861 Argument Results in Imprisonment for Snipes

As the anticipation for Spike Lee’s upcoming musical “Chi-Raq” continues to grow, many of us cannot help but be reminded of the past tax issues which faced one of their lead stars, Wesley Snipes. Snipes has faced a number of IRS-related issues over the years, including conspiring to defraud the United States, numerous counts of willfully failing to file federal income tax returns on time, and fraudulent payment claims.

He was then charged with failure to file tax returns from 1999 to 2004.

Despite claiming that he was a “non-resident” alien of the USA, it was found that Snipes was a birthright US Citizen. On April 24, 2008 Snipes was sentenced to three years in prison for wilfully failing to file his federal income tax returns (a decision which was affirmed on July 16 2010) and he stayed in the McKean Federal Correctional Institute from December 9 2010 to April 2 2013. He was acquitted on all other charges.

The 861 Argument Against Taxes

The IRS stated that Snipes was a well known “tax protester”, or someone who regularly challenges the federal government’s ability to collect taxes through what is known as the “861 argument” or tax protest.

The 861 argument asserts that only items which are listed under Section 861 of the Internal Revenue Code are taxable. Those who believe in the validity of the 861 argument believe that the domestic income of a US citizen is not taxable.

Is the 861 Argument Valid?

If an individual attempts to represent him or herself in court against the IRS with the 861 argument, they will almost assuredly have negative outcome. Section 861 stateS that compensation must be paid for labor or personal services provided within the USA, and the IRS has even reiterated the point by stating that citizens “in general” are liable to pay income taxes.

You Do Have a Defense Against the IRS

Your best defense for any case against the IRS is to hire an experienced Dallas, Texas tax attorney. At the Scammahorn Law Firm, we help clients explore their best defenses against the Internal Revenue Service so that their tax case ends with the most positive resolution possible.

If you have received a notice from the IRS, we invite you to call the Scammahorn Law Firm to discuss your options at (903) 595-1000.