LEVY AND DISTRAINT.

SEC. 6236. LEVY AND DISTRAINT. (a) Notice.—Section 6331(d) of the 1986 Code (relating to levy and distraint) is amended— (1) by striking out “10 days” in paragraph (2) and inserting in lieu thereof “30 days”, (2) by striking out “10-day requirement” in the heading of paragraph (2) and inserting in lieu thereof “30-day requirement”, and (3) by adding at the end thereof the following new paragraph: “(4) Information included with notice.— The notice required under paragraph (1) shall include a brief statement which sets forth in simple and nontechnical terms— “(A) the provisions of this title relating to levy and sale of property, “(B) the procedures applicable to the levy and sale of property under this title, “(C) the administrative appeals available to the taxpayer with respect to such levy and sale and the procedures relating to such appeals, “(D) the alternatives available to taxpayers which could prevent levy on the property (including installment agreements under section 6159), “(E) the provisions of this title relating to redemption of property and release of liens on property, and “(F) the procedures applicable to the redemption of property and the release of a lien on property under this title.” (b) Effect of Levy on Salary and Wages.— (1) In general.—Subsection (e) of section 6331 of the 1986 Code (relating to levy and distraint) is amended to read as follows: 102 STAT. 3738 “(e) Continuing Levy on Salary and Wages.—The effect of a levy on salary or wages payable to or received by a taxpayer shall be continuous from the date such levy is first made until such levy is released under section 6343.” (2) Cross reference.—Section 6331(f) of the 1986 Code (relating to cross references) is amended by adding at the end thereof the following new paragraph: “(3) For release and notice of release of levy, see section 6343.” (c) Increase in Amounts of Certain Property Exempt From Levy.— (1) Fuel, provisions, furniture, personal effects.—Paragraph (2) of section 6334(a) of the 1986 Code (relating to property exempt from levy) is amended by striking out “$1,500” and inserting in lieu thereof “$1,650 ($1,550 in the case of levies issued during 1989)”. (2) Books and tools.—Paragraph (3) of section 6334(a) of the 1986 Code is amended by striking out “$1,000” and inserting in lieu thereof “$1,100 ($1,050 in the case of levies issued during 1989)”. (3) Wages, salary, and other income.— (A) Increase in amount exempt.—Paragraph (1) of section 6334(d) of the 1986 Code (relating to exempt amount of wages, salary, or other income) is amended to read as follows: “(1) Individuals on weekly basis.— In the case of an individual who is paid or receives all of his wages, salary, and other income on a weekly basis, the amount of the wages, salary, and other income payable to or received by him during any week which is exempt from levy under subsection (a)(9) shall be the exempt amount.” (B) Exempt amount defined.—Subsection (d) of section 6334 of the 1986 Code (relating to property exempt from levy) is amended by redesignating paragraph (2) as paragraph (3) and by inserting after paragraph (1) the following new paragraph: “(2) Exempt amount.— For purposes of paragraph (1), the term ‘exempt amount’ means an amount equal to— “(A) the sum of— “(i) the standard deduction, and “(ii) the aggregate amount of the deductions for personal exemptions allowed the taxpayer under section 151 in the taxable year in which such levy occurs, divided by “(B) 52. Unless the taxpayer submits to the Secretary a written and properly verified statement specifying the facts necessary to determine the proper amount under subparagraph (A), subparagraph (A) shall be applied as if the taxpayer were a married individual filing a separate return with only 1 personal exemption.” (4) Additional property exempt from levy.— (A) In general.—Subsection (a) of section 6334 of the 1986 Code (relating to property exempt from levy) is amended by adding at the end thereof the following new paragraphs: 102 STAT. 3739 “(11) Certain public assistance payments.— Any amount payable to an individual as a recipient of public assistance under— “(A) title IV (relating to aid to families with dependent children) or title XVI (relating to supplemental security income for the aged, blind, and disabled) of the Social Security Act, or “(B) State or local government public assistance or public welfare programs for which eligibility is determined by a needs or income test. “(12) Assistance under job training partnership act.—Any amount payable to a participant under the Job Training Partnership Act (29 U.S.C. 1501 et seq.) from funds appropriated pursuant to such Act. “(13) Principal residence exempt in absence of certain approval or jeopardy.— Except to the extent provided in subsection (e), the principal residence of the taxpayer (within the meaning of section 1034).” (B) Levy permitted on principal residence in case of jeopardy or approval by certain officials.—Section 6334 of the 1986 Code is amended by adding at the end thereof the following new subsection: “(e) Levy Allowed on Principal Residence in Case of Jeopardy or Certain Approval.—Property described in subsection (a)(13) shall not be exempt from levy if— “(1) a district director or assistant district director of the Internal Revenue Service personally approves (in writing) the levy of such property, or “(2) the Secretary finds that the collection of tax is in jeopardy.” (d) Uneconomical Levy; Levy on Appearance Date of Summons.—Section 6331 of the 1986 Code (relating to levy and distraint) is amended by redesignating subsection (f) as subsection (h) and by inserting after subsection (e) the following new subsections: “(f) Uneconomical Levy.—No levy may be made on any property if the amount of the expenses which the Secretary estimates (at the time of levy) would be incurred by the Secretary with respect to the levy and sale of such property exceeds the fair market value of such property at the time of levy. “(g) Levy on Appearance Date of Summons.— “(1) In general.—No levy may be made on the property of any person on any day on which such person (or officer or employee of such person) is required to appear in response to a summons issued by the Secretary for the purpose of collecting any underpayment of tax. “(2) No application in case of jeopardy.—This subsection shall not apply if the Secretary finds that the collection of tax is in jeopardy.” (e) Surrender of Bank Accounts Subject to Levy Only After 21 Days.— (1) In general.—Section 6332 of the 1986 Code (relating to surrender of property subject to levy), as amended by title I of this Act is amended by redesignating subsections (c), (d), and (e) as subsections (d), (e), and (f), respectively, and by inserting after subsection (b) the following new subsection: “(c) Special Rule for Banks.—Any bank (as defined in section 408(n)) shall surrender (subject to an attachment or execution under 102 STAT. 3740judicial process) any deposits (including interest thereon) in such bank only after 21 days after service of levy.” (2) Conforming amendments.— (A) Subsection (a) of section 6332 of the 1986 Code is amended by striking out “subsection (b)” and inserting in lieu thereof “subsections (b) and (c)”, (B) Subsection (e) of section 6332 of the 1986 Code, as redesignated by paragraph (1), is amended by striking out “subsection (c)(1)” and inserting in lieu thereof “subsection (d)(1)”. (f) Release of Levy.—Subsection (a) of section 6343 of the 1986 Code (relating to release of levy) is amended to read as follows: “(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.—In the case of any tangible personal property essential in carrying on the trade or business of the taxpayer, the Secretary shall provide for an expedited determination under paragraph (1) if levy on such tangible personal property would prevent the taxpayer from carrying on such trade or business. “(3) Subsequent levy.—The release of levy on any property under paragraph (1) shall not prevent any subsequent levy on such property.” (g) Right of Taxpayer To Request That Seized Property be Sold Within 60 Days.—Section 6335 of the 1986 Code (relating to sale of seized property) is amended by redesignating subsection (f) as subsection (g) and by inserting after subsection (e) the following new subsection: “(f) Right To Request Sale of Seized Property Within 60 Days.—The owner of any property seized by levy may request that the Secretary sell such property within 60 days after such request (or within such longer period as may be specified by the owner). The Secretary shall comply with such request unless the Secretary determines (and notifies the owner within such period) that such compliance would not be in the best interests of the United States.” (h) Effective Date.— 102 STAT. 3741 (1) In general.—The amendments made by this section (other than subsection (g)) shall apply to levies issued on or after July 1, 1989. (2) Subsection (g).—The amendment made by subsection (g) shall apply to requests made on or after January 1, 1989.