INSTRUCTIONS:  3.18.  Pick the approach that gives you an acceptable risk level

Related steps:

Related links:

Minimizing risk exposure is probably the main reason why most people continue to pay taxes even though they know that doing so is illegal.  Certainly then, minimizing risk exposure is a very important requirement for those “nontaxpayers” who want to follow the dictates of their conscience and the content of this book.  We have already described many of the ways to minimize risk exposure in this chapter, but we haven’t treated this as a separate topic until now.  Minimizing your risk exposure consists in the following elements:

  1. Getting educated so you can’t be victimized by your own legal ignorance or an unscrupulous attorney.  Reading as much of this book as you can will solve that problem.
  2. Protecting your assets.  We talked about this in sections through
  3. Picking the approach to taxes that is right for you.  We’ll talk about this subject in this section.
  4. Joining an insurance or indemnification program.  We’ll talk about this subject in this section.

We will now cover the last two items above in more detail.

Picking an approach to taxes that is right for you

There are basically four approaches you can take with payment of the taxes.  If you decide to fight to protect your hard-earned money from extortion and plunder by an out-of control government that is violating the law, then you will need to pick at least one of the strategies below before you begin your fight and prepare as best you can for whatever outcome is expected in order to minimize the damage.  We have listed the four approaches here in increasing order of risk, where the highest number is the highest risk:

1.  Become self-employed so no income is reported by an employer.  You can do this by becoming an independent contractor or starting your own small business.  This eliminates the middle man and puts you in control, but at the same time carries with it new risks of its own.

2.  Working for an existing employer:

2.1.  Withhold now with your present employer under duress and try to litigate later to get it back.  Make sure you document the existence of duress by getting notarized evidence from your employer of that fact so you have ammunition later to litigate with.  Also take a third party witness who is not employed by the same company along when you submit your paperwork to your employer who can testify that you did so under duress.

2.2.  Stop withholding now and defend yourself later if the IRS goes after you for nonpayment.  This approach should be used with employers who are cooperative and will allow you to stop withholding without firing you.

2.3.  Withhold if your employer forces you to by threatening to fire you if your don’t and then sue your employer or withholding agent privately to recover your losses.  This takes a lot of balls and could get you fired.

Option 1:  The most risk-free method is #1 above because it puts you in complete control.  No employer is violating the law by snitching on you and reporting “wages” on a W-2 that you don’t in fact have.  Remember from reading section 5.6.7 of the Great IRS Hoax that you only earn “wages” under the I.R.C. if you have a voluntary withholding agreement in place with your “employer” and that the only entities who qualify as “employers” under the Infernal Revenue Code are the federal government and the governments of territories of the U.S..  You will also learn later in section that the W-2 form provided by employers to the IRS should either not be provided at all or at least should contain zero for “wages” if you do not have a voluntary withholding agreement in place with your private employer.

Option 2.1:  The second most risky method is to withhold taxes under duress.  This method is to be undertaken as a last resort by persons whose employers have threatened or are expected to threaten to terminate their employees if they stop withholding income taxes.  It is important if you choose this approach to get evidence that you were in fact under duress.  There are lots of ways that you can do this: 1.  By putting a duress statement on your withholding form and have your employer sign it acknowledging receipt; 2.  By bringing along a witness who doesn’t work for your employer and isn’t a relative who can testify in court when you litigate to get your money back; 3.  By putting saying under penalty of perjury on any income tax refund requests you submit that you were under duress when you paid the tax because of an errant employer.

Option 2.2:  The third most risky approach is to stop withholding and then prepare yourself to litigate against the IRS if they come after you later to recover what they wrongfully think you owe.  The advantage of this approach is that when the IRS finally does come after you, there will be a big pile of money to fight them with and also to support yourself with if you lose your job in the process.  You might lose your job because the employer will at first reluctantly allow you to stop withholding and not tell you that they don’t like it, and then later invent some lame excuse to lay you off that you know is a lie because they don’t want to deal with a “high maintenance employee” and don’t want to risk being sued for discrimination later.  If you take this approach, it’s best to make sure that you load your IRS administrative record down with tons of evidence that they can’t keep out of court and which you can present to a jury in your defense.  That way, if they go after you for willful failure to file or tax evasion, you will have plenty of ammunition to defend yourself with that they can’t keep out of the court record or out of evidence at trial.

Option 2.3:  The most risky approach of all is to sue your employer if the employer tells you that you will be terminated if you refuse to withhold.  This approach probably works best for those who can litigate their own case and don’t need to hire an attorney.  The reason is because it is hard to afford an attorney when you are unemployed or looking for work.  If you choose this approach, bring along someone to witness what your employer tells you when you communicate your withholding wishes to him.  Make sure it isn’t a relative and isn’t a fellow coworker who can be pressured by your boss.  That way, you can be sure to have a witness, that he is an objective and disinterested witness because he isn’t a relative, and you can be sure that he won’t be pressured by your boss not to talk if you have to litigate.  It’s also important to ensure that you save up a cash stash to live with or have other work or additional part-time work lined up so that if or when you get fired, you have the financial resources to fight the malicious and criminal employer with.  This takes guts and knowledge because it is very confrontational.

Joining an insurance or indemnification program

Another good technique is to pursue some kind of insurance or indemnification program to protect yourself from financial or criminal liability.  The purpose of an indemnification program is to prevent you from being criminally convicted or to reimburse you for financial losses incurred because of an illegal taking of property by the IRS through a lien or levy.  We know of three such programs so far that do this:

  1. The Save-A-Patriot fellowship ( has a membership program that costs $925 to join and $70/year thereafter plus $40 per letter for each piece of correspondence that is required to respond to an IRS letter.  Members indemnify each other if their property is levied or taken.  Whenever there is an illegal taking of property by the IRS, an assessment letter is sent out to the members for their share of the amount needed to reimburse the member for the property or money that was taken.  The members then mail their share of the assessment to the aggrieved party and he is fully reimbursed for the amount of his loss.  It’s a unique program and no one else offers anything like it.
  2. The Free Enterprise Society ( has a program they call the “Legal Defense Fund” for nonfilers which protects them from criminal prosecution for failure to file.  If anyone participating in this program is prosecuted for either willful failure to file or a false W-4, then Free Enterprise Society will defend you in court at their own expense.  The initial cost is $850 and the annual maintenance fee is $300 per year thereafter.
  3. The We the People organization ( has been trying to start a legal defense fund similar to the Free Enterprise Society’s beginning in 2003 that protects both employers and employees.  They have been trying to get the membership levels high enough where they could hire a full-time staff but so far have not been able to get started.

One of the alternatives above may satisfy your requirement to minimize risk in the process of following the tax laws.  Which one, if any, that you choose is up to you.  Of the alternatives presented, the Save-A-Patriot program has been in existence the longest and has the most financial resources and members behind it.