The Unhappiest Return The IRS Was Finally Forced to Make


When the IRS decided it was okay for them to target citizens who have never missed filing their taxes or been involved in or suspected of involvement in terrorist activities along with those known as tax evaders and terrorist suspects and seize their assets, the IRS became one of the bad guys. The Civil Assets Forfeiture or Seizure program engages every financial institution in the U.S. to help the IRS identify multiple small deposits that add up to $10,000 or more over a short period of time. This is a practice that has been kept in secrecy for decades. However, many small businesses make these types of deposits all the time totally unaware that their accounts are being flagged and watched by the IRS.

According to an article from Accounting Today, “In 2012, the IRS seized $446,651.11 from a Long Island convenience store distributor, Bi-County Distributors, and its owners, the Hirsch family, based on a pattern of cash deposits that had been deemed suspicious by federal agents.” The article continues to explain, “Federal law requires banks to report cash deposits larger than $10,000 to the IRS. Since the Hirsches frequently made deposits in amounts less than $10,000, the government claimed they were seeking to evade the reporting requirement.”

Fortunately the family that was victimized by the IRS decided they were not going to take it. They teamed up with the Institute for Justice who sued to force the government into court. The article reports that, “Rather than defend its actions in response to the lawsuit, the government agreed to return all of the seized money and to not pursue forfeiture of the funds in any civil or criminal action in the future.”

This victory against the IRS may not mean that they will stop seizing the assets of innocent Americans, but it does mean a precedent has been set and the IRS can be forced to return the money they’ve stolen. Who knows how many unhappy returns the IRS will be forced to make before they return their attention only to known criminals instead of innocent tax paying Americans.