The Internal Revenue Service (IRS) recently released its annual The Truth About Frivolous (funny) Tax Arguments report, which outlines not only the most popular arguments people have presented over the years to avoid paying their taxes, but also the policy statements and inevitable tax court decisions the government has used to debunk them.
Back in 2006, Congress increased the penalty for frivolous tax returns to $5,000 from $500. The penalty is applied when a person submits a tax return and any portion of the submission is based on a position the IRS identifies as frivolous. Filers typically present forms that indicate they have no income or tax liability, also known as a “zero return.” Their reasons for not paying usually come up in tax court when the filers try to contest an audit or lien.
Those who were planning a dispute can find the full report on the agency’s website, but MainStreet highlighted some of the main contentions disputed in federal courts and now considered frivolous by definition.
Contention 1: Taxpayers can refuse to pay income taxes on religious or moral grounds.
The IRS says taxpayers have frequently used the First Amendment to argue that they don’t have to pay taxes because it is against their moral or religious beliefs, since it says that “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.” The Supreme Court has frequently asserted that saying your religious beliefs are in conflict with the payment of taxes provides no basis for refusing to pay, though.
Contention 2: Paying taxes violates the Fifth Amendment.
The Fifth Amendment to the Constitution says a person shall not be “deprived of life, liberty, or property, without due process of law.” This might sound like a sound argument if the law hadn’t already decided it is well within the government’s rights to charge residents to live here. According to the IRS, the Supreme Court stated in Brushaber v. Union Pacific R.R., 240 U.S. 1, 24 (1916), that “it is … well settled that [the Fifth Amendment] is not a limitation upon the taxing power conferred upon Congress by the Constitution.”
Contention 3: Taxes are a form of servitude in violation of the 13th Amendment.
Residents have argued that paying taxes is a form of servitude, which is problematic, since the 13th Amendment prohibits slavery (as well as the imposition of involuntary servitude). Courts have consistently found that paying taxes is not considered forced servitude, though, calling the claim “clearly unsubstantial and without merit,” as well as “far-fetched and frivolous.”
Keep in mind that the IRS does have payment plans available for taxpayers who find themselves significantly impaired financially. In fact, the IRS recently made changes to its lien system, the main way the agency penalizes people who can’t pay their taxes on time.
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