EXCEPTIONS TO THE ANTI-INJUNCTION ACT

As most of you know, there is a federal law called the Anti-Injunction Act that makes it almost impossible to sue the IRS.  However there are some exceptions. Although these exceptions are by no means, a silver bullet; they can be effectively used in many cases.

For example, if the IRS makes an assessment before they have issued a notice of deficiency or if they assess while your case is in the Tax Court, they have made a mistake.  If the IRS has violated deficiency procedures, an injunction might work. It is also possible to sue the IRS under the Wrongful Levy Doctrine.  This doctrine is Section 7426 of the Internal Revenue Code.  If the IRS levies or sells the property of a person other than the individual assessed, then the individual who is a victim of the wrongful levy may sue.  A very important concept to understand when you are dealing with injunctive relief against the IRS is the Shapiro Doctrine which came about as a result of the Supreme Court Case of the Commissioner v. Shapiro, 424 U.S. 614 (1976).  You must be able to prove three elements to win your injunction.

You must prove that the government cannot sustain its claim that taxes are due, that you will suffer irreparable harm if the IRS is permitted to continue their collection, and that you do not have any other means of obtaining the requested relief.  Also, remember that the burden of proof is upon you:  It is not an easy fight. Under the case of Bothke v. Fluor Engineers and Constructors, 713 F.2d 1405 (9th Cir. 1983); the court determined that we have a right to seek judicial intervention if the government has messed up in its deficiency procedures. If the IRS has assessed without a Notice of Deficiency or they assess during the Tax Court proceeding; there is a good chance of an injunction.

If you are considering an injunction, you might first determine if a Tax Court Petition or a refund claim and subsequent refund suit might serve your purposes better.  Remember also that you must get in the ring and litigate or you must at least try to support those who do if you truly want to effect change in our tax system.  Good Luck and Good Fighting!

Tax Liens

            The IRS is required to notify the taxpayer of the filing of a Notice of Lien within five days of its filing.  During the 30-day period beginning with the mailing or delivery of the notification, the taxpayer may demand a hearing.  The following Regulations apply to any Notices of Federal Tax Lien that are filed after January 18, 1999:

            1.  A taxpayer is entitled to the notice of the filing of an NFTL not more than five business days after the date of filing.

            2.  This notice describes the taxpayer's right to request a Collection Due Process hearing with respect to any taxable periods described on the NFTL, within the 30-calendar day period beginning on the day after the five-day period for notification has expired.  The taxpayer is entitled to only one CDP hearing with respect to each taxable period to which the unpaid tax relates.

            3.  The determination made by Appeals may be appealed to either the United States Tax Court or a United States District Court. 

            4.  The running of the periods of limitations for collection after assessment, for criminal prosecutions, and for suits described under IRC Section 6532, are suspended for the periods in which the CDP hearing and any appeals are pending.

            If a taxpayer does not request a CDP hearing within the 30-day period, a taxpayer can still request a hearing at a later date and the IRS will provide a hearing equivalent to a CDP hearing.  However, the taxpayer will not be entitled to judicial review of the later hearing.

            The individual should file a Form 12153, Request for a Collection Due Process Hearing.  The request should set forth the individual's name, address, daytime phone number, type of tax, taxable period, taxpayer's
 TIN, a statement that the individual requests a CDP hearing concerning the NFTL and the reasons that the taxpayer   disagrees with the NFTL finding.  The request must be signed and dated by the taxpayer or the taxpayer's representative.

            After the hearing the individual has 30 days to appeal an adverse determination to court.