The Long Arm of IRS Jurisdiction

There are certain people who try to avoid paying taxes by circumventing the law because they do not know how far and wide the IRS extends. Tax "protesters" normally try to question the jurisdiction of the IRS and the constitutionality. So you do not end up suffering IRS problems in the future, you should know the laws as a taxpayer. Let's take a look at jurisdiction and the extent of the Internal Revenue Service.

A term often heard on movies, jurisdiction provides leaders the authority to enforce punishment when handling legal matters.

Since it has jurisdiction over all US taxpayers and those who make income in the US, the IRS is a bit amorphous. It's absolutely likely to suffer IRS issues if you fail to understand that you're a taxpayer, or that you have obligations to pay taxes.

Here is an excerpt from Title 26 of the Code of Federal Regulations which pertains to the IRS:

"The Internal Revenue Service is a bureau of the Department of the Treasury under the immediate direction of the Commissioner of Internal Revenue. The Commissioner has general superintendence of the assessment and collection of all taxes imposed by any law providing internal revenue. The Internal Revenue Service is the agency by which these functions are performed."

The IRS has jurisdiction over you as a taxpayer if you're a US citizen making money or living in foreign countries, a non-resident making money in the United States, or a resident of the United States. You'll encounter issues with the IRS if you fail to pay taxes on capital gains, earnings, property, etc.

There are those who do not fall under the jurisdiction of the IRS. In this paragraph from the case of Economy Plumbing and Heating Co. vs. The United States, it explains that non-taxpayers are excluded from the IRS's rules and regulations:

"The revenue laws are a code or system in regulation of tax assessment and collection. They relate to taxpayers, and not to non-taxpayers. The latter are without their scope. No procedure is prescribed for non-taxpayers, and no attempt is made to annul any of their rights and remedies in due course of law. With them [non-taxpayers] Congress does not assume to deal, and they are neither of the subject nor of the object of the revenue laws."

To avoid IRS issues, you need to find out if you are a non-taxpayer or not. You can find out from your state's tax website or the IRS website.

Tax protesters claim that the 16th Amendment that provided Congress the power to collect taxes on income wasn't officially ratified, questioning the jurisdiction of the IRS. With a majority vote, the 16th Amendment was indeed ratified.

Another frivolous argument is that the IRS has no jurisdiction because it is not a government agency. Actually, because the Secretary of Treasury has enforcement and administration power over the laws of internal revenue, the IRS was created. Arguments such as these will give people IRS problems because the IRS does have jurisdiction over taxpayers.

As a taxpayer, you're under IRS jurisdiction. Inaccurate declaration of income and failure to pay taxes will give you serious IRS problems.