Section 1320-02-01-.08 - COURT ACTION-BOND-INTEREST PAID BY STATE(1) Any person against whom a levy and distraint has been made shall have the right to stay the saleof seized property if a suit challenging the legality of the collection of the tax has been filed by the taxpayer and is pending in a court of competent jurisdiction at either trial or appellate level.(2) The right to stay a sale of property seized under a levy is conditioned upon the pendency of court action and the posting of a bond by the taxpayer in an amount equaling the amount of the tax liability (which includes the tax together with any penalty or interest payable). The bond is acceptable in lieu of payment of any further tax until the trial or review on appeal of the suit contesting the legality of a like tax previously assessed and collected.(3) The Tax Enforcement Procedures Act does not provide any additional method or procedure for procedure for review of a ruling of the Commissioner other than that already provided by law. It does afford a delinquent taxpayer the right to post a bond in lieu of satisfying a levy and distraint when a levy is made while proceedings are pending to have an adjudicated tax case reviewed in a higher court or during the pendency of an original suit contesting the subject tax in a lower court of competent jurisdiction. The objective of this provision is to avoid a closing of taxpayer's business during the period when the collection of a tax is in the process of being contested in any manner otherwise provided by law, by allowing the taxpayer to post a bond for additional taxes accruing under the same theory of tax liability. Where the taxpayer has not previously challenged the ruling of the Commissioner on the additional tax sought to be collected by filing a suit, contesting the collection of the subject tax prior to the date of levy there is no right extended under this chapter to day the sale of seized property by the posting of bond in lieu of payment of the tax.Tenn. Comp. R. & Regs. 1320-02-01-.08
Original rule filed June 7, 1974. Amendment filed June 22, 1989; effective September 27, 1989.Authority: T.C.A. §§ 67-1-1439 and 67-1-1411.