Jonathan R. Siegel, Professor of Law, George Washington University Law School
Aaron Russo has made a misleading, irresponsible film filled with utterly incorrect statements about the income tax. Don't be fooled. If you choose to believe and act upon his absurd conclusion that most Americans don't have to pay income taxes, you could end up paying extra to the government in interest and penalties and you could land yourself in jail.
Article in Wikipedia
Through interviews with various individuals including former IRS agents, Russo sets forth the tax protester argument that, "there is no law requiring an income tax", and that the personal income tax is illegally enforced to support the activities of the Federal Reserve System. The film refers to both article 1 section 8 of the U.S. Constitution, which grants Congress the right to impose taxes, and disputes the legitimacy of the Sixteenth Amendment, which removes any apportionment requirement. … One of the listed stars of the film, Irwin Schiff, was sentenced on February 24, 2006 to 13 years and 7 months in prison for tax evasion and ordered to pay over $4.2 million in restitution. In pre-sentencing documents filed with the court, Schiff's lawyers had argued that he had a mental disorder related to his beliefs about taxation. Initially, the film portrays Mr. Schiff as a tax expert, though his qualifications and those of many other individuals in the film are not mentioned. Later that the film Russo reveals that Schiff has gone to jail.
Review - By Declan McCullagh of NewsBlog
Russo is especially sympathetic to tax protesters, who have spent years challenging the IRS to show them a law requiring them to pay federal income taxes. They claim that section 861 of the tax code covers only corporate income and, alternatively, that the 16th Amendment was never properly ratified (largely because of slight differences in wording). … The problem for the tax protest movement is that courts have routinely rejected these arguments; iconic tax protester Irwin Schiff was convicted by a jury and, as the IRS helpfully points out, was sentenced last year to more than 12 years in prison. A jury has acquitted at least one tax protester on criminal charges, but the IRS doesn't need a unanimous jury to win a civil lawsuit.
Review - NY Times
… Mr. Russo says …that the Internal Revenue Service has refused every request to show any law making Americans liable for an income tax on their wages. … Yet among those thanked in the credits for their help in making the film is Anthony Burke, an I.R.S. spokesman. Mr. Burke said that when Mr. Russo called him asking what law required the payment of income taxes on wages, he sent Mr. Russo a link to documents, including Title 26 of the United States Code, citing the specific sections that require income taxes be paid on wages. Title 26 says on its face that it is law enacted by Congress.