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Last Updated: 7/24/2017

Jeopardy Collection

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When we take enforced collection action immediately to expedite collection of a debt because we have reason to believe a debtor plans to leave Minnesota, or to liquidate or conceal assets that could be used to pay their debts.

We can demand immediate payment and proceed with enforced collection action if the debtor does not pay. (See Minnesota Statutes, section 270C.36, subd. 2, and section 297D.12.)

Within five days of the collection action, we must send a letter to the debtor explaining the information used to determine a jeopardy situation. The debtor has 30 days to request an
administrative review of the action. The debtor can also appeal the administrative review decision in Minnesota Tax Court. Debtors cannot appeal a decision made by Tax Court.

We can sell property
seized in a jeopardy collection after the appeal period expires. If the debt remains unpaid for more than 30 days after the judicial system issued a final determination, we can sell the seized property. Exceptions to this include when:

  • The debtor gives written consent to the sale
  • The property is perishable
  • The price or value of the seized property greatly diminishes with time
  • The property is not cost effective to store

We cannot sell seized property that is part of probate proceedings, until the probate is completed or unless the court orders it sold.

A debtor can reclaim seized property with a surety bond or secure payment. The bond or payment amount needs to be equal to the appraised value that we determine the debtor’s interest in the property to be.  This amount will be no more than twice the amount of the debt.

While Minnesota Tax Court has jurisdiction over the appeal, the District Court may grant an injunction to prohibit enforcement of a seizure or to prohibit the sale of seized property.