The Treasury Inspector General for Tax Administration has released Fiscal Year 2006 Statutory Review of Compliance With Legal Guidelines When Issuing Levies (2006-30-101):

This report presents the results of our review to determine whether the IRS has complied with § 6330, Notice and Opportunity for Hearing Before Levy. The IRS Restructuring and Reform Act of 1998 requires the IRS to notify taxpayers at least 30 days before initiating any levy action to give taxpayers an opportunity to formally appeal the proposed levy. Specifically, we determined whether the IRS has sufficient controls in place to ensure taxpayers are advised of their right to a hearing at least 30 days prior to levy action. This audit is statutorily required each fiscal year.

This is the eighth annual report the Treasury Inspector General for Tax Administration has issued in compliance with the IRS Restructuring and Reform Act of 1998 to determine whether the IRS is complying with legal guidelines over the issuance of levies. The IRS properly informed taxpayers of their appeal rights at least 30 days prior to issuing levies.

Prior Treasury Inspector General for Tax Administration reports have recognized that the IRS has implemented tighter controls over the issuance of levies. This was due primarily to the development of systemic controls in both the Automated Collection System (ACS) and the Integrated Collection System (ICS) to prevent a levy from being generated unless there were at least 30 days between the date taxpayers received notice of their appeal rights and the date of the proposed levy. Our testing of these controls indicated that they continue to function effectively.

Prior years’ reports also addressed the issue of revenue officers not always properly notifying taxpayers of their appeal rights when issuing manual levies to seize taxpayer assets. Last year’s report was the first report that showed revenue officers properly notified taxpayers of their appeal rights. Our review this year of 44 ICS and 25 ACS manual levies issued between October 1, 2004, and June 30, 2005, continued to show revenue officers and ACS employees properly informed taxpayers of their rights at least 30 days prior to issuing the levies.