I recently wrote about the Browns whom Ron Paul likened to Mahatama Gandhi and Martin Luther King for their courageous stand against the income tax. I think they had more guns than Gandhi and MLK, but that is a detail. Mr. Brown kept saying “Show me the law”. That challenge gave me a bout of existential terror. It would be kind of embarrassing for me to realize that over my career I have told people to pay over millions of dollars in the aggregate that were not required. I satisfied myself on that point but then JJ MacNab pointed to a site that nicely outlines the source of the law that requires U.S. persons to pay income tax. It is titled “Here is The Law That Makes The Average American Liable For the Income Tax“ There is one concession to the protesters that the authors make:
Over the years and out of literally thousands of tax protesters who have been criminally prosecuted, a very small handful have won acquittals in their criminal trials, by convincing the jury that they were too stupid to understand that they had to pay taxes.
People who win on what is known as the “Cheek defense” can still have their property seized and the like. They just don’t get an all expense paid vacation at Club Fed. The Cheek defense is a little challenging though. You have to have some intelligence to convince people you are stupid, but you cannot have too much.
Recently Joseph Maga was complaining to the Sixth Circuit that the lower court erred in letting the federal prosecutor convince a jury that he was smarter than he thought he was. The Sixth Circuit complimented him on his intelligence by upholding his conviction. Here is the story:
Several years ago, Maga obtained copies of his “individual master file” transcript (also known as an “IMF transcript” or a “specific transcript”), a technical record that the IRS uses to keep a running account of all of a person’s tax events—e.g., penalties assessed, refunds owed, refunds issued, and interest. He noticed that the code “MFR-01” appeared on each of his IMF transcripts. Unsure of the meaning of this code, he wrote to the IRS about it. An IRS disclosure officer replied via letter that the code meant “1040 not required.” Based on this letter and his reading of IRS manuals on the Internet, Maga claims he interpreted the code to mean that he was “not required” to file any returns.
The IRS’s records revealed that Maga stopped filing tax returns in 1996, years before he received the letter from the disclosure officer. When the IRS sent a levy notice, Maga requested a collection due-process hearing, purporting that he did not need to file tax returns. A grand jury indicted Maga for failure to file a federal income tax returns between 2002 and 2006—five counts in all. It also indicted Maga for four counts of tax evasion.
That cross-examination revealed that Maga, in his request for a collection due-process hearing, claimed that he did not need to file a return and, by way of explanation, attached the letter from the IRS disclosure officer explaining the meaning of MFR-01. Keegan read this letter to the jury, which concluded with the statement, “[i]n addition, [this letter] is not an official determination by the internal revenue service as to whether or not tax payers are required to file a return.”
The jury did not buy into Mr. Maga’s sincerity and the Court ruled they were being reasonable.
When viewed in a light most favorable to the government, the record permits a factfinder to conclude, beyond a reasonable doubt, that Maga actually knew about his legal duty to file and only pretended to rely on an idiosyncratic reading of the IRS letter and documents