§7403 — Title 26 Internal Revenue Code | U.S. Code

Summary

When someone refuses or neglects to pay a federal tax, the government can file a lawsuit in federal district court to enforce its tax lien and have the person's property sold to pay the debt. The suit can reach any property the delinquent taxpayer owns or has any interest in. Everyone with a lien or claim on that property must be made a party to the case. The court sorts out all the competing claims and, if the government's interest is established, can order the property sold and divide the proceeds among the parties based on their interests. The court can also appoint a receiver to take charge of the property while the case proceeds.

Title 26, §7403

Internal Revenue Code — Source: USLM XML via OLRC

(a)In any case where there has been a refusal or neglect to pay any tax, or to discharge any liability in respect thereof, whether or not levy has been made, the Attorney General or his delegate, at the request of the Secretary, may direct a civil action to be filed in a district court of the United States to enforce the lien of the United States under this title with respect to such tax or liability or to subject any property, of whatever nature, of the delinquent, or in which he has any right, title, or interest, to the payment of such tax or liability. For purposes of the preceding sentence, any acceleration of payment under section 6166(g) shall be treated as a neglect to pay tax.

(b)All persons having liens upon or claiming any interest in the property involved in such action shall be made parties thereto.

(c)The court shall, after the parties have been duly notified of the action, proceed to adjudicate all matters involved therein and finally determine the merits of all claims to and liens upon the property, and, in all cases where a claim or interest of the United States therein is established, may decree a sale of such property, by the proper officer of the court, and a distribution of the proceeds of such sale according to the findings of the court in respect to the interests of the parties and of the United States. If the property is sold to satisfy a first lien held by the United States, the United States may bid at the sale such sum, not exceeding the amount of such lien with expenses of sale, as the Secretary directs.

(d)In any such proceeding, at the instance of the United States, the court may appoint a receiver to enforce the lien, or, upon certification by the Secretary during the pendency of such proceedings that it is in the public interest, may appoint a receiver with all the powers of a receiver in equity.

Notes & Related Subsidiaries

Editorial Notes

Amendments

1981—Subsec. (a). Pub. L. 97–34 struck out “or 6166A(h)” after “section 6166(g)”. 1976—Subsec. (a). Pub. L. 94–455, §§ 1906(b)(13)(A), 2004(f)(2), struck out “or his delegate” after “Secretary” and inserted provisions relating to the acceleration of payment under section 6166(g) or 6166A(h). Subsecs. (c), (d). Pub. L. 94–455, § 1906(b)(13)(A), struck out “or his delegate” after “Secretary”. 1966—Subsec. (c). Pub. L. 89–719 inserted sentence permitting the United States, if the property is sold to satisfy a first lien held by the United States, to bid at the sale such sum, not more than the amount of such lien with expenses of sale, as the Secretary or his delegate directs.

Statutory Notes and Related Subsidiaries

Effective Date

of 1981 AmendmentAmendment by Pub. L. 97–34 applicable to estates of decedents dying after Dec. 31, 1981, see section 422(f)(1) of Pub. L. 97–34, set out as a note under section 6166 of this title.

Effective Date

of 1966 AmendmentAmendment by Pub. L. 89–719 applicable after Nov. 2, 1966, regardless of when title or lien of United States arose or when lien or interest of another person was acquired, with certain exceptions, see section 114(a)–(c) of Pub. L. 89–719, set out as a note under section 6323 of this title.

§7403 Action to Enforce Lien or to Subject Property to Payment of Tax

Summary

Title 26, §7403

Notes & Related Subsidiaries

Editorial Notes

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Citations & Metadata