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It has been 20 years since Congress tightened the rules on civil forfeiture, but following unanimous approval by Congress, President Trump signed the Taxpayer First Act (H.R.3151) into law last week. This law curbs the IRS's power to seize cash for "structuring" offenses.
Under the Bank Secrecy Act of 1970, banks must report any cash transactions greater than $10,000. But if someone frequently deposits or withdraws their cash in amounts under $10,000, the IRS could seize it for “structuring.” Even though their money was earned legitimately and despite the fact that they were never charged with a crime, in 2012, the IRS seized nearly $63,000 from Randy and more than $446,000 from Jeff. It took years of litigation and high-profile coverage before they won their money back.
Structuring can be a Kafkaesque nightmare for small-business owners, especially for entrepreneurs like Jeff and Randy who work in cash-heavy industries: Jeff runs a convenience store distribution business with his brothers on Long Island, while Randy is a dairy farmer in Maryland.
Nor were the above isolated incidents.
Between 2005 and 2012, the IRS used civil forfeiture to seize nearly $200 million in over 2,100 cases. Roughly half of all seizures involved amounts under $34,000—hardly the proceeds of the sprawling criminal enterprises structuring laws were supposed to target.
The law (called the "RESPECT Act") puts in place a common sense requirement that should have been there from the beginning:
the IRS can now only seize property for structuring if it’s “derived from an illegal source” or if the money were structured to conceal criminal activity.
The law codifies a policy change made by the IRS in 2014 due to multiple lawsuits and associated publicity. That change resulted in a dramatic drop in associated forfeitures ($31.8 Million in 2014 to $6.2 Million in 2015).
The law also requires that judges promptly review structuring seizures, a process which previously took months or even years while a citizen's funds remained in the hands of the government before a challenge would be heard.
Previous Civil Forfeiture Coverage
(Score: 3, Insightful) by ikanreed on Friday July 12 2019, @02:30AM
I guess I should have been ready for a serious discussion of fiscal policy.
In theory, that would be okay. The idea of lightly disincentivizing naive savings, by encouraging investment through overnight interest rates I mean.
However, all the controls for money supply are aimed at what has become increasingly small numbers of increasingly large traditional banking institutions. Who are increasingly engaged in "non-traditional" financial products(i.e. they buy stock and bonds with their easily acquired money). Which means when the fed throws open the gates, a 3% drop in overnight rates represents maybe, maybe a 0.3% change in APR for things like a home loan, since it doesn't really change the math of whether it's better to make a loan to Joe IDoActualWork or buy AA+ rated bonds from WeBuyHousesWithCashAndRentThemOut LLC.
So... the housing prices goes up because WeBuyHousesWithCashAndRentThemOut LLC just bought a third of them with the easy money, and it's barely any easier for your to afford a loan. And your wages are stagnant, even though inflation is happening.
Turns out that inflation is almost entirely in the form of fixed real estate asset costs. And none of it is you getting paid more. Under the hood, it's stagflation, the economy isn't getting better, yet prices are going up. To the instruments of the fed, it's healthy good inflation, because they're seeing GDP rise, as WeBuyHousesWithCashAndRentThemOut LLC is making tons of purchases and the housing market is still moving.
Anyways, what I'm trying to say, is how rich people are right now, putting money in their mattress, isn't investing traditionally, hiring, training, and building, but rent seeking(or buying stock in companies that do the rent seeking for them). And the Fed's theory of inflation is increasingly at odds with the reality of investment.
And it's screwing us. And it's dangerous. And it's one area where I don't specifically blame trump, because when this should have first been fixed, Obama was afraid to take the hit of having rates raise during his tenure, and stocks approaching reality in cost, and endangering Hillary's chance of winning(lol).