Income tax

Irwin Schiff, R.I.P.

Man who argued there is no legal obligation to pay income tax dies of cancer shackled to prison hospital bed at age 87.

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Irwin Schiff died on Friday while in federal custody over charges connected with his refusal to pay taxes and his advising others to do so.

His public career began as a popularizer of small-government, Austrian-economics-influenced thought with a popular 1976 book mostly about the various ways he thought government actions of various sorts harmed citizens, called The Biggest Con. He then shifted to become the most famous popularizer, over many books over decades, of the idea that no one legally owes income tax.

According to an obituary notice from his son Peter Schiff, who runs the firm Euro Pacific Capital and is a public advocate for Austrian-influenced economic ideas himself, his father's end was unnecessarily ignominious and cruel.

He began a 14-year prison sentence 10 years ago, when he was already 77, then came down with skin then lung cancers in prison and was moved away from his family to a prison hospital in Texas where Peter Schiff insists his father's medical treatment was negligent. Then:

We tried to get him out of prison on compassionate release so that he could live out the final months of his life with his family, spending some precious moments with the grandchildren he had barely known.  But he did not live long enough for the bureaucratic process to be completed.  Two months after the process began, despite the combined help of a sitting Democratic U.S. congresswoman and a Republican U.S. senator, his petition was still sitting on someone's desk waiting for yet another signature, even though everyone at the prison actually wanted him released….When his condition deteriorated to the point where he needed to be hospitalized, government employees blindly following orders kept him shackled to his bed. This despite the fact that escape was impossible for an 87 year old terminally ill, legally blind patient who could barley breathe, let alone walk.

I met Schiff while researching my 2004 Reason feature on the "tax honesty" movement. He was indeed a jolly warrior for a cause he obviously very sincerely believed in, even when it became completely obvious that the federal government was not going to be daunted by his arguments and indeed was going to keep arresting him for practicing them and advocating them.

The New York Times obituary. While Schiff's writings on the income tax and his thoughts on why it was illegitimate stretched over many books, not all of which I've read, the Times is a bit misleading in claiming that a goldbuggy belief that the paper dollar wasn't a real dollar anymore so no one is really "earning money" was one of its cores. He discussed that point briefly in Biggest Con, which wasn't mostly about the income tax anyway. His position evolved to mostly arguing (among other things) that by his reading of the true legal definition of "income," neither you nor I had any, "income" properly defined according to his reading of court decisions and statutes being only corporate profits.

One might wonder, even beyond the compassionate exemption that ought to have been quickly forthcoming for a dying man of his advanced age, why it even seemed so vital for the government to keep an old man who posed no threat to the life or property of a fellow citizen in prison to begin with.

From the government's perspective though, he remained a threat who had to be neutralized because he would keep committing the crimes they convicted him for: not paying income tax and telling others they didn't legally have to either.

For those who want to go into some of the legal weeds of Schiff vs. the government, see this weirdly First Amendment-challenging injunction against him from 2008 basically making it illegal for him to sell his books about the income tax, this 2013 denial of his motion to have his last conviction overturned, or this collection of Department of Justice documents pertaining to their long war against Irwin Schiff for having, advising, and acting upon his eccentric beliefs about tax law.