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[Code of Federal Regulations]
[Title 27, Volume 1]
[Revised as of April 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 27CFR70.161]

[Page 1016-1018][emphasis added throughout for clarification]
 
            TITLE 27--ALCOHOL, TOBACCO PRODUCTS AND FIREARMS
 
 CHAPTER I--BUREAU OF ALCOHOL, TOBACCO AND FIREARMS, DEPARTMENT OF THE 
                                TREASURY
 
PART 70--PROCEDURE AND ADMINISTRATION--Table of Contents
 
     Subpart D--Collection of Excise and Special (Occupational) Tax
 
Sec. 70.161  Levy and distraint.

    (a) Authority to levy--(1) In general. If any person liable to pay 
any tax neglects or refuses to pay the tax within 10 days after notice 
and demand, the appropriate ATF officer who initiated the assessment may 
proceed to collect the tax by levy, provided the taxpayer has been 
furnished the notice described in Sec. 70.162(a) of this part. The 
appropriate ATF officer may levy upon any property, or rights to 
property, whether real or personal, tangible or intangible, belonging to 
the taxpayer. The appropriate ATF officer may also levy upon property 
with respect to which there is a lien provided by 26 U.S.C. 6321 for the 
payment of the tax. For exemption of certain property from levy, see 26 
U.S.C. 6334 and Secs. 70.241 through 70.245 of this part. For exemption 
of certain property from levy, see 26 U.S.C. 6334 and Secs. 70.241 
through 70.245 of this part. As used in 26 U.S.C. 6331 and this section, 
the term ``tax'' includes any interest, additional amount, addition to 
tax, or assessable penalty, together with costs and expenses. Property 
subject to a Federal tax lien which has been sold or otherwise 
transferred by the taxpayer may be seized while in the hands of the 
transferee or any subsequent transferee. However, see 26 U.S.C. 
6323(i)(2) and Sec. 70.144 of this part concerning the subrogation 
rights of certain transferees. Levy may be made by serving a Notice of 
Levy on any person in possession of, or obligated with respect to, 
property or rights to property subject to levy, including receivables, 
bank accounts, evidences of debt, securities, and salaries, wages, 
commissions, or other compensation. Except as provided in Sec. 70.162(c) 
of this part with regard to a levy on salary or wages, a levy extends 
only to property possessed and obligations which exist at the time of 
the levy. Obligations exist when the liability of the obligor is fixed 
and determinable although the right to receive payment thereof may be 
deferred until a later date. For example, if on the first day of the 
month a delinquent taxpayer sold personal property subject to an 
agreement that the buyer remit the purchase price on the last day of the 
month, a levy made on the buyer on the 10th day of the month would reach 
the amount due on the sale, although the buyer need not satisfy the levy 
by paying over the amount to the appropriate ATF officer until the last 
day of the month. Similarly, a levy only reaches property in the 
possession of the person levied upon at the time the levy is made. For 
example, a levy made on a bank with respect to the account of a 
delinquent taxpayer is satisfied if the bank surrenders the amount of 
the taxpayer's balance at the time the levy is made, including interest 
thereon to the date of surrender. The levy has no effect upon any 
subsequent deposit made in the bank by the taxpayer. Subsequent deposits 
may be reached only by a subsequent levy on the bank.

    (2) Jeopardy cases. If the appropriate ATF officer finds that the 
collection of any tax is in jeopardy, that officer may make notice and 
demand for immediate payment of such tax and, upon

[[Page 1017]]

failure or refusal to pay such tax, collection thereof by levy shall be 
lawful without regard to the 10-day period provided in 26 U.S.C. 6331(a) 
or the 30-day period provided in 26 U.S.C. 6331(d).

    (3) Bankruptcy or receivership cases. During a bankruptcy proceeding 
or a receivership proceeding in either a Federal or a State court, the 
assets of the taxpayer are in general under the control of the court in 
which such proceeding is pending. Taxes cannot be collected by levy upon 
assets in the custody of a court, whether or not such custody is 
incident to a bankruptcy or receivership proceeding, except where the 
proceeding has progressed to such a point that the levy would not 
interfere with the work of the court or where the court grants 
permission to levy. Any assets which under applicable provisions of law 
are not under the control of the court may be levied upon, for example, 
property exempt from court custody under State law or the bankrupt's 
earnings and property acquired after the date of bankruptcy. However, 
levy upon such property is not mandatory and the Government may rely 
upon payment of taxes in the proceeding.

    (4) Certain types of compensation--(i) Federal employees. Levy may 
be made upon the salary or wages of any officer or employee (including 
members of the Armed Forces), or elected or appointed official, of the 
United States, the District of Columbia, or any agency or 
instrumentality of either, by serving a notice of levy on the employer 
of the delinquent taxpayer. As used in this paragraph, the term 
"employer" means:

    (A) The officer or employee of the United States, the District of 
Columbia, or of the agency or instrumentality of the United States or 
the District of Columbia, who has control of the payment of the wages, 
or
    (B) Any other officer or employee designated by the head of the 
branch, department, or agency, or instrumentality of the United States 
or of the District of Columbia as the party upon whom service of the 
notice of levy may be made.

If the head of such branch, department, agency or instrumentality 
designates an officer or employee other than one who has control of the 
payment of the wages, as the party upon whom service of the notice of 
levy may be made, such head shall promptly notify the appropriate ATF 
officer of the name and address of each officer or employee so 
designated and the scope or extent of the authority of such designee.

    (ii) State and municipal employees. Salaries, wages, or other 
compensation of any officer, employee, or elected or appointed official 
of a State or Territory, or of any agency, instrumentality, or political 
subdivision thereof, are also subject to levy to enforce collection of 
any Federal tax.

    (iii) Seamen. Notwithstanding the provisions of section 12 of the 
Seamen's Act of 1915 (46 U.S.C. 601), wages of seamen, apprentice 
seamen, or fishermen employed on fishing vessels are subject to levy. 
See 26 U.S.C. 6334(c).

    (5) Noncompetent Indians. Solely for purposes of 26 U.S.C. 6321 and 
6331, any interest in restricted land held in trust by the United States 
for an individual noncompetent Indian (and not for a tribe) shall not be 
deemed to be property, or a right to property, belonging to such Indian.

    (b) Successive seizures. Whenever any property or rights to property 
upon which a levy has been made are not sufficient to satisfy the claim 
of the United States for which the levy is made, the appropriate ATF 
officer may thereafter, and as often as may be necessary, proceed to 
levy in like manner upon any other property or rights to property 
subject to levy of the person against whom such claim exists or on which 
there is a lien imposed by 26 U.S.C. 6321 (or the corresponding 
provision of prior law) for the payment of such claim until the amount 
due from such person, together with all costs and expenses, is fully 
paid.

    (c) Service of notice of levy by mail. A notice of levy may be 
served by mailing the notice to the person upon whom the service of a 
notice of levy is authorized under paragraph (a)(1) of this section. In 
such a case the date and time the notice is delivered to the person to 
be served is the date and time the levy is made. If the notice is sent 
by certified or registered mail, return receipt requested, the date of 
delivery on the receipt is treated as the

[[Page 1018]]

date the levy is made. If, after receipt of a notice of levy, an officer 
or other person authorized to act on behalf of the person served signs 
and notes the date and time of receipt on the notice of levy, the date 
and time so noted will be presumed to be, in the absence of proof to the 
contrary, the date and time of delivery. Any person may upon written 
notice to the appropriate ATF officer, have all notices of levy by mail 
sent to one designated ofice. After such a notice is received by the 
appropriate ATF officer, notices of levy by mail will sent to the 
designated office until a written notice withdrawing the request or a 
written notice designating a difference office is received by the 
appropriate ATF officer.

(26 U.S.C. 6331 and 6332)

[T.D. ATF-6, 38 FR 32445, Nov. 26, 1973, as amended by T.D. ATF-450, 66 
FR 29026, May 29, 2001]
PLEASE NOTE: THIS IS AS OF APRIL 1, 2002. THE SECTION THAT CORNELL LAW HAS IS OUTDATED AS IT DOES NOT SHOW SPECIFICALLY THE "APPROPRIATE ATF AGENT" AS THE PERSON "REQUIRED" TO INITIATE THE ASSESSMENT. COMPARE THE SUBTLE CHANGES BELOW

Available CFR Titles on GPO Access

[Code of Federal Regulations]
[Title 27, Volume 1]
[Revised as of April 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 27CFR70.161]

[Page 833-835]
 
            TITLE 27--ALCOHOL, TOBACCO PRODUCTS AND FIREARMS
 
 CHAPTER I--BUREAU OF ALCOHOL, TOBACCO AND FIREARMS, DEPARTMENT OF THE 
                                TREASURY
 
PART 70--PROCEDURE AND ADMINISTRATION--Table of Contents
 
     Subpart D--Collection of Excise and Special (Occupational) Tax
 
Sec. 70.161  Levy and distraint.

    (a) Authority to levy--(1) In general. If any person liable to pay 
any tax neglects or refuses to pay the tax within 10 days after notice 
and demand, the regional director (compliance) or Chief, Tax Processing 
Center who initiated the assessment (or, on that official's request, any 
other regional director (compliance) or the Chief, Tax Processing 
Center) may proceed to collect the tax by levy, provided the taxpayer 
has been furnished the notice described in Sec. 70.162(a) of this part. 
The regional director (compliance) or the Chief, Tax Processing Center 
may levy upon any property, or rights to property, whether real or 
personal, tangible or intangible, belonging to the taxpayer. The 
regional director (compliance) or the Chief, Tax Processing Center may 
also levy upon property with respect to which there is a lien provided 
by 26 U.S.C. 6321 for the payment of the tax. For exemption of certain 
property from levy, see 26 U.S.C. 6334 and Secs. 70.241 through 70.245 
of this part. As used in 26 U.S.C. 6331 and this section, the term 
``tax'' includes any interest, additional amount, addition to tax, or 
assessable penalty, together with costs and expenses. Property subject 
to a Federal tax lien which has been sold or otherwise transferred by 
the taxpayer may be seized while in the hands of the transferee or any 
subsequent transferee. However, see 26 U.S.C. 6323(i)(2) and Sec. 70.144 
of this part concerning the subrogation rights of certain transferees. 
Levy may be made by serving a Notice of Levy on any person in possession 
of, or obligated with respect to, property or rights to property subject 
to levy, including receivables, bank accounts, evidences of debt, 
securities, and salaries, wages, commissions, or other compensation. 
Except as provided in Sec. 70.162(c) of this part with regard to a levy 
on salary or wages, a levy extends only to property possessed and 
obligations which exist at the time of the levy. Obligations exist when 
the liability of the obligor is fixed and determinable although the 
right to receive payment thereof may be deferred until a later date. For 
example, if on the first day of the month a delinquent taxpayer sold 
personal property subject to an agreement that the buyer remit the 
purchase price on the last day of the month, a levy made on the buyer on 
the 10th day of the month would reach the amount due on the sale, 
although the buyer need not satisfy the levy by paying over the amount 
to the regional director (compliance) or the Chief, Tax Processing 
Center until the last day of the month. Similarly, a levy only reaches 
property in the possession of the person levied upon at the time the 
levy is made. For example, a levy made on a bank with respect to the 
account of a delinquent taxpayer is satisfied if the bank surrenders the 
amount of the taxpayer's balance at the time the levy is made, including 
interest thereon to the date of surrender. The levy has no effect upon 
any subsequent deposit made in the bank by the taxpayer. Subsequent 
deposits may be reached only by a subsequent levy on the bank.

    (2) Jeopardy cases. If the regional director (compliance) or the 
Chief, Tax Processing Center finds that the collection of any tax is in 
jeopardy, that official may make notice and demand for immediate payment 
of such tax and, upon failure or refusal to pay such tax, collection 
thereof by levy shall be lawful without regard to the 10-day period 
provided in 26 U.S.C. 6331(a) or the 30-day period provided in 26 U.S.C. 
6331(d).

    (3) Bankruptcy or receivership cases. During a bankruptcy proceeding 
or a receivership proceeding in either a Federal or a State court, the 
assets of the taxpayer are in general under the

[[Page 834]]

control of the court in which such proceeding is pending. Taxes cannot 
be collected by levy upon assets in the custody of a court, whether or 
not such custody is incident to a bankruptcy or receivership proceeding, 
except where the proceeding has progressed to such a point that the levy 
would not interfere with the work of the court or where the court grants 
permission to levy. Any assets which under applicable provisions of law 
are not under the control of the court may be levied upon, for example, 
property exempt from court custody under State law or the bankrupt's 
earnings and property acquired after the date of bankruptcy. However, 
levy upon such property is not mandatory and the Government may rely 
upon payment of taxes in the proceeding.

    (4) Certain types of compensation--(i) Federal employees. Levy may 
be made upon the salary or wages of any officer or employee (including 
members of the Armed Forces), or elected or appointed official, of the 
United States, the District of Columbia, or any agency or 
instrumentality of either, by serving a notice of levy on the employer 
of the delinquent taxpayer. As used in this paragraph, the term 
``employer'' means:

    (A) The officer or employee of the United States, the District of 
Columbia, or of the agency or instrumentality of the United States or 
the District of Columbia, who has control of the payment of the wages, 
or

    (B) Any other officer or employee designated by the head of the 
branch, department, or agency, or instrumentality of the United States 
or of the District of Columbia as the party upon whom service of the 
notice of levy may be made.

If the head of such branch, department, agency or instrumentality 
designates an officer or employee other than one who has control of the 
payment of the wages, as the party upon whom service of the notice of 
levy may be made, such head shall promptly notify the Director of the 
name and address of each officer or employee so designated and the scope 
or extent of the authority of such designee.

    (ii) State and municipal employees. Salaries, wages, or other 
compensation of any officer, employee, or elected or appointed official 
of a State or Territory, or of any agency, instrumentality, or political 
subdivision thereof, are also subject to levy to enforce collection of 
any Federal tax.

    (iii) Seamen. Notwithstanding the provisions of section 12 of the 
Seamen's Act of 1915 (46 U.S.C. 601), wages of seamen, apprentice 
seamen, or fishermen employed on fishing vessels are subject to levy. 
See 26 U.S.C. 6334(c).

    (5) Noncompetent Indians. Solely for purposes of 26 U.S.C. 6321 and 
6331, any interest in restricted land held in trust by the United States 
for an individual noncompetent Indian (and not for a tribe) shall not be 
deemed to be property, or a right to property, belonging to such Indian.

    (b) Successive seizures. Whenever any property or rights to property 
upon which a levy has been made are not sufficient to satisfy the claim 
of the United States for which the levy is made, the regional director 
(compliance) or the Chief, Tax Processing Center may thereafter, and as 
often as may be necessary, proceed to levy in like manner upon any other 
property or rights to property subject to levy of the person against 
whom such claim exists or on which there is a lien imposed by 26 U.S.C. 
6321 (or the corresponding provision of prior law) for the payment of 
such claim until the amount due from such person, together with all 
costs and expenses, is fully paid.

    (c) Service of notice of levy by mail. A notice of levy may be 
served by mailing the notice to the person upon whom the service of a 
notice of levy is authorized under paragraph (a)(1) of this section. In 
such a case the date and time the notice is delivered to the person to 
be served is the date and time the levy is made. If the notice is sent 
by certified or registered mail, return receipt requested, the date of 
delivery on the receipt is treated as the date the levy is made. If, 
after receipt of a notice of levy, an officer or other person authorized 
to act on behalf of the person served signs and notes the date and time 
of receipt on the notice of levy, the date and time so noted will be 
presumed to be, in the absence of proof to the contrary, the date and

[[Page 835]]

time of delivery. Any person may upon written notice to the Chief, Tax 
Processing Center or to the region director (compliance) having 
jurisdiction over such person, have all notices of levy by mail sent to 
one designated ofice. After such a notice is received by the Chief, Tax 
Processing Center or the regional director (compliance), notices of levy 
by mail will sent to the designated office until a written notice 
withdrawing the request or a written notice designating a difference 
office is received by the Chief, Tax Processing Center or the regional 
director (compliance).

(26 U.S.C. 6331 and 6332)
NOTE THE SOURCE FOR THIS IS TITLE 26, 6331, 6332 - NO TREASURY DECISION et. al., AS IT SHOWS FOR YEAR 2002. WHY THE CHANGE? NOTICE THE DIFFERENCE BETWEEN APRIL 1, 2001 AND APRIL 1, 2002. IT HAS BEEN CHANGED FROM: "...regional director (compliance) or Chief, Tax Processing Center who initiated the assessment..." TO: "... the appropriate ATF officer who initiated the assessment..." INTERESTING ... NO!? EVEN IF YOU DON'T BELIEVE ME ... CHECK IT OUT AT THE GOVERNMENTS OWN WEBSITE; part 70 Sec. 170.161 AT THE GPO - GOVERNMENT PRINTING OFFICE.