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The IRS Collection
Process To facilitate a better understanding of how the IRS works in dealing with war tax resisters, the following is a detailed look at current procedures of the IRS’s collection division* in its Jun. 1995 to Jan. 2001 efforts against Ed Hedemann. *based largely on papers obtained through the Freedom of Information Act Overview of IRS Collection Process Stage 1: Sending
form letters Stage 2: Agent
assigned to case Stage 3: The
courts and seizures
Detailed Chronology The following chronology is derived from two separate IRS histories carried out by two assigned IRS agents—the first from June 27, 1995 to April 23, 1996, and the second from October 4, 1997 to July 2, 2001. Most of the misspellings were corrected without notation, though some words and some abbreviations were indecipherable. Names of organizations omitted except for the NWU on which the IRS put unusual pressure. Items in red represent my comments or actions.
[Apr. 16, 1995: Filed my 1994 Form 1040, with letter of explanation, refusing to pay the entire Federal tax portion] [Apr. 17, 1995: Appeared on “CBS This Morning” to talk about war tax resistance. Later, attended a noon demonstration at the IRS in Manhattan.] The following (6/27/95 to 4/23/96) is from the handwritten “Investigation History” log (form 2747) compiled by RO Gillen: Jun. 27, 1995: RO L. Gillen begins new investigation with requests to DMV, NYS, PO for information Jul. 18, 1995: Liens filed and levies sent to county registrar’s office, employers, banks Aug. 7, 1995: Field visit to house; no one home; left calling card Aug. 8, 1995: “TP called from a pay phone [IRS offices are probably equipped with “caller ID”] and explained that he does not pay taxes to the government because the U.S. Gov’t ‘kills women, children, men and every other living organism [not my words]’ ‘The U.S. pays much money for military weapons.’ ‘I mail my tax balance due to various peaceful organizations, I send a list [letter, not list] in with my tax return as to which organization I have contributed.’ ‘I will be glad to mail you a copy of the list [letter, not list].’ I said okay and TP hung up.” Aug. 18, 1995: “Sent levy 668-W to [nine organizations listed]” Sept. 29, 1995: check owner of property; received negative responses from levies to organizations Oct. 31, 1995: looked at 1040 forms filed by TP Nov. 7, 1995: called 411 for phone numbers of several organizations Nov. 30, 1995: called organizations; results all negative Dec. 29, 1995: called National Writers Union; boss not there, will call back Jan. 4, 1996: called NWU again, was turned over to new office manager who referred RO to NWU counsel in DC; called counsel in DC and left message; “consult SPF advisory for procedure, possibly failure to honor levy” Jan. 22, 1996: received called from NWU counsel in DC: TP is consultant not an employee therefore not required to honor levy; RO told counsel that NWU must honor levy [Jan. 23, 1996: I quit the National Writers Union rather than allow them to turn over payments to the IRS.] Jan. 29, 1996: received call from NWU counsel: needs copy of levy with pub. 1494; said TP is paid when he submits work (about once a month) Feb. 27, 1996: “SPF advisors received an inquiry from NWU disputing the writing/wording of 668W.” Apr. 1, 1996: “Told by manager that TP was fired from NWU therefore wage levy is ‘moot.’” [Apr. 7, 1996: Filed my 1995 Form 1040 with letter of explanation refusing to pay the entire Federal tax portion] [Apr. 15, 1996: Join WRL demonstration at GPO protesting war taxes] Apr. 23, 1996: “TP is a tax protester. UCC/DMV/NYS/Real Prop. are all negative. Postal says mail is delivered. TP said in telephone call that he will not pay income taxes, only the SSA portion. There were 9 levies sent, all had negative results. All liens have been filed. All levies have been exhausted. At this time the balance due is not collectable. I am closing case.” May 2, 1996: IRS puts tax years 1983 through 1994 [the only years they were currently dealing with] into status 53 and destroys the files [most of these years had not yet reached the statute of limitations]
[No information of IRS investigations or case activity between 5/2/96 and 10/4/97]
[Apr. 9, 1997: Filed my 1996 Form 1040 with letter of explanation refusing to pay the entire Federal tax portion] The following comes from 21 pages of the IRS’s “Investigation History” from 10/4/97 to 1/6/00: Oct. 4, 1997: “Case . . . includes two bal due modules . . . [tax years 1995 and 1996]” Oct. 16, 1997: “TP is a repeater/TP is potentially dangerous TP. [Unless they mean politically dangerous, it appears that some in the IRS are unable to distinguish the militia-type tax protesters from war tax resisters.] Info transcript indicates that TP is a war tax resistor. States that Fed tax leads to killing and refuses to talk about bal due . . . Cause: TP has incurred subsequent penalties and interest and appears to be a tax protestor. Cure: FV to TP at case summary address — demand full pay and take enforcement action if TP does not work towards resolution of case including lien, levy and seizure. Compliance: Educate TP re. filing requirements and responsibility to pay. If TP is not compliant RO will bring TP into current compliance.” Oct. 28, 1997: “Reassigned to . . . employee name W. Valicenti” Nov. 11, 1997: “Field visit . . . rang main bell as well as basement apartment bell with no response. RO left calling card instructing taxpayer to call back no later than 11-21-97 firmly attached to mail box. RO asked neighbors sitting on stoop if TP resided at case summary address. They had no knowledge of TP or whereabouts. Plan of Action: RO will proceed with simultaneous follow up actions. Should TP not respond to calling card left on field visit, RO will file FTL and levy income sources upon expiration of 1058 issuance.” Nov. 26, 1997: “TP called per calling card left on field visit . . . stated that he is a war tax resistor and has been so for 20 [sic, 27] years. States that he refuses to pay income tax as it goes towards the Pentagon’s budget which leads to killing of innocent [his words, as I didn’t single out innocent people] people. He stated that he sends income tax due to other organizations instead. He is self-employed and does send his social security tax to the IRS. RO verified that TP has a 3000.00 credit balance for tax year 1997 posted as estimated payments. TP refused to give phone number or any other levy sources. RO instructed TP to send letter to RO’s attention outlining his position and his past dealing with the Internal Revenue Service. TP stated that he has suffered at the hands of the IRS due to questionable tactics and is not comfortable providing collection personnel with information. TP agreed to send letter as to why he does not pay the Internal Revenue Service. Plan of Action: RO will proceed with enforcement action upon review of procedures for tax protestor cases.” [apparently, the IRS does have different procedures for tax resisters] Dec. 9, 1997: “TP has not sent RO a letter regarding his position. RO will summons TP for financial statements and begin enforcement action no earlier than 1/3/98 upon expiration of 1058 letter.” Dec. 11, 1997: “RO received unclaimed 1058 letter returned to RO. Post office stamped envelope as unclaimed with delivery attempted three times [why help the IRS by accepting certified mail?]. Plan of Action: RO will issue levies to TP’s income sources and summons TP for 433-A and 433-B financial statements.” Jan. 5, 1998: “RO consulted SPF advisor James Lucignano regarding summons for collection statements. Advisor sted that RO should make at least 3 attempts to serve summons. RO made copy of letter from TP outlining his tax protest position and turned copy of letter over to SPF advisor Ed Johnson who forwarded copy on to CID Division. RO received close case files for review regarding taxpayer which contained Freedom of Information requests as well as correspondence from District Counsel to TP’s employer regarding nonpayment of a levy. [a reference to the NWU situation during the previous investigation of two years before] Prior ROs have 53’d case since 1977 as unable to contact [collect?]. TP works time to time lecturing, bookkeeping and writing [they’re guessing here because they really don’t know what I do] for various organizations. Plan of Action: RO will attempt to summons for current financial information. RO will follow up on levies issued to various employers.” Jan. 13, 1998: “RO made field visit to TP at case summary address. RO rang bell and was met by TP at door. Summons for collection information statements 433-A and 433-B. TP is summonsed to appear before RO on 28th day of January 1998 at 10:00 am. TP initially refused to accept summons and questioned why this was necessary. RO explained reason for summons as TP refused to come in to office voluntarily and that financial statements were necessary for determining TP’s ability to pay. TP stated all of his income is declared on the 1040. RO woea [sic?] if TP refuses to show for summons date. TP stated he was already in receipt of notices of federal tax liens. Plan of Action: Meet with TP on 01-28-98 and secure financial statements from TP and attempt to arrange part or full pay of outstanding balances.” Jan. 22, 1998: “Levy closed — other [from another Hedemann client]. Moved not forwardable” [Jan. 28, 1998: I go to IRS and meet with Valicenti who asks me questions about my assets, liabilities, income, and expenses. Instead, I give him the WRL tax piechart and tell him why I send my Federal taxes to nongovernmental organizations rather than to the IRS. He ends the interview after about 5 or 10 minutes.] Jan. 28, 1998: “TP came in and handed RO tax protestor literature. RO asked TP if he had any records or documents pertaining to summons issued for financial statement and TP said he will give no information that would facilitate collection of taxes that he disagreed with. TP’s position is that he has redirected the income portion of his taxes to charitable organizations. TP refused to give any information regarding financial statements and assumed RO had TP’s telephone number. RO concluded interview and stated that he would refer summons to legal advisors to effectuate enforcement of summons. Plan of Action: Speak with legal advisors regarding summons enforcement and research real property records for owner of house.” Jan. 30, 1998: “Levy source added: [Hedemann client]. Notice of levy 668a requested for: [Hedemann client]” Jan. 30, 1998: “RO prepared form 4443 summons referral and forwarded report along with summons and protestor literature to J. Lucignano SPF advisor for referral to District Council. RO researched an old coles directory and discovered possible tenants. Possible phone number for TP also listed as [xxx-xxx-xxxx]. RO will research court house records to determine owner of real property. Microfiche lists [name of building owner] with same phone number as TP however IDRS SSNAD and names has no record of that individual’s name. SPF advisor stated that if TP provides financial upkeep of property a nominee lien may in order and possible real property seizure. Summons will be issued to bank for mortgage and loan application and to utility companies for billing information.” Feb. 2, 1998: “RO received New York state wage indicating no info for TP. RO received levy response from the National Writers Union indicating levy source has moved and could not be forwarded. RO closed levy source off of ICS. Levy closed — other National Writers Union, could not forward return to sender. Levy closed — no funds [from another Hedemann client].” Feb. 17, 1998: “RO received memorandum and copy of letter issued to TP regarding summons referral to District Council. Summons was found to be legally enforceable and District Council issued a new deadline for TP to appear on 03-05-98 and provide records and documentation as directed in the original summons. Plan of Action: RO will meet with TP on 03-05-98 and prepare financial statements. Should TP fail to show up RO will refer to SPF for advice on further summons enforcement. RO will also research court records for determination as to ownership of property at [Hedemann address] and determine if rental income can be levied upon.” [Mar. 5, 1998: I go to IRS and meet with Valicenti once again, and once again give him the WRL tax piechart and tell him why I send my Federal taxes to nongovernmental organizations rather than to the IRS. He tries to ask questions, but when I balk, he immediately ends the interview.] Mar. 5, 1998: “TP came into office per letter received from District Counsel but refused give information or provide books and records that would facilitate collection of taxes or assist in the preparation of financial statements. RO concluded the interview and immediately consulted with SPF advisor Jim Lucignano. SPF advisor counseled RO on preparation of an affidavit. RO prepared a rough draft of an affidavit and sent to SPF for corrections. Plan of Action: Upon receipt of corrected affidavit, RO will sign in the presence of a notary and send to Justice Department for an Order To Show Cause.” Mar. 12, 1998: “RO prepared an affidavit to the effect that TP is not in compliance summons and had affidavit notarized by SPF advisor Karoff. RO submitted affidavit with copy of summons to SPF advisor Lucignano for processing with District Counsel. Plan of Action: RO will await Order To Show Cause and personally serve on TP to appear before a magistrate at the U.S. Attorney’s office.” Mar. 12, 1998: “Levy closed — no funds [from another Hedemann client]” [Apr. 7, 1998: Filed my 1997 Form 1040 with letter of explanation refusing to pay the entire Federal tax portion] Apr. 17, 1998: “RO received a copy of proposed Order To Show Cause and petition for enforcement of summons sent by District Council to U.S. Attorney’s office. RO spoke with SPF advisor Jim Lucignano regarding enforcement procedures and he stated that upon receipt of signed petition and order RO would have to personally serve papers on TP and then TP would have to appear before a magistrate. Advisor could not give RO a definite target date as to when Order and petition would be completed and forwarded to RO. Plan of Action: Upon receipt of Order and petition RO will serve on taxpayer.” Jun. 16, 1998: “RO reviewed case and no new action can be taken on part of RO. RO contacted SPF advisor Jim Lucignano on status of Order To Show Cause and has SPF advisor stated that he has received no word other than that the U.S. Attorney’s office is processing the order and as soon as he receives documents in the mail he will notify RO. Plan of Action: Await Order To Show Cause from SPF advisor” Sep. 28, 1998: “RO made field visit to county court house and researched UCC records. Possible old address for taxpayer is [address of Hedemann apartment from 10 years before]. RO will research real property records.” Nov. 30, 1998: “RO received phone call from Sandra Levy assistant attorney with the Justice Department regarding enforcement procedure on summons issued to TP in January. RO returned call and left message for attorney to call back RO and proceed with enforcement procedures. RO has reviewed case and a new period has been established for 30-9712. RO has prepared and issued a 1058 letter with pub 1 and 594 certified to TP at case summary address and regular mail. Copy enclosed in case file. RO also received DMV check which indicates no hit. RO also received levy response from [from another Hedemann client] which was negative and which RO closed off of system. RO received from service center correspondence sent with 1997 tax return from taxpayer indicating that he has [sent] 2576.00 to a nonprofit organization called Voices in the Wilderness in lieu of paying the federal tax portion of his income taxes.” Nov. 30, 1998: “RO made field visit to U.S. Attorney’s office and provided Assistant U.S. Attorney with copies of blank 433-A and 433-B and instructions which attorney assembled and drafted into a declaration to court. RO signed declaration. Attorney advised RO that declaration would be filed on 12-01-98 and RO would be contacted to pick up an Order To Show Cause which RO would then personally serve on TP. Plan of Action: Await phone call from attorney and pick up Order To Show Cause from U.S. Attorney’s office and then serve on TP.” Dec. 8, 1998: “RO made field visit to U.S. Attorney’s office with RO Bynes and met with Assistant U.S. Attorney Sandra Levine [sic]. She gave RO an Order To Show Cause and directed RO to personally serve Order on TP by 12-11-98. In the event that: Order To Show Cause cannot be personally served she would draft document requesting alternative service. Ms. Levine [sic] requested that RO have minimal contact with TP and to direct any questions regarding order to her. Attorney also advised RO to make multiple attempts to serve Order should the first be unsuccessful and to bring another RO along during attempts at service. Plan of Action: Personally serve Order To Show Cause on taxpayer.” Dec. 9, 1998: “RO made field visit with RO Bynes and 1:38 pm to TP at case summary address in an attempt to personally serve Order To Show Cause on TP. RO rang bell and there was no response from within apartment. Plan of Action: RO will make another attempt to serve order on 12-10-98.” [Dec. 11, 1998: My doorbell rings, I go out to the gate at first thinking it’s two Jehovah’s Witnesses but I realize my mistake when IRS agent Valicenti identifies himself and starts to shove a large brown envelope through the outer gate that I haven’t opened. Realizing that he’s trying to serve papers on me, I instinctively turn around without saying a word, go inside, and close the inner door. He continues to ring, but I don’t answer. He throws the envelope through the gate and leaves.] Dec. 11, 1998: “RO made field visit to TP’s case summary address with RO Bynes and rang bell at 9:45 am. TP answered bell and identified himself as Mr. Hedemann. RO attempted to give Order To Show Cause to TP and he ran [hardly!] back inside apartment and closed door in RO’s face [a rather dramatic exaggeration: agents not anywhere near inside door because they were at the outside gate which I never opened!]. RO reached through gate vestibule and dropped off papers in front of taxpayer’s apartment door. RO contacted U.S. Attorney’s office and described method service. U.S. Attorney stated that she thinks it was all right but would get back to RO before having RO sign affidavit of service.” [Apparently, because I didn’t accept the papers, they were concerned that it might not be a proper service.] [Dec. 17, 1998: To buy more time to prepare for the hearing, I request a postponement from U.S. District Court Judge Amon who grants the request on Dec. 21, making the new hearing date Feb. 1, 1999.] Dec. 24, 1998: “RO received telephone call from Asst U.S. Attorney that indicating that TP had responded to Order To Show Cause and had acknowledged receipt of order therefore service is valid. TP has requested an extension until January 21, 1999 for TP to respond to order and a new court appearance date of Feb. 1, 1999 at 4:30 for appearance date. U.S. Attorney instructed RO to prepare affidavit of service. Plan of Action: Meet with U.S. Attorney on 02-01-99 to discuss case prior to TP’s hearing date.” [Jan. 21, 1999: With the aid of legal assistance, I draft a pro se response to the government’s Order To Show Cause and submit it to Judge Amon and U.S. Attorney Levy.] Jan. 21, 1999: RO contacted U.S. Attorney Sandra Levy regarding status of Order To Show Cause response from TP. Attorney stated she would call RO if he had any questions upon receipt of information from TP and that if TP included information that looked like it was presenting an argument against Order To Show Cause she would contact RO immediately. Attorney requested that RO be available through next week and to keep schedule clear for 02-01-99 court date in case it was necessary for RO to testify.” [Jan. 26, 1999: U.S. Attorney Sandra Levy requests my agreement to another postponement to the hearing in order to answer my response to the Order To Show Cause. I agree, and Judge Amon moves the hearing to March 5.] Feb. 1, 1999: U.S. Attorney Sandera Levine [sic] contacted RO to inform RO that TP has presented an argument against Order To Show Cause. Attorney has received an extension from judge until 03-05-99 in order to present her case. She stated that since taxpayer was claiming a violation of his constitutional rights a request was placed in to District Counsel for an opinion. She requested that RO be available for 03-15-99 for possible testimony.” Feb. 10, 1999: “RO received VMS phone message from a Mr. Ridgewood [sic] who indicated on message that he was a reporter from the Village Voice and was doing a story on Mr. Hedemann as a war tax resistor and that RO had been named as IRS representative handling the case. RO did not call back reporter and notified manager. Group manger directed to immediately notify SPF advisor Jim Lucignano who handled summons referral and advised RO not to call back reporter. RO went to SPF advisor Lucignano who walked RO over to Bob Kobel public affairs officer. He requested lien information and TP’s TIN and address which RO supplied. He requested phone number of reporter from RO which RO supplied and stated not to contact reporter and that he would contact reporter. Plan of Action: Meet with U.S. Attorney on March 5, 1999 prior to hearing by TP.” Feb. 12, 1999: “RO received phone call from a Karen Charman a reporter with The Progressive Voice [sic]. She requested information from RO regarding TP’s case and wanted to know what law TP had broken and was being prosecuted for. RO stated that he could not speak with her regarding taxpayer’s case and took down her phone number and indicated that her name and number would be given to Mr. Kobel the public affairs officer for any Internal Revenue Service commentary. RO discontinued conversation. RO gave name and phone number of reporter to public affairs officer Mr. Kobel and also notified Jim Lucignano SPF advisor who is advising RO on case handling.” [Mar. 1, 1999: I receive a Reply Memorandum that U.S. Attorney Levy submitted to Judge Amon.] [Mar. 3, 1999: I submit an answer to the Government’s Mar. 1 Reply Memorandum and submit that to U.S. Attorney Levy and Judge Amon.] [Mar. 5, 1999: Join WRL-organized demonstration and walk from Brooklyn military recruiting offices, past IRS, through downtown Brooklyn, to Federal courthouse. Hearing before Judge Carol Amon begins at 1 pm with her persistent questioning of U.S. Attorney Sandra Levy about why I shouldn’t be allowed to claim the Fifth Amendment to IRS questions. I ask the judge about my military-spending reasons for not cooperating with the IRS. She dismisses those arguments. I ask about being paid witness fees for appearing before the IRS. She asks Levy to get back to her with citations on that, then asks me to appear before the IRS on March 8 to cite the Fifth to each question rather than making a blanket response. Hearing ends after 20 or 25 minutes.] [Mar. 8, 1999: With four others I go to the IRS and appear before RO Valicenti and two other IRS officials. Valicenti asks me a series of questions based on forms 433-A and 433-B which I refuse to answer. The process takes about a half hour.] Mar. 10, 1999: “RO made field visit to U.S. Attorneys office on 03-05-98 in order to meet with U.S. Attorney Sandra Levy prior to her appearance in court with TP regarding Order To Show Cause. U.S. Attorney asked if U.S. marshals had contacted RO regarding planned protests by TP and supporters. RO said they marshals had not contacted him. She stated that judge refused to allow cameras into court room and supporters would not be allowed into the court room [obviously not true]. RO met with Ms. Levy and asked RO about CIS statements and showed RO memorandum of law which TP answered. U.S. Attorney indicated to RO that TP may invoke 5th amendment rights regarding CIS statements. He may refuse to give testimony on the grounds that RO will use statements to pursue collection and that testimony would be self incriminating. RO waited in attorney’s office during hearing. Attorney returned one half hour later and indicated to RO that TP had appeared in court and that judge had ordered TP to appear before RO on 03-08-99 at 9:30 am. Attorney indicated that judge had asked about witness fees for TP. RO consulted with SPF advisor Jim Lucignano about witness fees who in turn went to District Council. District Council indicates that although witness is entitled to fees for appearing before IRS and federal judge, they would be offset against TP’s liability. Attorney indicated that TP’s CIS interview on 03-08-99 would need to be tape recorded or be notated by a court reporter so that an official record exists of TP invoking constitutional rights. RO contacted group Manager Cooks who arranged for a tape recorder to present. Mar. 10, 1999: “TP appeared in office on 03-08-99 at 9:30 am for CIS interview along with 5 [sic, 4] witnesses. RO arranged for conference room on 5th floor to be available. RO was present along with Branch Chief Frank Chimera and Group Manager D. Cooks. RO conducted 433-A and 433-B interview. Every question which RO asked TP refused to answer on the grounds that the information could be used to self-incriminate him. RO tape recorded entire interview and upon conclusion escorted witnesses and TP to 1st floor. RO contacted U.S. Attorney who indicated could drop off tape at any time to her office and she will have conversation transcribed by a court reporter. She along with District Council will review transcript and determine if TP has appropriately exercised 5th amendment privilege regarding CIS statements and they would determine if immunity would be granted to TP or if further enforcement action would be pursued. Plan of Action: Drop off tape to U.S. Attorney’s office for transcription.” Mar. 16, 1999: “RO dropped off tape recording of 03-08-99 interview to U.S. Attorney’s office for transcription on 03-11-99. U.S. Attorney stated that tape would be transcribed and that she would sit down with IRS District Council and determine validity of TP’s assertion of 5th Amendment claim. She stated that she would be in contact with RO in the near future. Plan of Action: Await contact from U.S. Attorney regarding TP’s assertion of 5th amendment claim.” [Apr. 14, 1999: Filed my 1998 Form 1040 with letter of explanation refusing to pay the entire Federal tax portion] Jul. 13, 1999: “Case reassigned from RO Valicenti. Stated case is in the hands of District Council and U.S. Attorney.” Sep. 20, 1999: “Await U.S. Attorney claim.” Jan. 6, 2000: “Per prior recommendation. Hold case pending U.S. Attorney.” July. 2, 2001: Case was closed because of “judgment for plaintiff [U.S.]” [This is an instance of win-the-battle-lose-the-war. Technically, the government won the judgment that I couldn’t assert the right against self-incrimination “blanketly” that’s why I returned to the IRS office on 3/8/99 to assert the right line-by-line. As a result, the government couldn’t proceed against me because the judge said I had a right not to answer . . . unless they were willing to grant me immunity to prosecution, which they declined to do.] return to IRS v. Hedemann |