Paul L. Caron

Friday, December 14, 2007

Wesley Snipes' Defense: It Can't Be Tax Fraud Because the IRS Didn't Pay My Bogus Refund Claims

I previously have blogged the bizarre claims by Wesley Snipes' lawyers as he faces criminal tax fraud charges (see list below).  In his first interview since his indictment, the actor makes a novel claim:

Snipes flatly denies all of the government's charges against him and insists that he filed returns for all of the years in question. And while he admits that yes, with the assistance of Kahn and Rosile, he did request refunds totaling $11.4 million for 1996 and 1997 taxes he paid, he never did so with the intent to defraud the IRS. Instead, he claims he was merely following the counsel of his advisers. ''The accountants say you're entitled to a refund because of these particular rules and regulations,'' he says. ''So you say all right.... If someone tells me I'm entitled to a refund, I'll go for the refund!''

Snipes admits that these refund requests may have been a bit aggressive (they allegedly hinge on a discredited tax-protester gambit called the ''861 argument,'' which claims that the domestic income of U.S. citizens is not taxable). But he argues that if the IRS had a problem with the claims, then it was obligated to meet with him if he so desired. He says that he made that request, but the government indicted him instead of granting him the meeting. When contacted to respond for this story, the U.S. Attorney's Office declined to comment, saying only, ''We will do our talking in the courtroom.''

In the meantime, Snipes remains baffled by the charges, especially since he claims he was never paid the refunds in the first place. ''I never got a dime,'' he insists. ''I didn't defraud the government by taking money that was not mine. We never got it!'' ...

Still, if Snipes' strategy next month in court is to blame his advisers, then it raises a question — not a legal one, perhaps, but a commonsense one: Didn't he think that his accountants' promises of multimillion-dollar refunds were too good to be true? Snipes laughs at this suggestion. ''Hell yeah, it sounded too good to be true!''

Prior TaxProf Blog coverage:

Celebrity Tax Lore | Permalink

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In the spirit of "reality TV," here's a pretty well done "docu-drama" illustrating Snipes's argument. Enjoy.

Posted by: Ian | Dec 16, 2007 10:30:52 PM

Unbelievable - to claim you've done nothing wrong because you were unsuccessful in the attempt! Great story.

Posted by: Valerie Lepine | Dec 15, 2007 2:27:52 AM