No Laws Prevent Irs Levy On Spouse - McIntyre v. U.S., levy on spuse's pension assets - Brief Article

California CPA, Nov, 2000

Never underestimate the power of an IRS levy... A recent Ninth Circuit decision holds that neither the federal law's anti-alienation provisions nor California's community property laws prevent the IRS from levying on a wife's community interest in her husband's pension benefits. (McIntyre v. U.S., (CA9, 7/13/2000) 86 AFTR2d Para.

2000-5087.) In this case not only could the IRS reach the pension plan, but they were able to reach the spouse's community property interest in the pension plan. While regular creditors will normally be unable to reach pension plan assets, the IRS is not a regular creditor. You should note, however, that due to a recent law change, there will be no 10 percent too-early (before age 59 1/2) penalty under Code Sec. 72 (t) when the distribution is due to an IRS levy under Code Sec. 6331.