§ 6343.
(a)
Release of levy and notice of release
(1)
In general
Under regulations prescribed by the Secretary, the Secretary shall release the levy upon all, or part of, the property or rights to property levied upon and shall promptly notify the person upon whom such levy was made (if any) that such levy has been released if—
(A)
the liability for which such levy was made is satisfied or becomes unenforceable by reason of lapse of time,
(B)
release of such levy will facilitate the collection of such liability,
(C)
the taxpayer has entered into an agreement under section 6159 to satisfy such liability by means of installment payments, unless such agreement provides otherwise,
(D)
the Secretary has determined that such levy is creating an economic hardship due to the financial condition of the taxpayer, or
(E)
the fair market value of the property exceeds such liability and release of the levy on a part of such property could be made without hindering the collection of such liability.
For purposes of subparagraph (C), the Secretary is not required to release such levy if such release would jeopardize the secured creditor status of the Secretary.
(2)
Expedited determination on certain business property
(b)
Return of property
If the Secretary determines that property has been wrongfully levied upon, it shall be lawful for the Secretary to return—
(1)
the specific property levied upon,
(2)
an amount of money equal to the amount of money levied upon, or
(3)
an amount of money equal to the amount of money received by the United States from a sale of such property.
Property may be returned at any time. An amount equal to the amount of money levied upon or received from such sale may be returned at any time before the expiration of 2 years from the date of such levy. For purposes of paragraph (3), if property is declared purchased by the United States at a sale pursuant to section 6335(e) (relating to manner and conditions of sale), the United States shall be treated as having received an amount of money equal to the minimum price determined pursuant to such section or (if larger) the amount received by the United States from the resale of such property.
(c)
Interest
Interest shall be allowed and paid at the overpayment rate established under section 6621—
(1)
in a case described in subsection (b)(2), from the date the Secretary receives the money to a date (to be determined by the Secretary) preceding the date of return by not more than 30 days, or
(2)
in a case described in subsection (b)(3), from the date of the sale of the property to a date (to be determined by the Secretary) preceding the date of return by not more than 30 days.
(d)
Return of property in certain cases
If—
(1)
any property has been levied upon, and
(2)
the Secretary determines that—
(A)
the levy on such property was premature or otherwise not in accordance with administrative procedures of the Secretary,
(B)
the taxpayer has entered into an agreement under section 6159 to satisfy the tax liability for which the levy was imposed by means of installment payments, unless such agreement provides otherwise,
(C)
the return of such property will facilitate the collection of the tax liability, or
(D)
with the consent of the taxpayer or the National Taxpayer Advocate, the return of such property would be in the best interests of the taxpayer (as determined by the National Taxpayer Advocate) and the United States,
the provisions of subsection (b) shall apply in the same manner as if such property had been wrongly levied upon, except that no interest shall be allowed under subsection (c).
(f)
Individuals held harmless on wrongful levy, etc.
1
So in original. Probably should be followed by a comma.
on retirement plan
(1)
In general
If the Secretary determines that an individual’s account or benefit under an eligible retirement plan (as defined in section 402(c)(8)(B)) has been levied upon in a case to which subsection (b) or (d)(2)(A) applies and property or an amount of money is returned to the individual—
(A)
the individual may contribute such property or an amount equal to the sum of—
(i)
the amount of money so returned by the Secretary, and
(ii)
interest paid under subsection (c) on such amount of money,
into such eligible retirement plan if such contribution is permitted by the plan, or into an individual retirement plan (other than an endowment contract) to which a rollover contribution of a distribution from such eligible retirement plan is permitted, but only if such contribution is made not later than the due date (not including extensions) for filing the return of tax for the taxable year in which such property or amount of money is returned, and
(B)
the Secretary shall, at the time such property or amount of money is returned, notify such individual that a contribution described in subparagraph (A) may be made.
(2)
Treatment as rollover
The distribution on account of the levy and any contribution under paragraph (1) with respect to the return of such distribution shall be treated for purposes of this title as if such distribution and contribution were described in section 402(c), 402A(c)(3), 403(a)(4), 403(b)(8), 408(d)(3), 408A(d)(3), or 457(e)(16), whichever is applicable; except that—
(A)
the contribution shall be treated as having been made for the taxable year in which the distribution on account of the levy occurred, and the interest paid under subsection (c) shall be treated as earnings within the plan after the contribution and shall not be included in gross income, and
(B)
such contribution shall not be taken into account under section 408(d)(3)(B).
(3)
Refund, etc., of income tax on levy
(5)
Treatment of inherited accounts
([Aug. 16, 1954, ch. 736], [68A Stat. 789]; [Pub. L. 89–719, title I, § 104(i)], Nov. 2, 1966, [80 Stat. 1138]; [Pub. L. 94–455, title XIX, § 1906(b)(13)(A)], Oct. 4, 1976, [90 Stat. 1834]; [Pub. L. 96–167, § 4(a)], Dec. 29, 1979, [93 Stat. 1275]; [Pub. L. 99–514, title XV, § 1511(c)(10)], Oct. 22, 1986, [100 Stat. 2745]; [Pub. L. 100–647, title VI, § 6236(f)], Nov. 10, 1988, [102 Stat. 3740]; [Pub. L. 104–168, title V, § 501(b)], July 30, 1996, [110 Stat. 1460]; [Pub. L. 105–206, title I, § 1102(d)(1)(B)], title III, § 3432(a), July 22, 1998, [112 Stat. 704], 759; [Pub. L. 115–97, title I, § 11071(a)], Dec. 22, 2017, [131 Stat. 2091]; [Pub. L. 115–123, div. D, title II, § 41104(a)], Feb. 9, 2018, [132 Stat. 155].)