Direct action for peace often entails exposure to unpredictable risks. War tax resistance is no exception. Though getting a notice from the IRS is very likely, jail is virtually unknown for war tax resisters.
IRS Notices and Fines
Those who file but refuse to pay will probably get several tax due notices, adding on civil penalties in the 5 to 25% range, plus compound interest at a rate around 10%. If your resistance is token (e.g., say $1), the interest and penalties will not amount to very much even after several years.
Nonfilers may go undetected, but if the IRS catches up with them, they may find stiffer penalties imposed, with no statute of limitations. The statute of limitations for filers is 10 years beyond the date of assessment (which is often a few months after filing). A false or inflated W-4 form, or a return claiming an unallowable deduction or credit affecting the calculation of tax due, may lead to a penalty of up to $5000.
The IRS considers their notices and threatening letters their most effective tax collection tool. However, sometimes they do proceed beyond their threatening notices.
The IRS has three years from the date of filing to audit a return. Generally, unless you claim questionable deductions on your tax returns, your chances of being audited are no more likely than most tax filers. However, many war tax resisters consider audits an opportunity to explain to the IRS their reasons for resisting. Resisters who don’t file are not likely to be audited. However, there is no statute of limitation for non-filers.
Levies and Property Seizures
Once the IRS “assesses” a specific amount for a given year and at least ten days have passed since a “final demand,” its power of collection includes levy (seizure) of wages, bank accounts and other property (such as — in very rare instances for war tax resisters — cars and houses).
- The first step for the IRS, after sending out its notices, will often be to look for bank accounts in banks near the home or office of the resister.
- The next step will be to find employers or clients (based on the W-2 or 1099 forms submitted with the income tax return) and levy the salary of the resister.
- Sometimes, an IRS collections agent will attempt to call or visit you at home to get you to pay up or at least get information about your assets.
- Very rarely, the IRS will attempt to find out if you own property (such as a car or house), then seize it. At any point, the IRS is usually happy to have you settle with them rather than proceed with seizure and auction of property.
The IRS rarely responds to telephone tax resistance because of the small amounts involved. It often costs the IRS more to deal with a resister than is eventually collected.
Criminal prosecution is possible, but in practice so rare that in most cases the risk is negligible. Since the modern war tax resistance movement began during World War II, only one person (in the 1940s) has been jailed for resisting his war taxes. Only about 30 out of tens of thousands of people in the U.S. who have resisted war taxes have even been brought to federal court and convicted on issues related to their war tax resistance (usually for refusing to reveal sources of assets to the government or, in the 1970s, inflating their W-4 forms by claiming too many dependents). Click here to see War Tax Resisters Taken to Court since World War II, as well as IRS Seizures of Property from War Tax Resisters since World War II.
Many resisters conclude that the positive consequences outweigh the negative. Resisted taxes are often given away by resisters to meet human needs. Resistance may motivate others to act, or may provide new opportunities to communicate your beliefs to others. Feelings of empowerment, liberation and personal integrity may themselves compensate for any penalties.