Week ending September 8, 2017
H.R.1843 – Restraining Excessive Seizure of Property through the Exploitation of Civil Asset Forfeiture Tools Act
HR 1843 would ‘amend title 31, United States Code, to prohibit the Internal Revenue Service from carrying out seizures relating to a structuring transaction unless the property to be seized derived from an illegal source or the funds were structured for the purpose of concealing the violation of another criminal law or regulation, to require notice and a post-seizure hearing for such seizures, and for other purposes.’
“H.R. 1843 would prohibit the Internal Revenue Service (IRS) from seizing money and other property from people in certain cases that involve the structuring of financial transactions. Current law requires that banks and other financial institutions report to the Department of the Treasury any transaction of more than $10,000. It is illegal for individuals to separate a transaction into multiple pieces, each below $10,000, to avoid such reporting, a process known as structuring. Violators are subject to both civil and criminal penalties. The bill would permit the IRS to seize money and other property in structuring cases only when the structuring was connected to a crime.” – CBO
For the most part the bill codifies existing IRS procedures.
Under the bill the IRS must make a good faith effort to find all owners of the properties and notify those owners of their rights post-procedure. The owner may request a court hearing within 30 days of the seizure notice is provided and the property must be returned if the hearing is not held within that time. However if the hearing determines the property was gotten from an illegal source or the funds were structured to conceal the violation.
Because the IRS requires banks and other financial institutions to report a transaction of more than $10,000 it is illegal to separate the transaction into smaller than $10,000 transactions to avoid the reporting requirement. That procedure is called structuring and will bring civil and criminal penalties. The IRS is authorized to also seize those funds but only if the structuring was related to or part of a crime.
Under the bill any interest received from the federal government through any action to recover the seized property would not be included as gross income.
(Full text of H.R. 1843 at congress.gov)
Sponsor: Rep. Roskam, Peter J. [R-IL-6] (Introduced 03/30/2017)
Status: Passed House /
VOTES and FLOOR ACTION
On Passage: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote.
Motion to recommit:
Text of the motion:
COST AND IMPACT
Cost to the taxpayers: H.R. 1843 could decrease the collection of civil and criminal penalties. Those fines are revenues. Criminal fines are available to be spent without further appropriations. Therefore, enacting the legislation could decrease such federal revenues and associated direct spending, but CBO expects any such decreases would not be significant in any year.
Pay-as-you-go requirements: Because enacting the bill would affect direct spending and revenue, pay-as-you-go procedures apply.
Regulatory and Other Impact: CBO and JCT have determined that the bill contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act.
Dynamic Scoring: The staff of the Joint Committee on Taxation (JCT) estimates that enacting the legislation would reduce revenues by $1 million over the 2018-2027 period. CBO and JCT estimate that enacting the bill would not significantly increase net direct spending in any of the four consecutive 10-year periods beginning in 2028, and would increase on-budget deficits over those periods by very small amounts.
Tax Complexity: Not applicable to this bill.
Earmark Certification: Data not available
Duplication of programs: Data not available
Direct Rule-Making: Data not available
Advisory Committee Statement: Data not available
Budget Authority: Data not available
Constitutional Authority: Assumed.
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