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The IRS has jurisdiction to forfeit property under Titles 18, 26, and 31.

Section 981(a)(1)(A) of Title 18 authorizes forfeitures of real and personal property involved in a transaction or attempted transaction in violation of 18 U.S.C. §§ 1956, 1957 and 1960, or property traceable to such property. See 18 U.S.C. §§ 1956 and 1957 and the Memorandum of Understanding (MOU), dated August 1990 defining Service jurisdiction.

IRS-CI has jurisdiction under 18 U.S.C. § 981(a)(1)(C) to forfeit proceeds derived from specified unlawful activities. In order to exercise this jurisdiction, the proceeds forfeiture must be incidental to a legitimate money laundering investigation. Use of forfeiture authority under section 981(a)(1)(C) is limited to situations in money laundering investigations where no reasonable forfeiture alternative is available, that is, proof required to forfeit under section 981(a)(1)(C) is lacking. These situations typically arise when the subject property cannot be traced to a specific financial transaction.

Sections 7301 and 7302 of the Internal Revenue Code (Code Forfeitures) authorize seizure and forfeiture of property used or intended to be used in violation of any of the internal revenue laws. All proposed forfeitures under IRC §§ 7301 or 7302 that do not relate solely to violations of IRC § 6050I or wagering excise tax violations (i.e., violations not relating to violations under IRC §§ 4401, 4411, 4412) require authorization from the Associate Chief Counsel (CT) prior to recommending forfeiture. The Associate Chief Counsel (CT) must review and approve any proposed seizure of real property for Code forfeiture. The field will handle all other forfeitures matters and may make the referral directly to the US Attorney (if judicial).

Section 5317(c) of Title 31 forfeitures are predicated on violations of the Bank Secrecy Act. See 31 U.S.C. §§ 5313(a), 5316, and 5324(a). Prior to enactment of the USA Patriot Act of 2001 (October 26, 2001), Pub. L. 107-56, 18 U.S.C. § 981(a)(1)(A) listed 31 U.S.C. §§ 5313(a) and 5324(a) as the only Title 31 violations subject to forfeiture. Section 372 of the Patriot Act removed those sections from Title 18 and inserted the sections in their entirety into 31 U.S.C. § 5317(c).

The burden of proof to seize forfeitable property is probable cause. The burden of proof to forfeit is preponderance of the evidence. The Criminal Tax attorney should ensure the available evidence is sufficient to sustain both the seizure and forfeiture.

Criminal Investigation’s authority to seize property subject to forfeiture is pursuant to Delegation Order No. 158 for Titles 18 and 31, and Delegation Order No. 157 for Title 26.