Regs Governing Review of Jeopardy Levies

 [4830-01]

 ACTION: Final Regulations.

 SUMMARY: This document contains final regulations relating to the procedures for review of jeopardy levies and jeopardy and termination assessments. The Technical and Miscellaneous Revenue Act. of 1988 expanded the coverage of the existing procedures for the review of an assessment made under sections 6851(a), 6852(a), 6861(a), or 6862 to include the review of those jeopardy levies made less than 30 days after notice and demand for payment is made under section 6331(a). In addition, because Congress intended to permit administrative and judicial review of all jeopardy levy cases where the general notice requirements of section 6331(a) and (d) are not met, the regulations extend review to include all such cases. The regulations also incorporate the modifications to section 7429 which now provide the Tax Court with concurrent jurisdiction with the federal district courts regarding the review of jeopardy and termination assessments and jeopardy levies in certain circumstances, where previously only the district courts had jurisdiction with respect to the review of jeopardy and termination assessments.

 EFFECTIVE DATE: These regulations are effective on December 14, 1992.

 FOR FURTHER INFORMATION CONTACT: Joseph W. Clark, 202-622-3640 (not a toll-free call)

SUPPLEMENTARY INFORMATION:

BACKGROUND

This document contains final regulations amending the Procedure and Administration Regulations (26 CFR part 301) under section 7429 of the Internal Revenue Code (Code). The regulations reflect the amendment of section 7429 by section 6237 of the Technical and Miscellaneous Revenue Act of 1988 (Pub. L. No. 100-647)

EXPLANATION OF PROVISIONS

 The Internal Revenue Service published a notice of proposed rulemaking in the Federal Register on May 9, 1991. The Internal Revenue Service received no public comments on the proposed regulations. No change& have been made to the final regulations.

 Section 6237 of the Technical and Miscellaneous Revenue Act of 1988 (TAMRA) (Pub. L. No. 100-647, 102 Stat. 3573) amended section 7429 of the Code to extend the existing procedures relating to the review of jeopardy and termination assessments to the review of certain jeopardy levies. The regulations specify that the Internal Revenue Service must give the taxpayer whose property has been subjected to jeopardy or termination assessment a written statement of the information on which the action is based within 5 days of the date the jeopardy or termination assessment is made. A written statement is also required within 5 days of the date that a jeopardy levy is made if the general notice requirements of section 6331(a) and (d) are not met with respect to the levy. The taxpayer has 30 days from receipt of the written statement or, if no statement was provided, 30 days from the date the statement was required to be furnished to request administrative review. The taxpayer may commence judicial review of the reasonableness of the jeopardy or termination assessment or levy by bringing a civil action in the appropriate court within 90 days after the earlier of (l) the date of notice of the administrative review determination or (2) the 16th day after the request for review was made. The regulations further reflect the grant to the Tax Court of concurrent jurisdiction with the federal district courts over challenges to jeopardy and termination assessments and levies if the taxpayer has filed a petition with the Tax Court prior to the making of the jeopardy assessment or levy with respect to any deficiency covered by the jeopardy assessment or levy notice.

SPECIAL ANALYSES

 It has been determined that these regulations are not major rules as defined in Executive Order 12291. Therefore, a Regulatory Impact Analysis is not required. It has also been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) and the Regulatory Flexibility Act (5 U.S.C. chapter 6) do not apply to these regulations, and, therefore, a final Regulatory Flexibility Analysis is not required. Pursuant to section 7805 of the Internal Revenue Code, the notice of proposed rulemaking for these regulations was submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business.

DRAFTING INFORMATION

 The principal author of these regulations is Joseph W. Clark, Office of the Assistant Chief Counsel (General Litigation), Internal Revenue Service. However, personnel from other offices of the Internal Revenue Service and Treasury Department participated in their development.

LISTS OF SUBJECTS IN 26 CFR PART 301

 Administrative practice and procedure, Alimony, Bankruptcy, Child support, Continental shelf, Courts, Crime, Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income taxes, Investigations, Law enforcement, Oil pollution, Penalties, Pensions, Reporting and recordkeeping requirements, Statistics, Taxes.

Treasury Decision 8453

ADOPTION OF AMENDMENTS TO THE REGULATIONS

Accordingly, 26 CFR part 301 is amended as follows:

Paragraph 1. The authority citation for part 301 continues to read in part as follows:

Authority: 26 U.S.C. 7805 * * *

Par. 2. Sections 301.7429-1, 301.7429-2 and 301.7429-3 are revised to read as follows:

SECTION 301.7429-1 REVIEW OF JEOPARDY AND TERMINATION ASSESSMENT AND JEOPARDY LEVY PROCEDURES; INFORMATION TO TAXPAYER.

Not later than 5 days after the day on which an assessment is made under section 6851(a), 6852(a), 6861(a), or 6862, or a levy is made under section 6331(a) without complying with the notice before levy provisions of section 6331(d), the district director shall provide the taxpayer a written statement setting forth the information upon which the district director relies in authorizing such assessment or levy.

SECTION 301.7429-2 REVIEW OF JEOPARDY AND TERMINATION ASSESSMENT AND JEOPARDY LEVY PROCEDURES.

(a) REQUEST FOR ADMINISTRATIVE REVIEW. Any request for the review of a jeopardy or termination assessment or jeopardy levy provided for by section 7429(a)(2) shall be filed with the district director within 30 days after the statement described in section 301.7429-1 is given to the taxpayer. However, if no statement is given within the 5 day period described in section 301.7429-1, any request for review of the jeopardy or termination assessment or jeopardy levy shall be filed within 35 days after the date such assessment or levy is made. Such request shall be in writing, shall state fully the reasons for the request, and shall be supported by such evidence as will enable the district director to make the redetermination described in section 7429(a)(3).

(b) ADMINISTRATIVE REVIEW. In determining whether the assessment is reasonable and the amount assessed is appropriate, or whether the jeopardy levy is reasonable, the district director shall take into account not only information available at the time the assessment or jeopardy levy is made but also information which subsequently becomes available.

(c) ABATEMENT OF ASSESSMENT. For rules relating to the abatement of assessments made under sections 6851 and 6861 see sections 301.6861-1(e), 301.6861-1(f) and 1.6851-1(d) of this chapter.

SECTION 301.7429-3 REVIEW OF JEOPARDY AND TERMINATION ASSESSMENT AND JEOPARDY LEVY PROCEDURES; JUDICIAL ACTION.

(a) TIME FOR BRINGING JUDICIAL ACTION. An action for judicial review described in section 7429(b) may be instituted by the taxpayer during the period beginning on the earlier of --

(1) The date the district director notifies the taxpayer of the determination described in section 7429(a)(3) and ending on the 90th day thereafter; or

(2) The 16th day after the request described in section 7429(a) (2) was made by the taxpayer and ending on the 90th day thereafter.

(b) EXTENSION OF PERIOD FOR JUDICIAL REVIEW. The United States Government may not by itself seek an extension of the 20 day period described in section 7429(b)(3), but it may join with the taxpayer in seeking such an extension.

(c) JURISDICTION FOR DETERMINATION. -- In general, the United States district courts will have exclusive jurisdiction over any civil action for a determination described in section 7429(b). However, if a petition for a redetermination of a deficiency has been timely filed with the Tax Court prior to the making of an assessment or levy that is subject to the section 7429 review procedures, and one or more of the taxes and tax periods before the Tax Court as a result of the petition is also included in the written statement that was provided to the taxpayer, then the Tax Court will have jurisdiction concurrent with the district courts over any civil action for a judicial determination with respect to all the taxes and tax periods included in the written statement. In all other cases, the appropriate United States district court continues to have exclusive jurisdiction over such an action.