[net.taxes] IRS

dave@lsuc.UUCP (David Sherman) (07/16/86)

In article <918@kontron.UUCP> cramer@kontron.UUCP (Clayton Cramer) writes:
>> >The IRS has also been known to fine people $500 (for a frivolous return)
>> >for doing things like writing checks to "internal ripoff service."
>> >Watch your step.
>> 
>> I would be interested in further details on this, since I find
>> it difficult to justify from a legal point of view.  In Canada,
>
>Most everything IRS does is difficult to justify from a legal point of
>view.

I've heard this view expressed before, in net.taxes (which group
I've now added to this discussion).  I admit I don't know that much
about the U.S. tax system, but I still find it hard to believe.
Americans are the most litigious people on earth, and you have
a solid constitutional framework which can be, and is, used to
attack laws and procedures which are unjust.  Now maybe the IRS
really is so powerful that no-one can risk attacking it, but I
still have my doubts.

>> the filing of the return is independent of the payment, although
>> of course they're usually done together.  But a return filed with
>> no cheque is just as valid as one with a cheque, and although
>> interest will run on unpaid balances, penalties for not filing
>> don't apply once the return is filed.  How could writing an
>> invalid cheque have any effect on this process?
>> 
>> I could understand a charge of attempted fraud, perhaps.
>> But filing a frivolous return?
>> 
>> Dave Sherman
>
>About three years ago, IRS had Congress pass a law making it illegal 
>to file a "frivolous" return.  I'm not sure exactly how Congress defined
>"frivolous", but the way IRS has enforced this law is to discourage any
>political comments that question their validity.

Again, what does the payment have to do with the return?
Where is this legislation - part of the Internal Revenue Code?
Section number?

Dave Sherman
The Law Society of Upper Canada
Toronto
-- 
{ ihnp4!utzoo  seismo!mnetor  utzoo  hcr  decvax!utcsri  } !lsuc!dave

ark@alice.UucP (Andrew Koenig) (07/17/86)

> I've heard this view expressed before, in net.taxes (which group
> I've now added to this discussion).  I admit I don't know that much
> about the U.S. tax system, but I still find it hard to believe.
> Americans are the most litigious people on earth, and you have
> a solid constitutional framework which can be, and is, used to
> attack laws and procedures which are unjust.  Now maybe the IRS
> really is so powerful that no-one can risk attacking it, but I
> still have my doubts.

In principle, anything the IRS does can be challenged in Federal
court.  The trouble is that before you can do that, you must first
bring your case to Tax Court, which is operated by -- you guessed it --
the IRS.  Once you lose your case there, I *think* you have to pay
the money they claim you owe and then go to Federal court to get
it back.  This is extremely time-consuming and expensive.

cramer@kontron.UUCP (Clayton Cramer) (07/18/86)

> In article <918@kontron.UUCP> cramer@kontron.UUCP (Clayton Cramer) writes:
> >> >The IRS has also been known to fine people $500 (for a frivolous return)
> >> >for doing things like writing checks to "internal ripoff service."
> >> >Watch your step.
> >> 
> >> I would be interested in further details on this, since I find
> >> it difficult to justify from a legal point of view.  In Canada,
> >
> >Most everything IRS does is difficult to justify from a legal point of
> >view.
> 
> I've heard this view expressed before, in net.taxes (which group
> I've now added to this discussion).  I admit I don't know that much
> about the U.S. tax system, but I still find it hard to believe.
> Americans are the most litigious people on earth, and you have
> a solid constitutional framework which can be, and is, used to
> attack laws and procedures which are unjust.  Now maybe the IRS
> really is so powerful that no-one can risk attacking it, but I
> still have my doubts.
> 

There's a long history of IRS "leaking" tax returns of Congressmen
who start investigations into their practices -- they usually lose
the next election.  If you are truly interested, mail to me, and
I will send you the text of a newspaper article reporting how IRS
obtained a prior restraint order prohibiting a legal publishing
house from publishing a judge's opinion which criticized the conduct
of Justice Department Tax Division lawyers in a tax fraud case.
No more articles have appeared anywhere I look about it, and law
students I no who have tried to locate the citation can't find it.
1984?  Maybe.

> >> the filing of the return is independent of the payment, although
> >> of course they're usually done together.  But a return filed with
> >> no cheque is just as valid as one with a cheque, and although
> >> interest will run on unpaid balances, penalties for not filing
> >> don't apply once the return is filed.  How could writing an
> >> invalid cheque have any effect on this process?
> >> 
> >> I could understand a charge of attempted fraud, perhaps.
> >> But filing a frivolous return?
> >> 
> >> Dave Sherman
> >
> >About three years ago, IRS had Congress pass a law making it illegal 
> >to file a "frivolous" return.  I'm not sure exactly how Congress defined
> >"frivolous", but the way IRS has enforced this law is to discourage any
> >political comments that question their validity.
> 
> Again, what does the payment have to do with the return?
> Where is this legislation - part of the Internal Revenue Code?
> Section number?
> 
> Dave Sherman

I've never seen anyone charged with a "frivolous" return for making out
the check wrong, but I've seen newspaper accounts of people charged by
IRS with this for sending in a tax return which contained no numbers 
but said, "TAXATION IS THEFT".  Note that no one could possibly be
confused into thinking this was a filled in tax return.

Newspaper articles NEVER tell you the section number under which someone
is charged.

Clayton E. Cramer

levy@ttrdc.UUCP (07/20/86)

In article <927@kontron.UUCP>, cramer@kontron.UUCP (Clayton Cramer) writes:
>There's a long history of IRS "leaking" tax returns of Congressmen
>who start investigations into their practices -- they usually lose
>the next election.  If you are truly interested, mail to me, and
>I will send you the text of a newspaper article reporting how IRS
>obtained a prior restraint order prohibiting a legal publishing
>house from publishing a judge's opinion which criticized the conduct
>of Justice Department Tax Division lawyers in a tax fraud case.
>No more articles have appeared anywhere I look about it, and law
>students I no who have tried to locate the citation can't find it.
>1984?  Maybe.

Is this referring to the Orwellian 1984 or the historical 1984?
Also what citation is being looked for:  the citation of the judge's
opinion which supposedly criticized the tax lawyers, or the citation
of the prior restraint order?  Go ahead and please type in the article for
all of us (name the newspaper and date, too, so that interested parties can
write or call direct to the newspaper).  This news group is well asbestos-
lined and can stand the flames :-).  Let's put our efforts where our mouths
are; the people are the only safeguard against ANY government's misdeeds.

While the allegation about IRS exposing the tax returns of Congresscritters
which seek to defang the IRS smacks (the exposing) of foul play, it also
seems to me that if a Congresscritter managed his/her financial affairs totally
honorably and meticulously (is that congenitally impossible for a
Congresscritter :-)?) that an exposed tax return or even the most intensive
of audits would provide el zippo (zilch, none) ammunition for the IRS,
and that any despicable behavior on the part of the IRS would provide that
much more ammunition for the Congresscritter's case.  Surely if the IRS
is that naughty, there MUST be someone somewhere with a simon-pure tax
record who would be willing to make that sacrifice as a member of Congress
in order to correct those alleged KGB-like IRS abuses.

>
>Newspaper articles NEVER tell you the section number under which someone
>is charged.
>

Maybe that is an example of Big-Botherism :-).

>Clayton E. Cramer
-- 
 -------------------------------    Disclaimer:  The views contained herein are
|       dan levy | yvel nad      |  my own and are not at all those of my em-
|         an engihacker @        |  ployer or the administrator of any computer
| at&t computer systems division |  upon which I may hack.
|        skokie, illinois        |
 --------------------------------   Path: ..!{akgua,homxb,ihnp4,ltuxa,mvuxa,
	   go for it!  			allegra,ulysses,vax135}!ttrdc!levy

ark@alice.UUCP (07/20/86)

> I've never seen anyone charged with a "frivolous" return for making out
> the check wrong, but I've seen newspaper accounts of people charged by
> IRS with this for sending in a tax return which contained no numbers 
> but said, "TAXATION IS THEFT".  Note that no one could possibly be
> confused into thinking this was a filled in tax return.

I've also heard of someone socked with a frivolous return penalty
for sending in a properly filled out return with a note on the bottom
saying "I am signing this return involuntarily under threat of punishment."

tedrick@ernie.Berkeley.EDU (Tom Tedrick) (07/20/86)

>>There's a long history of IRS "leaking" tax returns of Congressmen
>>who start investigations into their practices -- they usually lose
>>the next election.  

Yes, of course. And why not? After all, what better way for the
IRS to retaliate against their enemies? How better for the IRS
to retain and strengthen their position of power?

"We'll show the S.O.B.'s, just let them try and mess with US!"

You forgot to mention use of the IRS by the party in power to
harass the party out of power though.

"All's fair in love and war (ie politics) ... "

Seriously, the point is, the IRS like any group should be expected
to act in their own self-interest. If they have the power to use
tax information against their enemies, and their incentive is to
do so, who can blame them? The laws that let them do such things
are the underlying cause. They created the monster, now it is up
to us to figure out how to slay it.

>While the allegation about IRS exposing the tax returns of Congresscritters
>which seek to defang the IRS smacks (the exposing) of foul play, it also
>seems to me that if a Congresscritter managed his/her financial affairs totally
>honorably and meticulously (is that congenitally impossible for a
>Congresscritter :-)?) that an exposed tax return or even the most intensive
>of audits would provide el zippo (zilch, none) ammunition for the IRS,

Surely you are joking! :-)

It takes (usually) a fair amount of wealth to gain political office.
We live in a competitive society, where there is dog-eat-dog competition
for wealth. Anyone who wants to become wealthy has to deal with the
tax system. Our tax system is notoriously badly designed, full of
loopholes, ambiguities, etc. The system *FORCES* an individual who
wishes to suceed in the struggle for wealth and power to use the
tax system to his/her own best advantage, otherwise the individual
will be at a competitive disadvantage in the monetary rat race.
Trying to make the most favorable deal for oneself when working
in the tax jungle one has to push towards the limits of what the
system allows, hence one is always on the edge of doing things
that may not stand up to the light of day. Hence one would *EXPECT*
to be able to portray almost any wealthy individual in a bad light
given sufficiently close scrutiny of his tax and financial situation.
Even if everything is *PERFECTLY LEGAL* one can expect to be able
to generate unfavorable publicity, and subject the victim of the
investigation to heavy legal expenses until the matter is resolved.
If Cramer is discussing the same congresscritter I think he is,
this congresscritter was *DRIVEN OUT OF OFFICE*, criminally
charged, and finally *COMPLETELY ACQUITTED OF ALL CHARGES* after
several years of legal battles that wrecked his health and his
finances.

In conclusion, the tax system is *BADLY DESIGNED*. It *ENCOURAGES*
corrupt practices, and *PENALIZES* what most of us (or at least
what I) would consider ethical behavior. The corrupt individual
who is willing to pursue devious tax schemes has a *POSITIVE
INCENTIVE* to do so, built into the tax system. The "honest"
citizen pays a higher proportion of his income in taxes and
is at a disadvantage in the competition for wealth.

cramer@kontron.UUCP (Clayton Cramer) (07/21/86)

> In article <927@kontron.UUCP>, cramer@kontron.UUCP (Clayton Cramer) writes:
> >There's a long history of IRS "leaking" tax returns of Congressmen
> >who start investigations into their practices -- they usually lose
> >the next election.  If you are truly interested, mail to me, and
> >I will send you the text of a newspaper article reporting how IRS
> >obtained a prior restraint order prohibiting a legal publishing
> >house from publishing a judge's opinion which criticized the conduct
> >of Justice Department Tax Division lawyers in a tax fraud case.
> >No more articles have appeared anywhere I look about it, and law
> >students I no who have tried to locate the citation can't find it.
> >1984?  Maybe.
> 
> Is this referring to the Orwellian 1984 or the historical 1984?

Orwellian.  Remember the "memory hole"?

> Also what citation is being looked for:  the citation of the judge's
> opinion which supposedly criticized the tax lawyers, or the citation
> of the prior restraint order?  Go ahead and please type in the article for

Both.

> all of us (name the newspaper and date, too, so that interested parties can
> write or call direct to the newspaper).  This news group is well asbestos-
> lined and can stand the flames :-).  Let's put our efforts where our mouths
> are; the people are the only safeguard against ANY government's misdeeds.
> 

You asked for it:
----------------------------------------------------------------------

Law Book barred from publishing judicial opinion

New York Times Service

WASHINGTON -- The Justice Department has obtained a highly unusual
temporary order from a federal appeals court barring a law book company
from publishing an opinion by a federal district judge in Colorado that
was critical of the department.

Glenn L. Archer Jr., the head of the department's tax division, said 
in an interview that the prior restraint on publication was necessary
because the "slanderous" judicial opinion unfairly charged three of his
prosecutors with misconduct in a grand jury investigation in Denver into
suspected tax fraud.

Lawyers involved in the case and other legal experts said they knew of
no previous instance in which a private publisher had been barred, on
pain of contempt of court, from publishing a judicial opinion.

It is not unusual, on the other hand, for courts to designate certain
of their own opinions as having no precedential value and thus unsuited
for publication, or for law book companies to refrain voluntarily from
publishing those opinions.

James C. Goodale, a New York lawyer who has represented news organizations
in First Amendment cases, said in an interview that the order could not
"have withstood the mildest breeze from the First Amendment" and was
"frightening" in its implications.

"If legal opinions can be as easily enjoined as this, any kind of 
publication would be fair game for court injunction," Goodale said.

The brief censorship order was issued Jan. 3 by Judges William J.
Holloway Jr. and Stephanie K. Seymour of the U.S. Court of Appeals 
for the 10th Circuit and Federal District Judge Luther L. Bohannon,
who was sitting specially on the appellate court.  The court has its
headquarters at Denver, but these three judges sit in Oklahoma.

The order required the West Publishing Co. of St. Paul, Minn., "to
delay temporarily" publishing the Aug. 25 opinion by Federal District
Judge Fred M. Winner of Denver in the permanent bound volumes of
West's series, Federal Supplement, pending further consideration of
the matter by the appellate court.  The order is still in effect.

----------------------------------------------------------------------

The article appeared in the Santa Rosa Press-Democrat, sometime in 1983
or 1984.  Note that it is a wire service story -- should be readily
locatable.

> While the allegation about IRS exposing the tax returns of Congresscritters
> which seek to defang the IRS smacks (the exposing) of foul play, it also
> seems to me that if a Congresscritter managed his/her financial affairs totally
> honorably and meticulously (is that congenitally impossible for a
> Congresscritter :-)?) that an exposed tax return or even the most intensive
> of audits would provide el zippo (zilch, none) ammunition for the IRS,
> and that any despicable behavior on the part of the IRS would provide that
> much more ammunition for the Congresscritter's case.  Surely if the IRS
> is that naughty, there MUST be someone somewhere with a simon-pure tax
> record who would be willing to make that sacrifice as a member of Congress
> in order to correct those alleged KGB-like IRS abuses.
> 

Even a simon-pure tax record can appear embarrassing -- especially if you
leak information selectively.

> >
> >Newspaper articles NEVER tell you the section number under which someone
> >is charged.
> >
> 
> Maybe that is an example of Big-Botherism :-).
> 

No.  It's usually not relevant.

> >Clayton E. Cramer
> -- 
>  -------------------------------    Disclaimer:  The views contained herein are
> |       dan levy | yvel nad      |  my own and are not at all those of my em-
> |         an engihacker @        |  ployer or the administrator of any computer
> | at&t computer systems division |  upon which I may hack.
> |        skokie, illinois        |
>  --------------------------------   Path: ..!{akgua,homxb,ihnp4,ltuxa,mvuxa,
> 	   go for it!  			allegra,ulysses,vax135}!ttrdc!levy

Clayton E. Cramer

eme@mtgzz.UUCP (e.m.eades) (08/02/86)

>While the allegation about IRS exposing the tax returns of Congresscritters
>which seek to defang the IRS smacks (the exposing) of foul play, it also
>seems to me that if a Congresscritter managed his/her financial affairs totally
>honorably and meticulously (is that congenitally impossible for a
>Congresscritter :-)?) that an exposed tax return or even the most intensive
>of audits would provide el zippo (zilch, none) ammunition for the IRS,
>and that any despicable behavior on the part of the IRS would provide that
>much more ammunition for the Congresscritter's case.  Surely if the IRS
>is that naughty, there MUST be someone somewhere with a simon-pure tax
>record who would be willing to make that sacrifice as a member of Congress
>in order to correct those alleged KGB-like IRS abuses.

I have heard of a book by a former Congresscritter (I like that name :)
who challenged the IRS.  During his next election, the IRS started 
investigating him for tax fraud and tax evasion.  He lost the election
and the IRS declared that their investigations uncovered nothing and
all charges were dropped.  I believe the book was suppose to be
autobiographical,  anyone know who the congresscritter was and what
his book was called?
E.Eades

alang@masscomp.UUCP (Alan Groupe) (08/06/86)

In article <2002@mtgzz.UUCP> eme@mtgzz.UUCP (e.m.eades) writes:
>
>I have heard of a book by a former Congresscritter (I like that name :)
>who challenged the IRS.  During his next election, the IRS started 
>investigating him for tax fraud and tax evasion.  He lost the election
>and the IRS declared that their investigations uncovered nothing and
>all charges were dropped.  I believe the book was suppose to be
>autobiographical,  anyone know who the congresscritter was and what
>his book was called?
>E.Eades

I believe you are talking about George Hansen of Idaho. The book is
called "To Harrass our People".

smb@ulysses.UUCP (Steven Bellovin) (08/08/86)

> In article <2002@mtgzz.UUCP> eme@mtgzz.UUCP (e.m.eades) writes:
> >
> >I have heard of a book by a former Congresscritter (I like that name :)
> >who challenged the IRS.  During his next election, the IRS started 
> >investigating him for tax fraud and tax evasion.  He lost the election
> >and the IRS declared that their investigations uncovered nothing and
> >all charges were dropped.  I believe the book was suppose to be
> >autobiographical,  anyone know who the congresscritter was and what
> >his book was called?
> >E.Eades
> 
> I believe you are talking about George Hansen of Idaho. The book is
> called "To Harrass our People".

He's not the most objective source, as he's currently in the slammer for
assorted criminal violations of the House Ethics Act.  Given how many of
his little sins involved shifting money around between his campaign and
himself, I'd say the IRS was quite justified in taking a closer look...

Moral:  you may not like the IRS, but they're not *always* wrong or dishonest.