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Certain tax allegations can be very impactful for small business owners. This includes allegations of trying to avoid taxes or allegations of owing a significant tax debt. Sometimes, such allegations lead to the Internal Revenue Service taking actions that could have major impacts on a person’s business. This includes tax seizures. When a tax seizure extends to the assets of a company a person owns, it could heavily impact their future ability to do business.
Now, there are procedures the IRS is supposed to follow when taking tax enforcement actions. Also, business owners have certain rights when facing such actions from the IRS. So, when a business owner here in Missouri is being subjected to IRS actions that they fear could heavily impact their business, they may want to discuss what rights they have and what they can do to protect these rights with a skilled tax attorney.
Such attorneys can also help small business owners understand what options they have if they feel the IRS has violated their rights. In some situations, bringing a lawsuit against the federal government may be an option.
The federal government is currently facing a lawsuit from a couple that claims that the IRS acted improperly in relation to tax actions it took in connection to a business they owned.
The business in question was a wedding dress store in Texas. Reportedly, in March of 2015, the IRS:
- Seized assets from the store, including the store’s inventory and equipment.
- Quickly held an auction.
- Sold all the seized assets in this auction for around $17,000 in total.
These actions put the store in question out of business.
The IRS has claimed that the couple owed over $30,000 in taxes. The couple disputes this tax debt.
The couple alleges that the tax seizure against their business, as it was performed, was improper. They claim that the IRS strayed from its own procedures in the seizure and committed a variety of improprieties in connection to it (such as undervaluing the inventory). In March of this year, they brought a lawsuit against the federal government in connection to these allegations. The lawsuit asks for over $1.8 million.
Source: Dallas News, “IRS shuts down mom and pop dressmaker, sells dresses within hours,” Kevin Krause, July 8, 2017