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Many try, but most fail to come up with a good excuse not to file

Although there's no record that anyone's actually tried "my dog ate my tax return," just about every other excuse has been offered in an effort to forestall or evade the April 15 job.

Some are legit, some less so. Some are offbeat. Others are just downright odd. And a few -- very few -- even work.

Take the case of a bookkeeper for a small business. San Diego CPA Steve Kramer, who handled the company's taxes, recalls that the employee went skiing, fell and lost the keys to the filing cabinet that contained all the firm's tax records. Company officials couldn't get to their general ledger, and Kramer had to file for an extension. It was granted, by the way.

Then there was one of Kramer's elderly clients who had no family. After several months in a coma, the person died just a few weeks before the tax-filing deadline. Kramer relayed this information in his request for an extension to file the person's final 1040.

The Internal Revenue Service denied this one, forcing Kramer to phone the tax agency and track down a supervisor to approve it. Even then, the supervisor would only OK the request after Kramer submitted documentation that his client died.

Generally, you don't need an excuse for an extension, at least not the first one. And remember that extensions will only give you more time to file your return. You still have to pay any tax you owe with the request.

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Tougher sell for nonfilers
If you're trying to find a good excuse to get out of filing altogether, that's another -- and usually sadder -- tax story.

Eva Rosenberg, the Web's Tax Mama, had a physician client whose wife wrecked his business by filing fraudulent Medicare claims. The doctor believed he didn't need to file because he was so broke that he and his children were living in his car. That's a sad situation, but it's not a legitimate excuse in the eyes of Uncle Sam.

Rosenberg had another client who was living abroad. His nonfiling excuse: Since he had taxes withheld from his paycheck, he didn't need to file a tax return. And he had enough withheld so that he was perpetually due a refund, meaning the IRS wasn't anxious to come after him.

But his refusal to file hurt him financially. "He lost nearly $100,000 worth of refunds over 10 years because he didn't file," says Rosenberg.

Other tried, but failed, excuses given by clients to Rosenberg over the years include:

  • "I was afraid to do it wrong, so I just kept gathering information and lost track of time."

  • "My husband refused to file, so I didn't know what to do."

  • "I was drunk and totally out of it for the last few years. Hey, I was living on the streets. Do you think I cared about taxes?"

Working hard to not file
Some even go beyond the talk stage. They take action to avoid tax filing.

A common stalling route nowadays travels through the court system. Tax protestors in particular look to what they say are legal remedies against enforcement of the U.S. tax code.

In addition to the popular charge that the 16th Amendment authorizing collection of an income tax was not properly enacted, recent lawsuits have alleged that:

  • "Sovereign" states are not part of the United States. Only the District of Columbia, federal territories (such as Puerto Rico, Guam, etc.) and federal enclaves (Native American reservations, military bases, etc.) count, so persons living outside those boundaries are not subject to federal tax laws.

  • Information, both financial and personal, requested on tax forms is a violation of a person's 5th Amendment right against self-incrimination.

  • Payment of federal taxes is strictly voluntary.

The track record for these court-based excuses against filing isn't so good. According to the IRS, over the last two years 38 people who attempted to delay tax collections by pursuing what were deemed frivolous court cases were slapped with $126,000 in penalties.

And regardless of what route you take to try to get out of filing and paying your taxes, the cold hard truth is that sooner or later, you're probably going to have to pay up.

Jenny C. McCune is a contributing editor based in Montana.

-- Posted: April 14, 2003
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Tips on getting your 1040 to Uncle Sam
Why taxpayers procrastinate

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