The Illinois congressman who chairs the House of Representatives Oversight Subcommittee hails the news that the Internal Revenue Service is taking action to help farmers and small business owners who have had assets wrongly seized by the federal agency. The IRS and Department of Justice have put in place a review process to help those whose assets were improperly taken under civil forfeiture laws.
"I'm glad to see the IRS finally recognize the need to return the money they stole from innocent Americans," Rep. Peter Roskam said. He pledged vigilance by his committee to make sure the agency keeps its commitment to “deliver justice to the victims of civil asset forfeiture abuse."
Some readers will recall the plight of a convenience store owner who had more than $100,000 seized by the IRS because he was allegedly illegally “structuring” bank deposits to avoid a reporting requirement. The requirement was designed to curb money laundering, tax evasion and other criminal acts, has sometimes ensnared business owners and farmers who made deposits under the $10,000 reporting threshold just to avoid paperwork.
There was no evidence the North Carolina convenience store owner — as well as several others in similar circumstances — engaged in any criminal activities.
After the store owner’s plight was publicized, the agency fine-tuned its civil forfeiture actions, but apparently did nothing to fix the finances of those adversely affected by its earlier policy. Late last summer, the Ways and Means Subcommittee asked the IRS and DOJ to review its seizures of funds from legal sources.
Now the IRS says it has contacted all those who had funds seized for structuring from late 2009 onward, according to a report. Those 700 or so taxpayers can now petition the agency to see if they can get some or all of their seized funds returned. They have significant hurdles to clear, however. They must demonstrate to the IRS that “the underlying funds came from a legal source, and there is no evidence that the petitioning property owner engaged in structuring to conceal other criminal activity, such as tax evasion, money laundering, or other crimes.”
These are the kinds of IRS interactions often undertaken with the assistance of a knowledgeable tax lawyer experienced in report submission and negotiations with the federal tax agency on criminal charges. Regardless where your business is located, we have tax attorneys in Chicago and Cleveland available to consult on your case.
