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Fairy tales!

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  • rlbaty50
    If you read the article following my name closely, it might give you some idea as to what to look for in the Vernice Kuglin Tax Court case that is pending
    Message 1 of 1 , Jun 28, 2004
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      If you read the article following my name closely, it might give you
      some idea as to what to look for in the Vernice Kuglin Tax Court case
      that is pending (i.e., though she beat the criminal fraud charges,
      she may get stuck with civil fraud penalties).

      Sincerely,
      Robert Baty

      ########################################

      The Washington Post

      Sunday, June 27, 2004

      Fairy Tales Won't Put the Tax Court to Sleep
      (excerpt)

      Albert B. Crenshaw

      For some time now, the Internal Revenue Service has been shouting
      from the housetops about its stepped-up efforts to go after tax
      evaders, protesters and shelter promoters. And while it's hard to
      assess the impact of these efforts -- since even the agency doesn't
      really know how much tax goes uncollected -- there are some signs
      that the message is sinking in. For example, earlier this month a 26-
      year-old man who had been resisting the IRS and making typical tax-
      protester-type arguments in the U.S. Tax Court to try to stave off
      collection of more than $3,000 in taxes and penalties, suddenly
      recanted all and promised to pay his tax, interest and penalties and
      never to "make these arguments in the future or appear in the [Tax]
      Court again," according to the Tax Court ruling.

      The man's about-face, in which he quickly signed all required
      documents, persuaded the court to drop an additional penalty -- as
      much as $25,000 -- for making frivolous arguments or using a court
      case as a delaying tactic. Instead, he got off with a warning.

      And the Tax Court itself seems to be getting tougher.

      While it was willing to be lenient with the repentant 26-year-old, it
      is showing an increased willingness to hand out real pain to those
      whom it regards as abusers of the system.

      In the case of a Florida software engineer this month, the court
      added a $20,000 penalty to the more than $300,000 in taxes and
      penalties already assessed by the IRS.

      The engineer had failed to file tax returns from 1987 to 1997,
      telling the IRS that he and his wife did not work or reside "in any
      territory which is, or was, under exclusive federal jurisdiction." He
      also made other protester arguments.

      Criminal charges against him were rejected by a judge who determined
      his non-filing and nonpayment were civil matters, but the Tax Court
      was not so sympathetic. It determined that the IRS had met its burden
      of proving fraud and upheld the agency's assessment of back taxes and
      penalties. Then it added its own penalty.

      "Apparently [the engineer] expects that, if he feigns sincere belief,
      he will avoid penalties. . . . But he has persevered too long to have
      any credibility. Serious sanctions are necessary to deter him and
      others similarly situated," the court said.

      Also this month, a federal court in Nevada held Irwin Schiff, a well-
      known promoter of what the Justice Department called "frivolous tax
      evasion excuses," liable for more than $2 million in taxes and
      penalties in a case involving unpaid taxes for 1979 through 1985.

      Schiff argued that penalties shouldn't apply on the grounds that he
      is suffering from a "chronic and severe delusional disorder" that
      resulted in his irrational and incorrect beliefs pertaining to the
      federal income tax system. The court rejected that.

      For many years Schiff counseled through books and a Web site that
      paying taxes is voluntary.

      The court victories are good news for the IRS, which has sometimes
      struggled to convince the public that tax protesters' arguments are
      not valid. Last summer, a Tennessee jury acquitted a woman of
      criminal charges arising from her refusal to pay taxes on $920,000
      she earned from 1996 to 2001. The basis for her refusal was a well-
      known protester tactic, but one the jury apparently bought -- a claim
      that the IRS hadn't shown her where in the law it said she had to
      pay.

      In general, though, courts and most sentient Americans realize that
      the federal income tax is constitutional and Congress didn't forget
      to require that it be paid. Also, there is a growing understanding
      among honest taxpayers that when others don't pay, they have to make
      up the shortfall.

      ####################################3
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