Frivolous Tax Arguments

Promoters of frivolous schemes encourage people to make unreasonable and outlandish claims to avoid paying the taxes they owe. The IRS has a list of frivolous legal positions that taxpayers should avoid. These arguments are false and have been thrown out of court. While taxpayers have the right to contest their tax liabilities in court, no one has the right to disobey the law or IRS guidance.

This is the first in a series of three articles addressing frivolous tax arguments in general:

A. The Voluntary Nature of the Federal Income Tax System

Contention: The filing of a tax return is voluntary
Contention: Payment of tax is voluntary
Contention: Taxpayers can reduce their federal income tax liability by filing a “zero return
Contention: The IRS must prepare federal tax returns for a person who fails to file
Contention: Compliance with an administrative summons issued by the IRS is voluntary

B. The Meaning of Income: Taxable Income and Gross Income

Contention: Wages, tips, and other compensation received for personal services are not income
Contention: Only foreign-source income is taxable
Contention: Federal Reserve Notes are not income
Contention: Military retirement pay does not constitute income
C. The Meaning of Certain Terms Used in the Internal Revenue Code

Contention: Taxpayer is not a “citizen” of the United States, thus not subject to the federal income tax laws
Contention: The “United States” consists only of the District of Columbia, federal territories, and federal enclaves
Contention: Taxpayer is not a “person” as defined by the Internal Revenue Code, thus is not subject to the federal income tax laws
Contention: The only “employees” subject to federal income tax are employees of the federal government

D. Constitutional Amendment Claims

Contention: Taxpayers can refuse to pay income taxes on religious or moral grounds by invoking the First Amendment
Contention: Federal income taxes constitute a “taking” of property without due process of law, violating the Fifth Amendment
Contention: Taxpayers do not have to file returns or provide financial information because of the protection against self-incrimination found in the Fifth Amendment
Contention: Compelled compliance with the federal income tax laws is a form of servitude in violation of the Thirteenth Amendment
Contention: The Sixteenth Amendment to the United States Constitution was not properly ratified, thus the federal income tax laws are unconstitutional
Contention: The Sixteenth Amendment does not authorize a direct non-apportioned federal income tax on United States citizens

E. Fictional Legal Bases

Contention: The Internal Revenue Service is not an agency of the United States
Contention: Taxpayers are not required to file a federal income tax return, because the instructions and regulations associated with the Form 1040 do not display an OMB control number as required by the Paperwork Reduction Act
Contention: African Americans can claim a special tax credit as reparations for slavery and other oppressive treatment
Contention: Taxpayers are entitled to a refund of the Social Security taxes paid over their lifetime
Contention: An “untaxing” package or trust provides a way of legally and permanently avoiding the obligation to file federal income tax returns and pay federal income taxes
Contention: A “corporation sole” can be established and used for the purpose of avoiding federal income taxes
Contention: Taxpayers who did not purchase and use fuel for an off-highway business can claim the fuels tax credit
Contention: A Form 1099-OID can be used as a debt payment option or the form or a purported financial instrument may be used to obtain money from the Treasury