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BahRamYou  4mo ago (lesswrong.com)   Edited 4mo ago   2040 thread views

Thoughts on the LessWrong "don't pay taxes" post?

lesswrong.com

There was a recent post on lesswrong, which also got highlighted on AC10, that struck my interest. It claimed that he had been avoiding taxes for 20 years through "one simple trick:" filing, but not actually paying them. The idea is that the IRS is so small and incompetent that they basically won't do anything against this sort of passive resistance.

Is this too good to be true? I'm not any sort of "effective altruist," I just don't want to pay taxes. And as it happens, I have a lot of capital gains income this year. According to the rules, I'm supposed to write the IRS a big check by Jan 15 for "estimated taxes." I can afford it, but it would make my life better to keep that money for myself. Can I just... not...? This feels like a real Matrix, red pill moment-

"You're telling me that I can dodge taxes?" "No. I'm telling you that when the time comes- you won't have to."

Then again... I really, really don't want to go to prison. even just getting my passport suspended would be a major hassle. And the guy who wrote that post seems like a real hippy... no bank account and no salary income??? how does he live?

Perhaps it would be better to set up a shady small business and claim all sorts of vague tax deductions. Thoughts on this?

btw: long time lurker, first time poster. I'm asking here because you seem like people who are smart, outside-the-box, and not simps for the government.

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I think I'll take a pass on discussing the morality of it. I'd question the practicality though. Let's think here.

So it seems the primary mechanisms of enforcement against most people are through other institutions - they tell W2 employers to knock it off on bad withholding filings, and they do, they tell banks and investment institutions to hand over owed money, and they will. They know about all your bank accounts because the banks report to the IRS too. I am willing to believe that the IRS's most-feared punitive measures are actually pretty rare to come into contact with as the LW OP describes, but what is the plan for dealing with such institutional enforcement? You can choose to not actually write a check to the IRS when they come knocking, but your payroll processor and bank won't.

So then plans for refusing to pay taxes are mostly about living a lifestyle that avoids all such institutions. The low-end one is a pretty obvious option - take a job that pays cash under the table, seek living arrangement that accept cash, never use a bank. Certainly possible to do, but that's pretty low-end living, you'd have to be really determined to do that.

Maybe there's a Bitcoin variety of this? If you can take a job that pays in Bitcoin and doesn't pay attention to taxes, it might be possible to make pretty good money like that. Maybe you could convert that directly to cash by various means, buy prepaid cards and such, and consume luxury goods at a normal rate. Not sure about living space though, I don't think you can buy with crypto or any landlords would accept it, but maybe a roommate will, or would accept converted cash? Or maybe in a super-techy space like SV you could infact rent or buy with crypto. Though if you buy, you'll owe property taxes, which I'm not sure if we're also objecting to here. So maybe this is a practical way to avoid paying income taxes entirely while not living a minimum-wage lifestyle?

But then, the crypto world is not exactly a bastion of honest dealing and fiscal responsibility. What are the odds your crypto employer will pay the correct amount on time every time? How about the people trading crypto for physical goods? The failure rate for bank-like institutions working with crypto is not great either. I'm not even saying the scam and fraud rate is super-high, but if you're relying on it for your primary financial dealings, just one serious mishap could be a huge deal, even if it only happens once every few years. And where's the recourse on any of that? Think the police or courts will give a crap? I doubt it. Hey, organizations that are built around avoiding all taxes and regulation are rather less honest than the "legit" world, who would have guessed? If they're willing to screw over the Feds for more cash, why wouldn't they screw you over too - you're much easier and less dangerous to screw than the Federal Government. Maybe living and working in the normal regulated world isn't so bad after all, even if the Federal Government is not exactly great. Also, it seems kinda lame to be like, I hate the government so much that I refuse to pay any taxes ever, but then go crying to them for help when some third-party scams you.

Along the lines of there being other risks and dangers than the Government, if you live the all-cash or all-crypto no-taxes lifestyle, and you are anything but dirt poor, then you will probably have substantial cash/crypto lying around somewhere. This makes you an attractive robbery target. If you have any social life at all, people will figure this out eventually. You will be targeted. I've known people this has happened to, despite not being as obvious as guy who pays cash for everything because he wants to pay no taxes ever. Organized multi-person burglary schemes can very much happen to you if word gets around that you have 5-figures of cash lying around. Think the cops are gonna help? Unlikely. If you go crying to them that you got ripped off for $50k cash, they're probably going to be a lot more interested in why you had that much cash around than busting whoever did it. Also falls under the theme of, how you gonna refuse to pay taxes because you hate the government so much, then cry to them for help when somebody else screws you over.

I guess the independent community life might be an option. Can be called a "commune" or a "compound" depending on your politics. It can be a viable way to pay little to no taxes without living a completely shitty life. But it's definitely a very different lifestyle. If you dig that, well more power to you I guess, but I don't think it's worth going to that much trouble just for the specific reason of avoiding paying taxes.

So yeah, I don't have a strong moral objection to it, but show me a way to live a no-tax life that's not completely shitty and doesn't expose me to much more likely dangers than whatever the Federal Government is doing, and maybe I'd be into it. If it exists.

The way I understood it, the whole strategy was based around the IRS just being kind of a paper tiger. There were surprisingly few IRS agents, and they are mostly focused on big corporations and extremely wealthy people- it's just not worth their time to go after a regular shmuck who owes less than 100k. EG, Donald Trump seems to have gotten away with a lot of... questionable tax returns over the years, and he's not exactly poor or low-profile.

A whole lot of our life in a first-world society really just relies on cultural norms and the honor system. Like, if everyone decides to just start littering all over the place, the cops aren't going to stop that.

But it's been pointed out to me that the author of that strategy was kind of a hippy who avoids regular income, and also that the IRS has hired more agents lately and stepped up its game in automation. So it's possible that it worked for him in the past, but not for us going forward.

Most of the target of IRS activity is EITC fraud.

It isn’t so much that the IRS goes after big dollars but easy dollars.

So, if I don't claim the EITC i'm set?

The reason that is audited is because it is often just straight up easily proved fraud. Rich people frequently take gray positions which means (1) the field agent auditing has to be smart enough to understand the issue, (2) the Service has to agree that the tax position is against the law, (3) the Service has to believe pretty strongly they won’t lose in court (because if they do, then it opens the flood gates) and (4) the time and effort is worth the funds.

did you read the original post that's linked in the title? dude was claiming taxes and just not paying them. It's about the simplest "fraud" you can get.

And my point is OP will (if he isn’t lying about the whole thing m) get caught and fucked.

This strategy seems pretty dependent on never becoming somebody who the IRS might eventually target.

That is, if your income grows over time, you have a real chance of becoming a big enough fish that they'll find it worthwhile to target you. And if they can target you for years or decades of back taxes, that's a pretty heavy hand they can bring slamming down.

Tax liens are not fun to deal with.

Only up to 10 years, according to the guy who wrote the post. And it's a wash if you have to pay back taxes with penalties, since you also get the time value of the money.

If I someday become a billionaire, then I'll be happy to pay back my middle-class taxes from 10 years ago.

Have you ever personally gotten a tax lien, or known someone that did?

I'm thinking the IRS probably operates more like a business than most parts of the Federal Government. For any possible enforcement action, they're going to be looking at how much money they put into it versus how much they'd recover, and they'll stick with the things that bring in the most money for the least effort.

Are they going to send a SWAT team to raid your house and drag you off to jail for 20 years? Probably not. All of that is super expensive (dozens of agents tied up all day, plus vehicles and gear etc) and not likely to lead to recovering much money.

If you're living a normal upper-middle-class lifestyle, they're going to write a letter to your payroll processor telling them to fix your withholding and garnish your wages, and they will. Then they'll write a letter to your bank telling them to hand over $x from your account, and they will. That takes 10 minutes of work for one guy at a desk and will probably recover whatever they want. If you think they took too much, well sucks to be you, you can spend your own $$$ and hire a lawyer to sue them, and good luck winning anything back. Maybe they'd let it slide for a few years until the amount owed goes over $100k, but no reason to think they'd forget about it entirely when they can still collect easily.

If you're a weird hippie who went to the trouble to have hard to track income and savings, maybe they'll just ignore it because it's too much work to track down and probably not all that much money anyways. Why bother, when writing letters to compliant corporations regarding normal upper-middle-class people is much faster and easier and yields much more money.

For a Donald Trump level figure (let's say pre-Presidency, so kind of a stand-in for any super-rich cantankerous person with weird complex finances), they can assume it'll take tons of their resources to really audit what's going on with him, and he's going to throw a dozen of his own high-priced lawyers and accountants at you, so maybe they'll just leave it alone unless they think they have a rock-solid case that you owe big bucks that they can actually collect.

I actually read some of the "War Tax Resistance" people's website. They don't seem to have much better advice for avoiding enforcement action. Basically, don't work for people who will report to the IRS and obey their garnishment letters, and don't hold money in banks they can track easily.

I'm thinking the IRS probably operates more like a business than most parts of the Federal Government. For any possible enforcement action, they're going to be looking at how much money they put into it versus how much they'd recover, and they'll stick with the things that bring in the most money for the least effort.

I'm sure that's their plan. But I've never gotten the sense that they're even that competant. Partly because the Republicans have shrunk the IRS for political reasons, they're just not even active enough to spend 10 minutes writing a letter to your bank.

they're just not even active enough to spend 10 minutes writing a letter to your bank.

They certainly are. And its not even 10 minutes. They are literally just filling out a standard form. They are up on their game when they think you underpaid. That letter comes out swiftly. And if you don't pay or contest the next step isn't much more for the IRS.

Do you have any personal experience with this? Because what you say directly contradicts the post I linked and what I've heard about the IRS in general.

I was a 1099 contractor, at least, in part, for many years. If I ever reported less income than the counterparty I'd get a letter giving me XX days to respond. I always did contest, because I am not a goober. But then they dedicated hours of work to following up with both parties over typically $500-$1000 in income, which means some low hundreds amount in revenue. On top of that, a few years ago my wife, then fiance, got improperly claimed for like $5000 in 1099 income, from a company that somehow got her SS #, but was from another state. We sent at least 10 correspondences on that, spent at least 8 hours on the phone and the agent ultimately had to, at least pretend to read hundreds of pages of bank and credit card statements on top of whatever they got from the fraudulent counterparty claiming it paid out 1099 income. So, it seems to me, they are perfectly willing to chase ghosts over a few hundred speculative dollars. Why wouldn't they be willing to issue a garnishment order which takes 4 minutes and is guaranteed to net them those hundreds/thousands?

Cool, that's the kind of experience I was looking for. That does make them sound a lot more competant than I expected.

No, unless you are poor, in which case go for it lol.

If you have capital gains you are not in the bracket where Big Papa will live and let live. Imo, of course.

Mmmm - sounds to me like something out of the Heinlein juvenile, "Have Space Suit, Will Travel". Kip, the hero, talks about how his father who is an ex-spy pays his taxes: he just puts money into a jar then, every year, sends it off as an estimate.

The unfortunate revenue agents who show up and have to deal with him come off worst, but I always thought that was the author making the plot come out the way he wanted.

I mean, you could try this, but it probably works best if you don't earn enough to pay so much in taxes, that it would cost way more to come after you than to let this small fish slip through the net. It has that "sovereign citizen" vibe to it.

Filing taxes but not paying them really does sound to me like "the amount I claim as income is so tiddly, I don't even owe tax anyway" which is why the IRS isn't busting down his door.

EDIT: The American taxation system is so different to the Irish one, but I'm just learning the new statutory reporting on expenses which will come into effect in the New Year, and they count even things like "did your employer give you an Easter egg for Easter?" as coming under "small gifts and benefits" and needing to be reported.

If the Irish Revenue service is coming for untaxed Easter eggs from "three for a tenner" supermarket promotions, I'm dang sure the American IRS is not letting people get away with "okay so I'm reporting that I owe this much tax, but I'm not paying it ha ha" because they're too small and weak to come after you.

EDIT EDIT: In case you think I'm joking about the Easter eggs:

Example 8

Employer A provides easter eggs every year in April to all of its employees. Employer A also provides three €50 vouchers in January, June and November each year to all of its employees.

Employer A must determine before it provides any small benefit to its employees whether that ‘payment’ is a taxable payment, where income tax, USC and PRSI are applicable and it is reported through payroll.

If Employer A is satisfied that the benefit meets the conditions for the small benefit exemption, it must be reported in an ERR submission, with the date of payment and the value of the payment reported. One of the conditions of the small benefit are that it is the first and second provision of such a gift, with a maximum value of no greater than €1,000 that are to be deemed the small benefit and subject to the exemption.

In this instance the provision of the voucher in January and the easter egg in April will constitute small benefits for which the conditions for tax exempt treatment will apply. As with the other examples the voucher in January must be reported on or before it is provided to the employee and the value of the easter egg must be reported on or before it is provided to the employee in April.

Therefore, these benefits must be reported through ERR. The vouchers in June and November are taxable, as they are the third and fourth incentives given in the year and must be taxed in the normal way through the PAYE system.

Hey Hunter is posting on LessWrong. We should ask him if his dad is really going to run for president again!

Joking aside, terrible idea. While it’s true the IRS doesn’t audit everything, they do try to automate certain things as much as possible. Matching up receipt of return stating X dollars owed with zero dollars paid is easily automated.

Once there is a pattern, it is relatively easy to establish willful attempt to avoid paying the tax which is a criminal offense. Of course bragging about the criminal scheme on line is even worse (assuming not a Fed or Hunter Biden).

The idea is that the IRS is so small and incompetent that they basically won't do anything against this sort of passive resistance.

Author wrote about it also on https://sniggle.net/TPL/index5.php?entry=19Mar23

And this indicates that you need to restructure your life, give up passport, lower income AND hope that IRS will stay incompetent and will not use its power to seize what you owe. And maybe also put into prison.

This is terrible idea, as expected.

The total amount I owe at this point is well over the threshold at which the IRS is supposed to notify the State Department that I ought to be forbidden a passport and perhaps ought to have my passport revoked. It took the agency longer than I expected, but they eventually submitted this notification a few years back.♦ This means that the State Department could revoke my passport at any time, and in any case is not supposed to allow me to renew it when it expires. So far they have not revoked my passport.

BTW, given "Last year, when another year of my tax debt became uncollectible due to the statute of limitations" it seems that IRS funding really should be increased.

Yeah that is an important caveat. Thanks for catching that. Seems like this guy has very much devoted his life to this strategy. Interesting that the IRS did come after him, but they only took a relatively small amount of money from him, and didn't actually take his passport. Even though he's publicly encouraging tax fraud, so he really seems like the sort of person they'd want to make an example of. He does have some useful tips for legally reducing taxes though.

So he claims. I wouldn’t follow advice from this poster. Risking tax fraud for…small sums of money is insane.

well, its not that small. its like 20-40% of all the money you ever earn, which compounds over time.

This seems in the same vein as things I’ve read about how simply not paying debts works a lot better than it should in terms of avoiding actual repercussions.

Enforcement is expensive and so there are limited amounts of it.

Seems high risk, however, and I would not recommend it.

This seems in the same vein as things I’ve read about how simply not paying debts works a lot better than it should in terms of avoiding actual repercussions.

There's a problem in a lot of Americas formalized systems, the threats are largely effective to prevent you from living a normal middle class or above existence, which if you've already given up on or failed out of that goal, isn't very effective. Once people slip into the world where they'll never qualify for a mortgage, or get a really good job, or have a significant amount of savings in a bank, a lot of the threats of bankruptcy, collections, etc become ineffective. If you are never going to get a loan, you don't care about your credit score. If you work for cash under the table and never plan to get a formal job, you don't care about garnishment. You just hang up on the debt collectors, and you put all your bills in your girlfriend's name, and move on with your life.

When the rent/eviction moratoriums were in place, I understood the policy's goals and advantages, but I also understood the mindset of lower end renters in a way that was overlooked in a lot of analysis. If you're already never going to get a mortgage or have a decent credit score, and know you never will, then the obvious play if you won't be evicted for six months to a year is to stop paying rent and stack that cash on hand. Even if you're future oriented, not paying rent for six months gives you an opportunity to save money that you might never see again! Save $10-20k, and now move in with your girlfriend and put her name on the lease or maybe even use it as the down payment for a small house!

A lot of policy makers and bureaucrats didn't see a plan like that, because their credit score is really important to them, and they can't imagine a person for whom it isn't important. Something about Hawks and Rats?

This seems in the same vein as things I’ve read about how simply not paying debts works a lot better than it should in terms of avoiding actual repercussions.

Enforcement is expensive and so there are limited amounts of it.

Seems high risk, however, and I would not recommend it.

Because enforcement is limited the taxman punishes those who offend severely for the use of those limited resources. The quoted post reeks of 'everything is fine, until it isn't'. I have my doubts the poster will come back with a 'the IRS finally caught up with me and now I'm financially ruined' follow up post if that situation eventuates. Similar vibes to the high rollers on /r/wallstreetbets.

Two things you can't avoid in life: death and taxes.

My initial reaction was the same as just about everyone here: "horrible idea, don't ever do this"

I went and read the post, and it mostly changed my mind. Its still not something I would do, I am way to financially risk averse. But its not the worst idea ever.

The important thing to note about the advice is that there is an easy financial path in life where you don't really have to think too hard about financial things, you get a salary, your employer deducts the right amount for income taxes, and you get to use bank accounts and standard investment vehicles for growing what money you can manage to save. If you choose to do tax avoidance, that easy financial path will be gone. It is a large potentially permanent lifestyle decision that you'll have to make. And if you have a spouse they probably need to be willing to make the same lifestyle decision. And if you ever plan on having kids, it will impact those kids. Certain parts of the easy financial path in life are designed to benefit people with children, and those will be closed off to you. Inheritance will also likely be a mess. And your children might have to make the same financial lifestyle decision in order to receive financial help from you.

I was on that "easy path" for a long time. And it was... fine, just kind of boring and soul-crushing. I feel the need now to experiment and live a little differently. But yes, very risky.

Transparently terrible idea with a horrible risk-reward tradeoff. Oh, cool, I might be able to avoid a few hundred grand in taxes. What's the downside? Oh, they might seize millions in assets and put me in prison. That seems bad! Seriously, how low would the chance of facing those consequences need to be for it to make sense to take that tradeoff? For me, less than one percent, for sure. I don't need the money from my taxes, it would only change my life marginally, but the downsides are literal life-ruiners.

This pro tip is just about on par with sovereign citizens informing the police that they're not driving, they're traveling.

"Picking up pennies in front of a bulldozer," is the phrase that came to mind when reading your comment.

While I'm not a tax expert, if you owe taxes, the IRS may seize and sell your assets to cover the debt. There's a risk that the assets might be sold for less than their market value, potentially increasing your effective debt. Additionally, a forced sale could trigger further tax obligations, and there is no guarantee that the IRS will sell the seized assets in a manner that minimizes tax liability.

26 U.S. Code § 7202 - Willful failure to collect or pay over tax

Any person required under this title to collect, account for, and pay over any tax imposed by this title who willfully fails to collect or truthfully account for and pay over such tax shall, in addition to other penalties provided by law, be guilty of a felony and, upon conviction thereof, shall be fined not more than $10,000, or imprisoned not more than 5 years, or both, together with the costs of prosecution.

(Aug. 16, 1954, ch. 736, 68A Stat. 851.)

The IRS may be slow and incompetent, they may ignore the accounting error for a bit, but this scheme has to blow up in your face years from now once some bean counter decides he hates you in particular or enough people start doing the same thing and policy changes to reflect that.

And then you at best end up paying everything at once with a 25% markup and at worst a felon in pound-me-in-the-ass federal prison.

In fact it's so stupid a scheme it sounds like entrapment. If you're dumb enough to believe not paying what you declared you owe and bragging about it on the internet is a good idea because people getting sentenced for the crime you are committing is "almost unheard of", you're either profoundly retarded or are yourself a fed trying to pad his numbers by building a pile of easy to close cases. But I repeat myself.

Stick to the other perfectly legal method: just don't owe any taxes.

Please provide links.

Edit: I just noticed that the title is a link. Sneaky.

One one hand, it is true that the IRS cannot and does not audit everyone, or send all delinquent accounts to some form of collections. It is also true that they are disinterested in de minimis settlements from judgment-proof citizens, i.e. they're not coming after you for a $5 error (though they might send a letter about it!).

On the other hand, it is also true that there are things you can do that their computer systems will now notice more or less automatically, which will substantially increase your risk of an audit and/or collection activity. People can, and do, get hit with wage garnishment and even jail time for unpaid accounts.

I have never been able to think of a good moral argument for income or capital gains taxes; sales taxes possibly, certain limited property taxes maybe, but income and capital gains taxes are just straight theft. So please don't imagine I have any sympathy for the IRS when I say: just pay the IRS what you owe under the law as written. Unless you are at least a centi-millionaire for whom the cost of legal defense is arguably less than the possible savings, there are very few situations where I can imagine the risk outweighing the reward.

Now you might say--"but I don't know what I owe, because 'estimated taxes' are bullshit!" I sympathize, I really, really do. The fact that a single windfall can result in a year or more of the IRS asking you to pre-pay your taxes based on unrealized income you can't possibly predict is incredibly abusive. But so long as you pay a plausibly good faith estimate, you will have done something defensible. And also remember that the IRS doesn't (usually?) escalate to "jail time"--the first thing they do is demand their protection money, and the second thing they do is add penalties on top of that. So if you underpay your estimated taxes, there's a chance they'll hit you with a penalty for it.

Setting up a shady small business and taking deductions can indeed reduce your apparent tax burden, but it also exponentially increases your chances of an audit (and the penalties you will incur in the process).

Good luck!

It is also true that they are disinterested in de minimis settlements from judgment-proof citizens, i.e. they're not coming after you for a $5 error (though they might send a letter about it!).

On the other hand, it is also true that there are things you can do that their computer systems will now notice more or less automatically, which will substantially increase your risk of an audit and/or collection activity. People can, and do, get hit with wage garnishment and even jail time for unpaid accounts.

Yeah... I guess that's what I'm coming around to. I could probably get away with it if it was for a very small amount, but for larger amounts their software will probably catch it and it's not that hard for them to just seize my bank accounts or whatever.

no justification for income taxes

Payment for the services which allow you earn that income doesn’t do it for you? Or is it a sense of double-dipping with taxes on consumption?

I’m having a hard time imagining why the income tax would be less justifiable than any other form of tax.

Payment for the services which allow you earn that income doesn’t do it for you?

Which government services "allow" me to earn income? At best I suppose the provisioning of a fiat currency might qualify, but I'm not really sold on fiat currency being an improvement over known alternatives. Since government monetary policy is not typically crafted to benefit me (specifically), but to benefit banks and other large stakeholders, the absolute strongest steelman I can think of for fiat currency is that it creates a sort of "trickle down" effect where I benefit incidentally. Beyond that, stuff like the roads I travel to get to work, or the police I (basically never) rely on to keep my workplace safe, are all either privatizable, or easily provisioned through more direct means (e.g. tolls or vehicle purchase taxes or the like).

Or is it a sense of double-dipping with taxes on consumption?

Maybe? Nozick's "Tale of the Slave" captures the problem reasonably well. I don't mind paying for services I use. But if you split my "share" of income taxes proportionally between all government programs, at least 50% of that money is just being redistributed to people and programs who don't deserve my money. For every hour I work, I spend about five minutes enslaved to someone else's cause--causes that are not only unnecessary to the continuation of my community, but are in many cases (e.g. federal funding to Planned Parenthood, military incursions driven by sentiment rather than defensive or even economic considerations) things I regard as actively harmful to my community and to the world. I am told that this is why we have the democratic process, so I can have a "say" in how my money is spent, but realistically my "say" is worthless, and I don't think I should have only a 1/150,000,000 say in how my life is spent.

I’m having a hard time imagining why the income tax would be less justifiable than any other form of tax.

Because it's just stealing. Person A has $$$, so take it away and give in to person B. "Person B needs it more!" So? We don't actually redistribute money based on need, need is the excuse we give for redistributing money based on the political priorities of the powerful. Property taxes bug me (since they ultimately end with property confiscation) but at least they are mostly attached to services that make the property useable. Vehicle taxes, or even mileage or road taxes, are at least mostly attached to related services. Sales tax makes some sense to me insofar as we do have a shared currency, military operations keeping shipping lanes safe, etc. Even some of the more paternalistic stuff, like Social Security tax, is at least more justifiable that income tax, because (at least in theory) the money being confiscated is for a specific identifiable purpose directly related to the earner's well-being.

But income tax is just straight wage theft. It lacks even the patina of paternalism. People who pay income tax are just being milked by the government, in substantial measure for the purpose of outright buying votes from the poor. Basically every extant form of taxation I can think of is more justifiable than income tax. Which is not to say that I am especially bullish on other forms of taxation, but I'm not an anarcho-libertarian. I'm okay with sensible, relevant taxation, but income tax does not even remotely meet that threshold.

Maybe? Nozick's "Tale of the Slave" captures the problem reasonably well.

Taxation is theft, not slavery, that is why I like it over alternatives (or maybe tribute not theft).

This text was linked some time ago, and it is quite silly.

There is very significant difference that I have no some slave owner that may rape me, take all my stuff, sell me 200kmn away, flog me, forbid me to leave specific village or tell me that I am now obligated to do unpleasant job XYZ for 18 hours a day. Taxation is not like any of these things.

This text was linked some time ago, and it is quite silly.

Is it? You don't appear to have read it.

There is very significant difference that I have no some slave owner that may rape me, take all my stuff, sell me 200kmn away, flog me, forbid me to leave specific village or tell me that I am now obligated to do unpleasant job XYZ for 18 hours a day. Taxation is not like any of these things.

The text clearly accounts for all of this. All you seem to be saying is that you don't think #9 is slavery. What about #8, #7, etc.? The point of the text is not that taxation is slavery, it's that it is surprisingly difficult to specify, from a moral perspective, where slavery begins or ends.

the police I (basically never) rely on to keep my workplace safe

I've basically never seen a police officer in a drug store. What I do always see, though, is drug store shelves laden with row after row of expensive products, instead of the post-apocalyptic scene you get when police aren't keeping the products I'd like to buy safe. That's not because my city doesn't also have countless people who would be happy to steal shelves bare, it's just because there's a huge amount of hysteresis in these systems, so in my areas the police usually don't have to be seen because they've been effective enough to be a deterrent.

privatizable

Maybe. But I notice that that drug store's existing private security is reportedly "to protect customers and employees rather than chase after shoplifters", not to actually solve their huge security problem. Although as a customer I would indeed find myself in zero direct danger from a store that I have no remaining reason to enter, half of my family ended up relying on one life-saving drug or another in their old age, so I would at least consider a collapsing market for drug stores to be an indirect danger at some point. Perhaps private security would be forced to step up their game, if public police were completely nonexistent? Or perhaps the important factor is that the problem of liability concerns for unrestricted private policing would mostly go away at that point ... which strikes me as a bit of a double-edged sword, though I must admit that I'm not thrilled with all the side effects of public policing either.

People who pay income tax are just being milked by the government

Yup! Ironically, the "it's just stealing" premise (I like the phrasing "taxation is theft", personally) makes income tax more acceptable to me rather than less. Until we figure out how to keep a country working without a lot of stealing, we might as well give up on trying to make each individual theft precisely justifiable, and just focus on trying to mitigate the damage by spreading it around in amounts scaled to the victims' ability to afford the loss.

I suppose the real problem is the converse? If you're not trying to justify each particular form of taxation with reference to what that specific revenue is to be spent on, then you're also not trying to justify each particular form of spending with reference to how the specifically taxed people are going to benefit from it, and that means the options for spending blow wide open? But I'm not sure that would be a real obstacle to any politician who wasn't also a philosopher, and I suspect in the USA any remaining philosopher-politicians quit in disgust after the non-philosopher-politicians discovered the "reinterpret the Commerce Clause to let us make any law about anything" loophole.

I'm not an anarcho-libertarian.

No? I'd always thought of "privatize all police" as the major dividing line separating anarcho-libertarianism from the varieties including my own much more tentative/boring libertarian leanings. At the very least, when I think about "how could we make police privatization work", I'm hard pressed to find someone other than David Friedman who's given great thought to the issue, and e.g. his subtitle to "Law as a Private Good" is "A Response to Tyler Cowen on the Economics of Anarchy".

Payment for the services which allow you earn that income doesn’t do it for you?

Proper amounts of spending and proper sources of taxation aside, there are few services that I value or that I earn income from that are funded via federal income tax. Property taxes, while annoying, at least actually pays for the infrastructure of daily life.

Setting up a shady small business and taking deductions can indeed reduce your apparent tax burden, but it also exponentially increases your chances of an audit (and the penalties you will incur in the process).

This also sharply increases the chances your behavior will be seen as criminal. Simply failing to pay appropriately will almost certainly result in nothing more than payment plus fines and interest, even if no one really believes that your mistake was honest. Going out of your way to set up an illegal tax evasion scheme would likely result in the same treatment, but must be an order of magnitude more likely to be treated as a criminal offense, and you'd really have no plausible defense if you had an obvious sham business.

Stuff like this tends to work before some undetermined period and then blow up suddenly. What's your plan for when the IRS suddenly reprioritizes and checks your return? Do you really want to live with the dread of knowing it could be tomorrow?

Especially if the IRS were to crack down on this because, say, someone posted a popular how-to manual on the Internet and everyone started dodging taxes.

Was kinda hoping for more engagement on this... should I have posted this in one of the megathreads?

Top posts need mod approval and the mod team only currently exists in American time zones. I've approved your post, so now it's visible to everyone.

ah ok. I was confused because it seemed visible to me. thanks!

Doesn't show the post or user name for me, it just says "Filtered".

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