CITES BY TOPIC:  willful failure to file

United States v. Sullivan, 274 U.S. 259 (1927):

As the defendant's income was taxed, the statute of course required a return. See United States v. Sischo, 262 U.S. 165 , 43 S. Ct. 511. In the decision that this was contrary to the Constitution we are of opinion that the protection of the Fifth Amendment was pressed too far. If the form of return provided called for answers that the defendant was privileged from making he could have raised the objection in the return, but could not on that account refuse to make any return at all. We are not called on to decide what, if anything, he might have withheld. Most of the items warranted no complaint. It would be an extreme if not an extravagant application [274 U.S. 259, 264]   of the Fifth Amendment to say that it authorized a man to refuse to state the amount of his income because it had been made in crime. But if the defendant desired to test that or any other point he should have tested it in the return so that it could be passed upon. He could not draw a conjurer's circle around the whole matter by his own declaration that to write any word upon the government blank would bring him into danger of the law. Mason v. United States, 244 U.S. 362 , 37 S. Ct. 621; United States ex rel. Vajtauer v. Commissioner of Immigration ( January 3, 1927) 273 U.S. 103 , 47 S. Ct. 302. In this case the defendant did not even make a declaration, he simply abstained from making a return. See further the decision of the Privy Council, Minister of Finance v. Smith (1927) A. C. 193.

[United States v. Sullivan, 274 U.S. 259 (1927)]


26 U.S.C. §7203:  Willful Failure to File

26 U.S.C. Sec. 7203:  Willful Failure to File

Any person required under this title to pay any estimated tax or tax, or required by this title or by regulations made under authority thereof to make a return, keep any records, or supply any information, who willfully fails to pay such estimated tax or tax, make such return, keep such records, or supply such information, at the time or times required by law or regulations, shall, in addition to other penalties provided by law, be guilty of a misdemeanor and, upon conviction thereof, shall be fined not more than $25,000 ($100,000 in the case of a corporation), or imprisoned not more than 1 year, or both, together with the costs of prosecution. In the case of any person with respect to whom there is a failure to pay any estimated tax, this section shall not apply to such person with respect to such failure if there is no addition to tax under section 6654 or 6655 with respect to such failure. In the case of a willful violation of any provision of section 6050I, the first sentence of this section shall be applied by substituting ''felony'' for ''misdemeanor'' and ''5 years'' for ''1 year''.

Interestingly, the statute doesn’t define the meaning of “making a return”.  Why didn’t they say “submit” a return?  Because under the Fifth Amendment to the Constitution, parties have a right not to incriminate themselves, which means they have the right not to submit a return!  Don’t let the title above fool you!  It says “file” but the title is editorially supplied and is NOT law.  Only the content of the section is law, and it DOES NOT impose a requirement to file, but only to make the return, because if it did, it would violate the Fifth Amendment for natural persons.

Now lets look at the definition of “make”

make1. b. to seem to begin (an action) 2 a: to cause to happen to or be experienced by someone b: to cause to exist, occur, or appear c: to favor the growth or occurrence of 5: to put together from components: CONSTITUTE 6 a: to compute or estimate to be b: to form and hold in the mind.[1]

So according to common usage, and because there is not definition of the term “make”, we have to use the above definition.  The tax form is called a “return” but nowhere does it say that it must be “returned” to anyone, nor could returning such a form ever be made mandatory because of the privilege by natural persons under the Fifth Amendment to not be compelled to incriminate themselves.  As long as you “make” (create) a return, which process is never defined, you can always claim that you made it and that you filed it, but that you just didn’t file it with the Internal Revenue Service because they never specifically required you to do so ANYWHERE, nor could the IRS require you to do so under the Fifth Amendment, or punish you for failure to do so!  Because “taxpayer” includes fictions like corporations who can be made liable for income taxes, the statement below is accurate, but is misleading for natural persons, to whom the section does not apply.  The passage below confirms this.  If they wanted to REQUIRE natural persons to file the return, they would have put it in part  (a) below:

26 CFR 1.6011-1 General requiremens of return, statement, or list

(a) General rule. Every person subject to any tax, or required to collect any tax, under Subtitle A of the Code, shall make such returns or statements as are required by the regulations in this chapter. The return or statement shall include therein the information required by the applicable regulations or forms.”

b) Use of prescribed forms. Copies of the prescribed return forms will so far as possible be furnished taxpayers by district directors. A taxpayer will not be excused from making a return, however, by the fact that no return form has been furnished to him. Taxpayers not supplied with the proper forms should [not must] make application therefor to the district director in ample time to have their returns prepared, verified, and filed on or before the due date with the internal revenue office where such returns are required to be filed [by whom?..ONLY by corporations or elected or appointed officers of the U.S. government liable for the tax, but not any other “natural persons”].  Each taxpayer should carefully prepare his return and set forth fully and clearly the information required to be included therein. Returns which have not been so prepared will not be accepted as meeting the requirements of the Code. In the absence of a prescribed form, a statement made by a taxpayer disclosing his gross income and the deductions therefrom may be accepted as a tentative return, and, if filed within the prescribed time, the statement so made will relieve the taxpayer from liability for the addition to tax imposed for the delinquent filing of the return, provided that without unnecessary delay such a tentative return is supplemented by a return made on the proper form.

Do you see any definition above of WHO can be required to file a return?  There is none because they don’t want you to know that as a natural person who isn’t an elected or appointed political officer of the United States or an officer of a U.S.** corporation and who lives in the 50 states, you aren’t liable for filing returns or paying tax.  This was a very successful tactic of making but not filing a return was used by Gaylon Harrell, who was acquitted of state charges of Willful Failure to File, and who we talk about later in section 11.2.3 .  There are also NO implementing regulations for IRC 7203, which means that you cannot be criminally punished for violating it according to the following cites:

“…we think it important to note that the Act's civil and criminal penalties attach only upon violation of regulations promulgated by the Secretary; if the Secretary were to do nothing, the Act itself would impose no penalties on anyone.”  California Bankers Assn.  v. Shultz, 416 U.S. 21 (1974)

“An individual cannot be prosecuted for violating the act unless he violates the implementing regulations.” United States v. Reinis, 794 F. 2d 506 (9th Cir. 1986), United States v. Murphy, 809 F.2d 1427 (9th Cir. 1987)

“Criminal penalties…can attach only upon violation of regulations promulgated by the Secretary.”  U.S. v. Reinis, 794 F.2d 506.

Individual cannot be prosecuted for violating Currency Reporting Act unless he violates the implementing regulations.” 31 U.S.C.A. §5311 et. seq.

[1] Webster’s Ninth New Collegiate Dictionary, 1983, Merriam-Webster, pp. 718-719.