26 U.S.C. § 6330: Notice and Hearing Before an IRS Levy

Federal law provides protections for individuals facing collection actions from the Internal Revenue Service (IRS). Before the IRS can seize property to satisfy a tax debt, a process known as a levy, it must provide the taxpayer with an opportunity for a formal hearing. This right is established under 26 U.S.C. § 6330.

The primary avenue for this challenge is the Collection Due Process (CDP) hearing. A CDP hearing is an administrative proceeding designed to ensure a collection action is appropriate and to consider less intrusive alternatives before any property is taken.

The Notice of Intent to Levy

The right to a Collection Due Process hearing is triggered by a specific written communication from the IRS. This formal notification is legally required before the agency can proceed with seizing a taxpayer’s assets. The document is officially titled “Notice of Intent to Levy and Your Right to a Hearing.”

These notices are sent as a Letter 1058 or an LT11 and are delivered by certified or registered mail to the taxpayer’s last known address. The notice contains the total amount of the unpaid tax, the tax periods to which the debt applies, and outlines the taxpayer’s right to request a hearing to contest the proposed levy.

The law provides a 30-day period from the date of the letter for the taxpayer to request a hearing. Failing to respond within this timeframe results in the forfeiture of the right to a pre-levy CDP hearing, though an alternative hearing may still be requested.

Requesting a Collection Due Process Hearing

To formally request a hearing, a taxpayer must use Form 12153, “Request for a Collection Due Process or Equivalent Hearing.” This is the exclusive document the IRS accepts for this purpose and must be mailed to the address shown on the levy notice.

If a taxpayer misses the 30-day deadline to request a CDP hearing, they may request an “Equivalent Hearing” for up to one year from the date of the levy notice. This request is made using the same Form 12153. However, an Equivalent Hearing does not stop the IRS from taking collection action while the hearing is pending, and its resulting “Decision Letter” cannot be challenged in the U.S. Tax Court.

Completing Form 12153 requires basic identifying information and the tax details from the Notice of Intent to Levy. The most substantive part of the form is where the taxpayer must explain their reasons for disagreeing with the proposed levy. This section should be completed with a clear explanation of the basis for the dispute, such as proposing an installment agreement or an offer in compromise due to financial hardship.

The Hearing with the IRS Office of Appeals

Once a timely request is filed, the case is assigned to the IRS Independent Office of Appeals. The hearing is conducted by an Appeals Officer who has had no prior involvement with the tax matter in question. The hearing itself is often conducted by telephone or correspondence, though a face-to-face meeting may be requested.

During the hearing, the Appeals Officer verifies that the IRS has met all legal and procedural requirements for the proposed levy. The officer also evaluates whether the proposed collection action is appropriate, balancing the government’s need to collect taxes with the taxpayer’s concern that the action not be more intrusive than necessary.

Taxpayers can formally propose solutions such as an installment agreement, an offer in compromise, or having their account placed in currently not collectible status. Spousal defenses, such as a request for innocent spouse relief, can also be raised and considered during the hearing.

In limited circumstances, a taxpayer may challenge the existence or amount of the underlying tax liability itself. This is only permissible if the taxpayer did not receive a statutory notice of deficiency for the tax in question or otherwise did not have a prior opportunity to dispute it.

Receiving the Notice of Determination

Following the conclusion of the hearing, the IRS Office of Appeals will issue its findings in a document called a Notice of Determination. This notice is a formal, written decision that explains the Appeals Officer’s conclusions regarding the issues raised during the hearing and serves as the final administrative ruling.

The Notice of Determination will state whether the proposed levy action is sustained or if it should be released. For example, it could direct the release of the levy and approve a collection alternative that was negotiated during the hearing, such as an installment agreement.

If the taxpayer disagrees with the outcome, they have the right to seek judicial review by filing a petition with the U.S. Tax Court within 30 days of the date on the notice. This 30-day period is jurisdictional, meaning that if a petition is not filed on time, the Tax Court will not have the authority to hear the case. The Tax Court’s authority to hear an appeal may also be dependent on the IRS actively pursuing the levy. If the appeal is not filed in time, the determination of the Office of Appeals becomes final.