Having a hobby is generally a good thing, but some hobbies can become overwhelming and harmful. Protesting your taxes is an example of such a consuming hobby. In a recent case, Lawrence James Saccato had not filed tax returns for 14 years, claiming he was exempt from income tax for various frivolous reasons.

The legal system allows for penalties in such cases, and Section 6673 of the tax law enables the Tax Court to impose penalties of up to $25,000 when a taxpayer’s position is considered frivolous. In Saccato’s case, the deficiency topped $200,000, and he faced additional penalties.

Despite warnings from the judge to stop the tax protest nonsense, Saccato continued, attacking the legitimacy of the Tax Court and presenting arguments commonly used by tax protestors. This cost him dearly in terms of financial penalties but also consumed his time and resources. The case serves as a stark reminder that tax protesting can be a destructive hobby, bringing harm to the individual and wasting the legal system’s time and resources.

Moreover, such hobbies are not just detrimental to the individuals involved but also to tax administration and society as a whole. They consume the time and efforts of IRS employees and the Tax Court, diverting resources that could be better utilized to enforce tax laws for the benefit of everyone. So, engaging in tax protesting is indeed a hobby that erodes personal well-being and the efficiency of the tax system.

TaxProf Blog (typepad.com)

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