If someone owes the IRS money can I open a checking account for them?

I'm not totally clear on exactly what your are asking, but what I'm understanding is that the individual that "won a law settlement" owes the IRS money for back taxes and he is afraid to put the money in his own account for fear the IRS will levy on this. There is a possibility that you could be responsible for taxes on the amount transferred to the account you set up for your friend (transferee liability). There is also the possibility that each of you could be prosecuted for tax evasion. I say these things because you did not exactly make it clear what the situation was. I might also add that if the "law settlement" was damages for personal injuries this money would not be taxable as income to your friend. That does not, however, absolve him of the liability for past due taxes including interest and penalties.

If that person gives you the money, it is your money. If that person submits any documents to the IRS concerning personal finances and conceals that money, it may be illegal for the other person to do that.