Chicago lawyer Rachel Cohen owes greater than $8,000 in federal income taxes — however has deliberately left that balance unpaid.
“I am not paying my federal earnings tax this 12 months,” Cohen mentioned in a broadly seen TikTok video from March 2 about her resolution.
The 31-year-old neighborhood organizer filed her federal tax return, which exhibits a stability due of $8,830, based on a tax doc reviewed by CNBC. However Cohen mentioned she intentionally selected to withhold fee of that invoice as a protest towards immigration detention, together with ICE facilities, and U.S. strikes on Iran launched with out congressional approval.
Whereas voicing resistance to taxes is authorized, refusing to pay taxes owed can violate federal law and lead to severe penalties.
“It is utterly OK to be sad and be dissatisfied with our authorities,” mentioned Josh Youngblood, proprietor of The Youngblood Group, a Dallas-based tax agency. “However not paying taxes, or participating in tax fraud or evasion, shouldn’t be the reply.”
Along with penalties and curiosity that begin accruing instantly on their past-due balances, tax protesters can face “long-term consequences,” corresponding to wage garnishment, a tax lien on property and even jail time, based on Michele Frank, affiliate professor of accountancy at Miami College. Federal courts have a long track record of siding with the Inside Income Service in instances involving tax resistance, routinely dismissing these claims as frivolous and, in some situations, imposing extra penalties.
Cohen informed CNBC she is absolutely conscious of the potential dangers and that talking brazenly in regards to the resolution may appeal to extra scrutiny from federal authorities.
Her protest is directed at federal spending priorities, not taxation itself, Cohen mentioned. She paid about $3,000 in Illinois state taxes, based on a tax doc reviewed by CNBC, and mentioned she sees worth in how these {dollars} assist state and native providers.
Cohen mentioned her resolution is private and never one thing she is encouraging others to do, however hopes it pushes individuals to mirror on whether or not their actions match their beliefs.
Renewed curiosity in tax resistance
Cohen’s protest follows an extended custom of so-called struggle tax resistance, through which individuals withhold some or all of their federal taxes to oppose authorities insurance policies.
“It has been occurring just about so long as we have been a rustic,” Frank mentioned.
Usually, there’s an uptick in tax protesting — with filers holding again some or all of their tax funds — when the U.S. authorities engages in a struggle or different “controversial” actions, she mentioned.
That seems to be occurring once more, based on the Nationwide Struggle Tax Resistance Coordinating Committee, an academic nonprofit based within the early Nineteen Eighties by activists connected to the anti-Vietnam Struggle motion.
The group’s web site had averaged about 40,000 distinctive guests a 12 months till the struggle in Gaza started in 2023, based on Lincoln Rice, the group’s coordinator. In January 2026 alone, visitors surged to greater than 110,000 guests.
“I do not suppose anybody’s making the choice to apply struggle tax resistance primarily based on one single motion,” Rice informed CNBC. As a substitute, main political occasions can turn into the “ultimate straw” that prompts some individuals to discover the tactic.
Rice mentioned the group doesn’t encourage individuals to refuse to pay taxes however as a substitute offers details about how the apply works and its authorized dangers.
These approaches range. Some protesters file their tax returns however refuse to pay the stability owed, whereas others intentionally pay lower than they owe, Rice mentioned. Some additionally select to not file in any respect, which might expose them to steeper penalties.
Ruth Benn, a longtime struggle tax protester and volunteer counselor with the Nationwide Struggle Tax Resistance Coordinating Committee, mentioned she has adopted one of many extra widespread approaches: submitting her tax returns however refusing to pay the federal earnings tax she owes. She at the moment owes about $27,000 in federal taxes, together with curiosity and penalties accrued over a number of years, based on a abstract of her IRS account reviewed by CNBC.
Benn mentioned through the years she has often obtained IRS letters “with curiosity and penalties including up” and met with the company in 2009 associated to her tax debt.
She mentioned she has had small state refunds seized and a few authorities rebates withheld. “I believe round 1990 they took $800 from a checking account,” she mentioned. “In any other case, I do not recall extra checking account seizures, and I by no means had cash taken from a paycheck.”
Benn mentioned she started withholding fee a long time in the past after changing into concerned in anti-war activism, and that she sends the IRS a letter annually explaining why she is withholding fee. She mentioned she is open with the IRS about not paying, quite than attempting to cover earnings.
Nonetheless, failing to pay federal earnings taxes continues to be unlawful. Those that do not pay may nonetheless face penalties, curiosity and assortment actions, and in some instances, willful failure to pay taxes will be charged as a legal offense.
Individually, sure tax positions can set off extra extreme penalties. The IRS warned in a 2022 transient that taxpayers counting on “frivolous” arguments to keep away from taxes — corresponding to claiming tax returns are voluntary, or disputing what counts as earnings, amongst others — can face extra civil penalties and, in additional severe instances, legal prosecution, together with felony costs tied to tax evasion or false filings. The company cites multiple cases through which courts have dominated towards tax protesters.
Benn mentioned individuals contemplating tax resistance ought to perceive that the implications will be surprising, with the IRS generally pursuing assortment years later.
“It is unpredictable,” she mentioned. “That is the exhausting a part of this specific anti-war protest. You do not know what is going on to occur when.”
Penalties for tax protesters
Whereas some Individuals object to funding sure authorities packages, moral or religious beliefs do not exempt taxpayers from paying federal earnings taxes, based on the IRS.
When you do not file a return, there is a “failure to file” penalty, levied at 5% of your taxes due for every month or partial month the submitting is late and capped at 25%. The company additionally costs curiosity on penalties.
Finally, the IRS can put together a “substitute for return” in your behalf, with out the credit and deductions you are owed, mentioned Youngblood, who can be an enrolled agent, which is a tax license to apply earlier than the IRS.
After that, you possibly can anticipate a “90-day letter” with the company’s proposed evaluation of your stability earlier than they start collections. This might embrace refund offsets, garnishing wages, seizing property and different actions.
There’s additionally a “failure to pay” penalty — 0.5% of your stability for every month or partial month the submitting is late, capped at 25% — however different penalties will be considerably greater, Youngblood mentioned.
For instance, in the event you file a return with out sufficient data to calculate the proper tax legal responsibility, you could possibly be topic to a $5,000 civil penalty for what’s often called a “frivolous tax return,” based on the Inside Income Code.
Alternatively, some filers may see a 75% civil fraud penalty if the company believes the underpayment is because of fraud quite than negligence.
There’s additionally no statute of limitations for a “false or fraudulent return,” based on the Inside Income Code. For these instances, the IRS may pursue filers indefinitely.
In some instances, failure to pay taxes may end in jail time. Throughout fiscal 12 months 2024, the U.S. Sentencing Fee reported authentic sentencing for some 360 federal criminal cases involving tax fraud, up 11% from fiscal 12 months 2020. The 2024 instances included tax evasion and willful failure to file a return, provide data or pay tax, amongst different points.
