The headquarters of the US Internal Revenue Service, the agency responsible for income tax collection, is seen in Washington ( AFP / Saul Loeb)

Posts falsely claim US income taxes are 'voluntary'

Copyright AFP 2017-2022. All rights reserved.

Social media posts say income tax for Americans is "voluntary" or "optional" and that there is no legal requirement to pay. The claim is false; the need to file a return is enshrined in law and the Internal Revenue Service dismissed the posts as a "frivolous" argument for tax avoidance, noting that people who follow the myth of non-payment may be subject to financial penalties.

"There is no income tax that is required to be paid," an unidentified man states in a video posted on Facebook March 29, 2022 with more than  25,000 views. "It means for the last 50 years the entire federal establishment has been engaged in a monstrous fraud."

The claim has a long history online and often surfaces during US tax season --  the 2021 filing deadline was April 18, 2022. Similar claims circulated on FacebookTwitter and YouTube. Others, such as this one, go back several years.

An IRS document updated in March 2022 outlines the law and debunks arguments claiming taxes are not required or are unconstitutional, along with references from court cases.

"Some taxpayers assert that they are not required to file federal tax returns because the filing of a tax return is voluntary," the tax agency document says.

But it adds that the word "voluntary" in IRS publications refers to the system of allowing taxpayers initially to determine their tax liability rather than have the government do it.

"The requirement to file an income tax return is not voluntary and is clearly set forth in sections 6011(a), 6012(a), et seq., and 6072(a) of the Internal Revenue Code... Failure to file a tax return could subject the non-compliant individual to civil and/or criminal penalties, including fines and imprisonment."

The IRS adds that anyone relying on such baseless arguments may be subject to additional taxes or civil penalties and that people promoting these schemes can face criminal prosecution.

Susan Allen, senior manager for  tax practice and advocacy with the American Institute of Certified Public Accountants, said the law is clear that US income taxes are mandatory.

"The simple answer here is that people need to file tax returns; we do need to pay taxes," said Allen, who has worked as a tax accountant and advises CPAs.

"There are serious consequences when people do not. There is a failure to file penalty, there is a failure to pay penalty."

Allen told AFP that people who fail to pay taxes due can be subject to "substantial" interest which can accrue and that criminal penalties may be imposed in the most flagrant cases if fraud is involved.

"People do need to know they need to file their returns and accurately report their income. The IRS has matching processes in place" to verify taxable income, Allen told AFP.

Some of the claims allude to a "straw man" theory that the government creates a fictional entity for each person at birth with a "Treasury Direct" account which is legally responsible for that person's debts. The IRS says it is aware of these "meritless" arguments, and has pledged "vigorous enforcement action" for those who try to use them.

Income taxes have long been a contentious topic in the United States, with the original version of the US constitution banning any "direct tax."

The first US income tax was enacted in 1861 to fund the Civil War and then repealed a decade later. A national income tax approved by Congress in 1894 was subsequently ruled unconstitutional by the US Supreme Court.

This led to movement for a constitutional amendment, which was passed by Congress in 1909 and ratified by the requisite 36 states between August 1909 and February 1913.

High-profile targets for failing to pay taxes have included actor Wesley Snipes, who was sentenced to serve three years in prison in 2010, and mob boss Al Capone, who was sentenced to prison in 1931 on tax evasion charges.