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The Tax Man Cometh: DOJ Sues Man for Frivolous Tax Suits

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By Tanya Roth, Esq. on January 21, 2010 1:15 PM

Now here is a great money making idea. Find a few hundred, let's just call them overly-optimistic clients, some with substantial income tax liabilities. Sell them pre-packaged tax protest lawsuits that falsely claim that the IRS has unlawfully disclosed customers' federal tax information or unlawfully collected taxes, for the bargain price of $7,500 a pop. Claim that if the suit is successful, they will never have to file a federal income tax return or pay federal taxes ever again!

Sell about 200 of these ready to wear suits in 35 states. Maybe one or two (or "almost all") of them will get tossed out by an irate judge calling them, "frivolous" and "groundless," and a "boilerplate pleading filed without concern for the law, the facts, or the redundant expenditure of judicial resources." Make about $1 million doing this. Sit back and wait to see if the IRS, or any other governmental agency, notices.

Maybe it seemed like a good plan or at least a good scam to George K. Pragovich of Clarksville Tenn., who allegedly did just that. The Department of Justice, Tax Division, is not amused and announced their suit against him on Wednesday. Pragovich, who according the DOJ, is not a CPA and not an attorney, is a strict constructionist who doesn't believe in the 16th amendment and the power of the federal government to collect taxes. He has evidently announced his intention to "bury" the Department of Justice and the court system with at least 1,000 lawsuits in ten separate jurisdictions.

Looks like Pragovich was reportedly well advanced on his plan to toss a monkey wrench into the despised federal system of taxation, and coincidentally, make a little money for himself. Tax free no doubt. The DOJ hopes to slow down Pragovich's one man crusade of tax protests with their injunction, filed in U.S. District Court in Nashville.

When reached by phone by the Nashville Business Journal, Pragovich declined comment. Maybe he doesn't believe in them, either.

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