lessee which may be considered authority for the lessee to have possession of the property in accordance with terms of the agreement.

4. File original lease agreement in the related Disposition of Seized Property case file.

5. File control card chronologically by payment due date in a "lease control card file."

(7) Upon receipt of payments under the lease agreement, Advisory will note the control card as to date payment is received and prepare and process a memorandum posting document in duplicate in accordance with IRM 5.10.7.3 (4), Income From Acquired Property.

(8) If a payment is not received within a reasonable time after the due date, the Advisory Group Manager should contact the lessee to secure payment. If payment is not received, area counsel should be consulted as to the legal action required.

(1) Regulations provide that offers to bid at least a specified amount may be solicited from prospective bidders before giving a notice of sale of acquired property. Although this procedure is not a statutory requirement, it is desirable since it encourages more sincere bidding and practically ensures that the property will be sold when offered for sale. Ordinarily offers to bid will be the result of solicitation by the PALS or the revenue officer since they will be in the best position to contact prospective bidders. However, in some instances the agreement to bid may be secured by other Service personnel. The agreement to bid should be similar to the example in Exhibit 5.10.7-1.

(2) A deposit to secure performance of the agreement to bid may also be required and ordinarily is desirable. When a deposit is required, it should be the full amount of the offer to bid if the bid is $200 or less. If the amount of the offer to bid is more than $200, the deposit should be 20 percent of the bid or $200, whichever is greater.

(3) If a deposit is required with the agreement to bid, it should be made by a certified, cashier's, or treasurer's check drawn on any bank or trust company incorporated under the laws of the United States or under the laws of any state, territory, or possession of the United States, or by a postal, bank, express, or telegraph money order.

(4) Certificates of Deposit and irrevocable letters of credit are also acceptable if approved in advance by area counsel. However, care should be exercised in accepting and monitoring such instruments because the period of time in which they are negotiable is generally limited.

(5) Upon receipt of a bid deposit, prepare Form 2276 , Collateral Deposit Record. The remittance and Form 2276 will be submitted to Advisory for review and safekeeping. Additional information on collaterals can be found in IRM 5.6.1, Collateral Agreements and Security Type Collateral, and IRM 5.6.2, Maintenance. When completing the form:

• Complete items 1 - 11 as captioned.

• Item 2 - Secure the serial number from Advisory.

• Only complete item 8 if the collateral was submitted by someone other than the taxpayer.

• In item (b) "Description", enter "Agreement to Bid Deposit".

• In item (d) "Estimated Fair Market Value", enter "For Safekeeping".

(1) Personal property may be sold any time after it is acquired and a notice of sale given (IRM 5.10.7.4.5 (2), Notice of Sale). However, sufficient time should be allowed to permit adequate publicity of the sale so that the maximum amount may be obtained for the property at the sale. Ordinarily, the sale of personal property should be held in the area where the property was declared purchased for the United States. If the sale is to be held in another area, the area director should advise the director of the other area.

(2) Real property acquired under the provisions of IRC 6335(e) may be sold after the 180-day period of redemption expires and a public notice of sale has been given (IRM 5.10.7.4.5 (2)). The notice must have been given not less than 20 days before holding the sale. Ordinarily, when real property is involved, the taxpayer or other persons with an interest in the property, or a person on their behalf, have a right to redeem the property within the prescribed period. In some instances, such as in the case of real property acquired by forfeiture, the right to redeem may not exist. When real property is acquired by an action other than a sale under provisions of IRC 6335(e), consult area counsel to determine whether redemption rights exist.

(3) When real property is redeemed under 28 USC 2410 or IRC 7425, the PALS should arrange to sell it as soon as possible after proper notice of sale is given and the terms of agreements to bid permit. The property may not be sold less than 20 days after notice is given.

(4) Ordinarily, the place of sale of real property should be within the county where the property is situated. However, if it is believed that a substantially higher price may be obtained, the area director or Advisory Territory Manager may authorize the sale to be held outside such county. If this move causes the sale to be held in another area office, the area director should be notified by the approving official in the area where the property is situated.

(1) Regulations provide that the employee conducting the sale may adjourn the sale if an adjournment will best serve the interest of the United States. However, if the sale is adjourned for more than 30 days in the aggregate, a new notice of sale is required.

(2) When a sale is to be adjourned for any purpose, the employee conducting the sale should appear at the time and place originally established for the sale and make a public announcement of the adjournment and, if possible, inform those present of the new date and time of sale.

(1) Acquired property may be sold either by public auction or by sealed bids. The method used will depend upon the facts and circumstances surrounding the property, such as type of property, location, condition of property, etc. The method selected should be the one which is expected to produce the maximum amount for the property.

(2) Acquired property may be sold, if divisible, in parcels or piecemeal, or it may be combined with other acquired property and offered for sale. There are no restrictions relative to the grouping of the property for sale. It may be offered as separate items, as groups of items, in the aggregate, or both as separate items (or in groups) and in the aggregate. If the property is to be offered in groups, the groups should be segregated on the notice of sale.

(1) Regulations require that a notice of sale be publicly given. The notice of sale should be prepared as appropriate:

• Notice of Public Auction (for redeemed property), Exhibit 5.10.7-2, P–637

• Notice of Sealed Bid Sale (for redeemed property), Exhibit 5.10.7-3, P–1627

• Notice of Public Auction Sale, (other than redeemed property), Exhibit 5.10.7-4, P–339

• Notice of Sealed Bid Sale, (other than redeemed property), Exhibit 5.10.7-5, P–340

(2) If residential real property is being sold, the notice of sale should also contain a statement that the property is being sold on an open occupancy basis or nondiscriminatory basis. The notice of sale should be reproduced in a manner that will provide sufficient copies to satisfy the needs of the particular sale. For real property, the notice of sale must be published in a newspaper published or generally circulated within the county where the property is situated. If there is no newspaper published or circulated within the county, the notice will be posted at the post office nearest the place of sale and in at least two other public places. For personal property the notice of sale must be posted at the post office nearest the place of sale and in at least two other public places. For personal property, newspaper advertising may also be authorized but is not required. A copy of the notice of sale should also be retained by the PALS for submitting with the report of sale. A copy will be forwarded to Advisory.

(3) Other methods of giving public notice of sale and of advertising, such as radio or television spot announcements, posting on the Treasury Web Site (Internet), and trade journal advertising, may be used, in addition to those required by regulations, when it is believed that wider or more specialized advertising coverage will enhance the possibility of obtaining a higher price for the property. If commercial advertising is used, the procedures prescribed in IRM 5.10.4.10.1, Commercial Advertising of Sale, should be followed.

(1) The procedures prescribed in IRM 5.10.5.8, Condition of Title and of Property, are also applicable when acquired property is being sold.

(2) Because Form 2434-B, Notice of Encumbrances Against and Interests in Property Offered for Sale, is normally used for sales of seized assets, the following changes should be made when conducting a sale of acquired property:

1. On the front of the form in the space below "Internal Revenue taxes due from: (Taxpayer)", enter a statement to indicate how the Service acquired the property; for example — "The United States acquired the property from a distraint sale under the provisions of IRC section 6335 on 07/01/2000. Deed was executed to the United States on 02/05/2001. "

2. On the reverse of the form, change the first paragraph from "will be sold" to either "was sold and acquired by the United States" or "was acquired by the United States. "

3. On the reverse of the form, in the last paragraph, delete everything after the first sentence and add the following sentence: "Upon full payment of the accepted bid price, the United States will issue a Certificate of Sale for personal property or a deed for real property."

(1) At the time and place set for the sale, the employee conducting the sale should call the prospective bidders to order and read the authority for the sale and the conditions under which the property will be offered. The statement provided in Exhibit 5.10.7-6 should be used, but it may be altered as necessary to fit the conditions of a particular sale.

(2) After reading the statement as to the terms and conditions of the sale, the employee conducting the sale will open the bidding. If an agreement to bid has been secured and a deposit has been required, and a higher opening bid is not received, the property should be offered for sale at the amount of the offer. If a bid is not received equal to at least the amount of the offer, the sale should be adjourned and the property again offered for sale at a later date. At the conclusion of the bidding, the property will be declared sold to the highest acceptable bidder, unless it is determined that the best interest of the Government will be served by an adjournment of the sale (IRM 5.10.7.4.3, Adjournment of Sale).

(3) If the property is offered for sale by more than one method, the employee assisting in the sale will prepare a tabulation of the high bids received. Form 4425, Public Sale Bid Tabulation, or similar form, may be used for this purpose. It is not necessary that a record be maintained of bids as they are tendered during the progression of the tentative high bids. The sale should be recessed at the conclusion of the bidding for a period long enough to tabulate the tentative high bids received. After completing a verification of this tabulation, the name of the successful bidder or bidders should be announced. The records pertaining to the tentative high bids received will be retained and submitted by the employee conducting the sale with the report of the proceedings as stated in IRM 5.10.7.9, Report of Disposition — Other Than Sale of Redeemed Property.

(4) When property is offered for sale by more than one method, it may be desirable to secure payment from the tentative high bidder(s) pending the outcome of the bidding by the other method of sale. In these cases, the procedures in IRM 5.10.5.13, Property Offered for Sale by More Than One Method, should be followed.

(1) Regulations under IRC 7505 and IRC 7506 provide that acquired property may also be sold by sealed bids. If the property was not redeemed by the United States, the procedures prescribed in IRM 5.10.5.14, Sealed Bid Sale - General, will be followed except that:

1. Form 2593, Sealed Bid for Purchase of Property Acquired by the United States, will be used in place of Form 2222.

2. Any references to seized property should be considered to be "property acquired by the United States."

3. Any references to "minimum price" should be disregarded since such requirement is not applicable when selling property which has been acquired by the United States.

4. Any or all bids may be rejected at any time before declaring the property sold (See IRM 5.10.7.6, Sale Procedures - Public Auction Sale).

5. Form 2434-B will be prepared as described in IRM 5.10.7.6.1, Condition of Title and of Property.

6. The employee conducting the sale will prepare a report on the proceedings in accordance with IRM 5.10.7.9, Report of Disposition — Other Than Sale of Redeemed Property.

7. The return of a remittance to an unsuccessful bidder who had executed an agreement to bid will be governed by IRM 5.10.7.6.6, Return of Unsuccessful Sealed Bids and Amounts Deposited with Agreements to Bid.

(2) For property that was redeemed by the United States, the procedures prescribed in IRM 5.10.5.14, Sealed Bid Sale - General, will be followed except that:

1. Form 2593-A, Sealed Bid for Purchase of Property Redeemed by the United States, will be used in place of Form 2222.

2. Any references to seized property should be considered to be "property redeemed by the United States."

3. Any references to "minimum price" should be disregarded since such requirement is not applicable when selling property which has been redeemed by the United States.

4. Any or all bids may be rejected at any time before declaring the property sold. See IRM 5.10.7.6, Sale Procedures - Public Auction Sale.

5. Form 2434-B will be prepared as described in IRM 5.10.7.6.1, Condition of Title and of Property.

6. The employee conducting the sale will prepare a report on the proceedings in accordance with IRM 5.10.7.8, Report of Disposition — Sale of Redeemed Property.

7. The return of a remittance to an unsuccessful bidder who had executed an agreement to bid, will be governed by IRM 5.10.7.6.6, Return of Unsuccessful Sealed Bids and Amounts Deposited with Agreements to Bid.

(1) Instructions in IRM 5.10.4.8.3, Notice of Sale - Terms of Payment, are applicable.

(2) A Form 809 receipt will not be issued to the purchaser upon full payment of the purchase price if personal property is sold. Instead, a Certificate of Sale will be issued. See IRM 5.10.7.6.7, Certificate of Sale — Personal Property.

(3) If deferment of the full purchase price is permitted or if real property is sold and the payments are made by cash, the employee will issue a Form 809 receipt for the cash payments. Parts 1, 2, and 3 of the Form 809 receipt should be marked in the upper right corner above the receipt number "Full (or partial, if applicable) Payment—Sale of Acquired Property." The only entries that should be made are the taxpayer's name and the amount of the payment. Part 2 should be given to the purchaser and Parts 1 and 3, stapled together in reverse order, should be submitted via Form 3210, Document Transmittal, as provided in IRM 5.10.7.9, Report of Disposition — Other Than Sale of Redeemed Property.

(1) If a deposit is required with the agreement to bid and the depositor fails to bid the amount specified in the agreement and either the property is not sold for as much as the agreed amount or the Service incurs any costs resulting from the need for a subsequent sale, the amount of the deposit may be retained by the Service as damages.

(2) If payment in full is required upon acceptance of the bid and is not paid, or if deferred payment is permitted and is not paid within the prescribed period, the sale may be declared to be null and void and the property may again be advertised and sold as provided in these instructions. In this event, the new purchaser will receive the property or rights to property free and clear of any claim or right of the former defaulting purchaser. The amount paid upon the bid price may be retained by the United States pending determination of actual damages. Area counsel may be consulted, if necessary, to determine whether legal action is appropriate.

(3) In case of a deposit retained as damages under either IRM 5.10.7.6.5(1) or (2) above not related to property redeemed under IRC 7425, the employee who conducted the sale will prepare a memorandum in triplicate entitled "Retained Deposit Funds" and state thereon the:

• Name of the depositor

• Amount retained

• Reasons for retaining the funds

(4) The employee conducting the sale will forward all copies of the memorandum through their manager to the Advisory Group Manager to submit to RRACS.

(5) In case of a deposit retained as damages under IRM 5.10.7.6.5(1) or (2) above related to property redeemed under IRC 7425, the employee will report any default situation described above by memorandum, in quadruplicate, entitled "Default in Agreement to Bid" or "Default in Payment of Bid Price," as applicable. The memorandum will identify the redemption sale and will include the following information:

• Name of the bidder or depositor

• Amount of the agreement to bid or sealed bid

• Amount of the deposit, or of remittance accompanying the bid

• Amount which must be returned to the revolving fund

• Amount received from the sale of the property, or date for rescheduled sale

• Actual cost of re-selling the property (if unknown, estimate)

• Nature of and reason for default

(6) All copies of the memorandum will then be forwarded through the group manager and the Advisory Territory Manager for distribution to the Advisory Area Manager, Management & Finance Field Office, and area counsel. The fourth copy will be retained in Advisory.

(7) In order to minimize the chance of loss being incurred by the Service, the Advisory Territory Manager will, by memorandum, inform the Management and Support Field Office when any of the following situations occur:

• A bidder defaults in payment or fails to bid the agreed amount — the memorandum will indicate what actions are planned for recovering the full amount advanced from the revolving fund

• The full amount advanced from the revolving fund is recovered after a default situation arises, through subsequent sale of the property, legal action against the defaulting bidder, etc.

• All efforts to recover the fund advance have been exhausted and it is determined that the fund has suffered a loss which must be recovered administratively

(1) At the conclusion of the sale, remittances submitted in connection with unsuccessful sealed bids will be returned to the bidder unless the bidder defaulted in payment of the bid price.

(2) In no event will any remittance received with an unsuccessful bid be deposited as internal revenue collections or in the deposit fund account, nor will unsuccessful bidders be required to submit an application for a refund. Remittances will be returned to unsuccessful bidders if they are present at the sale. Otherwise, the remittances will be returned by certified mail. In either case, complete the applicable items of the "Return of Remittance to Unsuccessful Bidder" section of the related Form 2593 or Form 2593-A.

(3) Advisory is responsible for returning deposits submitted with agreements to bid if, after the sale, the individual who submitted the deposit was not the successful bidder.

(1) As soon as possible after receipt of the full purchase price, the employee conducting the sale will:

1. Issue in duplicate a Certificate of Sale of Personal Property in accordance with the example in Exhibit 5.10.7-7.

2. Furnish the original certificate of sale to the purchaser.

3. Release the personal property to the purchaser.

4. Retain duplicate certificate of sale for submission with report of sale as prescribed in IRM 5.10.7.9, Report of Disposition — Other Than Sale of Redeemed Property.

(1) Regulations under IRC 7506 provide that, upon payment in full of the purchase price, the delegated official will issue a deed to the purchaser. The authority to sign the deed is contained in Delegation Order 1-23-2 [formerly SB/SE Delegation Order 5.1 (Rev 2)]. See IRM 1.2.65.3.1 and IRM 1.2.65-2, SBSE 1-23-2 (Rev. 2), Authority to Sign and Issue Levy and Related Documents.

(2) The deed will be prepared in duplicate by Advisory and forwarded to area counsel for approval. A standard format for such deeds can be pre-arranged with area counsel. Once the deed is ready, Advisory will:

1. Remove the original Report of Sale from the suspense file.

2. Secure the appropriate signature on the deed.

3. Furnish the original deed to the purchaser.

4. Note on duplicate deed the date the original deed is executed and the date it is delivered to purchaser.

5. File the duplicate deed and original report of disposition in the related Record of Disposition of Seized Property case file.

(1) For redeemed property, expenses of sale, including the cost of advertising, are to be deducted from the excess over the amount required to reimburse the revolving fund before application to the taxpayer's liability. However, if there is no sale, the taxpayer's account will not be debited (See IRM 5.12.5.7.5, Disposition of Redemption Sale Proceeds.

(2) For other than redeemed property, expenses of sale, including the cost of advertising, are to be identified on the "Report of Sale of Acquired Property" per IRM 5.10.7.9, Report of Disposition — Other than Sale of Redeemed Property.

(1) If Form 2435 was not previously prepared, a certificate of sale to the United States should be prepared in duplicate in accordance with Exhibit 5.10.7-9 (P-342). The Certificate of Sale and the securities will be forwarded to the Advisory Group Manager, who will prepare four copies of a transmittal letter following the form in Exhibit 5.10.7-9.

(2) The Advisory Group Manager will send the following information in one package, by registered mail or by special messenger, to the Bureau of Fiscal Service :

• A transmittal letter (Exhibit 5.10.7-9) indicating the Service's contact, phone number, fax number, and appropriate Agency Location Code (IRM 3.17.63.3, Agency Location Codes)

• The original and two copies of the transmittal letter

• Two certified copies of the Notice of Seizure (Form 2433 )

• Two certified copies of the notice of sale (Form 2434 or Form 2434-A)

• The original certificate of sale (Form 2435 or Exhibit 5.10.7-8, P-342)

• The stock certificates and/or bonds

(3) The forms listed above must list the securities and have a visible seal.

1. If registered mail send the package to:

The Bureau of the Fiscal Service, Office of Public Debt Accounting
Debt Accounting Branch Manager
P.O. Box 1328
Hintgen Building Room 114
Parkersburg, WV 26106–1328


2. If special messenger, send to:

The Bureau of the Fiscal Service , Office of Public Debt Accounting
Debt Accounting Branch Manager
Hintgen Building Room 114
200 3rd Street
Parkersburg, WV 26101–5312

(4) Advisory will retain a copy of the transmittal letter and duplicate Certificate of Sale with the related case file, and will forward a copy of the transmittal letter to RRACS.

(5) The Bureau of the Fiscal Service, Debt Accounting Branch will liquidate the securities in accordance with established Department of the Treasury procedures. Inquiries can be made at (304)480–5161.

(6) Upon the sale, the Debt Accounting Branch will fax a copy of the liquidation letter to the IRS listing:

• The issuing company

• Number of shares sold

• Settlement date

• Net proceeds

• Account credited

• IRS seizure number

(7) The proceeds of sale will be deposited for credit of the Campus director for the IRS Location Code using the Fedwire Deposit System.

1. The message field ‘Orig. to Beneficiary’ (6000) will show: BPD (seizure number),PROC AS NMF CALL, and the IRS contact and phone number.

2. A deposit ticket, SF215C, will be generated from the Fedwire System via CASHLINK and forwarded to the service center on file for the Agency Location Code.

3. The RRACS will make necessary accounting entries to close the related Form 2436, Seized Property Sale Report.

4. The SF215C will be retained in the seizure case file.

(1) Efforts should be made to locate a prospective purchaser. The stock may be sold through regular sale procedures for acquired property.

(2) If the stock cannot be disposed of through sale, area counsel should be consulted to determine whether any legal action, by the United States, as owner of the stock interest of the taxpayer, would be appropriate under the law.

(1) Acquired notes will be forwarded to Advisory for determination of the action that is appropriate. The Advisory Group Manager will determine whether a sale is necessary, or whether the provisions of the instrument are such that demand for payment can be made upon a person obligated thereunder within a reasonable time after acquisition. In making this determination, area counsel should be consulted if there is any question as to the legality of the instrument or of the proposed action.

(2) If it is determined that demand for payment will be made, the Advisory Group Manager will prepare a letter to the person obligated to make payment on the note informing him/her that the note was acquired by the United States through a sale under IRC 6335 and that further payments on the note are to be made to the United States Treasury.

(3) If it is determined that the note should be offered for sale rather than demand for payment made from the person obligated, the Advisory Group Manager will request the appropriate area office to attempt to dispose of the note by public sale.