2023 Texas Statutes › Tax Code › Title 2 - State Taxation › Subtitle B - Enforcement and Collection › Chapter 111 - Collection Procedures › Subchapter A. Collection Duties and Powers › Section 111.021. Notice to Holders of and Levy Upon Assets Belonging to Delinquent

Sec. 111.021.  NOTICE TO HOLDERS OF AND LEVY UPON ASSETS BELONGING TO DELINQUENT.  (a)  If a person is delinquent in the payment of an amount required to be paid or has not paid an amount claimed in a determination made against the person, the comptroller may notify personally, by mail, or by means of facsimile or electronic transmission any other person who:
(1)  possesses or controls a credit, bank or savings account, deposit, or other intangible or personal property belonging to the delinquent or the person against whom the unpaid determination is made, hereafter referred to as "assets";  or
(2)  owes a debt to the delinquent or person against whom the unpaid determination is made.
(b)  A notice under this section to a state officer, department, or agency must be given before the officer, department, or agency presents to the comptroller the claim of the delinquent or person to whom the unpaid determination applies.
(c)  A notice under this section may be given at any time within three years after the payment becomes delinquent or within three years after the last recording of a lien filed under this title, but not thereafter.  The notice must state the amount of taxes, penalties and interest due and owing, and an additional amount of penalties and interest that will accrue by operation of law in a period not to exceed 30 days and, in the case of a credit, bank or savings account or deposit, is effective only up to that amount.
(d)  On receipt of a notice given under this section, the person receiving the notice:
(1)  within 20 days after receiving the notice shall advise the comptroller of each such asset belonging to the delinquent or person to whom an unpaid determination applies that is possessed or controlled by the person receiving the notice and of each debt owed by the person receiving the notice to the delinquent person or person to whom an unpaid determination applies;
(2)  may not transfer or dispose of the asset or debt possessed, controlled, or owed by the person at the time the person received the notice for a period of 60 days after receipt of the notice, unless the comptroller consents to an earlier disposal; and
(3)  may not avoid or attempt to avoid compliance with this section by filing an interpleader action in court and depositing the delinquent's or person's funds or other assets into the registry of the court.
(e)  A notice under this section that attempts to prohibit the transfer or disposal of an asset possessed or controlled by a bank or other financial institution is governed by Section 59.008, Finance Code, and also is effective if it is delivered or mailed to the principal or any branch office of the bank or other financial institution including any office of the bank or other financial institution at which the deposit is carried or the credit or property is held.
(f)  A person who has received a notice under this section and who violates Subdivision (2) of Subsection (d) of this section is liable to the state for the amount of indebtedness of the person with respect to whose obligation the notice was given to the extent of the value of the asset or debt transferred or disposed of.
(f-1)  A person who fails or refuses to comply with this section after receiving a notice of freeze or levy is liable for a penalty in an amount equal to 50 percent of the amount sought to be frozen or levied. This penalty is in addition to the liability imposed under Subsection (f).  The penalty may be assessed and collected by the comptroller using any remedy  available  to collect other amounts under this title.
(g)  At any time during the 60-day period as stated in Subdivision (2) of Subsection (d) of this section, the comptroller may levy upon the asset or debt.  The levy shall be accomplished by delivery of a notice of levy, upon receipt of which the person possessing the asset or debt shall transfer the asset to the comptroller or pay to the comptroller the amount owed to the delinquent or to the person against whom the unpaid determination is made.
(h)  A notice delivered under this section is effective:
(1)  at the time of delivery against all property, rights to property, credits, and/or debts involving the delinquent taxpayer which are not at the time of the notice subject to an attachment, garnishment, or execution issued through a judicial process;  and
(2)  against all property, rights to property, credits and/or debts involving the delinquent taxpayer that come into the possession or control of the person served with the notice within the 60-day period provided by Subdivision (2) of Subsection (d) of this section.
(i)  Any person acting in accordance with the terms of the notice of freeze or levy issued by the comptroller is discharged from any obligation or liability to the delinquent taxpayer with respect to such property or rights to property, credits, and/or debts of the taxpayer affected by compliance with the notice of freeze or levy.
(j)  Repealed by Acts 2015, 84th Leg., R.S., Ch. 1255 , Sec. 36(3), eff. September 1, 2015.
Added by Acts 1987, 70th Leg., 2nd C.S., ch. 1, Sec. 6, eff. July 21, 1987.  Amended by Acts 1993, 73rd Leg., ch. 362, Sec. 1, eff. Sept. 1, 1993;  Acts 1993, 73rd Leg., ch. 486, Sec. 1.03, eff. Sept. 1, 1993;  Acts 1999, 76th Leg., ch. 344, Sec. 7.009, eff. Sept. 1, 1999;  Acts 2001, 77th Leg., ch. 442, Sec. 4, eff. Sept. 1, 2001.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 931 (H.B. 3314), Sec. 4, eff. June 15, 2007.
Acts 2015, 84th Leg., R.S., Ch. 1255 (H.B. 1905), Sec. 36(3), eff. September 1, 2015.