House Passes Bill to Rein In IRS, DOJ Asset Forfeitures

The House passed by voice vote Tuesday the Clyde-Hirsch-Sowers-RESPECT Act, legislation to rein in IRS civil asset forfeiture abuse in structuring cases, which involved the IRS and Department of Justice seizing the bank accounts of law-abiding American citizens.

The bill, introduced by Reps. Peter J. Roskam, R-Ill. Chairman of the Ways & Means Subcommittee on Oversight, and Joseph Crowley, D-N.Y., is named for Andrew Clyde; Jeffrey, Richard and Mitch Hirsch; and Randy Sowers — small-business owners whose assets were seized by the IRS.

“Today we took a big step toward delivering justice for victims of IRS abuse,” said Roskam in a statement after the bill’s passage. “It’s clear to everyone involved that the IRS and DOJ abused their authority and took money from people who did nothing wrong. With today’s legislation, we’re making sure they can never do it again.”

Crowley added in the statement that “civil asset forfeiture started as a tool to combat criminal activity but it has morphed into a complex process that can unfairly entangle innocent Americans. There is no question the process is flawed and in need of reform. That’s why I’m proud to partner with Congressman Roskam to pass this critical legislation.”

Sens. Tim Scott, R-SC, and Sherrod Brown, D-Ohio, have introduced companion legislation.

The Ways & Means Oversight Subcommittee held a hearing last May titled Protecting Small Businesses from IRS Abuse, at which time both Republicans and Democrats expressed outrage over the practice.

Last June, under pressure from Congress, the IRS agreed to send letters to everyone from whom it had seized assets based on allegations of “structuring” cash deposits to avoid triggering reporting requirements, which is often done to hide money laundering or fraud.