IRS May Seize Tennessee Farmer’s Land Over Its Own $20,000 Erroneous Refund

A 76-year-old Tennessee farmer says the IRS threatened to seize his farm after mistakenly sending him a $20,000 refund in 2022 and then demanding interest on the money. An IRS notice issued in early July warned that the debt could lead to a property seizure if Kirby did not pay.

Wilson Perry Kirby, a retired Montgomery County Highway Department worker, said he never spent the money. He enlisted his accountant to report the mistake and tried to return the refund immediately after receiving it on May 10, 2022.

The agency later withheld Kirby’s entire 2025 tax refund, approximately $1,800, to apply toward the interest it said he owed. The dispute has now placed his Coopertown farm, valued at about $930,000, at risk of a levy.

Kirby’s case centers on what the IRS describes as an erroneous refund, money paid to a taxpayer who was not entitled to it or received more than was due. The agency’s instructions require taxpayers to return such payments, but Kirby says his efforts did not resolve the account.

“She [his accountant] didn't make a mistake, I didn't make a mistake, they made a mistake.”

Kirby made that statement while describing the transaction and the continuing dispute. He said letters arrived from IRS offices “all over the United States,” leaving him without one person to contact.

The interest demand grew after the original payment

The early July notice demanded $2,575.00 in interest and called for immediate payment. Other reports have put the balance as high as $4,300.00 as the amount continues to grow.

Kirby said the agency’s handling of the matter has brought him to tears. He is a widower whose wife, Norma Jean, died in August 2024.

“Oh, I cried. It hurt me. They don't mind asking you to vote for them, but when you need help, you can't get ahold of anybody.”

Kirby says the combination has created continuing financial and emotional pressure after decades of work at the highway department and on his farm.

The IRS has declined to discuss the specific account, citing federal privacy law. An agency spokesperson said:

“The IRS has not publicly addressed the specifics of Kirby's case, citing federal privacy law.”

Federal officials and local leaders entered the dispute

Kirby said U.S. Senator Marsha Blackburn’s office called him in May 2026 and told him the matter was “settled.” Letters from the IRS continued to arrive shortly afterward.

U.S. Senator Bill Hagerty, a Tennessee Republican, said in a post on X on July 23, 2026, that he had directed his office to investigate and assist Kirby.

“I've directed my office to look into this and offer our assistance.”

Kirby also contacted Coopertown Mayor Jeff Smith, who has worked as a chief financial officer and accountant, and Tennessee Governor Bill Lee. The federal representatives and the IRS Taxpayer Advocate Service remain central to efforts to resolve the account.

Kirby met with the Taxpayer Advocate Service in Nashville in mid-July 2026. The meeting did not immediately stop the seizure threats or eliminate the interest balance.

Country music performer John Rich has also publicly supported Kirby and used his platform to press federal officials for a resolution. NewsChannel 5 reporter Hannah McDonald connected Kirby with a Nashville tax attorney to consider litigation or formal appeals aimed at stopping the levy.

The dispute reflects wider problems with automated tax notices

The IRS issued over 9.4 million math error notices in 2022, according to figures cited in reports about the case. Those notices highlight the scale of automated tax processing problems that can affect taxpayers when account records do not reflect a reported correction.

Kirby’s accountant flagged the refund as an error, but Kirby says the IRS system failed to recognize either the attempted return of the funds or the report of the mistake. The agency instead treated the disputed amount as an unpaid debt subject to interest.

A levy could threaten the land Kirby has farmed even though the original payment came from an IRS mistake, according to his account of the dispute. The early July warning gave the conflict a direct property consequence.

Kirby is pursuing the case through federal offices and the Taxpayer Advocate Service while his attorney examines possible appeals or litigation. The interest demand remains tied to the $20,000 payment made on May 10, 2022.

This article is for informational purposes only and does not constitute tax advice. Consult a qualified tax professional or CPA about your specific situation.