More IRS Documents

July 27th, 2010 // 8:13 pm @ admin

In 2005 I was audited by the IRS on eight years of 1040 returns I had filed for 1997 through 2004. During this audit the IRS attempted to get the names, addresses and telephone numbers of those who bought the book I had authored entitled “Constitutional Income”. With the help of Center for Individual Rights, a public interest law firm in Washington DC, we were able to prevent these names, addresses and telephone numbers from being turned over to the IRS. It took CIR and me two years and two lawsuits before we were successful. However, this turned the audit into a four year process.

In retaliation for not turning over these names, addresses and telephone numbers, the IRS denied me all of my business deductions for the eight audited returns. This ballooned up the taxable income by $300,000 and the sequent tax, interest and penalties. I was told by an IRS revenue officer, “When you don’t give us everything we ask for, we deny all of your deductions”.

I do not regret the decision to protect my readers, as I was defending their First Amendment right to be able to read whatever they want. I was also defending them against possible violations of their Fourth and Fifth Amendment rights as it was entirely likely they would be subjected to IRS scrutiny for having bought my book.

You will find here a sample of some of the business deductions that have been denied to me. During the audit, I gave the IRS over three banker’s boxes full of documents. The documents you’ll see here were all provided to the IRS, yet I was denied these expenses on my tax returns. And our Idaho State Tax Commission has also piled on denying me the same deductions and demanding that I pay taxes on the “income” for these monies that were expended for operating my business.