Income Tax Myths
"Government officials, judges, lawyers, and professors can't be trusted to tell the truth about tax law."
Whom Should You Trust?
You can't trust everything you read on the Internet. But you can trust me and other legal experts on the question of whether there is an income tax law. Here's why.
The Experts Agree
First of all, the experts are virtually unanimous on this question. Lots of questions in life are debatable, with reasonable arguments on both sides. There is a real debate on the question "should we have an income tax?" One can find highly respectable pro- and anti- views on this question.
But on the question "do we have an income tax?" there is only one possible view. There is no real debate on this topic. One side is right and the other side is a bizarre fringe group.
Every executive branch official, every judge, every law professor, and pretty much every private lawyer to have expressed a view on this question is on the same side. The tax protestor movement is made up of convicted criminals, movie celebrities who have no expertise in law, and a motley crew of other fringe, counterculture characters.
To say that there is a debate on whether there is an income tax in the U.S. is like saying that there is a debate on whether the earth is round or flat. There is still a Flat Earth Society, but it is a fringe group that no one takes seriously.
Questioning The Experts' Motives
Why do some people not accept the unanimous expert view? A big part of it seems to come down to trust. Some people are ready to believe that the IRS, all the judges, all the law professors, and pretty much all the lawyers are lying.
Government officials, according to this theory, know that there is not really an income tax that applies to most Americans, but want to fool people into paying taxes anyway. Judges are supposedly either part of the scheme or go along out of fear of IRS retaliation. Private lawyers have said to have a financial interest in fostering the big coverup.
This theory is ridiculous. Here's why:
Why You Can Trust the Experts on this Issue
Even if there were a massive conspiracy among government officials to hide the truth about income tax (a fantastical notion), the conspiracy could never extend to all judges, all law professors, and nearly all private lawyers.
Our government has a system of checks and balances. Judges, law professors, and private lawyers serve as a check on government. Each group has strong incentives to carry out this function.
Judges: Federal judges have life tenure under Article III of the U.S. Constitution. They can't be fired for their rulings and their salary can't be reduced. This protection frees federal judges to rule according to what they believe to be the truth. Federal judges frequently rule against the government on all kinds of issues, including tax issues. If there were even the remotest possible truth in tax protestor arguments, some federal judges would have ruled in their favor, but not one has.
Law Professors: Most law professors (including me) also have life tenure. This frees us to write what we believe to be true without fear of job reprisals. Law professors get the greatest job rewards for exposing errors in conventional thinking. If there were any argument to be made that most Americans don't have to pay income tax, law professors would have every incentive to make that argument.
Private Lawyers: Another important check on the government comes from the private bar. There are hundreds -- probably thousands -- of respected private lawyers who have made their whole career out of suing the government and exposing government wrongdoing. These lawyers constantly sue the government over alleged violations of human rights, environmental laws, and every other possible topic. These lawyers are not afraid to sue the government -- it's what they do for a living.
If there were any respectable argument to be made that most Americans don't have to pay income tax and that the government is hiding this truth from the public, these lawyers would be falling over each other to do so, especially since the financial incentive to do so would be enormous.
The argument that lawyers have an incentive to hide the truth is absurd. Maybe tax lawyers do have a financial interest in the current system (because they make money by helping people pay taxes), but most lawyers aren't tax lawyers. Most lawyers would have a huge incentive to establish that there is no obligation to pay taxes. They'd save money themselves and they'd become famous and celebrated if they could beat the government on this issue.
Also, when very rich people (such as Leona Helmsley) get prosecuted for income tax evasion, they hire the best, most expensive lawyers. These excellent lawyers have an incentive to raise every argument against the income tax. But they don't make tax protestor arguments.
Only a tiny number of fringe lawyers are involved in tax protestor cases -- that's why most tax protestors have to represent themselves.
Another Reason the Conspiracy Theory is Absurd
Moreover, the truth about income tax is not the kind of thing that it would even be possible to hide. The answers to some questions can be kept secret, because the relevant events occur behind closed doors where no one can look. What really goes on at the CIA? Does our government mistreat prisoners? The government can at least try to keep the answers to these questions secret.
But the law is in the books for anyone to look at. It's completely public. There's just no way to hide it. If the government were lying about it, anyone could find out immediately. And, for the reasons stated above, judges, law professors, and private lawyers would find out immediately and expose the lie.
Deciding Based on Trust
The best way to understand the income tax laws is to read them for yourself. If you have the time, go right ahead, here they are.
But tax arguments can get complicated. Not everyone has the time or patience to read through all of the statutory provisions involved. Some people will decide this issue on the basis of whom they trust.
A certain amount of skepticism and distrust of what the government says is healthy in a democratic society. But even if you don't trust the government generally, you can bet your last dollar that if there were anything to the tax protestor arguments -- if there were any tax protestor arguments that could even remotely have a chance -- there would be some respectable lawyers bringing suit based on the arguments, some respectable law professors advocating them, and some federal judges somewhere accepting them.
This isn't just about trusting the government. When all the judges, law professors, and respected private lawyers agree with the executive branch that there's nothing to the tax protestor arguments, you can have trust in that because the system is set up to let the judges rule truthfully and to give private lawyers and law professors strong incentive to challenge conventional legal wisdom where there is any basis for doing so.