The 861 Tax Argument Brought to you by Wesley Snipes

If all goes well in the US Governments plan this is pretty much the next picture you'll see Starring Wesley Snipes in. According to the IRS Mr. Snipes owes Income Taxes on $38 Million in income generated between 1999 and 2004. First, who knew being "Blade" paid that much, and two how do you have $38 MILLION in income and think that you can not pay taxes. That wasn't far enough for Mr. Snipes, actually he went a step farther and said the government owed HIM $14 Million.

Actually there are many arguments that citizens have filed saying that Federal Income Taxes are unconstitutional, or illegal, or not binding due to the way the statuette is written. Mr. Snipes is basing his argument on something called the 861 Argument.

This refers to Internal Revenue Code Section 861 titled "Income from sources withing the United States." This section deals with what income can be called income from within the United States. The tax protesters say that the statute excludes some portion of the income of US citizen and Resident Aliens.

The argument is that since the domestic activities of residents of the United States (Americans and resident aliens) are not shown to be taxable, the domestic income derived from such activities does not become taxable "gross income" according to Wikipedia. The argument goes on that even this small amount is still eligible for your deductions. This is how he believes that the Government owes him $14 Million as that is what was already withheld.

Wesley believes in this so strongly even after the IRS told that wasn't going to hold water, he continued to withhold payment for two more years. The potential fine? Up to 16 years in prison. Under that same Wikipedia article it goes on to tell of 10+ more of these type protests like 861 that is out there.

Just a quick moment of clarity...say he is right. not just right, but the sort of right where the US government goes, "Oops, he is right! We never even thought of that. We are going to have to refund 100% of all monies collected from US citizens since 1861." "Gosh we're sorry!" It would be mayhem and the government would default. So if the government couldn't let it happen, even if you were right (which courts have said over and over that you are not) what is the best possible outcome? That you won't get audited? To recap, he not only didn't pay, He asked for $14 Million back!

You may be able to fight vampires Mr Snipes, but you'll never kill the biggest bloodsucker of them all, the IRS...