Tax delinquency

“ The imposition of a tax is certainly a function of government and creates an obligation, and the power that creates the obligation can assign the measure of its delinquency-the detriment of delay in payment, and section 14a has done so in this case, and explicitly done so. Five per centum penalty is the cost of delinquency, and interest upon the amount due at 1 per cent. per month-12 per cent. ”

“ It cannot be supposed that Congress intended, by penalizing delinquency, to deprive the government of any suitable means of enforcing the collection of revenue. In large transactions, as in the case at bar, the fine which could be imposed would be much less than the tax, and no reason is suggested why the government should forego the collection of that which, under the statute, is its due. ”

“ As a State may provide in advance that taxes shall bear interest from the time they become due, it may with equal validity stipulate that taxes which have become delinquent shall bear interest from the time the delinquency commenced. Likewise, a State may adopt new remedies for the collection of taxes and apply these remedies to taxes already delinquent. [619] After liability of a taxpayer has been fixed by appropriate procedure, collection of a tax by distress and seizure of his person does not deprive him of liberty without due process of law. ”

“ The complaint concludes with a demand for judgment against the defendant for the several sums of state and county tax alleged to be delinquent and unpaid as stated therein, aggregating the sum of $295,740.71, with 5 per cent. thereon for delinquency and nonpayment, with interest at the rate of 2 per cent. ”

“ Too often, Federal contracting officials do not have the most basic information they need to make informed judgments about whether a company trying to win a Federal contract is delinquent in paying its taxes. ”

“ Whatever room for argument there may be as to the competency of State legislation to extinguish material products, as sources of internal revenue to the United States, by proscription of their legal use while their actual use continues, it can never be tolerated that personal vice and guilt constitute a fund for Federal taxation, which ousts the States of police and penal regulation of the personal conduct of their inhabitants. ”

“ But such a scheme of taxation applied to communities whose exclusive and paramount legislation proscribes the taxed pursuit as common and public nuisances, imputes every step in such pursuit as a crime, and punishes every transaction out of which the tax is raised by fine and imprisonment, and requires every grand jury to be specially charged to inquire into every perpetration of these crimes, is an absurdity. ”

“ The sanction of fine and imprisonment prescribed by section 146 (b) for willful attempts 'in any manner to evade or defeat any (income) tax,' introduced into the act under the heading 'Penalties,' is obviously a criminal one. The sanction of 50 per centum addition 'if any part of any deficiency is due to fraud with intent to evade tax,' prescribed by section 293 (b) , introduced into the act under the heading 'Additions to the tax,' was clearly intended as a civil one. ”

“ They do not lose their character as taxes because of the incidental motive. But there comes a time in the extension of the penalizing features of the so-called tax when it loses its character as such and becomes a mere penalty, with the characteristics of regulation and punishment. ”

“ To deny a deduction for expenses incurred in the unsuccessful defense of a criminal prosecution would impose such a burden in a measure dependent not on the seriousness of the offense or the actual sentence imposed by the court, but on the cost of the defense and the defendant's particular tax bracket. We decline to distort the income tax laws to serve a purpose for which they were neither intended nor designed by Congress. ”

“ Of all the powers conferred upon government that of taxation is most liable to abuse. Given a purpose or object for which taxation may be lawfully used and the extent of its exercise is in its very nature unlimited. It is true that express limitation on the amount of tax to levied or the things to be taxed may be imposed by constitution or statute, but in most instances for which taxes are levied, as the support of government, the prosecution of war, the National defence, any limitation is unsafe. The entire resources of the people should in some instances be at the disposal of the government. ”

“ We thus have this singular and, I venture to say, unprecedented fact, in the history of judicial decisions in this country, that the property of a citizen honestly acquired, without suspicion of wrong in his vendor, is forfeited and taken from him because such vendor, at some period whilst owning the property, conceived the intent to defraud the government of the tax thereon, although such intent was never developed in action, and for the execution of which no step was even taken. ”

“ Congress did not intend that a person, by reason of a bona fide misunderstanding as to his liability for the tax, as to his duty to make a return, or as to the adequacy of the records he maintained, should become a criminal by his mere failure to measure up to the prescribed standard of conduct. ”

“ The Spies and Holland cases, which are said to support outright reversal, stand for no more than that where, as here, a criminal tax statute makes 'willfulness' an element of the offense, the Government must prove an 'evil motive and want of justification in view of all the financial circumstances' on the part of the defendant, in failing to do what was required of him. ”

“ The statute does not prescribe a punishment simply for the intent to defraud the United States of the tax on spirits distilled, but for the act of engaging in and carrying on the business of a distiller with that intent. The act and the fraudulent intent together constitute the offence. That Congress, as a means of protecting the revenue and of securing taxes rightfully due the government, may declare such an act, when accompanied by such an intent, to be a public offence, and prescribe a punishment therefor, we do not doubt. ”

“ It is not easy to draw an exact line of demarcation between a tax and a penalty, but, in view of the fact that the statute denominates the assessment a 'tax,' and provides proceedings appropriate for the collection of a tax, but not for the enforcement of a penalty, and does not contemplate a criminal prosecution, we cannot go far afield in treating it as a tax rather than a penalty. ”

“ The collector demanded payment of a penalty, and section 3224, which prohibits suits to restrain assessment or collection of any tax, is without application. And the same is true as to statutes granting the right to sue for taxes paid under protest. A revenue officer without notice has undertaken to assess a penalty for an alleged criminal act and threatens to enforce payment by seizure and sale of property without opportunity for a hearing of any kind. ”

“ The proliferation of statutes and regulations has sometimes made it difficult for the average citizen to know and comprehend the extent of the duties and obligations imposed by the tax laws. Congress has accordingly softened the impact of the common-law presumption by making specific intent to violate the law an element of certain federal criminal tax offenses. ”

“ It has been the settled law of the country for a great many years, that an injunction bill to restrain the collection of a tax, on the sole ground of the illegality of the tax, cannot be maintained. There must be an allegation of fraud ”

“ Taxes are what we pay for civilized society, including the chance to insure. A penalty on the other hand is intended altogether to prevent the thing punished. It readily may be seen that a State may tax things that under the Constitution as interpreted it can not prevent. ”

“ And every person who removes, deposits, or conceals, or is concerned in removing, depositing, or concealing any goods or commodities for or in respect whereof any tax is or shall be imposed, with intent to defraud the United States of such tax or any part thereof, shall be liable to a fine or penalty of not more than $500. ”

“ Willful but passive neglect of the statutory duty may constitute the lesser offense, but to combine with it a willful and positive attempt to evade tax in any manner or to defeat it by any means lifts the offense to the degree of felony. ”

“ It lacks all the ordinary characteristics of a tax, whose primary function 'is to provide for the support of the government' and clearly involves the idea of punishment for infraction of the law-the definite function of a penalty. ”

“ There can be no such case, at least in the federal courts, where there is a plain and adequate remedy at law. And, except where the circumstances which we have mentioned exist, the party of whom an illegal tax is collected has ordinarily ample remedy, either by action against the officer making the collection or the body to whom the tax is paid. ”

“ Thus, although it was not the law yesterday, it will be the law tomorrow that funds embezzled hereafter are taxable income; and although past embezzlers could not have been prosecuted yesterday, maybe they can and maybe they cannot be prosecuted tomorrow for the crime of tax evasion. (The question of the civil tax liability of past embezzlers is left equally unclear.) We do not challenge the wisdom of those of our Brethren who refuse to make the Court's new tax evasion crime applicable to past conduct. ”

“ The dilatory course of a trial at law to recover the taxes imposed on individuals, would neither suit the exigencies of the public, nor promote the convenience of the citizens. It would often occasion an accumulation of costs more burthensome, than the original sum of the tax to be levied.
"And, as to the conduct of the officers of the revenue, the provision in favour of trial by jury in criminal cases, will afford the desired security. Willful abuses of a public authority, to the oppression of the subject, and every species of official extortion, are offences against the government ”

“ Thirdly, by the forfeitures and other penalties which those unfortunate individuals incur who attempt unsuccessfully to evade the tax, it may frequently ruin them, and thereby put an end to the benefit which the community might have derived from the employment of their capitals. An injudicious tax offers a great temptation to smuggling. ”

“ If, in different circumstances, a taxpayer is not confronted by substantial hazards of self-incrimination, or if he is otherwise outside the privilege's protection, nothing we decide today would shield him from the various penalties prescribed by the wagering tax statutes.' 390 U.S., at 61, 88 S.Ct., at 709. ”

“ However, in my judgment it stretches provious tax interpretations too far to classify the sporadic loot of an embezzler, an extortioner or a robber as taxable earnings derived from a business, trade or a profession. I just do not think Congress intended to treat the plunder of such criminals as theirs.
It seems illusory to believe, as the majority apparently does, that the burden on honest American taxpayers will be lightened by a governmental policy of pursuing extortioners in futile efforts to collect income taxes. ”

“ For the reasons discussed above, the Government may validly enforce the tax laws by a scheme of required reports, directed at all persons engaging in certain types of activity, and requiring them to report the amount of their income so that the Government may insure that the requisite taxes have been paid. If such a reporting requirement raises a substantial danger of incrimination under state or federal statutes making criminal the activity that is being taxed, an individual may, of course, assert the privilege against self-incrimination and refuse to disclose the information sought. ”

“ Any officer charged with the duty of assessing real property, who shall willfully omit from the tax lists real property which he knows to be lawfully taxable, shall be guilty of a misdemeanor and punishable by a fine not exceeding one thousand (1,000) pesos, or imprisonment not exceeding two (2) years, or both, in the discretion of the court.
SEC. 88. Any officer charged with the duty of listing or collecting license or privilege taxes, who shall willfully omit to list or collect the same or any part thereof, shall be guilty of a misdemeanor and subject to the penalties provided in section 87. ”

“ If, as the opinion below suggests, the only question that can properly be submitted to the jury is whether the entire deduction is fabricated, an unconscionable taxpayer can immunize himself from the criminal sanctions for tax evasion by the simplest of expedients. He need only find a legitimate item of deduction and then pad it as much as his purpose requires. ”

“ And the denouncers kept harassing the more respectable farmers by holding over them the threat of an accusation, alleging that they had for a long time been paying their tax at a lower rate than that imposed upon their district. For the poor wretches had to fear not only the new payment of the tax, but also the possibility that they might be weighed down by the burden of taxes for so great a number of years for which they owed nothing. In any case, many men actually handed over their property either to the blackmailers or to the Treasury and went their ways. ”

“ The larger the allowable deduction the smaller are the net taxable income and the tax imposed. The first four counts of the indictment set out attempts by the defendants to evade income taxes of the Consensus Publishing Company for the years 1933 to 1936, through a fraudulent scheme whereby, under the guise of paying commissions which were deducted from gross income, the corporation distributed dividends deduction of which the statute does not permit. ”