II 

114TH CONGRESS 

2D SESSION S. 3353 

To amend title 31, United States Code, to prohibit the Internal Revenue 

Service from carrying out seizures relating to a structuring transaction 

unless the property to be seized derived from an illegal source or the 

funds were structured for the purpose of concealing the violation of 

another criminal law or regulation, to require notice and a post-seizure 

hearing for such seizures, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 20, 2016 

Mr. SCOTT (for himself and Mr. BROWN) introduced the following bill; which 

was read twice and referred to the Committee on Finance 

A BILL 

To amend title 31, United States Code, to prohibit the Internal Revenue Service from carrying out seizures relating 

to a structuring transaction unless the property to be 

seized derived from an illegal source or the funds were 

structured for the purpose of concealing the violation 

of another criminal law or regulation, to require notice 

and a post-seizure hearing for such seizures, and for 

other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Restraining Excessive 

3 Seizure of Property through the Exploitation of Civil 

4 Asset Forfeiture Tools Act’’ or the ‘‘RESPECT Act’’. 

5 SEC. 2. INTERNAL REVENUE SERVICE SEIZURE REQUIRE6 MENTS WITH RESPECT TO STRUCTURING 

7 TRANSACTIONS. 

8 Section 5317(c)(2) of title 31, United States Code, 

9 is amended— 

10 (1) by striking ‘‘Any property’’ and inserting 

11 the following: 

12 ‘‘(A) IN GENERAL.—Any property’’; and 

13 (2) by adding at the end the following: 

14 ‘‘(B) INTERNAL REVENUE SERVICE SEI15 ZURE REQUIREMENTS WITH RESPECT TO

16 STRUCTURING TRANSACTIONS.— 

17 ‘‘(i) PROPERTY DERIVED FROM AN IL18 LEGAL SOURCE.—Property may only be 

19 seized by the Internal Revenue Service 

20 pursuant to subparagraph (A) by reason of 

21 a claimed violation of section 5324 if the 

22 property to be seized was derived from an 

23 illegal source or the funds were structured 

24 for the purpose of concealing the violation 

25 of a criminal law or regulation other than 

26 section 5324. 


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1 ‘‘(ii) NOTICE.—Not later than 30 

2 days after property is seized by the Inter3 nal Revenue Service pursuant to subpara4 graph (A), the Internal Revenue Service 

5 shall— 

6 ‘‘(I) make a good faith effort to 

7 find all persons with an ownership in8 terest in such property; and 

9 ‘‘(II) provide each such person 

10 with a notice of the person’s rights 

11 under clause (iv). 

12 ‘‘(iii) EXTENSION OF NOTICE UNDER

13 CERTAIN CIRCUMSTANCES.—The Internal 

14 Revenue Service may apply to a court of 

15 competent jurisdiction for one 30-day ex16 tension of the notice requirement under 

17 clause (ii) if the Internal Revenue Service 

18 can establish probable cause of an immi19 nent threat to national security or personal 

20 safety necessitating such extension. 

21 ‘‘(iv) POST-SEIZURE HEARING.—If a 

22 person with a property interest in property 

23 seized pursuant to subparagraph (A) by 

24 the Internal Revenue Service requests a 

25 hearing by a court of competent jurisdicVerDate Sep 11 2014 02:20 Sep 21, 2016 Jkt 059200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3353.IS S3353

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1 tion within 30 days after the date on which 

2 notice is provided under clause (ii), such 

3 property shall be returned unless the court 

4 holds an adversarial hearing and finds 

5 within 30 days of such request (or such 

6 longer period as the court may provide, but 

7 only on request of an interested party) 

8 that there is probable cause to believe that 

9 there is a violation of section 5324 involv10 ing such property and probable cause to 

11 believe that the property to be seized was 

12 derived from an illegal source or the funds 

13 were structured for the purpose of con14 cealing the violation of a criminal law or 

15 regulation other than section 5324.’’. 

16 SEC. 3. EXCLUSION OF INTEREST RECEIVED IN ACTION TO 

17 RECOVER PROPERTY SEIZED BY THE INTER18 NAL REVENUE SERVICE BASED ON STRUC19 TURING TRANSACTION. 

20 (a) IN GENERAL.—Part III of subchapter B of chap21 ter 1 of the Internal Revenue Code of 1986 is amended 

22 by inserting before section 140 the following new section: 


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1 ‘‘SEC. 139G. INTEREST RECEIVED IN ACTION TO RECOVER 

2 PROPERTY SEIZED BY THE INTERNAL REV3 ENUE SERVICE BASED ON STRUCTURING 

4 TRANSACTION. 

5 ‘‘Gross income shall not include any interest received 

6 from the Federal Government in connection with an action 

7 to recover property seized by the Internal Revenue Service 

8 pursuant to section 5317(c)(2) of title 31, United States 

9 Code, by reason of a claimed violation of section 5324 of 

10 such title.’’. 

11 (b) CLERICAL AMENDMENT.—The table of sections 

12 for part III of subchapter B of chapter 1 of such Code 

13 is amended by inserting before the item relating to section 

14 140 the following new item: 

‘‘Sec. 139G. Interest received in action to recover property seized by the Internal Revenue Service based on structuring transaction.’’. 

15 (c) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to interest received on or after the 

17 date of the enactment of this Act. 

Æ 


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