My own observations of tax protesters lead me to believe that the actions of tax protesters are driven by emotional or psychological needs that are more complicated than simple greed, and that the âargumentsâ they present to the IRS and the courts are really nothing but elaborate rationalizations (or delusions) that they have constructed in order to avoid a reality that they are unable to accept. Sometimes the unacceptable reality is a sense of personal financial failure. Unable to accept the idea that their own incomes (or the lack thereof) might be the result of their own lack of skill or effort, or a matter of impersonal economics, tax protesters instead decide that the income tax system is the problem and begin finding reasons why it should not exist. In other cases, the unacceptable reality may be a moral or legal failure. An unhappy encounter with the government, such as a bad result in a divorce or a child custody dispute, or even something as minor as a speeding ticket, can lead to a belief that the government is broken, corrupt, or otherwise dysfunctional, which can then lead to a fixation on the federal tax system as symbolic of that dysfunction. In the case of almost every persistent tax protester, there is some personal, financial, or legal trauma or crisis that precedes the tax protesterâs obsession with the tax system.
My belief is very well illustrated by the case of Irwin Schiff. Schiff originally sold investments and insurance and became unwittingly involved in a Ponzi scheme which resulted large financial losses for himself and his clients. He became depressed by his business failure and was diagnosed and treated for bipolar disorder. It was only following his business failure that Schiff began developing his theories about the tax laws and began writing his first book about taxes and the government. Schiff has faced the government in court many times, both in criminal prosecutions for his failure to file income tax returns and in civil actions to assess and collect taxes, and Schiff has lost every time. In pleadings filed in federal court, Schiff himself cited this history of failure, as well as the opinions of a lawyer, a psychiatrist, and a psychologist, as evidence that his actions were irrational and the result of a âmental disease or defect,â so that he is unable to act âwillfullyâ within the meaning of the provisions of the Internal Revenue Code relating to tax fraud.
