- The IRS maintains super-creditor powers to seize bank accounts, real estate, and inherited assets to settle unpaid debts.
- A 2025 agreement allows data-sharing with ICE, exposing over one million individuals to asset verification and potential enforcement.
- For tax year 2026, the federal estate tax exemption rises to fifteen million dollars per individual under new legislation.
The Internal Revenue Service can seize bank accounts, vehicles, real estate and other assets tied to unpaid tax debts, including property already distributed to heirs, according to 2026 court filings and government guidance.
The Department of Homeland Security has also gained access to taxpayer information through a data-sharing agreement signed in April 2025. The arrangement allows Immigration and Customs Enforcement to submit names for cross-checking against IRS records in enforcement actions, including asset seizures.
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The IRS holds what the filings describe as “super-creditor powers.” Tax obligations do not disappear when someone dies, and an executor who distributes an inheritance before settling those debts can expose beneficiaries to collection efforts.
That risk reaches beyond large estates. Executors may need to file Form 706 even when no estate tax is immediately due, including to preserve portability of unused estate-tax benefits for a surviving spouse.
For tax year 2026, filed in 2027, the federal estate tax exemption stands at $15 million per individual, up from $13.99 million in 2025. Congress set the 2026 amount through the “One Big Beautiful Bill Act,” signed July 4, 2025.
Non-U.S. citizens and non-resident aliens face a much lower threshold. An estate must file Form 706-NA when a non-resident alien dies owning more than $60,000 in U.S.-situated assets, such as real estate or U.S. stocks.
The IRS can levy property after a final notice goes unanswered
Under IRC § 6331, the IRS does not need a court judgment before taking collection action. After a final Notice of Intent to Levy, identified as LT11 or CP90, goes unanswered for 30 days, the agency can freeze and seize bank accounts.
It can also auction physical property. That includes vehicles, homes and business equipment. Wage and Social Security benefits can face garnishment as well.
| Asset or payment | Collection action |
|---|---|
| Bank accounts | Freeze and seizure |
| Vehicles, homes and business equipment | Seizure and auction |
| Wages and Social Security benefits | Garnishment |
The estate process creates a separate exposure for beneficiaries. If an executor pays heirs before resolving the decedent’s tax obligations, the IRS can seek those assets from the recipients. Inherited IRAs and 401(k)s have also drawn increased enforcement, despite assumptions that they cannot be reached.
A federal case put the data-sharing program under scrutiny
Dottie A. Romo, the IRS chief risk and control officer, described the information exchange in a sworn declaration filed February 11, 2026, in federal case No. 1:25-cv-00457-CKK. She said the IRS shared last known addresses and confidential return information involving thousands of people with ICE.
“The IRS provided confidential taxpayer information even when DHS officials could not provide sufficient data to positively identify a specific individual.”
Romo’s declaration is identified as Decl. of Dottie A. Romo, No. 1:25-cv-00457-CKK, ECF No. 66-1 (D.D.C. Feb. 11, 2026). The agreement authorizing the cross-verification was signed by Treasury Secretary Scott Bessent and Homeland Security Secretary Kristi Noem in April 2025.
Court records show that ICE requested data on 1.28 million individuals from the IRS to verify residency and assets. A federal judge also found that the IRS improperly disclosed confidential data 42,695 times to DHS.
A federal court ruling allowed the program to continue. Attorney General Pam Bondi called that decision a “crucial victory” on February 24, 2026.
“Deporting illegal aliens makes the American people safer.”
The data-sharing records add an immigration-enforcement dimension to estate administration. Non-citizens and visa holders may also face withheld “Federal Transfer Certificates,” which can prevent the legal transfer of U.S. assets to heirs abroad when required tax obligations remain unresolved.
Filing the estate return can protect benefits and transfer rights
The IRS’s official guidance on Form 706 identifies the return used for federal estate-tax reporting. Filing can preserve portability for a surviving spouse, even when the estate falls below the exemption amount.
The filing issue is separate from the later collection process. An estate that fails to address its obligations can leave an executor, heirs and beneficiaries facing asset restrictions after property changes hands.
That exposure can include the full inheritance. The agency takes priority over distributions to family members when an estate has unpaid debts.
The Taxpayer Advocate Service maintains guidance on seizures through its official seizure resources. The DHS press office also publishes agency announcements through its newsroom.
As of August 2026, the court record places the data-sharing dispute in the current year, while the estate-tax exemption applies to tax year 2026. Executors handling U.S. property for citizens, non-citizens or heirs abroad must address both the return requirement and outstanding tax debts before distributing assets.
This article is for informational purposes only and does not constitute tax advice. Consult a qualified tax professional or CPA about your specific situation.
