Are Federal Income Taxes Legal?

It's the urban legend that just won't go away. It goes something like this: the federal income taxes embodied in the 16th Amendment to the Constitution are illegal because the amendment was never properly ratified. Another version suggests that being required to file an income tax return violates an individual's right to avoid self-incrimination under the 5th Amendment.

The 16th Amendment reads:

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.

The amendment would have required ratification in its exact wording by three quarters of the states. At the time, that would have been 27 of the 36 existing states of the union. It would also have required that no state violate its own state constitution by ratifying the amendment.

According to several anti-tax groups after extensive research into the original state documents, the following result was what really occurred. Oklahoma changed the wording to mean the exact opposite of the amendment's wording. Minnesota filed no papers on their decision but was marked as ratifying. Kentucky rejected the amendment but was marked as ratifying. And, according to these groups, at least 20 states seriously violated their own constitutions by ratifying the 16th Amendment.

The ultimate conclusion of the anti-tax movement based on these assessments is that the federal government is collecting an illegal tax and that, by threatening imprisonment and property seizure for non-payment, they are engaging in tyranny.

These claims have never seriously been challenged in a court of law, in part due to the judicial system's unwillingness to review any tenet of law that is mainly political. Also, the repercussions to the country of potentially tossing out the 16th Amendment are enormous and would undermine the country's infrastructure.

Handfuls of taxpayers (or non-taxpayers as the case may be) have argued in tax court that they have no legal compunction to pay the tax and that the federal government has no legal authority to impose or seize it. Many of these taxpayers reside in prison today. There has never been a successful case based on the unconstitutionality of the 16th Amendment.

One of the most famous cases of this issue came to light when the actor Wesley Snipes was indicted on felony counts of attempting to defraud the federal government. Snipes argued that taxation of domestic income in the United States was unconstitutional. He was backed by a high-profile anti-tax group who helped him retain a lawyer. Snipes was ultimately sentenced in 2008 to 3 years in federal prison for failing to file income tax returns. When his appeals ran out, he reported to prison in December 2010 and is projected to be released in July 2013.

So, do you really have to pay income taxes? Unless you want to lose your home, your job, your possessions, and potentially your freedom, yes you do. And, if you drive on roads, have electricity, use natural gas, buy American products or eat American food, you should. Federal taxes support all of these initiatives. It's natural to dream about a tax-free world as you stay up late at night finishing up your tax return on April 15th, but that world is not a practical one.

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