Don’t file a ‘frivolous’ tax return

This is an archived article and the information in the article may be outdated. Please look at the time stamp on the story to see when it was last updated.

NEW YORK (CNNMoney) — Wild, misguided notions of what’s legal may make for amusing conversation, but when it comes to taxes, they’re a problem.

There are still plenty of scam artists who are willing to use loopy ideas to convince fee-paying tax filers that they really don’t owe any income tax at all.

The IRS calls these ideas “frivolous tax arguments” and has seen some doozies in recent years.

Among the most common: Filing and paying your taxes is voluntary. Only foreign-source income is taxable. You may refuse to pay your taxes on religious or moral grounds by invoking the First Amendment. And the only people subject to federal income tax are employees of the federal government.

Or there’s this one: You won’t owe federal income taxes if you simply file a return saying that you have no income and no tax liability. People apparently do this despite having recorded taxable income through, say, a paycheck. The same people often ask for a refund for the taxes their employer withheld, the IRS said.

All told the IRS has compiled more than 40 frequently made frivolous arguments.

“These arguments are wrong and have been thrown out of court,” the agency said in a statement.

Any taxpayer, of course, is free to contest his tax liabilities. “But no one has the right to disobey the law or disregard their responsibility to pay taxes,” the IRS noted.

If you choose to file a so-called frivolous tax return — or let someone else do it on your behalf – you’ll pay a $5,000 penalty for the privilege. You could also face accuracy-related penalties, a civil fraud penalty, and an erroneous refund claim penalty among others, according to the IRS.

Notice: you are using an outdated browser. Microsoft does not recommend using IE as your default browser. Some features on this website, like video and images, might not work properly. For the best experience, please upgrade your browser.