The Phaserl


FASCIST OUTRAGE: IRS Seizes $107K From This Innocent Small Business, Despite Recent Policy Changes

from Institute For Justice, via Vox:

If you deposit more than $10,000 in cash, your bank is required to file a form with the authorities reporting the transaction. But the law also makes it illegal to “structure” deposits — depositing cash in amounts under $10,000 to avoid triggering the reporting requirement.

But aggressive enforcement of these laws can ensnare small business owners whose only crime is dealing in cash. This video tells the story of Lyndon McLellan, a convenience store owner in rural North Carolina who had $107,702 seized by the IRS. The agency hasn’t charged McLellan with any crime, but under controversial civil asset forfeiture rules the burden of proof is on him to prove he didn’t violate the “structuring” laws. The video was made by the Institute for Justice, a libertarian public interest law firm that is representing McLellan.

The New York Times points out that business owners can have legitimate reasons for keeping their cash deposits under $10,000. For example, some store owners have insurance policies that only cover cash losses up to $10,000.

It won’t be easy for McLellan to get his money back. Many forfeiture targets don’t bother to contest seizures under civil forfeiture laws because legal fees would exceed the value of what was taken. But with IJ’s help, he might be able to recover the money the IRS took from him.

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3 comments to FASCIST OUTRAGE: IRS Seizes $107K From This Innocent Small Business, Despite Recent Policy Changes

  • Mike

    Can someone give me a better reason why NOT to have “money” in a bank?

  • Howard Roark


    How many examples does one need???

  • Jerry

    In a some of the cases that I read where people had their money taken, they actually knew something about the structuring law and were trying to avoid going over $10,000. Does not sound like that was the case with this guy though.

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