Part 5. Collecting Process
Chapter 11. Notice of Levy
Section 3. Jeopardy Levy without a Jeopardy Assessment

5.11.3 Jeopardy Levy without a Jeopardy Assessment
5.11.3.1 Background
5.11.3.2 Conditions that Mean Jeopardy
5.11.3.3 Getting Approval
5.11.3.4 Forms and Letters for a Jeopardy Levy without a Jeopardy Assessment
5.11.3.5 After the Jeopardy Levy is Approved
5.11.3.6 Appealing the Jeopardy Levy

5.11.3.1 (09-19-2006)
Background

Normally, the notices and waiting periods described in IRM 5.11.1.2.1, Required Notices, must be issued before property can be levied. However, if collection is in jeopardy, property can be levied sooner.

Generally, if collection is in jeopardy, there is a jeopardy or termination assessment. Then, there is an immediate notice and demand which is followed by a jeopardy levy. Sometimes, however, there may already be an assessment before jeopardy is known.

Note:
In every situation where a jeopardy levy occurs without a jeopardy or termination assessment, the Service has already assessed the tax liability through normal procedures.

Example:
There may be a prompt assessment on a voluntarily filed return. Then, the taxpayer starts moving property to hide it. Property can be levied, even though the usual waiting periods after notices have not passed.

A jeopardy levy without a jeopardy or termination assessment can happen:

After tax is assessed, but before the notice and demand is normally required by IRC 6331(a) is issued, provided immediate notice and demand is given to the taxpayer

After the notice and demand is issued, but before ten days have passed

After the ten day notice and demand period ends, but before the 30 day notice of intent to levy and notice of a right to a hearing have been issued, or

After the notice of intent to levy and notice of a right to a hearing have been issued, but before the 30 days for the taxpayer to request a hearing have passed.

Note:
The taxpayer may request an administrative or judicial review of the jeopardy levy action under IRC 7429only when the jeopardy levy is issued within 30 days from the notice and demand (first notice). If a jeopardy levy occurs subsequent to that 30 day period, the Service will issue a CDP notice under IRC 6330(f) within a reasonable period of time to give the taxpayer an opportunity to seek CDP appeal rights under that section. See table in 5.11.3.5(4) below.

In general, no levy can be made in the following circumstances:

The appearance date of a summons

There is a pending or active installment agreement

A rejected installment agreement can be appealed or is being appealed

An offer in compromise is pending

A rejected offer in compromise can be appealed or is being appealed

However, in the circumstances listed in (4) above, if collection is in jeopardy a jeopardy levy may be issued.

Hereafter, any reference to "jeopardy levy" in this section shall refer only to a jeopardy levy without a jeopardy or termination assessment unless otherwise noted.

5.11.3.2 (01-19-1999)
Conditions that Mean Jeopardy
A jeopardy levy requires a condition which would have allowed a jeopardy assessment.

See the IRS policy statement in IRM 1.2.1,Policies of the Internal Revenue Service, regarding jeopardy assessments, IRM 1.2.1.4.27, P-4-88.

5.11.3.3 (09-19-2006)
Getting Approval
If collection of assessed tax is in jeopardy, prepare either a written report or a narrative ICS history entry for the territory manager requesting approval to issue a jeopardy levy. Include the same information that is needed for a jeopardy assessment. See IRM 5.1.4, Jeopardy, Termination, Quick and Prompt Assessments . Send the request through the group manager.

The managerial approval process can be accomplished by having the group manager and territory manager access ICS and document their approval with a history entry. Alternatively, if written approval is secured, a copy of the written approval must be kept in the file.

In addition, IRC 7429(a)(1)(A) requires Counsel approval, in writing, for a jeopardy levy. This approval can be no lower than the Associate Area Counsel.

Note:
For SB/SE International Operations, the authority is delegated to the Deputy Associate Chief Counsel (Strategic International Programs) or this person's delegate.

Note:
All jeopardy levies will be approved by Counsel even though under IRC 7429(a)(1)(A) Counsel is only required to approve jeopardy levies issued during the 30 days from notice and demand. While Delegation Order 5-3 (13) does not require Counsel's approval to issue a jeopardy levy after all pre-levy notices have been issued and the waiting periods for them have passed, see 5.11.3.1(4) above, Collection policy requires Counsel approval of alljeopardy levies.

When all appropriate approvals for issuance of a jeopardy levy are secured, the revenue officer can generate the levy on ICS, sign, and issue it.

If securing written approval, include Letters 2439/2439A(CG), Notice of Jeopardy Levy and Right of Appeal, and 2438(CG), Jeopardy Levy Letter to Third Party Levy Recipient, for the territory manager's signature. If approval is secured via ICS, then sign the letters for the territory manager.

If Then
The notice and demand has not been issued, or it has been issued and ten days have not passed yet. The taxpayer must be given an immediate notice and demand for payment. See " Note " under subsection IRM 5.11.1.2.1(2)

For joint IMF returns, prepare two Letters 2439A(CG) which includes the dual notice language. If an immediate notice and demand is required, also prepare two Forms 3552, Prompt Assessment Billing Assembly, Parts 3 & 4. Put both taxpayers' names on the letters and on the notice and demand.

Use Parts 3 & 4 of Form 3552 to make immediate notice and demand. Cross out "Please return this copy with your payment to the address shown above" at the bottom of the form. If a blank Form 3552 is not available, copy the text of one on IRS letterhead stationery or print one off the Publishing website. Have the territory manager sign this, too, when the notice of levy is approved or sign for the territory manager if approval is secured via ICS.

See Servicewide Delegation Order 5-3 for all position titles with the authority to issue notices of levy when collection is in jeopardy and the pre-levy notices have not been issued and/or the waiting periods after the notices have not passed or the general levy prohibition exists.

If time constraints or other conditions prevent securing Territory Manager written or systemic approval, the Territory Manager can approve the levy by telephone. When this occurs, write a narrative ICS history entry or a memo to file including the information that would have been in the report described in (1). Send a copy of the memo to file to the territory manager.

5.11.3.4 (09-19-2006)
Forms and Letters for a Jeopardy Levy without a Jeopardy Assessment
The forms and letters that are needed depend on the timing of the jeopardy levy. In addition to notice of levy and Federal Tax Lien, the forms and letters needed for jeopardy levies are:

If And Then prepare
Tax has been assessed. The notice and demand normally required by IRC 6331(a) has not been issued. 1. IMMEDIATE NOTICE AND DEMAND (Altered Form 3552). 2. LETTER 2439/2439A(CG) ] . 3. LETTER 2438(CG).
Tax has been assessed. The notice and demand has been issued, but ten days have not passed. 1. IMMEDIATE NOTICE AND DEMAND (Altered Form 3552).
2. LETTER 2439/2439A(CG).
3. LETTER 2438(CG). ).
The notice and demand has been issued. It is between 10 and 30 days since issuance of the notice and demand 1. LETTER 2439/2439A(CG).
2. LETTER 2438(CG).
The notice and demand has been issued. 30 have passed, but a notice of intent to levy and notice of your right to a hearing has not been issued or the notice was issued and it is within the 30 (+15) days to request an appeal. 1. LETTER 2439/2439A(CG)
2.  LETTER 2438(CG).
3. PUBLICATION 594.
4. PUBLICATION 1660.
5. FORM 12153.
A jeopardy levy is to be issued during the general levy prohibition (5.11.3.1(4)) A notice of intent to levy and notice of your right to a hearing has not been issued or the notice was issued and it is within the 30 (+15) days to request an appeal
1. LETTER 2439/2439A(CG)
2. LETTER 2438(CG)
3. PUBLICATION 594
4. PUBLICATION 1660
5. FORM 12153
A jeopardy levy is to be issued during the general levy prohibition (5.11.3.1(4)) A notice of intent to levy and notice of your right to a hearing was issued and the 30 (+15) days to request an appeal have passed
1. LETTER 2439/2439A(CG)
2. LETTER 2438(CG)
3. PUBLICATION 594
4. PUBLICATION 1660
5. FORM 9423

5.11.3.5 (11-05-99)
After the Jeopardy Levy is Approved
If an immediate notice and demand is required, give the altered Form 3552 to the taxpayer and demand immediate payment. If personal delivery is not practical, send it by certified mail to the last known address. If a field visit to deliver the form reveals the address is not good, check IDRS for a new one.

When the immediate notice and demand is issued, or if it is not required:

File a Notice of Federal Tax Lien, and

Serve the Notice(s) of Levy.

Include Letter 2438(CG) with each notice of levy. This letter asks the party in receipt of the levy to delay sending payment for 45 days. This allows time to see if the taxpayer appeals. If the taxpayer successfully appeals, the levy can be released rather than issuing a manual refund.

The taxpayer must be told the reason collection is in jeopardy. Use Letter 2439/2439A(CG), to communicate this. Avoid saying anything in the letter that could identify a confidential informant.

If Then
Form 3552 is required. Give the taxpayer Letter 2439/2439A(CG) at the same time.
Form 3552 is not required. Give Letter 2439/2439A(CG) to the taxpayer within five days of serving the jeopardy levy.

Try to give the letter to the taxpayer in person. If personal delivery is not practical, send it to the taxpayer's last known address by certified mail with a return receipt. See IRM 5.11.1.2.2.2(8),Issuing Notice of Intent to Levy/Notice of a Right to a Hearing in CFf. If a field visit to deliver the letter reveals the address is not good, check IDRS for a new one.

Note:
For joint IMF returns, try to deliver letters to each taxpayer in person. Also, if an immediate notice and demand is required, deliver Form 3552 to each taxpayer. If this is not practical, mail the notices as described in IRM 5.11.1.2.2.3Issuing Notice of Intent to Levy /Notice of a Right to a Hearing for Joint IMF Bal Due Account.

Reminder:
If the taxpayer has an authorized representative, a copy of correspondence to the taxpayer must also be given to the representative. If mailed, use regular mail for the copy.

5.11.3.6 (09-19-2006)
Appealing the Jeopardy Levy
Only if the jeopardy levy is being issued within 30 days of the notice and demand can the taxpayer appeal under IRC 7429. The taxpayer can appeal under IRC 7429 within 30 days after the L2439/2439A(CG) is given, or should have been. The issue is whether the jeopardy levy is reasonable under the circumstances (collection is truly in jeopardy). If the appeal is rejected, the taxpayer can obtain judicial review of the jeopardy levy. If any of the liabilities on the jeopardy levy were being considered in Tax Court before the making of the jeopardy levy, the taxpayer can obtain judicial review of the jeopardy levy by the Tax Court.

If the jeopardy levy is being issued after 30 days from the notice and demand and the taxpayer has not already been issued their appeal rights under IRC 6330, the IRS must notify the taxpayer of their appeal rights under IRC 6330. See also 5.11.3.5.(4). The taxpayer has 30 days from the date of the L2439/2439A(CG) to request a Collection Due Process hearing. The taxpayer must request a CDP hearing under IRC 6330 in order to request judicial review under that section. See IRM 5.1.9,Collection Appeal Rights, for additional information about taxpayers' rights to appeal under IRC 6330.

If the taxpayer appeals or says a suit is being filed, contact AIQ-Advisory. Also, get advice from Counsel, as needed. The local Appeals Office will handle the administrative appeal. Tell the levy recipient(s) to delay paying over the funds while the appeal is considered using Letter 2438(CG), Jeopardy Levy Letter to Third Party Recipient.

If the taxpayer has received all the pre-levy notices and the waiting periods have passed, they can appeal under the Collection Appeals Program (CAP) or request an equivalent hearing. The taxpayer cannot go to court if they disagree with Appeals' decision. See IRM 5.1.9, Collection Appeal Rights, for additional information on CAP and equivalent hearings.