Tax protesters are individuals who, for whatever reason, deny that they are under any obligation to pay federal and/or state income taxes, or refuse to pay their taxes for other reasons. These people refuse to pay taxes because they believe that the tax laws in place are unconstitutional and that the tax laws do not apply to them or their income.
Their reasons for refusing to pay their taxes vary, but there are basically two categories of people who might be called “tax protesters.”
Dissagreement with Tax Laws: There are the people who acknowledge that the law requires them to pay their taxes, and they may believe that the tax laws are legitimate. However, because of fundamental disagreement with one or more government policies, they have decided to stop paying their taxes so they won’t have to pay for that activity, and to express their disagreement. They usually view this as a form of civil disobedience, and are aware of, and prepared to accept, the legal consequences.
Tax Laws are Unconstitutional: The other category of tax protestors are the ones who believe (or claim to believe) that they don’t have to pay their taxes, usually on the grounds that the income tax is unconstitutional or that the tax code doesn’t actually create any duty to pay income taxes.
What Are the Tax Protester's Arguments?
High profile proponents of the “tax protest” movement come up with new arguments all the time, and it is impossible to discuss and debunk them all. However, as a general matter, you should only take tax advice from a licensed accountant or tax attorney. Any reputable source of information about tax law will never promise to relieve you of your duty to pay taxes or tell you that you never had to pay taxes in the first place.
Here is a brief discussion and debunking of some of the most common arguments made by tax protesters:
Myth 1: The 16th Amendment Was Not Properly Ratified
The 16th Amendment to the U.S. Constitution was ratified in 1913, and explicitly gives the federal government the power to lay and collect taxes on incomes from any source. Before this, the federal government lacked the constitutional power to collect income taxes.
To become a part of the Constitution, a proposed amendment must be passed by 2/3 of Congress and ratified by the legislatures of ¾ of the states. When individual state legislatures were considering ratifying the amendment, like any other law, each state had to draft a bill and put it to a vote. Each bill contained the full text of the proposed amendment and varied from state to state in spelling, punctuation, or capitalization.
However, the substance of each version of the proposed amendment was identical. Every court that has considered the constitutionality argument of the income tax has flatly rejected it.
Myth 2: The Tax Code Doesn’t Actually Require Me to Pay Taxes
Some tax protesters claim that the tax code, which goes to great lengths to define what is and isn’t income and lays out various tax deductions, credits, and exemptions, doesn’t actually have a provision that requires citizens to pay their taxes. Their argument boils down to “show me the law.”
Here is the law: 26 USC § 6012 provides criminal penalties for failing to file a tax return, and 26 USC § 6151 states that payment of any taxes owed, barring a few specific exceptions, must be made at the time the return is filed.
Myth 3: The IRS Must Explain Exactly Why I Have to Pay My Taxes, within an Amount of Time Specified By Me
Some people claim you can avoid paying taxes if you write a letter to the IRS demanding a detailed explanation of why, exactly, you are required to pay your taxes. Further, they claim that if you put a provision in the letter saying something like “If you do not respond within 15 days, you formally relinquish any right to collect taxes from me, now and forever,” they will be bound by those terms, and if they don’t respond, you don’t have to pay.
This is, of course, false. First of all, in contract law, silence almost never constitutes an acceptance. Secondly, the IRS has plenty of information on its website about the services taxes pay for, why taxes are important, and where the IRS derives its legal authority to collect taxes. If you send a letter requesting this information, they’ll probably be glad to send you some literature answering any legitimate questions you might have. But they will do this on their schedule, and if they don’t respond, you still have to pay your taxes.
Myth 4: I’m a Member of a Historically Oppressed Ethnic Group, So I Don’t Have to Pay Taxes
Throughout American history, several ethnic groups have been treated unfairly or have even been oppressed. Obvious examples include African Americans, Native Hawaiians, and Native Americans. While we, as a society, continue to grapple with the consequences of these actions, the law applies to everyone in the U.S. equally, regardless of race or ethnicity. This applies to both legal rights and legal obligations, including taxes.
No court has ever held, nor does anything in the tax code provide, that there are any exemptions from tax liability based solely on the fact that one belongs to an ethnic group that has previously suffered injustice at the hands of the U.S. government.
Why Should I Pay Taxes?
There are many websites and arguments made by tax protesters that claim that taxes are unconstitutional or should not be paid. However, the IRS has laid out a detailed explaination of why these arguments are untrue and why taxes should be paid. Taxes should be paid because they go to other resources that help the country keep going. Anyone who files a return or makes a submission to the IRS based on frivolous tax arguments would be subject to an IRS penalty of $5,000 and may also be liable for a 75% civil fraud penalty.
Do I Need a Tax Attorney?
There is a huge amount of misinformation floating around about U.S. tax law. If you need tax advice, you should only seek it from a licensed tax attorney or accountant. If you hear a novel legal argument which claims to prove that you don’t have to pay your taxes, you should ask a tax attorney about it. He or she will likely explain, in as much detail as you want, if that argument has.