It’s Not Racial, It’s That Your Famous

Joe Kristan of Roth Tax Updates has an update on the Wesley Snipes case. For those of you who don’t remember, Wesley Snipes is accused of asking for a fraudulent refund of $12 million. Snipes used tax the argument that only foreign income is taxable (hint to anyone who wants to try that: don’t). The IRS wasn’t amused, and Snipes is now a Florida courtroom.

When we last reported on Snipes, he had accused the prosecutors of being “racially motivated.” The judge denied that motion, and stated:

“From a prosecutor’s point of view, especially in tax cases, the primary objective in deciding whom to prosecute is to achieve general deterrence. Here, Defendant Snipes is admittedly a well known movie star, and a person of apparent wealth, whose prosecution has already attracted considerable publicity. By contrast, the Defendant Eddie Ray Kahn does not appear to share Defendant Snipes’ notoriety. “Since the government lacks the means to investigate and prosecute every suspected violation of the tax laws, it makes good sense to prosecute those who will receive, or are likely to receive, the attention of the media.” United States v. Catlett, 584 F. 2d 864, 868 (8th Cir. 1978) (internal citations omitted); see also United States v. Hastings, 126 F.3d 310, 314 (4th Cir 1997) (no selective prosecution in case against prominent businessman and Republican party leader charged with failure to file income tax returns).”

Wesley Snipes was wrong. If you’re famous, and the IRS thinks that you’ve evaded taxes, you are much more likely to be prosecuted. It also helps (if you want to be prosecuted) when you persist with tax protester arguments after the IRS warns you to stop (which Wesley Snipes did).

So Mr. Snipes will soon go on trial. And if he (and his attorney) continue down this path, he will likely find himself at ClubFed.

Hat Tip: Roth Tax Updates


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