The "Voluntary" Nature of the Income Tax

by Jacob G. Hornberger
Apr. 15, 2009

Article reprinted from May, 2000.

Last month, of course, was tax time, the month in which millions of Americans filed their income tax returns with the Internal Revenue Service and paid whatever income taxes they still owed the government for 1999. Citizens dutifully went to their neighborhood post office, deposited their tax returns and checks into the mail, and secured return-receipt certificates verifying that they weren't late in mailing in their returns and checks.

Why? Why do people fork over a large portion of their hard-earned money to people they don't even know?

After all, think of what all that tax money would buy. Let's assume that 10 years ago, a person who pays an average of $20,000 a year in income taxes had stopped paying income taxes. That would mean that today he would have $200,000 plus interest in the bank, a nice chunk of money that would help fund a savings account, his children's education, an additional room to his house, a European vacation, medical bills, or a few donations to his favorite charities.

Yet he decides instead to send the money to the Internal Revenue Service or, more properly, allows the IRS to take it from him.

Why?

For years, the IRS has proclaimed that the great virtue of America's tax system is that it's voluntary. How does the IRS define "voluntary"? It says that the tax is voluntary because everyone computes his own income tax liability and sends the amount owed to the government. In other words, if the government calculated the tax liability for the citizenry, the tax would be involuntary. But since the people themselves are permitted to compute the liability, the tax is voluntary.

One can only wonder, of course, how many public-school-trained Americans believe this nonsense. The truth is that the income tax is no more voluntary than the military draft. If you fail or refuse to pay, they will seize you, fine you, jail you, or in the worst case, kill you, just as they do if you refuse to comply with a military draft.

And this is the true reason that people troop down to the post office and dutifully deposit those returns and checks.

Of course, an IRS official would respond, "You have a choice, and that's what makes the tax voluntary. You can choose to pay the tax or you can choose to go to jail. No one forces you to choose to pay the tax, and so it's voluntary."

But the choice between two evils does not convert the choice of one of them into a voluntary act. It is instead a choice between two coerced options.

For example, suppose a thief grabs you in a dark alley, points a gun in your face, and says, "Your money or your life." You choose to give him your money rather than surrender your life.

Could the thief later appear in court and say to the judge, "Your honor, I'm not guilty of theft because my victim gave me his money voluntarily"?

The process is no different with the IRS. Despite all the deceptive hoopla about the IRS's being a nice, pleasant, friendly, benign agency (check out its website at www.irs.gov), the truth is that this agency is no different, in principle, from the Nazi Gestapo or the Communist KGB.

State-sponsored terrorism

The IRS is a state-sponsored terrorist organization. Its very existence depends on the terror that it is able to strike in the hearts and minds of the American people. And it knows that the reason that American citizens scurry down to that post office to mail their tax returns is that they live in deadly fear of retaliation by this agency, just as people in Nazi Germany and Soviet Russia lived in mortal fear of the Gestapo and the KGB.

Every April, the IRS engages in a very subtle and sophisticated advertising campaign to reinforce the fear that it has instilled in the American people. For example, there was the time they hauled away the multimillionaire Leona Helmsley to jail for taking a few improper income-tax deductions. The not-so-subtle message to the rest of us? "If the wealthy and powerful cannot stand against us, what chance do you have? Pay your taxes on time or else!"

This year, the publicity campaign centered around the Indianapolis Baptist Church in Indiana. The church owes $6 million in unpaid payroll taxes. The church's position is that they never paid "salaries" to their employees but instead made a series of "love gifts."

Unfortunately, however, IRS people don't believe in love, because one of their spokesmen (who asked not to be identified) dismissed the church's argument, declaring, "In the United States, if you employ people, whether you are tax-exempt or not, you've got to withhold taxes for workers."

Got to? But I thought it was all voluntary!

The IRS threatened to begin foreclosing its tax lien on the property, and guess what date it selected to begin the process: April 10. What a remarkable coincidence! "If a 50-year old church with 1,000 members cannot stand against us, what chance do you have? Pay your taxes on time or else!"

The viciousness of the IRS

What happens if you refuse to file your tax returns and refuse to pay your income taxes? Well, tax resisters say that nothing will happen to you because, echoing the IRS commissioner, they say that the income tax is voluntary. Their arguments are multifaceted, ranging from their claim that the U.S. criminal statutes and IRS code do not require people to pay their taxes to their claim that the 16th Amendment was never properly ratified. On the basis of these claims, thousands of American tax resisters don't file and don't pay taxes and tell other people that they can live tax-free lives as well.

All too often, however, what the tax resisters don't tell others is that they live lives of misery and impoverishment. Most of them don't have bank accounts, preferring to deal with bank money orders purchased at convenience stores, because the IRS will simply place a levy on their bank accounts. They also customarily don't own real estate, including a home, because the IRS clouds their title with tax liens. They don't hold salaried positions because the IRS garnishes their wages. Thus, to truly avoid the IRS's collection of the taxes owed, tax resisters are often relegated to finding a series of "independent contracts," entailing no withholding tax, which provides them with a subsistence standard of living.

Are they principled? You bet. Are they courageous? You bet. But they cannot deny that when people free themselves from the "voluntary" income tax, the result is a lifestyle different from that of everyone else.

Tax resisters often point to the fact that they are not in jail as proof that the income tax is voluntary. But the truth is that many of them have gone to jail. And while the IRS doesn't go after all of them, especially those who keep a low profile, it is simply owing to staff shortages and not because the IRS has folded or surrendered.

Let me provide you with an example of the viciousness of these IRS people. When I was a young attorney, I represented a woman who owed the IRS, as I recall, somewhere around $20,000. Her husband had abandoned her and her child and was living somewhere in Mexico. The bank was foreclosing on her home, which had an equity of about $40,000 in it.

Owing to indifference or incompetence, the IRS had forgotten to file a tax lien against the property. We advertised the foreclosure sale in the local newspaper, and on the appointed day, lots of people showed up and bid on the property. The result was an enormous foreclosure check for the equity, which was made jointly payable to my client and her husband (who, unfortunately, was not around to endorse and cash the check).

We immediately filed suit for divorce in state court, deposited the check into the registry of the court, and asked the judge to use the money for child support for my client's teenage boy until he reached 18 years of age. By placing the money under the control of a state court, we had immunized it from IRS liens.

A local IRS agent got wind of what we had done, walked into my law office, and pleasantly demanded his share of the money. I pleasantly responded that there was nothing I could do because the money was under the control of the state judge, who himself was concerned about the welfare of the child.

The IRS agent smiled and left my office. He then embarked on a course of harassment that included regular telephone calls and visits both to my client's home and to her place of work. He also made regular visits to her son's high school, where he seized the boy's truck.

After several weeks of this abuse, my client walked into my office and said, "Pay them the money. I cannot live like this." The IRS's nasty, vicious, little devils who constantly remind us of the "voluntary" nature of the income tax and how they're here just to "serve" had won.

Tax resistance can be deadly

What happens to tax resisters who follow their principles to their logical conclusion? Government agents kill them. And the only reason that we don't see IRS killings is that tax resisters place limits on themselves as to how far they will actually follow their principles. For they know that if they follow their principles to the end, they will find themselves part of the next life. Leonard Read, the founder of The Foundation for Economic Education, made this point in his book Anything That's Peaceful.

For example, let's assume that a tax resister says, "The income tax is voluntary, and I'm not paying it." Someone asks him, "Aren't you going to sell your home? The IRS could put a lien on it." He responds, "No way. This is my home. It belongs to me. I bought and paid for it with my own money. No IRS agent is going to take it away from me and I'm not going to sell it to avoid these people. I ain't afraid of them!"

One day, the IRS files its tax lien and sends a notice of the lien to the tax resister, with a request that he pay the back taxes. The resister says, "They don't understand. I ain't paying." If in fact he did pay under threat of foreclosure, then we would have to ask him, "Why then did you refuse to pay in the first place?"

The IRS files suit to foreclose its lien and the judge orders the foreclosure to take place, The resister says, "Let them foreclose. What's that to me? I ain't leaving my home." Of course, if he paid the taxes to avoid the foreclosure, we'd have to ask him, "Why then did you refuse to pay in the first place?"

At the foreclosure sale, a buyer purchases the property and the judge orders the local sheriff to evict the resister and give possession of the property to the new buyer. The sheriff sends the resister a letter asking him to vacate the property. The resister says, "You people don't understand what I've said from the very beginning. I ain't paying my taxes and you ain't gonna take my property from me. This is my home." And after all, if he tried to negotiate a deal with the new owner and the IRS, we would have to ask him, "Why then did you refuse to pay the taxes in the first place?"

On the appointed day, armed deputy sheriffs (and possibly a few tanks) surround the tax resister's house, prepared to enforce the judge's writ of possession. Through a megaphone, they order the resister to come out and vacate the premises. If the resister comes out and departs, we would have to ask, "Why then did you refuse to pay your taxes in the first place?" But if the resister decides to resist force with force, they will kill him.

Thus, if a tax resister refuses to pay his taxes, and if he follows his principles to their logical conclusion, he is a dead man.

There is one -- and only one -- good solution to the income tax and the IRS: repeal the tax, abolish this Gestapo-KGB agency, and ensure through constitutional amendment that this horrific assault on the freedom and well-being of the American people can never again become part of American society.

Mr. Hornberger is founder and president of The Future of Freedom Foundation, publisher of Your Money or Your Life: Why We Must Abolish the Income Tax by Sheldon Richman.