Many US celebrities, including Wesley Snipes, believe they are exempt from taxation because of an obscure ‘interpretation’ of the Internal Revenue Code (IRC), often nothing more than a technique by certain groups to scam people out of money through consulting fees and membership dues by convincing them they do not owe tax to the government.
Abcnews.com reports that, according to the federal indictment against Snipes, he became a member of the anti-tax group known as the American Rights Litigators (ARL), which tax analysts told abcnews.com is known for scamming its clients into believing in the ‘861 Argument’.
This so-called argument refers to Section 861 of the IRC, which groups such as ARL say imposes taxes only on income made outside the US, therefore making income earned within the US ineligible for taxation.
‘It's a twisted reading of the federal tax code,’ said a US tax expert who has testified before Congress on anti-tax movements. ‘It's a cult belief.’ The government argues that, under the direction of the ARL, Snipes used multiple illegal tactics to avoid paying taxes.
Further reading:
Snipes may have to waive claim of ineffective counsel
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