Over the six-plus years I’ve spent as editor-in-chief at Accounting Today, I’ve come to anticipate several certainties as tax season winds down.
The first is that I’m going to be writing checks to my federal and state governments. Second, a number of managing partners are going to be a lot easier to get on the phone. And last, at least one story will surface about some outfit decrying paying taxes as unconstitutional.
On the last point, I present “We the People,” an organization that has come into the cross-hairs of regulators for peddling a product called a “Tax Termination Package” that assures its purchasers they can legally stop their tax withholdings.
In a 14-page complaint filed last week in U.S. District Court in Syracuse, N.Y., prosecutors allege that the group’s scam has resulted in shorting the U.S. Treasury more than $21 million in unpaid taxes since 2003.
They charged that founder Robert Shulz has used the We the People Foundation for Constitutional Education, and ancillary organization We the People Congress, to basically market the Tax Termination scheme to people in some 37 cities.
For a donation of $20, the package provides buyers a number of forms that are advertised as substitute IRS forms, and supplies instructions on how to terminate their tax holdings. The filing also alleges that the package tells its purchasers to demand that their employers discontinue using their Social Security numbers. That alone should raise at least one red flag or two.
Like my annual exercise in check writing, the exhortations of We The People are a familiar story riddled with a familiar, almost antiquated premises. -- i.e. the 16th Amendment was not ratified, federal taxes are voluntary, ad nauseum.
What never ceases to amaze me, however, is that there never seems to be a down market for these types of Barnum-esque cons.
Unfortunately for honest taxpayers, tax avoidance schemes aren’t like bell-bottoms or leg warmers -- impacted by changing consumer tastes.
There’s a willing (read gullible) and easily replenished demographic attracted to the misguided notion that paying taxes is not mandatory. And undoubtedly there will always be a inexhaustible force behind the marketing of such schemes, smooth orators who can easily convince a tollbooth collector that the car behind them is going to pay.
The sad part of this annual travesty is that every argument I’ve read or heard about -- and since I began this job in 2000 I’ve heard plenty -- has been quickly dismissed in a courtroom.
Yet, like Ralph Kramden of The Honeymooners, who was convinced that his next get-rich-quick scheme would finally yield the mother lode, tax-avoidance hopefuls are told the line forms to the right.
Sorry folks, I don’t like the April payment ritual any more than you do, but unless we usher in true tax reform, my advice is to place any marketing materials for these programs in the nearest circular file.
In the long run it will prove infinitely cheaper.
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