IRS Shuts Down Mom And Pop Dressmaker, Sells Dresses Within Hours

The unmarked vehicles arrived in the morning. More than 20 armed agents poured out.

Hours later, Mii’s Bridal & Tuxedo was out of business after serving customers for decades. Its entire inventory of wedding gowns and dresses as well as sewing machines and other equipment were sold at auction.

by Kevin Krause, Federal Courts Reporter – You may read the entire article HERE on DallasNews.com

The hastily-called sale held inside the store netted the IRS about $17,000 — not enough to cover the roughly $31,400 in tax debt alleged, court records show. The balance is now likely unrecoverable.

Mii’s, a small Garland business owned by an elderly immigrant couple from Thailand, was never accused in court of violating any federal laws.

The owners, Tony Thangsongcharoen, 68, and his wife, Somnuek Thangsongcharoen, 72, are fighting back. The Garland couple sued the government in federal court in Dallas in March for more than $1.8 million, alleging the IRS violated its own procedures during the tax seizure at the small storefront on Garland Road in March 2015.

“The agents auctioned off, before their very eyes, the family’s entire life savings for pennies on the dollar,” the lawsuit said.

Allegations of improprieties against the IRS for its asset seizures are not new. The agency has been under fire in recent years for seizing the bank accounts of mom and pop businesses due to their banking transactions.

The IRS claimed that the businesses intentionally tried to evade federal bank reporting requirements by making cash deposits just under the $10,000 limit. Critics say the IRS is being heavy-handed for seizing money from businesses when they haven’t been charged with a crime.

Anya Bidwell, an Austin-based attorney for the Institute for Justice, a public interest law firm in Arlington, Va., said the IRS has a “history of aggressively interpreting federal laws to seize property.” The IRS agreed to change its policy of targeting small businesses for cash seizures, she said. But the Mii’s Bridal case, she said, shows that “broader, more comprehensive reform is also needed.”

“No one in the United States should lose property without being convicted of a crime or without a proper due process hearing,” Bidwell said.

IRS agents seized the entire inventory of Mii's Bridal in 2015 and put the elderly owners out of business after decades of serving customers. They are fighting back in a federal lawsuit in Dallas.  (Susan Walsh/The Associated Press) — IRS agents seized the entire inventory of Mii’s Bridal in 2015 and put the elderly owners out of business after decades of serving customers. They are fighting back in a federal lawsuit in Dallas.
(Susan Walsh/The Associated Press)

The Mii’s Bridal lawsuit also claims that some of the seizing agents improperly purchased items during the auction, in addition to other irregularities.

“The lead agent brought four children to join the armed agents and tag along during the entire process,” the lawsuit stated. The children sat on a pallet with several boxes of pepperoni pizza while watching events unfold, the suit said.