So if I understand correctly, the IRS took their money because they didn’t exceed the level set by law. Sort of like giving you a speeding ticket for driving a few mph under the limit because you were intentionally trying to not exceed the speed limit. Because you were obviously trying to avoid being ticketed by not exceeding the limit.
This is damned insanity.
Not quite. It's illegal to exceed the speed limit.
It's NOT illegal to deposit more than $10k. It's just that the bank has to report it.