The IRS Pays Back $107,000 They Wrongly Seized From A North Carolina Store Owner.

A North Carolina small business owner fought the IRS and Department of Justice and won — he has received $107,000 the IRS had wrongly seized from him.

Lyndon McLellan had his convenience store’s bank account seized by the IRS and initially he didn’t understand why. The agency acted on civil asset forfeiture laws to take the Fairmont, North Carolina, man’s money without him being convicted or even charged with a crime.

As an explanation, the IRS said it suspected that McLellan was violating federal structuring laws, according to which it is illegal to make multiple cash deposits of less than but close to $10,000. (Scroll down for the video.)

1. Business owner Lyndon McLellan (pictured in his store L&M Convenience Mart in Fairmont, N.C.) received $107,000 the IRS had seized from him (photo: Institute For Justice).

The IRS Pays Back $107,000 They Wrongly Seized From A North Carolina Store Owner.

Under public criticism of seizing money and property from well-intended people, policies were changed in October 2014 to not seize property in these kinds of cases.

Yet, this change made no difference in McLellan’s case. On the contrary, U.S. Attorney Steve West threatened the business owner that going public would only worsen his situation. He told him that doing so “just ratchets up feelings in the agency. My offer is to return 50% of the money.”

But McLellan did go to the media anyway. Following the press reports that ensued, the IRS quickly relented and gave Lyndon McLellan back all of the $107,702 they had seized from him.

2. U.S. Attorney Steve West had threatened the business owner that going public with his complaint would only worsen his situation (photo: Institute For Justice).

The IRS Pays Back $107,000 They Wrongly Seized From A North Carolina Store Owner.

Robert Everett Johnson, a lawyer at the Institute for Justice who represents Lyndon McLellan, said in a statement:

The government cannot turn Lyndon’s life upside down and then walk away as if nothing happened.

Lyndon should not have to pay for the government’s lapse in judgment. And the government certainly should not profit from its misbehavior by keeping the interest that it earned while holding Lyndon’s money.

We’ll continue to litigate this case until the government makes Lyndon whole.

3. IRS seizes $107,000 from an innocent small business owner despite recent policy changes.

Sources: Institute for Justice.
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