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The IRS and the overall government has a wide set of rules, guidelines and laws in place when it comes to banking; a lot of this is an attempt to curb criminal activity such as terrorism, drug dealing and trafficking.
In an attempt to catch these types of activities, the IRS has had a rule in place that banks must report any deposit made over $10,000.
Easy enough right?
Well, one can almost just as easily make deposit below the required reporting amount, just in more increments. When this happens, though, the banks and government are still watching, looking for those trying to abuse this rule.
Enter the Situation of Oh Suk Kwon, a South Korean immigrant, U.S. veteran and husband.
Kwon fulfilled the American dream when he bought a business in 2007, a service station on a highway in Maryland. However, just a few years later after owning it, the IRS seized all of his assets, some $59,000.
He was depositing money below the $10,000 reporting amount.
Well, if you think about it, instead of depositing lump sums greater than $10,000 at a time, one can almost just as easily make deposits below the required reporting amount, just in more increments.
To Kwon’s dismay, the government coincidentally began scanning bank records for deposits made below the reporting amount, but in a relatively high frequency.
Is Kwon a criminal laundering money for drugs or terrorism? Absolutely not.
Turns out bank tellers often tell business customers to make payments below the $10,000, in a higher frequency, to avoid the paperwork that goes with a $10,000+ deposit.
Kwon is left with nothing since his legal troubles with the IRS began. He has lost his business, his pride and to cancer, his wife. Not giving up, Kwon is still fighting to get his money back but the IRS is not having it.
To this day he still has nothing. Kwon’s case is hardly unique either; it happens more than it probably should. Here’s a similar case we posted back in April. How the IRS Seized Millions from Small Business: Equitable Sharing or Extortion?
Moving Forward: How to Stop the IRS From Seizing Your Bank Accounts or Assets
The IRS is a tough agency to work with; this is why you need proactive and aggressive tax consultants on your side so misunderstandings like Kwon’s don’t happen. Paying taxes is reasonable, but no one should have their business taken away from them for simply following the rules.
If you’ve received a Notice of Intent to Levy from the IRS, or have already had your accounts or assets taken, the tax attorneys, enrolled agents, and licensed professionals at Boxelder Consulting are here to defend your rights and fight for you. Contact us today to start taking action now.