An audit of IRS property seizure practices found that the agency generally followed legal procedures but failed in some cases to protect renters whose homes were seized for unpaid taxes.
A Treasury Inspector General review of 44 taxpayer cases involving 49 property seizures found that IRS Field Collection employees generally complied with applicable laws and procedures. However, eight seizures involved real estate used as a principal residence by someone other than the taxpayer, such as a tenant, and revenue officers did not take required action to ensure tenants received adequate notice of the seizure, according to the audit report.
In three other cases, the IRS did not follow required procedures, resulting in unnecessary burden to taxpayers. The properties, valued at nearly $377,000, were released back to the taxpayers after the procedural errors were identified, the audit found. The errors were not caught by group managers during their reviews or during pre-seizure review processes, according to the report.
The audit recommended that the IRS consider reinstating a higher level of approval for certain seizures. Prior to October 2016, these seizures required Area Director approval, according to the report.