Government Report Finds 30% Of IRS Tax Seizures Are Illegal

WASHINGTON, DC – MAY 24: A sign stands outside the Internal Revenue Service (IRS) building on May 24, 2013 in Washington, DC. The IRS is one of at least four federal agencies that is closed today due to the automatic sequestration cuts forced government agencies giving employee’s an unpaid furlough. (Photo by Mark Wilson/Getty Images)

The IRS scandal house just keeps building additions atop their already shaky foundation. A new government report by the Treasury Inspector General for Tax Administration found that 30% of IRS tax seizures of taxpayer property did not comply with the law.

To quickly give a bit of background, despite his politically motivated claim that the “era of big government is over” in 1996, under President Clinton the IRS gained substantial authority, or as Robert Wood in Forbes phrased it, became “aggressive.” So in 1998, in order to provide protection to the taxpayers, Congress amended part of the tax code that deals with seizures. I.R.C. §§ 6330 through 6344. The Treasury Inspector General for Tax Administration is now required to evaluate the IRS annually. A significant evaluation is the inspection of IRS seizures.

The TIGTA surveyed a random sample of 50 of 738 seizures conducted from July 1, 2011, through June 30, 2012. In 15 seizures, the TIGTA found 17 instances in which the IRS did not comply with a legal mandate of the tax code. The violations are as follows:

• The sale of the seized property was not properly advertised. (§ 6335(b))
• The amount of the liability for which the seizure was made was not correct on the notice of seizure provided to the taxpayer. (§ 6335(a))
• Proceeds resulting from the seizure of properties were not properly applied to the taxpayer’s account or seizure and sale expenses were not properly charged. (§§ 6341 and 6342(a))
• The balance-due letter sent to the taxpayer after sale proceeds were applied to the taxpayer’s account did not show the correct remaining balance. (§ 6340(c))

While it may be rough water to sail on if we attempt to qualify the degree of severity in their error, it is worth pointing out the last violation. To put it simply, they are ripping off the taxpayer by selling off their assets, but not crediting fair market value to their tax burden. Now before you act on the inclination to shirk off sympathy, because after all had they paid their “fair share” of taxes they would not have to be worried about seizure, remember that it is relatively easy to find yourself in a bind with the IRS. Certainly, there are many, many instances where no sinister intentions were at play, but taxpayers have found themselves on the receiving end of an “aggressive” IRS.

Untouched, the IRS is set to have an appropriation of $13 billion for the 2014 fiscal annual budget, but House Republicans have proposed $3 billion -24% – in cuts to the federal agency. But this bureaucratic blob has a cultural, systemic big government mentality that epitomizes tyranny, and that is not an overreaching assessment. Whenever a government agency runs rampant over We the People, because they do not fear or expect public condemnation, then a so-called free society is in a lot of trouble. Let’s recap the IRS scandals thus far.

The Obama administration supposedly knew nothing of the IRS targeting of Tea Party and other conservative groups, which according to AEI and Harvard, suppressed conservative support enough to reelect Barack Obama. The attempt by the left to minimize the scandal by attempting to add progressive groups to the list of those singled out for scrutiny, was quickly refuted as fiction by the Treasury Inspector General, Mr. J. Russell George. While 292 conservative groups raised the IRS flag as they passed through the filter and all were singled out for scrutiny, just 6 progressive groups hit going through the filter, but none were single out for additional scrutiny.

We have recently learned, that as it turns out, Mark Childress who is the former deputy White House Chief of Staff – and now Obama’s nominee for Tanzanian Ambassador – was involved in the administration’s behind-the-scenes strategy for disclosing the IRS scandal. His name surfaced as one of the few White House officials who were in the loop as the Treasury Department and IRS tried to figure out how to come forward with allegations that IRS officials had systematically singled out conservative groups for additional scrutiny.

Childress and others were told about the looming Treasury Inspector General report by White House Counsel Kathryn Ruemmler after she was informed on April 24. Childress and his colleagues would have been told several weeks before the IRS went public with the scandal on May 10.

Immediately following the original scandal a video of IRS employees line dancing emerged. That quickly followed with the Star Trek and Gilligan’s Island getaway scandalous charades.

Now, just the other day, the revelation that thousands of donor names along with their social security numbers and other personal information were publicly displayed on an IRS database for all to see made headlines on Fox News. Agency officials have cited IT and human error that was not sinister, but at the very least, it demonstrates the complete incompetence of the federal agency.

Senators Ted Cruz and Rand Paul have been leading the fight to abolish the IRS. Many Americans simply do not understand that the federal government was never given the power to directly tax individuals for a reason. It was not until the Progressive Era, which of course was sold as a tax on the rich, that the Sixteenth Amendment gave the federal government the abusive ability to arbitrarily tax and single out whoever may oppose the power of the central power.

For years, the libertarian movement has advocated for the abolition of the IRS and the implementation of the flat tax, and now, the IRS is making the case for them.