Officials of the Internal Revenue Service (IRS) have often acted with impunity and, in one heartbreaking recent case, in contravention of the agency’s own policies. Lyndon McLellan, the owner of a convenience store in rural North Carolina had $107,000 seized from his bank account in December because IRS officials suspected him making small deposits to evade reporting requirements — in spite of the agency’s announcement in October that it would no longer pursue such cases. The Institute for Justice (IJ) took on McLellan’s case pro bono, and the IRS has backed down, agreeing to return the money.
“I'm relieved to be getting my money back,” Lyndon McLellan is quoted as saying in an IJ press release. "What’s wrong is wrong, and what the government did here is wrong. I just hope that by standing up for what’s right, it means this won’t happen to other people.”
This is a remarkable victory for McLellan, for IJ, and for freedom from the arbitrary and unilateral power of government officials — but the fight is far from finished. IJ will continue pursuing the case until the IRS refunds not only the money it stole from McLellan, but the thousands of dollars McLellan spent in earlier legal and accounting fees, as well as interest for the period of time that the money spent in government hands.
“The government cannot turn Lyndon’s life upside down and then walk away as if nothing happened,” Robert Everett Johnson, an IJ attorney, said in the press release. “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.”
The Institute for Justice is on the front lines in its battle for the rights of property owners and entrepreneurs against encroachment by civil forfeiture and other intrusive laws. Its victory for Lyndon McLellan represents a victory for everybody who loves liberty.