Taxes are Illegal?

The man sitting across my desk had been a client for years. He had come in to tell me that he would not be using my services ever again.

“Why?”, I asked.

He had found a lawyer who had told him that income and social security taxes were illegal. All my former client needed to do was file some forms with the government and he would effectively “untax” himself.
“Anyone can do it,” my client told me. “It is just that the government has everyone believing that taxes are required. All you need to do is file the proper forms, and you won’t ever have to pay taxes again. And it is perfectly legal.”

Unfortunately I never saw him again so I have no idea how the whole scheme worked. But every year I have people tell me that taxes are illegal, or unconstitutional, or only for corporations. And every year I tell them that the IRS has said over and over again that taxes are legal, and constitutional, and for everyone with income.

I was looking at a website today, that will sell you a package to “untax” yourself for the small sum of $700. The package will include all the forms you need to send to the government so you will never have to pay income taxes or social security taxes again.

Judging from the page and pages of double speak, the main argument of this website, is that paying taxes is voluntary. They also state that the 16th amendment was never properly ratified, and that wages are not taxable because they are not defined as “income” in the IRS tax code.

Before you fall for this type of scam, please take a moment to read what the IRS has to say about these frivolous tax arguments(pdf file).

If you don’t like reading IRS documents I’ll sum it up for you here. Taxes are legal, the 16th amendment was properly ratified, and wages are income under the law. You can’t avoid taxes by declaring you are not a citizen, by filing any type of “untaxing” paperwork, or by submitting a zero income tax return.

If you choose to use any of these arguments on your tax return the IRS can impose a $5,000 penalty for preparing a frivolous tax return in addition to any other fines or penalties that may be due for underpayment of tax and failing to file a tax return.

The Top Tax Protester, Where Is He Now?

Irwin Schiff is arguably the most prominent tax protester in the United States. He is the author of two books, has presented seminars and appeared on national television promoting his ideas about the legality of the income tax. Most if not all of the tax protester arguments you will hear today originated with Irwin Schiff.

Today Irwin Schiff is a guest of the United States government, serving over 12 years for his 2005 conviction for filing false tax returns, assisting in the preparation of false tax returns filed by other taxpayers, conspiring to defraud the United States, and income tax evasion. He has also been ordered to pay over $4 million in back taxes, fines and penalties.

If You Told People The Truth About Income Taxes You Would Be Out Of A Job

I can’t tell you how many times I have had people tell me that I must know that paying taxes is illegal, and the only reason I don’t tell people is that I would be out of a job. If only it were true. The truth is, if I knew a way that people could legally earn income without paying taxes, I would be more than happy to share it with all my customers, and I am sure they would be more than happy to pay for that information. In fact, I would be the most popular tax adviser in my state.

20 thoughts on “Taxes are Illegal?”

  1. I remember reading about these arguments in law school. While I’m about as libertarian as they come, it’s pretty hard to argue against some minimal taxation. What really irks me, is when local government taxes through law enforcement. While our Massachusetts Lawyer Network doesn’t currently handle tax cases, it’s good to know that there are those lawyers out there protecting folks from unfair taxation.

  2. Nice arguments , even I had heard lot of times that paying taxes are illegal but one should thing how the country will spend money if nobody would pay taxes . I feel strange if somebody gets trapped under such scam

  3. Taxes are illegal? That’s hilarious! If I were you, I would just tell that client to go ahead and file the necessary paperwork to releive him of his tax burdens…and then make sure he writes at least once a week from his Federal prison cell to let me know how it turned out for him.

    Bottom line: everybody needs to pay taxes. Although we hate it, it is still a necessary burden that is in place for the greater good of all.

  4. Sigh, if only there was a legal and proper way to not pay taxes, I’m sure someone would’ve unearthed how by now. The sad truth is that there’s none. Irwin Schiff is a great example why we should diligently and honestly pay and file our income taxes, unless we want to end up in jail. Thanks! :)

  5. Wish it were true – given this economy I can see why people – especially if they are on a fixed income – would be trying to do something like this. Too bad the people selling them these lines of bull are also probably ripping them off.

  6. Paying taxes is an obligation. This is our way, as citizens, to contribute for the betterment of our country. I’m just hoping that people in the government will use it wisely and for the benefit of all its citizens.

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  7. You do need to pay your taxes honestly, but on another point, there is no reason to pay more than you owe. I think of taxes like a game. I play by the rules but I play to win. Take advantage of every deduction and don’t pay any more than you are legally obligated to.

  8. We have an obligation to pay our taxes, our government has an obligation to spend the money wisely. I am not sure how well they are holding up their end of the deal! But like I said before, no one is obligated to pay more than their fair share.

  9. wow i havent heard about this before, but wouldn’t it be super if it were true? if only corporations are taxed and not us? 😀

  10. As a responsible citizen, everybody must pay the tax. And at the same time government must utilize the money in proper way. But there is no need to pay more at all. And we must be aware of this thing. Kathleen, u have told the whole thing in a very interesting and nice way. Great.

  11. Paying taxes is a responsibility that every citizen should conform to. I think it’s the least we can do to give back to our country. Thanks for your insights! :)

  12. No surprise,Sometime I also agree taxes are Illegal.
    Well, it’s depend on where you are living and what is your financial situation is.
    In a 3rd world country, paying taxes means paying money to help some pirate of the parliament to do more crime (no offense).

    Now if your financial is unbearable because you maintain a large family etc. You could think like the heading of this article. Again is 3rd world countries there are no social security, no infrastructures etc.

    But while you are in a first world county the heading of this article may go wrong. Your govt. makes bringing all happiness for you, we should pay it to them. There must be some exception, so the heading could be true.

  13. Taxes are legal. I would say pay your taxes but be sure to find a good accountant who keep you from overpaying them. You don’t want to get into a situation where you are up against the IRS, which is an area in which we are experts.

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