Last I checked in with the creative tax
resisters of Keene, New Hampshire, they’d taken to following around
parking enforcers and quickly filling expired meters in front of them so as to
reduce the number of tickets they could write. They’d leave cards under the
windshield wipers of the cars they’d rescued signed “Robin Hood and his Merry
Men.” They also encouraged the parking enforcers to resign.
The city filed for a restraining order against the activists, saying that they
were harassing the parking enforcers. The Merry Men countered that this had
nothing to do with harassment — the city was just angry at the interruption of
its revenue stream.
Over the course of the trial, one of the parking enforcers said he had resigned
to avoid the harassment, and the city director of finance testified that
because of this resignation there had been a loss of ticket revenue and
additional costs to the city. In addition, the city had spent money to hire a
private investigator to shadow the Merry Men as they shadowed the parking
Joseph Thorndike, at the Tax Analysts blog on
Forbes, brings to light this remarkable quirk in
U.S. tax law:
The Cold War ended more than 20 years ago, but the battle against global
communism rages on — at least in the pages of the Internal Revenue Code.
Lawmakers… forgot to repeal a provision of the tax law exempting employees of
Communist organizations from having to pay Social Security taxes on their
wages. (They are similarly forbidden from collecting Social Security benefits
derived from those wages, since wages and benefits are linked for all of us.)
When enacted, the Social Security provision was intended to be a punishment;
lawmakers didn’t think people trying to overthrow the government should be
able to participate in that same government’s premier social program. In
fact, the provision was prompted by press reports that jailed Communists were happily collecting Social Security checks while sitting in their cells.
But today, it’s hard not to wonder if young Communists might not actually
welcome their banishment from Social Security. As tax lawyer Libin Zhang has pointed out:
What was a penalty in might be a
blessing today. Younger employees nowadays might prefer to forgo paying
Social Security Tax and give up on the fragile likelihood of receiving
Social Security checks in their retirement.
Of course, young Reds might have a hard time using this tax break since… the
tax law depends on a cross-reference for its definition of a
“Communist-action organization, a Communist-front organization, or a
Communist-infiltrated organization.” The reference is meaningless, since no
one is keeping lists of those organizations anymore (at least not officially).
You never know, of course. As Zhang suggests, “An employer could voluntarily
send in a registration form and see how it goes.” But if they’re going to
give it a shot, they better move fast. In a sign that lawmakers are finally
catching up with current events, the congressional Joint Committee on
Taxation has identified both the charity disallowance and the Social Security
exemption as examples of “potential deadwood” lurking in the code.
Zhang’s blog post reprints the applicable part of the Internal Revenue Code
that releases from social security tax any payments for…
…service in the employ of any organization which is performed (A) in any year
during any part of which such organization is registered, or there is in
effect a final order of the Subversive Activities Control Board requiring
such organization to register, under the Internal Security Act of
, as amended, as a Communist-action
organization, a Communist-front organization, or a Communist-infiltrated
organization, and (B) after .
Alas, Zhang says, “[t]he mandatory registration requirements of the Internal
Security Act of were repealed in
after some court cases found them to be
unconstitutional [and] the Subversive Activities Control Board was abolished
in .” So there is probably no final order
“in effect” requiring any organizations to register under the exempting act.