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BahRamYou  5mo ago (lesswrong.com)   Edited 5mo ago   2075 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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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.

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