When the Government Seizes Property Without Just Cause
The IRS utilizes considerable resources to seek out assets alleged to be either the fruit of illegal activities or otherwise used in the course of such acts. Task forces combine the efforts of international, federal, and local authorities to locate and seize assets subject to forfeiture due to these alleged connections to crime. Homes, investments, cash, automobiles, computers, and other possessions are wrongly taken by the government through this process.
Types of Federal Asset Forfeiture
Forfeiture may proceed in several ways:
- Administrative forfeiture: Permits the federal government to seize property without judicial involvement, typically for personal property valued at $500,000 or less (or unlimited for certain monetary instruments). If no valid claim is filed, the agency declares forfeiture.
- Civil forfeiture: Also called civil judicial forfeiture, this is an action brought against the property itself (in rem). No criminal charge is required against the individual, and the property is the defendant. The government must prove forfeitability by a preponderance of evidence.
- Criminal forfeiture: An action brought as part of a criminal prosecution (in personam), requiring a conviction and proof beyond a reasonable doubt that the property is tied to the crime.
Defenses and Strategies to Challenge Federal Asset Seizures
Challenging a federal asset seizure requires swift action, as deadlines are strict—often 30-35 days for claims. At The Wilson Firm, we leverage statutory defenses under 18 U.S.C. § 983 and equitable principles to halt proceedings, secure releases, and recover property. Common defenses focus on lack of government proof, procedural errors, and your rights as an innocent party. Below are key strategies, updated for 2025 policies.
Procedural Defenses
Exploit government missteps to force property return:
- Untimely Notice or Complaint: Administrative notice must be sent within 60 days of seizure (90 for adoptions); failure requires return of non-contraband property with no bar to refiling judicially. In judicial cases, the government must file a complaint within 90 days of a valid claim or return the asset.
- Insufficient Claim Review:Agencies must forward sufficient claims (under oath, stating interest and non-frivolous grounds) to the U.S. Attorney's Office; invalidation without opportunity to cure can invalidate forfeiture.
- Adoption Violations: For state-federal adoptions, challenge lack of 100% state activity or federal basis; 2025 IRS updates emphasize stricter certifications.
Constitutional Challenges
- Fourth Amendment (Illegal Seizure): Argue lack of probable cause in warrant applications or warrantless seizures without exigent circumstances (e.g., no risk of destruction). Suppress evidence from unlawful searches.
- Eighth Amendment (Excessive Fines): Forfeit value must not be "grossly disproportional" to the offense—factors include crime, gravity, your involvement, property role, and harm. In 2025, courts increasingly scrutinize this in civil cases.
- Fifth Amendment (Due Process): Demand hardship hearings for real property seizures or restraining orders.
Petitions for Remission or Mitigation
Post-forfeiture, file petitions under 28 C.F.R. Part 9 within 60 days (extensions for good cause) via the DOJ portal. Innocent owners get full return (less waivable costs); others may mitigate for cooperation or minimal role. Victims of the underlying crime (e.g., fraud losses) prioritize restoration. 2025 updates streamline hybrid reviews and emphasize no judicial review absent procedural errors.
IRS-Specific Strategies for Tax-Related Seizures
For IRS seizures under 31 U.S.C. § 5317 (e.g., structuring) or 18 U.S.C. § 981 (tax evasion proceeds), request a Collection Due Process (CDP) hearing if tied to collections, or challenge via administrative claim shifting to judicial. Proactive options include installment agreements or Offers in Compromise to prevent seizure. Per 2025 IRM revisions, focus on pre-seizure factors like hardship and proportionality.
The Innocent Owner Defense
Under 18 U.S.C. § 983(d), if you acquired your interest in the property before the illegal activity or without knowledge of it, you can defeat forfeiture. For pre-illegal interests, prove by a preponderance of evidence that you (1) lacked knowledge of the conduct and (2) took reasonable steps to prevent it upon learning (e.g., notifying authorities, revoking permission, or consulting counsel—without risking personal safety). For post-illegal acquisitions, show you were a bona fide purchaser for value without knowledge or reason to believe the property was forfeitable. Courts may apply a "willful blindness" test, but the burden shifts to the government if you establish a prima facie case. In 2025, DOJ policy requires prosecutors to pre-assess viable innocent owner defenses before filing; if all owners qualify, they refrain from proceeding.
How The Wilson Firm Can Help You Recover Seized Assets
Regardless of how the client's involvement with asset forfeiture began or the process under which it takes place, the tax attorneys at The Wilson Firm are well-positioned to help clients get their property returned to them.
In cases where the client had no knowledge that the property was being used illegally, or when no crime was committed, the client may be entitled to have their property returned to them.
Frequently Asked Questions
The innocent owner defense under 18 U.S.C. § 983(d) protects those who prove they had no knowledge of the property's illegal use or took reasonable steps to stop it, or acquired the interest bona fide after the activity without reason to suspect forfeitability. You bear the burden of proof with evidence like affidavits.
File a verified claim with the SAC within 35 days of notice, identifying your interest and affirming it's not frivolous. This converts the case to judicial review; the government must then file a complaint within 90 days or return the property.
Yes, via a hardship petition under 18 U.S.C. § 983(f) if you have a possessory interest, community ties, and prove substantial hardship (e.g., inability to work) outweighs risks like flight. File after a claim; expect a decision within 15 days.
Claims must be filed within 30-35 days of notice; petitions for remission/mitigation within 35 days. Hardship decisions come in 15 days. Missing deadlines can forfeit your rights—act immediately upon notice.
No, in civil forfeiture, the action is against the property, not you personally. However, you can still defend via innocent owner or procedural challenges, and CAFRA requires the government to prove its case by preponderance.
Why Choose The Wilson Firm?
At The Wilson Firm, we provide personalized, strategic representation tailored to each client’s needs. Whether you’re facing a tax dispute, or seeking proactive tax planning, transactional guidance, or estate planning, our attorneys work closely with you to understand the facts, assess the risks, and pursue the most favorable resolution possible.
We manage the legal complexities so you can focus on moving forward. From communications with tax authorities and building strong legal strategies, to structuring business transactions and planning for your family’s future, we are committed to protecting your rights, your interests, and your peace of mind at every stage.
Our experience spans both defensive and proactive planning ensuring that you are prepared and positioned for long-term success.
Contact us today to learn how our experience, discretion, and dedication can help you navigate even the most challenging legal matters with clarity and confidence.
