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WESLEY SNIPES JAILED FOR FAILING TO FILE TAX RETURNS

Updated: Jan 17

WESLEY SNIPES JAILED FOR FAILING TO FILE TAX RETURNS - WAS SNIPES UNDER THE MISCONCEPTION THAT IRS AGENTS WERE VILLAINS IN AN ACTION MOVIE THAT HE COULD PICK OFF?


From 1999 through 2001, Wesley Snipes avoided $7 million in taxes. He surely would have paid it willingly had he known that the government would go after him in a full court press. The government was able to nab a high-earning celebrity and teach a lesson to tax protesters at the same time. Sadly, Mr. Snipes followed an accountant and an anti-tax advocate down a dangerous and costly path.

The advisers claimed that they did not legally have to pay taxes. Sounds alluring, doesn't it? Snipes was such a well-known figure and high earner—raking in about $40 million from 1999 to 2004—that not paying taxes was hard to fathom. 

But Snipes wasn’t convicted for merely trying to dodge the IRS. He was actively claiming that the IRS had no right to tax him. Snipes’ central argument was that he was a “nonresident alien” (despite being born in the United States), and therefore, the US government had no jurisdiction over him. 

But it gets weirder. Not only did Snipes refuse to pay his taxes, he threatened federal employees who went after him, claiming in a letter that the IRS deceives to “terrorize, enslave, rape [and] pillage” taxpayers, further asserting that any taxes withheld were stolen from him. He also wrote that “illegal collection action” would result in “significant personal liability” for IRS agents.

Was Snipes under the misconception that IRS agents were villains in an action movie that he could pick off?

Despite the threats, despite the failure to pay taxes on $37 million and the attempt to steal $11 million back from the government, it really is a testament the power of celebrity that Snipes was not convicted of any felonies. In 2008, Mr. Snipes was convicted of three misdemeanor counts of failing to file tax returns. 

Snipes was convicted of the misdemeanor of failure to file, while filing falsely is a felony. You must file a tax return each year with the IRS if your income is over the requisite level, and the U.S. taxes all income wherever you earn it. There are numerous bogus theories taken up by tax protesters for explaining why they are not legally obligated to pay. Mr. Snipes fell prey to a variation of the argument that only foreign-source income is taxable. If you have domestic income, the crazy theory, goes, it is tax-exempt.

After big legal and financial setbacks, Mr. Snipes is probably not likely to believe someone who tells him he doesn't have to pay taxes. You have to be careful who you hire and who you trust.


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