The Truth About Frivolous Tax Arguments

Some assert that they are not required to file federal tax returns because
the filing of a tax return is voluntary. Proponents point to the fact that the
IRS itself tells taxpayers in the Form 1040 instruction book that the tax
system is voluntary. Additionally, the Supreme Court’s opinion in Flora v.
United States, 362 U.S. 145, 176 (1960), is often quoted for the
proposition that "[o]ur system of taxation is based upon voluntary
assessment and payment, not upon distraint."
The Law: The word “voluntary,” as used in Flora and in IRS publications,
refers to our system of allowing taxpayers initially to determine the correct
amount of tax and complete the appropriate returns, rather than have the
government determine tax for them from the outset. The requirement to
file an income tax return is not voluntary and is clearly set forth in
sections 6011(a), 6012(a
Any taxpayer who has received more than a statutorily determined amount
of gross income is obligated to file a return. Failure to file a tax return
could subject the non-complying individual to criminal penalties, including
fines and imprisonment, as well as civil penalties. In United States v.
Tedder, 787 F.2d 540, 542 (10th Cir. 1986), the court clearly states,
“although Treasury regulations establish voluntary compliance as the
general method of income tax collection, Congress gave the Secretary of
the Treasury the power to enforce the income tax laws through involuntary
collection . . . . The IRS’ efforts to obtain compliance with the tax laws are
entirely proper.” The IRS issued Revenue Ruling 2007-20, 2007-14 I.R.B.
863, warning taxpayers of the consequences of making this frivolous
argument.