Surprising Tactic to Suspend an Internal Revenue Service Levy

26 U.S.C. § 6330(e) contains a provision that is little acknowledged and underutilized by individuals dealing with an IRS levy of their bank account or paycheck. That subsection provides in pertinent part:

“(e) Suspension of collections and statute of limitations
“(1) In general
“… if a hearing is requested under subsection (a)(3)(B), the levy actions which are the subject of the requested hearing…shall be suspended for the period during which such hearing, and appeals therein, are pending…”

The suspension of collection activities by timely requesting a Collection Due Process Hearing (CDPH) is a very effective technique to end an IRS (Internal Revenue Service) levy on a bank account or paycheck. I have employed this provision to bring to a standstill an Internal Revenue Service levy in as little as two days. I recently put a note in my shopping cart that even a dancing bear could block an IRS levy by a well-timed request for a CDPH hearing as provided in 26 U.S.C. § 6330(b)(1).

Nevertheless, a dancing bear would not be able to keep IRS (Internal Revenue Service) collection activity put off and most likely neither would most of us. In spite of all the lulls while appeals are pending; and in spite of being able to retrieve any funds you had in the bank when the Notice of Levy showed up from the IRS (Internal Revenue Service); and in spite of receiving full paychecks during those delays; eventually, the end of the line will get here and the IRS (Internal Revenue Service) will move forward with collection activities as they were before the hearing was demanded. At the point this happens almost all the people will be right back where they began; dealing with collection activity by the Internal Revenue Service. It is because of this harsh actuality that I posted nine, free videos, 4-10 minutes long at www.irsterminator.com talking about strategies I have researched out that make keeping IRS (Internal Revenue Service) collection activities suspended indefinitely a very real likelihood.

There are two aspects to winning a CDPH hearing: 1) Taking positive strategies with the plan being able too prevail in the hearing as I discuss in the videos referenced above; 2) Avoiding raising issues that would trigger you losing the hearing. Keeping away from losing matters is a matter of doing a little investigation and reviewing what issues have been raised in the past that lost.

Rohner v. U.S., 91 A.F.T.R.2d 2003-2425 (N.D.Ohio 2003) is the Collection Due Process appeal ruling that I desire to address in part in this article. Rohner lost hisCDP (Collection Due Process) hearing and appealed to the Federal District Court. I was able to discovered his case by searching the District Court data base at www.versuslaw.com. I made an hour and forty minute video about how to use Versuslaw to do research and that video tutorial is available for you to gain knowledge of how to go about online legal research too at www.bearscart.com in the “law study” category.

In the section of the Court’s decision entitled “Factual and Procedural Background” the Court recounted:

“Although Plaintiff submitted Forms 1040 to the Internal Revenue Service (IRS) along with copies of Forms W-2 indicating his wage income for the years 1996 and 1998, he reported no income on the returns and attached statements containing frivolous arguments as to why he was not liable for an income tax for those two years…With regards to the 1998 tax return, the IRS then sent Plaintiff a letter dated May 24, 1999, advising him that a frivolous return penalty of $500 under 26 U.S.C. § 6702 would be assessed against him unless he corrected his position within 30 days…Plaintiff failed to correct the Form 1040 and the IRS assessed § 6702 penalty against him on September 13, 1999, with respect to the 1998 Form 1040…The IRS also accessed Plaintiff a § 6702 penalty on November 13, 2000, with respect to the 1996 Form 1040, because he submitted a Form 1040 for tax year 1996 showing no income with an attached statement containing frivolous arguments on July 21, 2000.”

So, it appears like Rohner may have been using an early Cracking the Code plan; or maybe, something taught by Irwin Schiff. He seems to be using the hearing to prevail on the hearing officer to be in agreement with his view on why he had no taxable income and to get out of paying frivolous return penalties. The IRS sent Rohner a Notice of Intent to Levy that informed him of his entitlement to a CDP Hearing and he demanded the hearing. After losing in the CDPH hearing, Rohner lost on appeal to the Federal District Court:

1) According to the published result, the Court said that Rohner maintained that he had the right to make a recording of the collection due process hearing or have a court reporter transcribe the hearing. The Court held that Rohner misstated the law and held that he did not have the right to have the collection due process hearing recorded or to have a court reporter transcribe the hearing.

2) It is recounted in the published ruling, the Court said that Rohner claimed that the hearing officer refused to give him a individual hearing with respect to the frivolous return penalties for each of the two separate tax years. The Court held that collection due process hearings consist of more than simply the face to face meeting between the taxpayer and the officer. It held that written communications, telephone discussions and face-to-face meetings all are sufficient for an acceptable hearing.

The Court ended up holding that the Internal Revenue Service’s administrative determination was to be upheld. In the videos at www.irsterminator.com I discuss how to use Rohner’s losing issues above to your own advantage. Check them out.

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