Criminal Tax Manual 40.00 ILLEGAL TAX PROTESTERS [FN1]

Table Of Contents

  1. 40.01 GENERALLY
  2. 40.02 SCHEMES
    1. 40.02[1] Paper Terrorism
      1. 40.02[1][a] Harassment Schemes
      2. 40.02[1][b] Bogus 1Financial Instruments
    2. 40.02[2] Warehouse Banks
    3. 40.02[3] Trusts
    4. 40.02[4] Church Schemes
    5. 40.02[4][a] Generally 40.02[4][b] Vow of Poverty
    6. 40.02[4][c] Charitable Contributions 40.02[4][d] First Amendment Considerations
    1. 40.03[1] Criminal Summons
    2. 40.03[2] 26 U.S.C. 6103(h)(5) Juror Audit Information
    3. 40.03[3] IRS Agents' Authority
    4. 40.03[4] Indictment Not Sufficient Notice of Illegality
    5. 40.03[5] Filing of Protest Documents: Is the Document Filed a Tax Return?
      1. 40.03[5][a] Generally
      2. 40.03[5][b] What Is a Tax Return?
      3. 40.03[5][c] What Is or Is Not a Tax Return: A Matter of Law
    6. 40.03[6] Discovery of IRS Master Files
    7. 40.03[7] Motions in Limine
    8. 40.03[8] Attorney Sanctions
    9. 40.03[9] Evidentiary Issues
      1. 40.03[9][a] Prior or Subsequent Tax Protest Activities: Rule 404(b)
      2. 40.03[9][b] IRS Agent's Testimony and Sequestration
      3. 40.03[9][c]Admissibility of IRS Computer Records
    10. 40.03[10] Use of Pseudonyms by IRS Revenue Agents and Officers
    11. 40.03[11] Jury Nullification
  4. 40.04 WILLFULNESS
  5. 40.05 DEFENSES
    1. 40.05[1] Good Faith
      1. 40.05[1][a] Reliance on Return Preparer/Accountant
      2. 40.05[1][b] Reliance on Advice of Counsel
      3. 40.05[1][c] No Defense in Non-Tax Cases
    2. 40.05[2] Constitutional Challenges
      1. 40.05[2][a] Fourth Amendment -- Unreasonable Search and Seizure
      2. 40.05[2][b] Fifth Amendment -- Due Process; Freedom from Self-incrimination Are Unconstitutionally Vague Amendment Never Ratified
      3. 40.05[2][c] Tax Laws
      4. 40.05[2][d] Sixteenth
    3. 40.05[3] Selective Prosecution and Freedom of Speech
      1. 40.05[3][a] Generally
      2. 40.05[3][b] Selective Prosecution Defense
      3. 40.05[3][c] Freedom of Speech
    4. 40.05[4] District Court Lacks Jurisdiction of Title 26 Offenses
      1. 40.05[4][a] Generally
      2. 40.05[4][b] The Gold-Fringed Flag ("The American Maritime Flag of War")
    5. 40.05[5] Filing Income Tax Returns Is Voluntary, Not Mandatory
    6. 40.05[6] Wages Are Not Income
    7. 40.05[7] Defendant Not A "Person" or "Citizen";District Court Lacks Jurisdiction Over Non-Persons and State Citizens
      1. 40.05[7][a] Generally
      2. 40.05[7][b] Filing U.S. Nonresident Alien Income Tax Return
    8. 40.05[8] IRS Has Duty to Prepare Returns for Taxpayer (26 U.S.C. 6020(b))
    9. 40.05[9] Violation of the Privacy Act
    10. 40.05[10] Federal Reserve Notes Are Not Legal Tender
    11. 40.05[11] Form W-2 As Substitute for Form 1040
    12. 40.05[12] Paperwork Reduction Act ("PRA") Defense
    13. 40.05[13] Lack of Publication in the Federal Register
    14. 40.05[14] Taxpayer's Name in Capital Letters or Misspelled
    15. 40.05[15] Tax Protest Against Government Spending



Over the past thirty years, illegal tax protesters have developed numerous schemes to evade their income taxes and frustrate the Internal Revenue Service under the guise of constitutional and other objections to the tax laws. Individuals who merely express dissatisfaction with the income tax system are not criminally prosecuted. However, the right to freedom of speech is not so absolute as to protect conduct that otherwise violates or incites a violation of the tax laws. United States v. Citrowske, 951 F.2d 899, 901 (8th Cir. 1991). See also United States v. Fleschner, 98 F.3d 155 (4th Cir. 1996) (asking for First Amendment instruction); United States v. Kuball, 976 F.2d 529, 532 (9th Cir. 1992) (First Amendment does not protect those who go beyond mere advocacy, and assist in creation and operation of tax evasion schemes.)

Illegal tax protest schemes range from simply failing to file tax returns to concealing financial transactions and assets in warehouse banks and trusts to filing frivolous liens to interfere with IRS investigations. These schemes give rise to charges under all of the criminal tax statutes. [FN2] Thus, this chapter should be read in conjunction with those chapters of the Manual that discuss the various substantive offenses in detail. See Chapters 8.00 through 29.00, supra.