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Title: IRS shuts down mom and pop dressmaker, sells dresses within hours
Source:
Dallas News
URL Source: https://www.dallasnews.com/news/cri ... aking-selling-entire-inventory
Published: Jul 10, 2017
Author: Staff
Post Date: 2017-07-10 08:01:43 by IbJensen
Keywords: None
Views: 2991
Comments: 7
The unmarked vehicles arrived in the morning. More than 20 armed agents poured out. Hours later, Mii’s Bridal & Tuxedo was out of business after serving customers for decades. Its entire inventory of wedding gowns and dresses as well as sewing machines and other equipment were sold at auction. The hastily-called sale held inside the store netted the IRS about $17,000 — not enough to cover the roughly $31,400 in tax debt alleged, court records show. The balance is now likely unrecoverable. Mii’s, a small Garland business owned by an elderly immigrant couple from Thailand, was never accused in court of violating any federal laws. The owners, Tony Thangsongcharoen, 68, and his wife, Somnuek Thangsongcharoen, 72, are fighting back. The Garland couple sued the government in federal court in Dallas in March for more than $1.8 million, alleging the IRS violated its own procedures during the tax seizure at the small storefront on Garland Road in March 2015. “The agents auctioned off, before their very eyes, the family’s entire life savings for pennies on the dollar,” the lawsuit said. Allegations of improprieties against the IRS for its asset seizures are not new. The agency has been under fire in recent years for seizing the bank accounts of mom and pop businesses due to their banking transactions. The IRS claimed that the businesses intentionally tried to evade federal bank reporting requirements by making cash deposits just under the $10,000 limit. Critics say the IRS is being heavy-handed for seizing money from businesses when they haven’t been charged with a crime. Anya Bidwell, an Austin-based attorney for the Institute for Justice, a public interest law firm in Arlington, Va., said the IRS has a “history of aggressively interpreting federal laws to seize property.” The IRS agreed to change its policy of targeting small businesses for cash seizures, she said. But the Mii’s Bridal case, she said, shows that “broader, more comprehensive reform is also needed.” “No one in the United States should lose property without being convicted of a crime or without a proper due process hearing,” Bidwell said. IRS agents seized the entire inventory of Mii's Bridal in 2015 and put the elderly owners out of business after decades of serving customers. They are fighting back in a federal lawsuit in Dallas. (Susan Walsh/The Associated Press) IRS agents seized the entire inventory of Mii's Bridal in 2015 and put the elderly owners out of business after decades of serving customers. They are fighting back in a federal lawsuit in Dallas. (Susan Walsh/The Associated Press) The Mii’s Bridal lawsuit also claims that some of the seizing agents improperly purchased items during the auction, in addition to other irregularities. “The lead agent brought four children to join the armed agents and tag along during the entire process,” the lawsuit stated. The children sat on a pallet with several boxes of pepperoni pizza while watching events unfold, the suit said. And the Thangsongcharoens dispute that they owed the IRS any taxes. The government says they owe for the 2005, 2008 and 2010 tax years. “The taxpayer’s tax returns on file with the IRS reflect that the tax year at issue generated a net operating loss carryover, not a taxable amount,” the suit says. The IRS declined to comment, saying its policy doesn’t allow statements about specific cases. The Justice Department’s tax division defended the agents’ actions in court filings, however, and has asked a federal judge to dismiss some claims in the lawsuit. Curtis Smith, an attorney for the government, denied in a court filing that one of the seizing agents bought something at the auction. He conceded however that an “off-duty Dallas Police officer in plain clothes bid on and purchased one small item.” Dallas police assisted the IRS during the raid. The police department did not respond to questions about the matter. Speedy sale The Thangsongcharoens started their wedding dress business in 1983 after coming to Texas from Thailand, according to their lawsuit and corporate filings. When reached at their home on Thursday, the couple said they didn’t want to say anything that could harm their case. An IRS agent obtained authorization for the seizure from a U.S. district court after she submitted an affidavit, the lawsuit said. The couple’s attorney, Jason Freeman, received numerous internal documents from the IRS following a Freedom of Information Act request about the incident. The lawsuit says one document received is a written “directive” from an IRS supervisor to “shut down this failing business.” Freeman, a tax law specialist who teaches at SMU’s law school, could not immediately be reached for comment. When the agents arrived for the seizure, they told the Thangsongcharoens to give them a $10,000 check within two hours to avoid the sale of their roughly 1,600 “designer” gowns, worth more than $615,000, according to the suit. Regarding the speed of the sale, the government said in legal filings that the IRS used a special law that allows for a streamlined procedure if the agency determines the goods seized could “perish or waste” or become greatly reduced in value. As a result, the IRS didn’t have to post advance public notice of the Mii’s sale or wait at least 10 days before selling the goods, as is normally required. The provision also says a speedy auction can be used if storing the property would cost the IRS “great expense.” The Mii's Bridal sign remains at a shopping center on Garland Road but the business never recovered after being raided by IRS agents in 2015. The Mii's Bridal sign remains at a shopping center on Garland Road but the business never recovered after being raided by IRS agents in 2015. It’s unclear from court records which of those scenarios was foreseen by the IRS in the Mii’s Bridal shop case. But the Thangsongcharoens say in their suit that the agents deliberately marked down the inventory to about $6,000 so they could claim it would cost more to store than it was worth. That comes to less than $4 per dress, the lawsuit said. The agents initially believed the value was significantly higher, according to the lawsuit. IRS regulations say the agency calculates a minimum bid price prior to the sale of seized items. Addison-based tax lawyers Garrett and Deborah Gregory are former government tax attorneys who worked for the IRS. He said selling a business’s entire stock within four hours of seizure would be “unusually fast.” Deborah Gregory said the IRS usually doesn’t act that quickly. “A lot of bureaucracy has to happen,” she said. She also said it’s unusual for a police officer to bid on seized items, even if he was off duty at the time. “If nothing else, it looks really bad,” she said. “I think the agency would frown upon it.” Garrett Gregory said, however, said that taxpayers generally get plenty of notice of their tax debt before collection efforts begin. “They’ll shut down businesses,” he said. “They can move pretty swiftly on that ... to stop the bleeding.” Left 'destitute' In the case of Mii’s Bridal, a revenue agent listed the dresses as being new and in “good condition.” The retail store stocked dresses for brides, bridesmaids and family members as well as veils, tiaras, pillows and prom dresses, court records say. Agents seized items they shouldn’t have, such as a Vietnam veteran’s hat left at Mii’s to have badges of honor sewed into it, according to the lawsuit. The IRS refused to return the hat, the suit says. The agents also seized video game consoles, a surround-sound music system and a 65-inch TV, which was not authorized by the judge’s order, the suit said. The Government Accountability Office studied IRS tax seizures in a 1999 report and made several recommendations after finding that some decisions to seize assets were “questionable.” In just under a quarter of the cases studied, the seizures “produced little revenue to the government and contributed little to resolving the taxpayers’ delinquencies,” the GAO report said. In some cases, the seizures essentially ended any attempts for further collections, the report said. Tony Thangsongcharoen blames the episode for his subsequent heart problems that required a quadruple bypass surgery. “Tony and Somnuek were left destitute — everything that they had built since immigrating to the United States and beginning their business in 1983 wiped out before their eyes,” his lawsuit says. Poster Comment: ...never accused in court of violating any federal laws. How utterly gestapoesque of the central socialist government thugs. This elderly couple couldn't be more desolate or maltreated if the thugs wielded clubs and beat them. Twenty armed agents to subdue an elderly couple who were never a burden to the state's welfare apparatus. Now they likely will be on the dole, but the good news is that the agents were able to latch on to a few bargains at the ridiculous mark-down forced sale. Down and out with the IRS and their well-fed and well-paid goons. Eliminate all the alphabet agencies by firing many and combining duties into one agency: like the TSA, Homeland (in)Security and the ATF, etc. etc. etc. Fold them into the FBI in order to prevent these idiots from stepping all over each other.
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#1. To: IbJensen (#0)
Power corrupts, absolute power corrupts absolutely !!
Si vis pacem, para bellum Rebellion to tyrants is obedience to God. Never Pick A Fight With An Old Man He Will Just Shoot You He Can't Afford To Get Hurt I am concerned for the security of our great nation; not so much because of any threat from without, but because of the insidious forces working from within." -- General Douglas MacArthur
If the IRS didn't follow the law that would make the people involved criminal thief's. If that is the case they should all be shot in the head.
"Stop the bleeding"? Just for a second can we look at this from a tax revenue perspectiv:. If the agents' goal is raising money, how are these people going to pay any taxes now?
Well, when they were in business they didn't pay taxes. So the IRS decided they would take what they could get.
As a small business owner, it’s crucial that you understand what happens when your business owes the IRS money so you can protect your company’s interests moving forward. Tax Penalties and Fines Companies who fail to pay their taxes on time may suffer a number of unfavorable consequences. Here are some of the side effects of falling behind on your tax payments. Notices When a business fails to make its tax payments, the IRS typically responds by sending a notice informing the company of what is owed. While you may be tempted to toss these notices in the trash or tuck them away in a filing cabinet, ignoring the IRS will only result in additional fees and penalties being levied on your business. If you don’t make restitutions within 30 to 60 days, the IRS may even assign an agent to handle the case. Fees and Penalties The IRS levies penalties on businesses that fail to file taxes or pay the full amount due. In fact, companies that file after the April 15 deadline may be on the hook for an additional 5% of the taxes owed each month up to a maximum of 25%. Furthermore, businesses that don’t file within 60 days of the due date will face a penalty of $135, plus an interest rate equal to the federal short-term rate plus 3% on the amount owed. In the long run, companies that neglect to make appropriate tax payments may find themselves owing a great deal more before all is said and done. Loss of Benefits Along with levying fees and penalties, the IRS can suspend benefits from business owners who fail to pay taxes on time. Under the Federal Payment Levy Program, the government has the right to seize an individual’s Social Security earnings. This can be especially problematic for entrepreneurs who start their businesses in retirement and rely on benefits to make a living. Property Seizure Levies are considered the final act of taxation enforcement, involving the seizure of taxpayer property to satisfy a debt. Because the IRS can levy the assets of businesses that default on their taxes, entrepreneurs must take pains to file on time and pay all that they owe. In fact, business owners who don’t have the cash to pay can wind up losing their cars, company equipment and even their properties. Rectifying IRS Issues Small business owners have a tendency to pay off suppliers before the IRS, and as a consequence, they often struggle to make necessary tax payments. Fortunately, there are steps your business can take to avoid property seizures and other negative consequences associated with nonpayment. If you’ve received a notice from the IRS, start by reaching out to the agent handling your case. In many instances, the IRS will work with you to create a payment plan that works for all those involved. Here are a few ways in which the IRS helps small business owners reconcile their tax debts. Extensions Companies that are unable to file their taxes on time should request an extension rather than default on their payments. Although extensions don’t eliminate applicable fees and penalties, they do give businesses an extra 120 days to file their taxes without suffering additional negative consequences. In the long run, filing an extension can help you avoid a great deal of stress while keeping your company in good legal standing. Keep in mind that this extension gives you extra time to file your taxes. You will still have to pay any amounts owed by the applicable deadline. Installment Agreement It’s no secret that small businesses often struggle to become profitable. If your business is unable to satisfy its tax burden, you may qualify for a type of payment plan known as an installment agreement. If you owe less than $50,000, you can receive a 72-month installment agreement simply by asking for one. While installment agreements can prevent the IRS from levying your property, it’s important to note that this repayment method often comes with a hefty interest rate. Additionally, taxpayers who fail to file returns or make estimated payments when necessary will not qualify for installation agreements. Uncollectible Status Did your business endure a recent period of low revenue? If your financial situation is grave enough, the IRS may concede to place you on uncollectable status. While being dubbed uncollectable doesn’t put a halt on tax penalties and interest, it will stop the IRS from suspending benefits or attempting to levy assets for the agreed- upon period. Because taxpayers can’t remain in this status forever, you will still need to find a way of satisfying your tax burden in the long term. Bankruptcy No one wants to admit that a business venture may be a failure. However, companies that have neglected to file for several years may see bankruptcy as the only way to escape steep tax fees and penalties. While bankruptcy can stop the IRS from seizing property and assets in the short term, in many cases the organization will resume its efforts to collect tax liens down the line. For this reason, declaring bankruptcy might not be as effective as taking out a loan or requesting an installment plan to satisfy back taxes. Owing the IRS money can be seriously stressful. However, ignoring your tax problems won’t make them go away. In the long run, a business that neglects to meet its tax obligations may even be forced to close its doors. If you owe back taxes, consider contacting a qualified tax professional who can help you create an installment plan that works for everyone involved.
Pretty safe bet that the government goons kept this loot for themselves. The agents also seized video game consoles, a surround-sound music system and a 65- inch TV, which was not authorized by the judge’s order, so their lawyer says. And it's pretty safe to say that you are really dumb to actually believe something just because a lawyer said it.
#2. To: IbJensen (#0)
#3. To: IbJensen, Gatlin (#0)
“They’ll shut down businesses,” he said. “They can move pretty swiftly on that ... to stop the bleeding.”
#4. To: Anthem (#3)
If the agents' goal is raising money, how are these people going to pay any taxes now?
#5. To: IbJensen (#0)
Poster Comment:
WTF you talking about, Willis?
...never accused in court of violating any federal laws.
They didn’t need to be “accused in court of violating any federal laws.”
You obviously don’t know what happenes when your business owes the IRS money.
So, here….let me help you understand the procedure. In a perfect world, everyone would qualify for a refund come tax season. Unfortunately, small businesses frequently owe the Internal Revenue Service (IRS) money at the end of the fiscal year. And while it’s understandable that an entrepreneur may struggle to raise sufficient tax funds, failing to pay the IRS its due is not an option.
It’s the law. If it’s a bad law, then work to get it changed. But, don’t simply ignore the law and expect nothing to happen….because it will.
#6. To: IbJensen, Stoner, Anthem, misterwhite, Gatslime (#0)
The agents also seized video game consoles, a surround-sound music system and a 65-inch TV, which was not authorized by the judge’s order, the suit said.
“Truth is treason in the empire of lies.” - Ron Paul
Those who most loudly denounce Fake News are typically those most aggressively disseminating it.
#7. To: Deckard (#6)
(Edited)
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