§1631k Taxes

Summary

When a federal officer or agency named by the President takes control of property or its earnings, taxes at the federal, state, territorial, or local level still apply for times before and after that takeover. The officer or agency must pay any taxes tied to the property or its earnings as soon as it is safe and proper for the United States to do so, even if someone has filed a claim or lawsuit. The former owner is not responsible for taxes that come due while the property is held by the designee, unless the property is returned without the designee having paid those taxes. The designee should pay taxes from the property, its proceeds, or other property from the same former owner. No one can force tax collection from the property while the designee holds it without the designee’s consent. If the designee transfers the property under other parts of the law, it may go free of tax except for liens that were already perfected when control began; the sale proceeds count the same as the property for tax purposes. The Treasury Secretary will make rules about how to figure and pay these taxes, including which credits, deductions, or exemptions apply. Time limits for assessing, collecting, or refunding federal taxes are paused while the property is held and for six months after; no interest is paid on refunds for periods when those limits are paused. “Tax” here covers many kinds (for example, property, income, excess-profits, war-profits, excise, estate, employment taxes, import duties, and special assessments) and also includes interest or penalties unless those extra charges are the result of something the designee did.