Ray Knoefler, Maxine Knoefler v. S. R. Schneider, Agent, Internal Revenue Division, United States Department of Treasury

The Knoeflers appeal from a dismissal of their suit for injunctive relief and money damages based upon an alleged violation of their civil rights. We affirm.

The Knoeflers filed a joint tax return for 1974 which showed a tax liability of $7,066. No remittance was enclosed with the tax return. After three demand notices, a threat of enforcement action and a personal visit to the Knoeflers, IRS Agent Schneider served a levy on the Knoeflers’ bank account and seized two real properties that the Knoeflers owned. One of the properties was a residence occupied by tenants; the other was a vacant lot.

In or around May of 1976, the Knoeflers filed an amended tax return which showed that instead of the income reported, they had actually sustained a loss and had no tax liability for that year. Apparently the amended return was filed after collection proceedings had begun, but the record is not clear as to this point.

Sometime after the amended return was filed, Agent Schneider advertised the properties for sale. The Knoeflers brought the instant action to enjoin the sale of the properties or any other attempt to collect the tax and for damages for violations of their civil rights. The…