IRS Suffers Staggering defeat...jury returned zero convictions on 161 charges faced by nine defendan

Hardly a "staggering" defeat. From the above links:

Several defendants pleaded guilty, and for the others the jury hung on the question of whether there was willful conspiracy.

Further, there was an issue in that the IRS had apparently not provided guidance regarding how to report circulating coins whose market value exceeds their face value. You can bet they will provide such guidance very soon. The IRS is likely to assert, and the courts are likely to agree, that if you receive something of value in compensation for your work, you have to pay tax on that value. This is the case when you are paid in kind rather than cash.

These folks found a loophole, and the jury was hung on that loophole, due to the discrepancy between the face value and the market value of circulating coins and the difficulty of proving intent to break the law.

But a hung jury is not an acquittal and the loophole will be rapidly closed.

 

<div class='quotetop'>QUOTE(burritos @ Oct 12 2007, 08:34 PM) [snapback]524940[/snapback]</div>

Good that the law kicks the Feds

In the UK this idea was shut down in the late 60's when a guy was paying his workers in golden sovereigns!

 

The law didn't really kick the feds. The issue of whether these folks still owe taxes was not resolved, and nobody was acquitted. A hung jury means that the prosecutor can re-try them if he likes. My guess is that they'll still have to pay the taxes, even if they get out of the criminal charges for evading taxes, which is clearly what they were doing.

Note: I applaud anyone who evades taxes. But if you do it illegally, you'd better be prepared to do the time. You can avoid taxes legally by living below the taxable level. But if you conceal your income, as these folks did, you're taking your chances. Apparently they were clever enough to stay out of jail (for the time being).

I knew a guy who filed a correct tax return, but refused to pay. You can be sent to prison for failing to file, or for filing a false return; but you cannot be sent to prison for refusing to pay. In that case, they just take your property or salary, plus fines and fees. In my friend's case it was a matter of principle.

Note: I lived below the taxable level for a long time, thereby legally avoiding taxes. These days I pay every penny the accountant says I owe. But I do have a soft spot in my heart for tax refusers.