Wednesday, January 16, 2008

Mo' Money Mo' Problems

Wesley Snipes: Tax protester by day, vampire hunter by night.

Yes! Finally! Posts not related to the primaries (as requested by certain people). So, here's the scoop. Actor Wesley Snipes (widely known for starring in the Blade serie
s),
...has been charged with six counts of failing to file tax returns, two of fraudulently claiming tax refunds and one count of conspiracy to defraud the government. He faces up to 16 years in prison... Prosecutors allege Snipes failed to file tax returns for the years 1999 to 2004 and sought refunds totaling more than $11 million for taxes paid in 1996 and 1997.
Snipes claims that his domestic income is not taxable, citing the 861 argument. Not surprisingly, the courts have consistently ruled against the 861 argument. According to this site, which you can read if you want a full explanation on why the argument is supposedly flawed,
[The 861 Argument] is based on the assumption that the income tax is imposed on "sources" or "items" of “income” - rather than being an excise tax on “income” separated from those sources - therefore, say its advocates, it is important to determine where ones taxable “income” comes from.
Basically, due to some vague wording in IRS law, followers of the 861 argument believe that the IRS can only tax sources of income, not the income earners themselves. Sounds sketchy to me.
Incidentally, GOP presidential candidate Ron Paul believes in abolishing the IRS because he--oh wait, this post wasn't supposed to be related to the primaries. My bad.

2 comments:

Keith Chin said...

Sounds like a nice loophole. But, then the government would barely get any money and wouldn't be able to actually do anything. Besides, Snipes seems like he'd be pretty well off, especially if he's trying to get 11 million in refunds. I don't see any reason why he wouldn't be willing to pay part of his millions of dollars.

Kerina Chiu said...

Maybe Snipes really does deserve tax refunds since he may not be as well off as he used to be (he hasn't been cast in any major movies lately) or more of his untaxed income is coming from overseas.