Earlier this week, I wrote about war tax resister Elizabeth Borden and her effort to get the IRS to stop calling her and other war tax protesters frivolous. One of the things I noted in that piece was that criminal prosecution of war tax resisters is extremely rare. Of course the vast majority of, for lack of better terms, "tax protesters", whose ideology will often stand in contrast to that of war tax protesters, who tend to lean left, and outright evaders, whose ideology is me, me, me will not be prosecuted either.
Still enough of the evaders and protesters are prosecuted and usually then convicted to give the rest of pause. That is actually the point of the small number of prosecutions. They are selected and publicized to encourage compliance.
Among the reactions to my post was a tweet from Martin Kelley, whose blog is called the Quaker Ranter. Martin pointed me to the story of Joseph Olejak, a Quaker, who seems to be an exception to the rule of non-prosecution of war tax resisters. It may well be that Mr. Olejak is the proverbial exception that proves the rule. A bit of background first.
Reasons Not To Pay
I'm going to propose a typology of people who are not what I call conventionally tax compliant. You know, filing an income tax return every year that at least tries to be pretty accurate and paying the tax, if able, otherwise requesting a payment plan. I think it is reasonable to look at there being three broad categories - evaders, protesters and resisters.
I'd Rather Be Driving A Mercedes
Evaders are the simplest to understand. They would prefer to keep the money for themselves rather than pay taxes and think they can get away with it. And we're not talking penny ante stuff. Somebody who has reason to know about such things told me that IRS CI will not be interested in anybody who owes less than a hundred grand. I wouldn't rule out them going on a small fry campaign sometime, so don't let that make you cocky.
Show Me The Law
Protesters are a much more interesting and colorful bunch. Although he denies that he is a tax protester, Kent Hovind is a good example of the type. Nearing the end of a long prison sentence on tax related charges, he finds himself facing new charges relating to activities that the government thought were meant to interfere with the sale of property that was seized as a result of his first conviction. His supporters are waging a pretty effective social media campaign on his behalf, although its depth is unclear. The We The People Petition for his pardon, which has been up for nearly two weeks, has gathered 1,362 signatures as I write this.
#FreeKent, the flagship website of the Hovindication movement, points to letters from "tax professionals" that prove Kent has done nothing wrong. Ironically, at least in my view, the letters actually are something of an encyclopedia of tax protester arguments . Nearly twenty years of litigation refuting every claim in the letters (For example: Wages are not income. The income tax only applies to corporations) make no impression on Kent Hovind who continues to insist that he has paid every tax that he owes. The ultimate tax protester, though, is probably Irwin Schiff, who may have devised many of the arguments that Kent Hovind's "tax professionals" urged him to rely on.
Turn The Other Cheek
War tax resisters have a very different approach. Resisters do not challenge the law in the way protesters to do. Resisters tend to acknowledge that the law is the law. They are engaging in civil disobedience. The most famous war tax resister is probably Henry David Thoreau.
Thoreau's Civil Disobedience which influenced both Gandhi and Martin Luther King was a reflection on a night spent in the Concord Jail. He was there for, well, war tax resistance. He refused to pay the poll tax which he saw as going, at least in part, to support of the war with Mexico. Henry David Thoreau was not the only one who thought that the Mexican War was unjust. In Mexico, they call it Invasión estadounidense a México. Even an American soldier, who achieved some distinction serving with the 4th Infantry Regiment would write in his memoirs many years later
Generally the officers of the army were indifferent whether the annexation [of Texas] was consummated or not; but not so all of them. For myself, I was bitterly opposed to the measure, and to this day regard the war, which resulted, as one of the most unjust ever waged by a stronger against a weaker nation. It was an instance of a republic following the bad example of European monarchies, in not considering justice in their desire to acquire additional territory.
Although practice varies among contemporary war tax resisters, it is common to file a scrupulously accurate return and attach a letter indicating that because of conscientious objection to military expenditures, some or all of the computed tax is being directed to a charity. There is actually legislation that has been proposed to institutionalize this practice just as conscientious objectors were allowed to perform alternative service back when we had a draft. Here are some sample letters that have gone into the IRS.
The National War Tax Resistance Coordinating Committee promotes the practice and helps people implement it. NWTRCC is funded by donations which are, what do you know, not tax deductible.
About Joseph Olejak
Joseph Olejak is a chiropractor in Delmar NY. In an interview, he explains that when he heard Madeline Albright say that the death of 500,000 Iraqui children was a price worth paying, that he decided there was something seriously wrong and he "couldn't do it anymore".
Joseph mentions the influence of Quakerism on his beliefs, but indicates that he is not yet a full member of the Old Chatham Meetinghouse that he attends. Here is his "Why I stopped paying taxes" statement"
Doctor Olejak has yet to suffer from a cynical bastard amateur historian CPA listening to his testimony and noting that he says he started his war tax resistance in 1994 and that, at least according to the sources I have found, the Madeline Albright interview was in 1996. Frankly, I don't think that really impugns his sincerity, but I just wanted to let you know that I am paying attention.
Not Your Typical War Tax Resister
Deliberately not paying your taxes violates the law, so I don't want to imply that there is an "official" correct way to do it. There is no right way to do the wrong thing and, at least in the eyes of the IRS and the courts, deliberately not paying is the wrong thing. Nonetheless, the drill of war tax resisters seems to be to file a return and then to refuse to pay. As it happens, not paying is pretty common, for more mundane reasons than conscientious objection. The other common practice of war tax resisters is to make an alternative payment. Doctor Olejak did not file and as far as what happened with what he might have paid, according to this story
Olejak didn't have a precise answer for that question. He didn't track his tax savings, he said, and he didn't set the money aside or donate it to charity. Much of the money, he supposed, went into his chiropractor practice, helping to cover patients who couldn't pay for services.
Other behavior more typical of evaders and protesters that were noted in his plea agreement were trying to shield his personal residence with a fraudulent trust deed, filing notices in the country courthouse that IRS liens were fraudulent and keeping title to property related to his business out of his name.
Doctor Olejak wrote a piece for the National War Tax Resistance Coordinating Committee called Faith and Consequences , (I should note that he does mention in there that the Albright interview was in 1996). In a comment Ruth Benn and Peter Goldberger note some atypical aspects of his case
During the period of his tax refusal, Dr. Olejak was not known to the WTR network. In response to the summons to bring his financial records to the IRS, Dr. Olejak did not turn over the records and did not assert any legal justification for refusing, as many WTRs have done. The IRS took their next step of suing him to enforce the summons, and he was called before the federal magistrate. Again he did not turn over the records and did not advance any legal defense. Many resisters in the same situation have prevailed by advancing carefully framed defenses. The IRS CID response, executing a search warrant at his office, is unusual; it appears to reflect frustration with his responses to the administrative investigation. A number of the tax collection avoidance tactics that Dr. Olejak admitted in connection with his guilty plea are commonly viewed as fraudulent by the IRS. In this case the IRS focused particularly on their attempts to impose a tax lien on property that they believed was owned by Dr. Olejak.
As the commenters note and Dr. Olejak, himself, concedes in his interview, his sentence was still relatively light. Rather than a stretch in federal prison, Dr. Olejak served 26 weekends in county jail.
Dr. Olejak is probably the exception that proves the rule when it comes to few prosecutions of war tax resisters compared to tax protesters. The protesters, because they believe the IRS is acting illegally, end up performing other illegal or questionable acts - such as the structuring that made up most of the counts Kent Hovind was convicted of or the type of property filings (sometimes called "paper terrorism"), that are the basis of Hovind's current prosecution.
In Dr. Olejak's case we see that type of behavior in a war tax protester and similar attention from IRS Criminal Investigation. When it comes to the lighter sentence, he ended up getting credit for "acceptance of responsibility" and entered into a plea agreement. Hovind, on the other hand, went to trial and even after conviction and unsuccessful appeal continues to insist that he broke no laws.
Give Peace A Chance?
Many of the war tax resisters would come into full compliance if legislation regularly proposed by Congressman John Lewis were passed. The proposal is to have Religious Freedom Peace Tax Fund. That has not gotten very far.
A somewhat related concept would be the proposal of Senator Chris Coons that specific tax revenue be raised to fund the war against ISIS.
Historic Note
My reference to the memoir writer reflecting on his attitudes toward the Mexican War is timely as we are approaching the 150th anniversary of the end of the war that gave our country an income tax for the first time. Somewhat to the chagrin of my partners, I am taking the second week in April off to make a trip to Virginia for the commemoration of a meeting between the brevet captain in the Fourth Infantry and a slightly older Mexican War veteran, who went a lot further in the ante-bellum army including service as Superintendent of the academy on the Hudson River that graduated both of them. It is probably the only world class military academy that provided its graduates with an epic intramural war. Here is the document that came out of their meeting.
General R.E. Lee,
Commanding C.S.A.
APPOMATTOX Ct H., Va.,
April 9,1865,
General; In accordance with the substance of my letter to you of the 8th inst., I propose to receive the surrender of the Army of Northern Virginia on the following terms, to wit: Rolls of all officers and men to be made in duplicate, one copy to be given to an officer to be designated by me, the other to be retained by such officer or officers as you may designate. The officers to give their individual paroles not to take up arms against the Government of the United States until properly [exchanged], and each company or regimental commander to sign a like parole for the men of their commands. The arms, artillery, and public property to be parked, and stacked, and turned over to the officers appointed by me to receive them. This will not embrace the side-arms of the officers, nor their private horses or baggage. This done, each officer and man will be allowed to return to his home, not to be disturbed by the United States authorities so long as they observe their paroles, and the laws in force where they may reside.
Very respectfully,
U.S. Grant,
Lieutenant-General
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