Tuesday, March 4, 2008

Tax Time Scams--How to keep I.R.S. from Knocking on Your Door

--Amateur Tax Cheats Going Berserk with Looney Tunes Tax Filings--Don't Make these Mistakes

Tax time puts the Law of Argument in the spotlight: Anything is possible if you don't know what you're talking about. If you need a match and a cup of gasoline, aimless tax cheating might qualify you for such playthings.

So many of the excuses so many taxpayers use at filing time to avoid paying taxes are totally absurd. They are not only plentiful, but unbelievable, child-like. If they are in training to become a professional con man, they have failed miserably. In prison you spend most of your time in an 8 x 10 cell; at work you spend most of your time in a 6 x 8 cubicle. Maybe these people are trying, in some warped way, to upgrade their lifestyle. Here are some examples of their attempts to qualify:

> The filing of a tax return, and payment of taxes are "voluntary," is the claim. Wrong. You don't say this to IRS any more than you would say to a feminist, "Isn't that cute?" Voluntary only refers to the individual's rights to put the figures together. The right to file, and pay, is definitely involuntary. To the point of a pounding drum beat, courts have repeatedly told us this.

> The filing of a zero return, entering the figure 0 on every line. Some taxpayers even go so far as to request a refund of their taxes withheld. Insanity? At times it seems reality is a crutch for people who can't handle drugs. This doesn't even have the first raw rudiments of a legal scam.

> Contention: Section 6020(6) of the tax code requires the IRS to prepare a federal tax return for any person who does not file. Another nutty, unimaginative argument. (Everybody is somebody else's weirdo.) Oh, if you don't file, IRS will file for you alright. They will gather the figures on compensation, and tax you on the entire gross amount. No split-out gross / adjustable gross / net income figures here.

> Some actually assert that wages, tips, and other compensation received for personal services rendered are not income--because, get this, there is no taxable gain when a person "exchanges" labor for money. This "reasoning" is like trying to figure why a woman can't apply mascara with her mouth closed. Still another head-scratcher.

> Federal Reserve Notes are not money. Why? Because they cannot be exchanged for gold or silver. How about wampum?

> Some claim they have rejected U.S. citizenship in favor of state citizenship, thereby freeing themselves of all obligations to pay federal taxes. Easy way out, huh? After all, there is no recorded case of an ostrich ever having died of suffocation from burying its head in the sand.

> Some even go so far as to claim that the United States consists only of the District of Columbia, federal territories, e.g. Puerto Rico, Guam, etc., and federal enclaves such as Indian reservations and military bases; therefore non-residents of these enclaves are tax exempt. Dreamers, dreamers, dreamers. (Never give yourself a haircut after 3 Martinis.)

Some mistakes are too much fun to only make once? Is that the driving motivation?
Real people. Real thought processes. But, you must ask, are these people all living in the real world?

32 comments:

Anonymous said...

I don't think Federal Reserve Notes are money any more either. I wonder if I could pay my taxes in Euros.

Anonymous said...

As tax time is closing in I am running out of deductions to claim. I can't think of any. But no thank you, I will not choose any on this menu.

Jill said...

Great article, as usual, Jack. Thanks for the 'what not to do list'

Jill

Anonymous said...

Great skip list. Not that I was tempted to do any of the things on the list, but it is nice to have a good refresher course on restrained idiocy now and then.

Anonymous said...

My friend, Wilma, had a demand from the IRS for taxes on the entire $100,000 of her income. Her tax would have been some $32,000. After she proved her deductions and other claims she ended up paying $14,000. That's a lot of difference.

Jack Payne said...

Like your local tax assessor saying, if we can tax it, we will, IRS is, fundamentally, no different. But, reality must prevail. And, the case histories presented here obviously have no kinship with reality.
So, if you wish to remain free of an IRS audit, please do not go the route of Forest Gump's mother's warning, "Stupid is as stupid does."

Jack Payne said...

Like your local tax assessor saying, if we can tax it, we will, IRS is, fundamentally, no different. But, reality must prevail. And, the case histories presented here obviously have no kinship with reality.
So, if you wish to remain free of an IRS audit, please do not go the route of Forest Gump's mother's warning, "Stupid is as stupid does."

Swubird said...

Super advice. People should be constantly reminded of how much the IRS loves them one and all. Just like God's children. But as soon as you stray from the flock, the love affair is over. Like the Godfather said, "Don't ever go against the family."

Nice post.

Happy trails.

Anonymous said...

Are these people slow learners or quick forgetters? This whole thing is like an I.Q. problem. I can't conceive any of these 'taxpayers' having an I.Q. greater than that of a pencil eraser.

Jack Payne said...

Swubird, every extended family has a Crazy Uncle Harry living in somebody's attic. I guess these are the loose cannons that cause problems for all the straight-forward taxpayers. This must be the big happy family--complete with weak links--that IRS deals with all the time.

McAlee, every April somebody goes to the attic to pick up Uncle Harry's tax return and transmit it to IRS for him. How else could these idiot-returns ever see the light of day.

I must apologize again, folks. I have double-clutched again--got 2 renditions of the same message back to back in this Comments thread. I'm still struggling with the stupidity of this.
With determination I will lick this problem yet.

Anonymous said...

I can't even conceive of these taxpayer types being marched out of a courtroom in a handcuffed perp-walk on their way to prison. I can only envision them being led out of their homes in straightjackets by men in white coats, on their way off to a mental institution.

Anonymous said...

and these people actually work somewhere and earn a living, amazing. have you checked ebay for jack payne? have you made and album in the past? have you secretly recorded music in the past?

Anonymous said...

I've got an Uncle Harry in my family, a real uncle. With him, even though he doesn't live in an attic, the same nuttiness is his hallmark. Every year he comes up with some absurd deduction that should only be taken in heaven. Next I expect to see him declare citizenship of Slobovia to escape U.S. taxes.

Jane Turley said...

So that how Bruce Willis lost his hair! I'd been wrestling with that question for a long time... now I know I feel sufficently composed enough to fill out my tax return. (Don't look Jack but I've got a magic pen....)

Anonymous said...

lol I never thought it went this far...

I've heard some things like
had an ex who struck a deal with some random woman (im talking stranger people) to claim her kid on his taxes - AND me mind you.. so that he could get a bigger refund

somehow, someway - it worked for like 2 min

til the IRS came knocking for their money back

money they quickly spent

several thousand dollars you didn't have to begin with? painful. just.. painful.

Anonymous said...

I didn't know Bruce Willis lost his hair over taxes.

Jack Payne said...

Sharyn, Sharyn, Sharyn, my love. I have offered to take you in off the streets, put a roof over you to keep raindrops from falling on your lovely head. I have offered to give you shoes and your very own kitchen. You know me well. And, you still don't know that the musical Jack Payne is someone else?
Tsk, tsk, Sharyn. When will you learn? One would think you have become overcome by pizza oven fumes.

Yes, Jemi, I too could never understand why women can't apply mascara with their mouths closed. The riddle remains.

Jane and Terry, I believe it was about the time of his break-up with Demi Moore that Bruce Willis lost his hair. I understand he had a big tax problem at that time but am unclear as to specifics.

Jane Turley said...

Hmm, I think you're right Jack...I bet Bruce had a huge tax problem. (Although, come to think of it, Demi didn't look so good in GI Jane either..)

Ps, I look forward to reading your book that Tamera has reviewed. Sounds just up my street; hope the protagonist keeps his hair on though.

Jack Payne said...

Jane, hair stays on.

Guaranteed.

Anonymous said...

you are so very talented i just thought music was one of your various many gifted achivements

Entrepreneur Life said...

Thanks for stopping by Entrepreneur Life and leaving a comment, maybe one day I can interview you? Great Post by the way, I especially liked the humorous line about upgrading their lifestyle.

Anonymous said...

I thought this was a real live wire comments string...but what happened? All of a sudden it went dead.

Jack Payne said...

That's the way the cookie crumbles sometimes, Terry. One never knows about the ebb and flow of information over the internet, does one?

Jane Turley said...

Ok ok, I don't mind talking about Yul Bryner... now he had a really bad tax problem....

Jack Payne said...

Ho, hum! Pretty sleepy around here right now, Jane. New piece goes up tomorrow, then, next week, my big one...

Yada, Yada, Yada--Blah, Blah, Blah

(This is the title.)

This article challenges societal "conventionalwisdom" everywhere, with not-too-delicate sledge hammer blows. This one might kick up a little interest.

I knew Yul, along with Bruce Willis, had a hair problem. But, I didn't know he had a tax problem too.

Jane Turley said...

Ah well, I look forward to the sledge hammer blows... nighty, night.

Lyn Collins said...

I've just recently found your blog. Great read. Lyn

Anonymous said...

thank you mr. jack for for making us realise thee hidden facts that are very useful in our daily lives. so nice article

Anonymous said...

i didn't kbnow that these taxmen can be involved in scams like these. so, this articles adds more importance to already exsisting importance....in other words, its a must read article..

Anonymous said...

its a really very harsh reality came before us at a very right time. thanks to the writer that he cares so much bout us....

Anonymous said...

didn't know that these damn taxmen are so eager to suck out our hard-earned money by using any smalest opportunity they get......

Unknown said...

mr. jack is doing tremendous work towards the upliftment of society by writing these superb articles...