U.S. Tax Collections and Seizure of Foreign Assets: IRS Procedures, Tax Treaties, Key Issues for Taxpayers and Counsel

One of the most frightening events for taxpayers is receiving an IRS notice indicating that the Service is pursuing an enforced collection action, which may also cause a taxpayer's foreign assets and accounts to be subject to IRS seizure. Generally, taxpayers are not aware of the IRS' reach when it comes to foreign assets. Tax counsel must accordingly have an advanced understanding of the IRS' enforced collection process to effectively defend taxpayers who find their foreign assets subject to lien, levy, and seizure.

The key statutory tools available to the IRS in collecting alleged tax deficiencies are lien, levy, and asset seizure powers. Each of these actions has a defined course of escalating notice and response requirements. In addition, U.S. tax treaties with jurisdictions where such assets are held or located may allow IRS access to these assets. Depending on the nature of the tax due and the stage of the collection process, tax counsel has available defense and mitigation remedies for each collection action.

Knowing what tools are available to challenge IRS-enforced collections enables tax counsel to properly respond to IRS actions.

Listen as Patrick J. McCormick, J.D., LL.M., Partner at Rimon Law, provides a thorough, "beyond-the-basics" guide to effectively navigating the IRS' collection process once foreign asset attachment or seizure is on the table as an option for collecting delinquent tax.