Tax Court provides chapter-by-chapter refutations of popular tax protester book "Cracking the Code"

Today the U.S. Tax Court issued an interesting opinion which provides a chapter-by-chapter refutation of Peter Hendrickson's book "Cracking the Code: The Fascinating Truth About Taxation in America." Waltner v. Commissioner, T.C. Memo. 2014-35. Cracking the Code is popular in the tax protester community and provides the basis for many frivolous arguments presented to the IRS and U.S. Tax Court.

In many cases involving frivolous tax arguments, instead of responding specifically to each of the frivolous arguments, the Tax Court simply refers to the oft-cited case Crain v. Commissioner, 737 F.2d 1417 (5th Cir. 1954), for the proposition that courts need not "refute these arguments with somber reasoning and copious citation of precedent; to do so might suggest that these arguments have some colorable merit." However, in Waltner, the Tax Court saw fit to address the positions presented in Cracking the Code in order to establish clear and articulate rules for the future, among other purposes.

The Tax Court held that the taxpayer was liable for a penalty under I.R.C. sec. 6673 in the amount of $2,500, and warned that "future litigants are on notice that the propositions advanced in Cracking the Code are frivolous and relying on those position may result in sanctions."

No Comments

Leave a comment
Comment Information

Contact the Law Office of Williams & Associates

For more information about our tax law services, or to discuss your tax matter, call our Sacramento office at (916) 488-8501 or toll free at (800) 684-7147. You may also send us an inquiry via email.

Contact the Firm

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Office Location:

3600 American River Drive, Suite 135
Sacramento, CA 95864

Toll Free: 800-684-7147
Phone: 916-488-8501
Fax: 916-488-8196
Sacramento Law Office Map