U.S. prosecutors sue Quaker group over pacifist's unpaid taxes

PHILADELPHIA -- Priscilla Adams doesn't mind paying taxes.

She just doesn't want her money going to the military.

Adams, 50, a longtime peace and justice organizer for her Quaker religion, now finds herself at the center of a second court battle with the Internal Revenue Service. She has refused to pay at least some of her federal taxes since 1974.

"They can do things like the checkoff for the presidential election campaign; they could easily do an accommodation for a peace-tax fund," Adams said Wednesday from her Willingboro, N.J., home.

The IRS, which says Adams owes more than $42,000 in back taxes, interest and fines, upped the ante in the ongoing dispute Tuesday when it sued her employer for allegedly refusing to garnish her wages. The IRS wants to lodge a 50 percent penalty _ of more than $21,000 _ against the Philadelphia Yearly Meeting of the Religious Society of Friends, a regional Quaker organization.

"That would be a hefty price for what we believe is right," said Gretchen Castle, who holds a leadership position with the group. "I think that there are other ways the government can do it that are more friendly, more supportive of our faith."

Adams earns about $32,000 a year for the Philadelphia Yearly Meeting, a coalition of over 100 local Quaker groups.

Under a prior arrangement, the Quakers withhold taxes from her paychecks and put them in an escrow account that the IRS can access. The Quakers say they don't want to help the IRS collect the back taxes and penalties by garnishing additional wages.

Nationally, an estimated 8,000 Americans avoid paying some or all of their federal income taxes because of their political beliefs, often because they oppose military spending, according to the New York-based National War Tax Resistance Coordinating Committee.

Adams is the only current employee of the Philadelphia Yearly Meeting who doesn't voluntarily pay income taxes, although a few take other actions, such as refusing to pay federal telephone taxes that go to the military, Castle said.

"We are not against paying the taxes that support our life and our living and our communities. It's just that we need to have the option to truly not support the killing of people," Castle said.

Adams sued the government on religious freedom grounds in 1996, asking the IRS to set up a separate fund for conscientious objectors and to excuse her accumulated tax fines and penalties on the grounds that her religious beliefs provided "reasonable cause" for nonpayment.

The 3rd U.S. Circuit Court of Appeals, which heard her appeal from U.S. Tax Court, rejected her arguments, and the U.S. Supreme Court declined to hear the case.

"We acknowledge the sincerity of Adams's beliefs, but ... we can easily imagine a plethora of other sects that would also have an equally legitimate concern with the usage of tax dollars to fund activities antithetical to their religion," Judge Midge Rendell wrote in her 1999 opinion.

Gregory S. Hrebiniak, a Justice Department lawyer handling Adams' case, referred calls to a department spokesman who did not immediately return a telephone message Wednesday.

Peter Goldberger, who represented Adams and now represents her employer, said Quaker leaders hope to formulate a response to this week's lawsuit at their September meeting.

"They have to meet and pray and decide," said Goldberger, who has carved out a niche over the past 20 years representing Quakers and other conscientious objectors in tax cases. He said he's never seen a criminal prosecution, perhaps because of the bad publicity that might ensue.

"What we're seeing here is a fairly sharp escalation of penalties, but still in the realm of civil penalties," Goldberger said.

Adams, who is married and has two children at home, said she might quit her job if the Quakers lose the case, rather than see most of her income go to the IRS' general fund.

For now, she loans the amount in dispute to charitable causes she supports such as peace groups and refugee assistance programs. She won't demand repayment unless the IRS comes after her, she said.

"I don't get any benefit from the money I don't pay, except it betters the world, and that is a wonderful benefit," Adams said.