26 U.S.C. § 7432
Section 7432 · Civil damages for failure to release lien
Amended 1 time on record
Applied in 162 court decisions — leading case Ledford v. United States (2002)
Most recently applied in William Canada, Jr. v. USA (IRS) (February 2020)
Applied most in the Ninth Circuit Circuit (25 decisions)
Cases citing this section usually also cite 26 U.S.C. § 7433 · 28 U.S.C. § 1346 · 26 U.S.C. § 6325
How often courts cite this section
Court decisions citing this, by year.Markers show enactment, consequential amendments, and circuit splits over this section — watch for a citation surge after a change or a disagreement. The dip in the last several years is a data-coverage gap, not a real trend — our corpus holds fewer opinions from the most recent years, so recent citations are undercounted.
If any officer or employee of the Internal Revenue Service knowingly, or by reason of negligence, fails to release a lien under section 6325 on property of the taxpayer, such taxpayer may bring a civil action for damages against the United States in a district court of the United States.
In any action brought under subsection (a), upon a finding of liability on the part of the defendant, the defendant shall be liable to the plaintiff in an amount equal to the sum of—
(1) actual, direct economic damages sustained by the plaintiff which, but for the actions of the defendant, would not have been sustained, plus
(2) the costs of the action.
Claims pursuant to this section shall be payable out of funds appropriated under section 1304 of title 31, United States Code.
(1) Requirement that administrative remedies be exhausted
A judgment for damages shall not be awarded under subsection (b) unless the court determines that the plaintiff has exhausted the administrative remedies available to such plaintiff within the Internal Revenue Service.
(2) Mitigation of damages
The amount of damages awarded under subsection (b)(1) shall be reduced by the amount of such damages which could have reasonably been mitigated by the plaintiff.
(3) Period for bringing action
Notwithstanding any other provision of law, an action to enforce liability created under this section may be brought without regard to the amount in controversy and may be brought only within 2 years after the date the right of action accrues.
The Secretary shall by regulation prescribe reasonable procedures for a taxpayer to notify the Secretary of the failure to release a lien under section 6325 on property of the taxpayer.
Editorial notes U.S. Code · Office of the Law Revision Counsel
Prior Provisions
A prior section 7432 was renumbered 7434 of this title.
Effective Date
Section 6240(c) of Pub. L. 100–647 provided that: “The amendments made by this section [enacting this section] shall apply to notices provided by the taxpayer of the failure to release a lien, and damages arising, after December 31, 1988.”