A number of new Revenue Rulings present the counter-arguments against claims that

• compensation received in exchange for personal services is not taxable income
  
  
• filing a tax return is voluntary, not mandatory
  
  
• the IRS must provide taxpayers with a summary record of assessment, signed by an authorized employee or officer, before it can collect overdue taxes
  
  
• income is excluded from taxation if an individual claims to have rejected or renounced United States citizenship or is not a person as identified by Internal Revenue code.

Taxpayers making these arguments often attempt to avoid their federal income tax liability by furnishing Forms W-4 Employee Withholding Allowance Certificates on which they claim excessive withholding allowances or claim complete exemption from withholding.

Since the first quarter of 2005, employers have not been required to submit copies of Form W-4 to the IRS that they believe do not correspond with the employee's circumstances. The IRS has its own procedures for identifying workers with withholding compliance problems and, in cases where problems are identified, the IRS will send a notice to the employer with specific instructions for withholding on the affected employee. Link Link Link Link

...US Tax News - Latest

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