Background
Joseph R. Banister is a bit of a puzzle, because he is (or has been) a certified public accountant, and did work for the Internal Revenue Service, so he should know something about tax law, and yet he ended up buying into the tax protester craziness and quitting the IRS. He has since become one of the darlings of the tax protester cult and has apparently earned substantial fees for speaking at tax protester events.
Theories Advocated/Promoted
There is no law making anyone liable for the federal income tax.
Court Actions
Banister advised Walter "Al" Thompson and apparently encouraged him not to file tax returns or pay employment taxes, as a result of which Banister was indicted for conspiring with Thompson to evade taxes. Banister's trial was separated from Thompson's and Banister was acquitted after a jury trial. (Interestingly enough, Thompson was also acquitted of the charge that he conspired with Banister even though Thompson was convicted on all other charges, so two different juries in two separate trials agreed that the government's evidence of conspiracy was insufficient to convict either of the alleged conspirators.)
Although Banister escaped criminal liability for his advice to Walter Thompson, the Office of Professional Responsibility of the U.S. Treasury moved to bar Banister from practice before the Internal Revenue Service because of his advice to Thompson and others. A hearing was held before an Administrative Law Judge, and Banister was disbarred from IRS practice, the ALJ finding that Banister had violated the rules for practice before the IRS by his ``absolutely wrong" advice to his clients and by failing to file personal tax returns for 1999 through 2002. See IR-2004-5 (1/12/2004). Banister appealed the disbarment to the Secretary of the Treasury, who upheld the disbarment for the advice given to clients but held that there was insufficient evidence introduced at the hearing that Banister had enough income to require income tax returns for the years for which he failed to file returns. Banister could have filed a further appeal to federal District Court, but chose not to.
Based on the Treasury action, [I don't remember if this has been mentioned before, but according to the California Board of Accountancy web site, the California Board of Accountancy revoked Banister's CPA license effective March 7, 2007. Banister publicly stated that he intends to appeal that decision, but whether he did or not is unconfirmed.
There is also still a possibility of criminal charges against Banister for his own failure to file tax returns.
According to a petition filed in federal district court on June 18, 2008, Banister is being investigated by the IRS to determine if he has been promoting false or abusive tax schemes. According to the petition, a "substantial" part of Banister's income over the last few years has been payments to Banister by Robert Bernhoft, the lawyer who represented Banister in his criminal trial. Bernhoft himself was enjoined against promoting tax protester scheme in 1999, and the IRS filed the petition to get a court order to force Bernhoft to explain why he has been paying Banister. United States v. Robert Bernhoft, No. 2:08-cv-00515-RTR (U.S.D.C. E.D. Wis. 6/18/2008).
Students/Disciples/Associates
Banister's known clients have not fared well in court. As noted above, Banister advised Walter "Al" Thompson and apparently encouraged him not to file tax returns or pay employment taxes, as a result of which Thompson was indicted and convicted and is now in prison. In Banister's own criminal trial, he was represented by Robert Bernhoft, who also represented him in the IRS disbarment proceedings.