IRS Eases Up On War Tax Resisters
If a taxpayer submits a document with a frivolous argument to the IRS, a penalty under section 6702(a) will apply only if the taxpayer files a purported tax return that either does not contain information on which the substantial correctness of the self-assessment may be judged or contains information that on its face indicates that the self-assessment is substantially incorrect. I.R.C. §6702(a)(1).
Pot Growers Exempt Application Goes Up In Smoke
Your activities violate this general principle. Your primary activity, facilitating and organizing transactions between members who cultivate and possess cannabis, is illegal under Federal law. You enter into agreements that give you title to the cannabis grown by your members. Once you obtain title, you process, sell, and otherwise dispose of it as you decide. Federal law does not recognize any health benefits of cannabis and classifies it as a controlled substance.
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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.