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Historical Perspectives on the Federal Income Tax

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The Fourth Amendment states:

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized..

The present procedures followed by the IRS in assessment of income tax deficiencies and the collection of unpaid taxes have generally been sustained by the courts as valid and as not violative of the Fourth Amendment.

The income tax law requires all taxpayers to maintain such records as are deemed by the Treasury Department, through the IRS, to be necessary for the determination of the taxpayer's liability.47  Furthermore, the IRS is authorized by statute to inspect such records and to demand their presentation in order to determine whether a return is correct and whether a return has been filed.48


This summons may be enforced by the IRS by means of an action brought in the United States District Court.49

The Supreme Court has held that the use of an administrative summons to obtain a taxpayer's records is not a violation of the Fourth Amendment right to be free from unreasonable searches and seizures.50   However, the IRS must issue such a summons in "good faith," for use in determining the taxpayer's civil liability for income taxes, rather than the taxpayer's criminal liabilities.51

The IRS follows a set pattern of procedures for assessing a deficiency in income taxes and collecting those assessed taxes. If a taxpayer is determined to have underpaid his income taxes, the IRS will issue a notice of proposed assessment, giving the taxpayer an opportunity to seek administrative review of the determination within the next thirty days. If the taxpayer fails to request administrative review, or if the review sustains the liability, a notice of deficiency is issued.52  This notice permits the taxpayer to petition the United States Tax Court for a re-determination of the assessed deficiency without first paying the taxes allegedly due. If no petition is filed by taxpayer within the ninety days from the issuance of the notice of deficiency, the Tax Court loses jurisdiction over the case.53  At that time, the IRS issues a demand for payment of the tax.54  Now the taxpayer must legally pay the tax.55  If the taxpayer fails to do so, the IRS may collect the tax through judicial proceedings or through its power of levy and distraint.

The power of levy and distraint gives the IRS the ability to seize the assets of a taxpayer and sell them, applying the proceeds to the outstanding tax liability.56 The Supreme Court has held that the exercise of these powers is constitutional and that such extra judicial seizures and sales do not violate the protections of the Fourth Amendment against unreasonable search and seizures because the taxpayer will already have ample opportunity for judicial review of


the deficiency.57  The Court has referred to the power of the IRS to levy on a taxpayer's property as an 'essential part of our self assessment tax system...[which] enhances voluntary compliance in the collection of taxes.58

The Supreme Court has noted some constitutional limitations on the exercise of the Government's power of levy and distraint. In G.M. Leasing the Court held that the IRS could not make a forced entry onto the taxpayer's premises in order to seize property without a court order. However, the agents could take the taxpayer's property which was not in an enclosed area.59

In some limited circumstances, the IRS will levy upon the property of a taxpayer without first providing the opportunities for administrative or judicial review discussed above. The IRS is authorized by statute to dispense with these procedures and immediately seize the property if it believes that the taxpayer intends to remove or hide himself or his property in order to defeat the collection of the tax.60  This emergency procedure is known as “jeopardy assessment” and has been sustained against a Fourth Amendment challenge by the Supreme Court.61

45 See, Donelin v. Comm, T.C. Memo. 1984-131, and Schiff v. Commr., T.C. Memo. 1884-223.

46 See, Newman v. Schiff, 778 F.2d 460 (8th.Cir.1985).

47 IRC § 6001.

48 IRC § 7602

49 IRC § 7604.

50 See, United States v. Bisceglia, 420 U.S. 141 (1975).

51 United States v. Sullivan, 274 U.S. 259 (1926).

52 IRC § 6212.

53 IRC § 6213.

54 IRC § 6155.

55 However, the taxpayer's options for judicial review are not foreclosed. IRC § 7422 provides that after the taxpayer has paid the tax in full a suit for a refund may be brought in either the appropriate United States District Court or in the United States Claims Court.

56 See, IRC § 6331 through 6345.
57 Phelps v. United States, 431 U.S. 330 (1974).

58 G.M. Leasing Corp. v. United States, 429 US. 339 (1977).

59 Id.

60 See, IRC § 6851 through 6864.

61 Laing v. United States, 423 US.161(1976).

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