Tax Protester Constitutional Arguments - Taxing Labor or Income From Labor

Taxing Labor or Income From Labor

Several tax protesters assert that the Congress has no constitutional power to tax labor or income from labor, citing a variety of court cases. These arguments include claims that the word "income" as used in the Sixteenth Amendment cannot be interpreted as applying to wages; that wages are not income because labor is exchanged for them; that taxing wages violates individuals' right to property; and several others.

Another protester argument is that the U.S. Constitution authorizes the income tax only on income derived from activities that are government-licensed or otherwise specially protected. The courts have rejected this theory, ruling that "Congress has taxed compensation for services, without any regard for whether that compensation is derived from government-licensed or specially protected activities, and this has been construed to cover earnings from labor."

Robert L. Schulz and his We the People Foundation take the positions that the government "is clearly prohibited from doing what it is doing – taxing the salaries, wages and compensation of the working men and women of this country and forcing the business entities that utilize the labor of ordinary American citizens to withhold and turn over to the IRS a part of the earnings of those workers" and "that the federal government DOES NOT possess ANY legal authority -- statutory or Constitutional -- to tax the wages or salaries of American workers."

Similarly, tax protester Tom Cryer, who was acquitted of willful failure to file U.S. Federal income tax returns in a timely fashion, argues that "the law does not tax wages", and that the federal government cannot tax "oney that you earned paid for with your labor and industry" because "the Constitution does not allow the federal government to tax those earnings" (referring to "wages, salaries and fees that earn for ").

Arguments about the taxability of compensation for personal services, whether called wages, salary, or some other term, may be either constitutional arguments as in United States v. Connor (see below) or statutory arguments as in Cheek v. United States, depending on the details of the argument. For purposes of presentation, these arguments are summarized here rather than in the article Tax protester statutory arguments. The rest of this section explains these arguments in more detail.