A victory worth cheering for due process and property rights: the U.S. House has unanimously approved a bill that would curb IRS seizure of bank accounts premised on the owners’ having engaged in a pattern of deposits or withdrawals below the $10,000 reporting threshold (“structuring forfeiture”). The measure would 1) codify a recent IRS practice of not keeping money if no underlying illegality were found such as tax evasion or income from unlawful sources; 2) assure account holders a quick hearing after a seizure, a process that can now drag out for long periods. [Institute for Justice press release; Michael Cohn, Accounting Today] The Treasury inspector general found that “in a whopping 91 percent of sampled cases, the laws were being used to forfeit assets from individuals and businesses found to have obtained their income legally.” [Michael Haugen, The Hill, April]
I’ve been writing on this issue for years. The bill, co-sponsored by Reps. Peter Roskam (R-IL) and Joseph Crowley (D-NY), is called the Clyde-Hirsch-Sowers RESPECT Act; I’ve written about the structuring case of Maryland farmer Randy Sowers here and here.
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This and asset forfeiture need to be ended.
The Treasury inspector general used the word “whopping” in an official report?
I suspect the quote comes from the cited source, not the Treasury report (and in fact that quote does appear in the cited source).
One case I found interesting—where multiple deposits of less than $10K (totalling more than $10K) are done on one day–CTR regs require aggregation so there will be a CTR, This happened to a supermarket which had a standard policy of just taking money across the street when it got to be close to the insurance limit of $10K. No evidence of evasion.
Shouldn’t federal judges be more willing to sanction attorneys who defend this sort of nonsense? Obviously, I’d never be a federal judge, but this sort of tyranny-lite would prompt me to want to hold the government attorney and the applicable decisionmaker in contempt of court.
There was a case I read about where a Russian woman who immigrated to the US (legally).
She was trying to transfer money from her bank in Russia to a US bank so she could buy a house here. The Russian bank refused to do individual transfers over $9K US.
She transferred all the money, pain fully over several months and right after she bought the house she wanted, the IRS stepped in and sized the house as the fruits of structuring.
She had all the documentation need to prove that all the money was hers and obtained legally. The IRS didn’t care.
At least in that case the appeals court tossed it. However, not due to any problem in the law, but based on the improper use of unrelated evidence.