So, you want to know the truth about America’s tax laws & tax system.

Introduction

So, you want to know the truth about America’s tax laws and income tax system. This book contains the absolute truth about the tax system. A truth that our government prays you will never learn, or even become aware of. The truth is; United States Citizens are not subject, under the letter of the law, to the payment of income taxes on domestic income, and are not required by law to file a Form 1040 for the purpose of reporting, or paying the income tax on, their own domestic income. The truth is the IRS has been a fraudulent, illegal operation for over 60 years. The truth is the IRS routinely violates the Law, the Regulations and the United States Constitution. The IRS is an operation that is more representative of the Nazi Gestapo than the American Constitution, routinely trampling the rights of innocent Citizens. The IRS is the most un-American agency in the country today and the sooner we are rid of this fraudulent lie the better off we will be as a nation.

The truth is that America’s tax filing system is based on voluntary compliance and self assessment, and that’s right from the IRS itself, which we’ll see later. But what does that actually mean, and why do they say that: "Voluntary compliance and self assessment." ?

Did you know, or did they tell you, that you "comply voluntarily", and self-assess ?

You see in America, under the law, the Citizens are free, and FREE means not taxed. If you don’t believe me, let's look and see what the tax laws actually say. Before we begin, I would just like to point out that I am not trying to tell anyone what they personally should do in the future. I’m simply going to show you what the law actually says about income taxes, how those laws are supposed to be applied, and then given what the law actually does say, what it is possible to legally do under those laws.

The Constitution of the United States of America, the Supreme Law of the Land, establishes a limited federal government in America, representative of WE THE PEOPLE. Wherein, the Federal government is forever bound as the SERVANT of the PEOPLE, never to become their master. In this context, "Limited" means "bound by law" ! The IRS has turned this relationship upside down, effectively enslaving the People to the existing political system and parties, denying the People their FREE CHOICE ,and effectively creating a political system where it is virtually impossible to object to the activities of our supposedly representative government.

In the early centuries A.D. men feared the Fire Breathing Dragon, a great mythical creature of indeterminable and undefeatable power which burned individual men to ashes with a single breath. Today, believe it or not, we live with the same MYTH, about a "creature" of great and undefeatable power. Our DRAGON, our national curse and disgrace, our BEAST, is, of course, the IRS.

Most Americans fear the IRS out of ignorance of the law. Knowledge dispels hysterical fears of the unknown and makes possible the vanquishing of our foes. This information has been assembled in an effort to help all American Citizens overcome their own unfounded, hysterical fears of the IRS by making them knowledgeable about the law imposing income taxes, and how those laws affect you, the American Citizen. Once you know the TRUTH about the tax laws; the unconstitutional and illegal reign of terror orchestrated by the IRS in America for over 50 years will finally be over.

THE CODE HAS BEEN BROKEN !

The Paperwork Reduction Act Notice of 1980 is the key to exposing and understanding the truth about America's tax laws. The truth has been in print (the code) since 1916, and reaffirmed in print again recently. In 1985, when the IRS complied with the mandates of the Paperwork Reduction Act by providing to the Office of Management and Budget (OMB) the Table shown in 26 CFR 602.101, the stage was set to effect the end of the IRS in America. The IRS cannot ask you for more information, under any given code section, than this Table shows is required by that code section. This Table is from Title 26 (the Internal Revenue Code), Code of Federal Regulations (CFR), which implement the United States Code (USC) sections providing for the legal reduction of paperwork, and the administrative costs associated with its maintenance.

The following, showing the actual legal code sections that the IRS itself cites and invokes, should serve as proof beyond any reasonable doubt what-so-ever that the income tax laws are being intentionally misapplied to all American Citizens in America, in order to fund an unspoken, and un-American political agenda of socialist global control. To understand just how important the Paperwork Reduction Act is to the tax laws, keep in mind that since 1980 the IRS has been required by law to provide a notice of it (Notice 609) with every single piece of correspondence they issue to individuals. You can find a complete copy of this notice on Page 1 of any Form 1040 Tax Instruction Booklet. But, the IRS won’t tell you about the Code of Federal Regulations where you can lookup the information collection (form) requirements of any given code section. They just tell you that you’re supposed to know the law. Well, after reading this book, YOU WILL !

CHAPTER 1

IMPLEMENTATION

United States Code Annotated - General Index

Where does one begin an examination of the United States tax laws. The United States Code is voluminous and very complex. So, let us start at the beginning. Here, in the General Index for the United States Code Annotated from 1994, under the major heading Citizenship, we try to find an entry for Income Tax. But we only find:

CITIZENSHIP, cont'd.

........

Illegitimate Children 8 § 1409

Immigration, this index

Imprisonment,

Citizens by foreign governments 22 § 1732

Detention of Citizens prohibited except by

Act of Congress 18 § 4001

Indians,

Generally 8 § 1401

........

Where is income tax? There is nothing listed or shown for Income Tax in the General Index under 'Citizenship'. It would be there between 'Imprisonment' and 'Indians' if it existed. It’s not listed. There are no income tax code statutes shown here in the General Index as being applicable under 'Citizenship' because, as you will see, the income tax does not apply to a Citizen's domestic earnings and income earned by RIGHT, and the law accurately records that legal fact.

Here, in the General Index again, we see the entries for Citizens under the major heading Income Tax.

INCOME TAX, Cont'd.

.......

Citizens,

About to depart from U.S., waiver of requirements

as to termination of taxable year 26 § 6851

Living abroad, exclusion of earned income and

foreign housing costs from gross income 26 § 911

Civic Leagues,

....

How many code sections are shown here, in the General Index, as being applicable to Citizens under income tax? There are two sections, and they both have to do with what? They both have to do with foreign countries. So, here in the General Index for the Annotated Code, we immediately get our first indication that the income tax laws may be substantially different than what we have been led to believe is true by our government. Furthermore, if one looks up "Income Tax" under the major heading of "Aliens" in this General Index, one will find nine pages of code sections listed as being applicable, eight of those pages relate to income tax sections relevant to nonresident aliens.

Income Duty of 1861

Most people in America believe that income tax first started in America between 1913 and 1916. That is not correct. Income tax first appeared in the law at the beginning of the Civil War, in 1861. The text of the law read:

INCOME DUTY

§ SEC. 89. And be it further enacted, That for the purpose of modifying and reenacting, as hereinafter provided, so much of an act, entitled "An act to provide increased revenue from imports to pay interest on the public debt, and for other purposes," approved fifth of August, eighteen hundred and sixty-one, as relates to income tax;...

The first income tax was an income DUTY, imposed as a duty on revenue derived from foreign IMPORTS; imposed as a FOREIGN TAX DUTY. Duties are collected at the Ports of Entry to a nation, THEY ARE NOT IMPOSED ON DOMESTIC ACTIVITIES.

Also in the 1860s, in 1862, along with the Income Duty of 1861, Congress passed an Act into law that can only, and most accurately, be described as a Federal employment "Kickback" agreement. The text of the Act read:

The Federal Employee Kickback

Section 86. Salaries and Pay of Officers and Persons in the Service of the United States, and Passports.

§ SEC. 86. And be it further enacted, that on and after the first day of August, eighteen hundred and sixty-two, there shall be levied, collected, and paid on all salaries of officers, or payments to persons in the civil, military, naval, or other employment or Service of the United States, including senators and representatives and delegates in Congress, when exceeding the rate of six hundred dollars per annum, a duty of three per centum on the excess above the said six hundred dollars; and it shall be the duty of all paymasters, and all disbursing officers, under the government of the United States or in the employ thereof, when making any payments to officers and persons as aforesaid, or upon settling or adjusting the accounts of such officers and persons, to deduct and withhold the aforesaid duty of three per centum, and shall, at the same time, make a certificate stating the name of the officer or person from whom such deduction was made, and the amount thereof, which shall be transmitted to the office of the Commissioner of Internal Revenue, and entered as part of the internal duties; and the payroll, receipts, or account of officers or persons paying such duty, as aforesaid, shall be made to exhibit the fact of such payment.

...[balance of section 86 applied to passports] (emphasis added)

Please note that the ONLY people who are subject to this duty, by clear statutory language, ARE FEDERAL EMPLOYEES. The EFFECT of Section 86 identifies what it really is - a KICKBACK of part of the property agreed, under employment contract, to be paid for the labor of a Federal government employee. By this Act the amount of compensation contractually agreed to was diminished by one party to the agreement (Congress), without the consent of the other party (the federal employee). A unilateral change in the employment contract of all persons already in the employ of the Federal government was, and is, not legal, and the conduct of the United States judges for the next 70 years proves it, as they REFUSED to pay this "duty" until after 1932. Thus becoming, according to the IRS, the first "tax protesters" in American history. The Judges understood thaat the result of arranging for the withholding of three percent of the compensation due to Federal government employees under existing contracts was a deprivation of property and liberty without due process of law, which is violative of the Fifth Amendment to the Constitution.

The Judges Refuse

In 1863 Supreme Court Chief Justice Taney sent a letter to the Secretary of the Treasury attacking implementation of Section 86 on the compensation of Federal judges as being unconstitutional. This letter was also published as a Supreme Court decision (157 U.S. 701). In it, Justice Taney states:

"The Act in question, as you interpret it, diminishes the compensation of every judge three percent, and if it can be diminished to that extent by the name of a tax, it may in the same way be reduced from time to time at the pleasure of the legislature." (emphasis added)

Here you can see that the judges understood the effect of this law was a diminishment "by the name of a tax". They knew it was not an actual tax, BUT A FORCED DEBT OBLIGATION. In this country there exists no circumstance under which a person lawfully can be forced to accept a debt against their will. The judges chose to exercise their RIGHT to REFUSE TO ACCEPT THIS DEBT.

The facts presented above were expressed by the Supreme Court in Pollock v Farmer's Loan & Trust Co. in 1895 where they said:

"Subsequently, in 1869, .... The question arose whether the law which imposes such a tax upon them was constitutional. The opinion of the Attorney General thereon was requested by the Secretary of the Treasury. The Attorney General, in reply, gave an elaborate opinion advising the Secretary of the Treasury that no income tax could be lawfully assessed and collected upon the salaries of those officers who were in office at the time the statute imposing the tax was passed, holding on this subject the views expressed by Chief Justice Taney. His opinion is published in Volume XIII of the Opinion of the Attorney General, at page 161. I am informed that it has been followed ever since without question by the department supervising or directing the collection of the public revenue." (emphasis added)

The "kickback" program illegally forced a three percent debt obligation upon Federal government employees working under an existing employment agreement in 1862. However the "kickback" program established by Section 86 was legal when applied to the salary of persons who took employment with the Federal government after the Act was passed because they were on notice that a three percent kickback was part of their employment agreement.

This “tax” (notice that it is not even called a tax in the Act, but a “Duty”), ONLY APPLIES TO FEDERAL EMPLOYEES. It is these two acts from the 1860's, the Foreign Income Duty and the Federal employment agreement "kickback", blurred under the 16th Amendment distractions, whose provisions have been intentionally mingled with the Social Security provisions of the 1930’s, that have become today's so-called income tax, NOT BY PROPER CHANGES IN THE LAW, but by improper enforcement procedure by a renegade IRS, brutally and illegally intimidating, coercing and persecuting good American Citizens by threat, in order to force them to pay a so called "income tax" that they LEGALLY NEVER OWED in the first place, because they were never subject to it under the law because they never worked for the Federal government or earned foreign income under treaty !!!

A Note From the Commissioner

If we look at what the IRS tells us today about income taxes on the first page of the Form 1040 Tax Instruction Booklet from 1994, we find a "Note From the Commissioner", which is usually one of the first things in the booklet. This one is from Margaret Richardson, the current Commissioner of the IRS. It states in part:

Dear Taxpayer,

Thank you for making this nation's tax system the most effective system of voluntary compliance in the world. The key to maintaining that system is ensuring that you are treated fairly and equitably, that your privacy is protected, and that our tax system is as simple and understandable as possible....

Margaret Milner Richardson

The first sentence here is:

“Thank you for making this nation’s tax system the most effective system of voluntary compliance in the world.”

There it is! Voluntary Compliance. Why does she say that ? What does that mean ? Does that seem strange to you, given their known position in court ? And how does it effect you, a sovereign American Citizen, if compliance really is voluntary ? We will come back to those questions in a bit, but I would point out here that this opening statement is not unusual. Nearly every instruction booklet from past years has opened with some variation of this statement from the Commissioner.

The next thing we’re going to take a look at is the Privacy Act & Paperwork Reduction Act, Notice 609, which is required by law to be supplied to you by the IRS with any correspondence you receive from the IRS. It states in pertinent part:

Privacy Act and Paperwork Reduction Act

Notice 609

The Privacy Act of 1974 and Paperwork Reduction Act of 1980 say that when we ask you for information, we must first tell you our legal right to ask for the information, why we are asking for it, and how it will be used. We must also tell you what could happen if we do not receive it and whether your response is voluntary, required to obtain a benefit, or mandatory under the law.

This notice applies to all papers you file with us, including this tax return. It also applies to any questions we need to ask you so we can complete, correct, or process your return; figure your tax; and collect tax, interest, or penalties.

Our legal right to ask for information is Internal Revenue Code sections 6001, 6011, and 6012(a) and their regulations. They say that you must file a return or statement with us for any tax you are liable for. Your response is mandatory under these sections.........

We ask for tax return information to carry out the tax laws of the United States. We need it to figure and collect the right amount of tax............

If you do not file a return , do not provide the information we ask for, or provide fraudulent information, the law says that you may be charged penalties and, in certain cases, you may be subject to criminal prosecution..........

Please keep this notice with your records. It may help you if we ask for other information. If you have questions about the rules for filing and giving information, please call or visit any Internal Revenue Service office.

In the third paragraph it states:

"Our legal right to ask for information is Internal Revenue Code Sections 6001, 6011 & 6012(a) and their regulations. They say that you must file a return or statement with us for any tax you are liable for."

Now does that say you have to file a return for taxes that you are not liable for ? No! Does it state who is liable ? No! Does it even state what liability is ? No ! And that raises the legal questions, what is liability, and who is liable?

Now keep in mind that this does not actually say that this is their right to ask you (the Citizen) for information. It doesn't actually specifically say from whom information may be requested, it just establishes that a legal right to request information does exist. But from whom may information actually be requested under these laws ? Well, they cite three code sections in this notice, what do they say ?

§ 6001. Notice or regulations requiring records, statements, and special returns.

Every person liable for any tax imposed by this title or for the collection thereof, shall keep such records, render such statements, make such returns, and comply with such rules and regulations as the Secretary may from time to time prescribe. Whenever in the judgment of the Secretary it is necessary, he may require any person, by notice served upon such person or by regulations, to make such returns, render such statements or keep such records as the Secretary deems sufficient to show whether or not such person is liable for tax. The only records which an employer shall be required to keep under this section in connection with charged tips shall be charge receipts, records necessary to comply with section 6053(c), and copies of statements furnished by employees under section 6053(a).

(emphasis added)

Notice that the first three words in this code section are: “Every person liable”. Does this code section actually establish liability ? Or, does it simply list the consequences of being liable, leaving the reader to assume that he or she is in fact made liable elsewhere in the Code. Indeed it does not establish liability, it merely lists the consequences of being liable. It is interesting to note, that the second sentence here says:

"Whenever in the judgment of the Secretary it is necessary, he may require any person, by notice served upon such person or by regulations, to make such returns, render such statements or keep such records as the Secretary deems sufficient to show whether or not such person is liable for tax."

Have you ever received notice from the Commissioner ? Are you sure that you’re required to make such returns, render such statements or keep such records ? Which records, which statements, and which returns are required ?

Do you see in the third sentence where it refers to "employers". Does this code section apply to employers ? Are employers liable for tax ? (see Section 3403 - Liability for Tax)

Section 6011 was the next section cited in Notice 609 by the IRS as their right to request information, and it says:

§ 6011. General requirement of return, statement, or list.

(a) General rule.

When required by regulations prescribed by the Secretary any person made liable for any tax imposed by this title, or with respect to the collection thereof, shall make a return or statement according to the forms and regulations prescribed by the Secretary. Every person required to make a return or statement shall include therein the information required by such forms or regulations...........

(emphasis added)

The first sentence states in pertinent part:

"... any person made liable...”

Does this code section actually make anyone liable, or again, does it just list the consequences of being made liable, leaving the reader to assume or presume, again, that liability exists, or is actually established elsewhere in the code ? Neither of these code sections, 6001 nor 6011, actually establish liability. They simply establish the consequences of being liable, or being made liable. So, we’re going to look for Code sections that do state some person is liable, or is made liable for the payment of "income" tax, that would trigger the filing requirements established by these sections.

The last section referenced by the IRS in Notice 609, as their right to ask for information, Section 6012, states in pertinent part:

§ 6012. Persons required to make returns of income.

(a) General rule. Returns with respect to income taxes under subtitle A shall be made by the following:

(1)(A) Every individual having for the taxable year gross income which equals or exceeds the exemption amount, except that a return shall not be required of an individual -

(i) who is not married, is not a surviving spouse, is not a head of a household and for the taxable year has gross income of less than the sum of the exemption amount plus the basic standard deduction applicable to such an individual.

(ii) who is a household and for the taxable year has gross income of less than the sum of the exemption amount plus the basic standard deduction applicable to such an individual.

(iii) who is a surviving spouse and for the taxable year has gross income of less than the sum of the exemption amount plus the basic standard deduction applicable to such an individual.

(iv) who is entitled to make a joint return and whose gross income, when combined with the gross income of his spouse, is, for the taxable year, less than the sum of twice the exemption amount plus the basic standard deduction applicable to such a joint return, but only if such individual and his spouse, at the close of the taxable year, had the same household as their home.

This section states

“Returns with respect to income taxes under Subtitle A ...”

and Subsection (1)(A) says, “every individual having for the taxable year...”

So, the requirement identified here is being established for individuals under Subtitle A. Where is the tax imposed on individuals that would correspond to this filing requirement, and what is the exact legal nature of the specific requirement that is established by this section (6012), under the imposing statute? This Code section (6012) may appear to be related to individuals and their corresponding filing requirement (for Returns), but what are its legal limitations, as recorded in the law, and who are the individuals subject under subtitle A ?

Structural Organization of Title

First, a short explanation regarding the organization of the Tax laws in the United States Code. The tax law of the United States of America is in Title 26 of the United States Code (Internal Revenue Code). Title 26 is broken into a number of Subtitles, each Subtitle being a distinct and separate section of the law as the table below shows:

Tax or Topic Subtitle Chapters Sections

--------------------- ------- --------- ----------

Income Taxes A 1 to 6 1

Estate & Gift Taxes B 11 to 13 2001

Employment Taxes C 21 to 25 3101

Miscellaneous Excises D 31 to 47 4041

Alcohol, Tobacco and

Certain Other Excises E 51 to 54 5001

Procedure and

Administration F 61 to 80 6001

Joint Committee on

Taxation G 91 to 92 8001

Financing Presidential

Election Campaigns H 95 to 96 9001

Trust Fund Code I 98 9500

This book examines the laws under Subtitle A - Income taxes, Subtitle C - Employment taxes, and Subtitle F - Procedure and Administration, which applies and implements the other Subtitles under the law. The code sections we just looked at 6001, 6011 and 6012 are all from Subtitle F. Income taxes are in Subtitle A, consisting of chapters 1 - 6 of Title 26, Employment taxes are in Subtitle C, consisting of chapters 21 - 25.

It is important to understand that each Subtitle establishes a distinct and separate program, or "tax", with its own individual authority to administer within that Subtitle, over its code sections. These authorities do not automatically cross over into the other Subtitles and cannot be invoked as an authority in the other Subtitles unless it is shown as applicable within the law and its provisions (regulations).

Each Subtitle imposes its own tax, and establishes the groups of persons subject to that tax, within that specific subtitle. Just because one group of people is subject to one tax under one subtitle, does not necessarily imply that group is automatically also subject to the taxes imposed by other subtitles. To demonstrate this point one could ask "Do you pay Subtitle E taxes ?". For most people, the answer is a resounding "NO". Why not, you may ask, isn't everyone subject to the law? The answer, of course, is that the group of persons subject to Subtitle E taxes are ONLY those people who engage in the manufacture and sale of alcohol and tobacco products, as proscribed in Subtitle E.

As you will see, the group of people who are subject to the Subtitle C Employment Tax laws are those people who have voluntarily chosen to participate in the Social Security program and supply a Social Security number. Who then, is the subject of the Subtitle A - Income Tax laws, and what exactly is the true nature of this tax and its associated filing requirements ? Well, Section 6012 said: “... with respect to income taxes under Subtitle A ...", and we are looking for the Code section where the income tax is imposed on individuals, so, we go to Title 26, Subtitle A, Chapter 1, Section 1, which states:

SUBTITLE A - INCOME TAXES

Chapter 1. - NORMAL TAXES AND SURTAXES

Subchapter A. - Determination of Tax Liability

PART 1. - Tax On Individuals

§ 1. Tax Imposed.

(a) Married individuals filing joint returns and surviving spouses. There is hereby imposed on the taxable income of -

(1) every married individual (as defined in Section 7703) who makes a single return jointly with his spouse under Section 6013, and

(2) every surviving spouse (as defined in Section 2(a)), a tax determined in accordance with the following table:

If taxable income is: The tax is:

Not over 32,450 15% of taxable income

Over 32,450 but not

over 78,400 4,867.50, plus 28% of

the excess over 32,450

Over 78,400 17,733.50, plus 31% of

the excess over 78,400

(b) Heads of households. There is hereby imposed on the taxable income of every head of a household (as defined in section 2(b)) a tax determined in accordance with the following table:

If taxable income is: The tax is:

Not over 26,050 15% of taxable income

Over 26,050 but not

over 67,200 3,907.50, plus 28% of

the excess over 26,500

Over 67,200 15,429.50, plus 31% of

the excess over 67,200

(c) Unmarried individuals (other than surviving spouses and heads of households). There is hereby imposed on the taxable income of every individual ( other than a surviving spouse as defined in section 2(a) of the head of a household as defined in section 2(b)) who is not a married individual (as defined in section 7703) a tax determined in accordance with the following table:

If taxable income is: The tax is:

Not over 19,450 15% of taxable income

Over 19,450 but not

over 47,050 2,917.50, plus 28% of

the excess over 19,450

Over 47,050 10,645.50, plus 31% of

the excess over 47,050

(d) Married individuals filing separate returns There is hereby imposed on the taxable income of every married individual (as defined in section 7703) who does not make a single return jointly with his spouse under section 6013, tax determined in accordance with the following table:

If taxable income is: The tax is:

Not over 16,225 15% of taxable income

Over 16,225 but not

over 39,200 2,433.75, plus 28% of

the excess over 16,225

Over 39,200 8,866.75, plus 31% of

the excess over 39,200

(e) Estates and trusts. There is hereby imposed on the taxable income of -

(1) every estate, and

(2) every trust,

taxable under this subsection a tax determined in accordance with the following table:

If taxable income is: The tax is:

Not over 3,300 15% of taxable income

Over 3,300 but not

over 9,900 495 , plus 28% of

the excess over 3,300

Over 9,900 2,343 plus 31% of

the excess over 9,900

(f) Adjustments ...........

Does all of this look familiar ? It should, this is the Income Tax you probably pay every April 15th of every year, and it sure looks like everyone has to pay, doesn't it ?

But wait, notice that the language in each of the paragraphs of this section reads in the form:

“...there is hereby imposed on the taxable income ... a tax ...”.

Notice that in all of these paragraphs the tax is not actually imposed on the individual him or herself, it is imposed on the taxable income of the individual. So, that leads to the question, what is taxable income, and what makes income taxable, as opposed to non-taxable ? What everybody in America apparently does: is assume that they have taxable income, and then assume that they have liability for tax, and then they assume that Form 1040 is the correct form to file to satisfy that liability for tax on taxable income that they have as individuals, So they fill out Form 1040 and send it in to the IRS to pay the tax. But, is that the correct and proper legal procedure to follow under the law ? Certainly that is what the IRS tells us to do, but what does the law actually say. What information is legally required from U.S. Citizens to satisfy the statutory liability for tax on taxable income established in Chapter 1, Section 1, by the (income) tax imposed ?

For the answer to that question we must go back to the Paperwork Reduction Act, but first, a small note (code section).

Most people believe that Section 1 is all there is in the law regarding the imposition of the income tax. But what about this next section from Title 4 - Rules For Federal Employees.

4, U.S.C. § 111. State, and so forth, taxation affecting Federal areas; taxation affecting Federal employees; income tax.

The United States consents to the taxation of pay or compensation for personal service as an officer or employee of the United States, a territory or possession or political subdivision thereof, the government of the District of Columbia, or an agency or instrumentality of one or more of the foregoing, by a duly constituted taxing authority having jurisdiction, if the taxation does not discriminate against the officer or employee because of the source of the pay or compensation.

Here Congress is consenting to the taxation (kickback return) of the pay of Federal officers and employees in the name of income tax. There is no such corresponding statute anywhere in the code for anyone who DOES NOT WORK FOR THE FEDERAL GOVERNMENT. In this law, the U.S. government is providing notice that ONLY the employees of the U.S. government (United States), who are receiving the U.S. government's property (in the form of wage payments to those employees), which is subject to being returned (kick-backed) to the government, are responsible for those returns of income (referenced in 6012), to the government as part of their employment agreement. This section is in Title 4 BECAUSE IT ONLY APPLIES TO GOVERNMENT EMPLOYEES and cannot apply to anyone else. Congress cannot enact law for any other taxing authority (like a State), or in any area where it does not have jurisdiction to tax. Only government employees are responsible for returning a portion of their income to the Federal government (IRS), NOT Citizens in the fifty States WHO DO NOT WORK FOR THE FEDERAL GOVERNMENT. DO YOU WORK FOR THE FEDERAL GOVERNMENT ? Are you still sure that you are required to "make a return of income" to the Treasury ?

THE PAPERWORK REDUCTION ACT

Now, the Paperwork Reduction Act effectively says that the United States government cannot require, or collect, more information from Citizens than is absolutely necessary to satisfy the requirements of the law. And under this Act, which was passed in 1980, the IRS was required to file with OMB, the Office of Management and Budget, a list of all the code sections that required information to be collected from individuals, together with the cross-referenced list of forms to be used to satisfy those legal information collection requirements for any given code section.

This table is incorporated into the law in the Code of Federal Regulations in 26 C.F.R. 602.101, whose introduction states that the purpose of this regulatory section is to comply with the legal requirements imposed on the government by the Paperwork Reduction Act. The IRS itself prepared and supplied this Table to OMB. It took the IRS five years to comply with the mandate of this Act to document the specific filing requirements associated with any given section, and after you see the table you will understand why the IRS did not want to release this information for over five years.

It states in pertinent parts:

PART 602 - OMB CONTROL NUMBERS UNDER THE PAPERWORK REDUCTION ACT

Section 602.101. OMB Control numbers.

(a) Purpose.. This part collects and displays the control numbers assigned to collections of information in Internal Revenue Service regulations by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1980. The Internal Revenue Service intends that this part comply with the requirements of .... (OMB regulations implementing the Paperwork Reduction Act), for the display of control numbers assigned by OMB to collections of information in Internal Revenue Service regulations....

_________________________________________________

26 CFR (4-1-94 Edition)

CFR part or section where Current

identified and described OMB Control No.

1.1-1 ........................................... 1545-0067

1.23-5 ...........................................1545-0074

1.25-1T.........................................1545-0922

1545-0930

1.25-2T..........................................1545-0922

.....

1.60120....................................... 1545-0067

1.6012-1...................................... 1545-0074

........

In the portion of the table reproduced above, the left hand column shows the code section (where the income tax is imposed; in PART 1, Section 1, designated here in the table as 1.1-1), and the right hand column shows the OMB Document Control Number (DCN) assigned to the information collection request (the form), that is required by the code section to satisfy its legal requirements. Note that there is only one form shown here as being required by the law that imposes the income tax, and note that the form that is to be used to satisfy the requirements of this code section, where the income tax is imposed, carries OMB DCN 1545-0067. Also note that the same form is required by Regulation 1.6012-0, which corresponds to the individual's filing requirement established in Section 6012, which has already been reviewed.

It should be noted that 6012 (from Subtitle F - Procedure and Administration) is used to enforce all of the individual filing requirements established and imposed in the other Subtitles, but it does not expand or establish any new or additional requirements in association with any given section. So, while 1.6012-1 can be used to enforce (and require) the use of Form 1040 in association with those sections that actually do require it (1.23-5 for example), IT DOES NOT AND CANNOT EXPAND THE REQUIREMENT OF SECTION 1, as shown in the above CFR table. It can properly be used to enforce the requirement(s) shown, but it cannot expand them.

So, if Form 1040 is the proper form for United States Citizens to file to satisfy their liability on taxable income, under the law, as listed by the IRS; that OMB Document Control Number, 1545-0067, will show up on the top of a Form 1040.

Department of the Treasury - Internal Revenue Service

Form 1040 U.S. Individual Income Tax Return 1993 | Reserved for IRS Use Only.

For the year Jan 1-Dec 31, 1993, or other tax year beginning , 1993 ending ,19 | OMB No. 1545-0074

------------------------------------------------------------------------------------------------------------

Here is the reproduced top portion of a Form 1040 from 1993, and there in the upper right hand corner, it says OMB No. 1545-0074. Does that number match the number shown in the table as being required by Section 1 that imposes the tax ? No ! It’s the wrong number! The Table in the Code of Federal Regulations shows that the law requires the form with OMB Document Control Number 1545-0067, not 1545-0074.

It’s probably worth saying that 1545 is the prefix assigned by OMB to all IRS documents. But OMB Document Control Number 1545-0074 is assigned to Form 1040, and the form required by the law carries DCN 1545-0067. So what form does carry the OMB Document Control Number 1545-0067 ?

Form 2555 Foreign Earned Income |OMB No. 1545-0067

__________________________________________________________________________________

For Use by U.S. Citizens and Resident Aliens Only 1993

------------------------------------------------------------------------------------------------------------

Here, you see at the top of the form, in the upper right hand corner it says: OMB No. 1545-0067. Now that matches the entry in the CFR Table! And what is the title of this form ? Form 2555 Foreign Earned Income ! And what does it say underneath the title ?

"For Use by U.S. Citizens and Resident Aliens Only".

Now does Form 1040, say anything about who is supposed to use it ? No, it doesn’t! But Form 2555 - Foreign Earned Income states who is supposed to use it, “U.S. Citizens and Resident Aliens Only”. This is the form that’s listed in the law as being required to satisfy the information reporting requirements associated with the individual's statutory liability for income tax on "taxable income", imposed by Section 1 in Chapter 1, the income tax; and, it is the same form shown as being required under Section 6012, which was cited by the IRS itself in Notice 609.

I’ll mention that here again, under the law, we find that the income tax, for Citizens, other than the Federal “source” kickback”, appears to be related only to foreign income. Remember we started with the General Index for the United States Code Annotated and found that under Income Tax, under Citizens, it only referenced foreign countries, and here again, we find that the only form actually required under the law, reports only foreign income. The law is consistent so far, isn't it? It doesn't agree with what we are told to believe by the IRS, but it agrees with itself, without contradiction, doesn't it ? So what is the proper legal use of Form 1040 ? The next document will help explain things.

TREASURY DECISION 2313

Income Taxes

Treasury Department

Office of Commissioner of Internal Revenue

Washington, D.C., March 21, 1916

To collectors of internal revenue:

Under the decision of the Supreme Court of the United States in the case of Brushaber v. Union Pacific Railway Co., decided January 21, 1916, it is hereby held that income accruing to nonresident aliens in the form of interest from the bonds and dividends on the stock of domestic corporations is subject to the income tax imposed by the act of October 3, 1913.

Nonresident aliens are not entitled to the specific exemption designated in paragraph C of the income-tax law, but are liable for the normal and additional tax upon the entire net income "from all property owned, and of every business, trade, or profession carried on in the United States," computed upon the basis prescribed in the law.

The responsible heads, agents, or representatives of nonresident aliens, who are in charge of the property owned or business carried on within the United States, shall make a full and complete return of the income therefrom on Form 1040, revised, and shall pay any and all tax, normal and additional, assessed upon the income received by them in behalf of their nonresident alien principals.

The person, firm, company, copartnership, corporation, joint-stock company, or association, and insurance company in the United States, Citizen or resident alien, in whatever capacity acting, having the control, receipt, disposal, or payment of fixed or determinable annual or periodic gains, profits, and income of whatever kind, to a nonresident alien, under any contract or otherwise, which payment shall represent income of a nonresident alien from the exercise of any trade or profession within the United States, shall deduct and withhold from such annual or periodic gains, profits, and income, regardless of amount, and pay to the office of the United States Government authorized to receive the same such sum as will be sufficient to pay the normal tax of 1 per cent imposed by law, and shall make an annual return on Form 1042. (emphasis added)

This is the only place that I have ever been able to find the proper explanation, actually, any explanation what-so-ever from the United States government, for the proper use of Form 1040. Treasury Decision 2313, handed down in 1916, instructs the collectors of the Internal Revenue on how to implement the income tax laws as imposed under the 16th Amendment. This Treasury Decision is the result of a Supreme Court ruling, referenced in the first paragraph as "Brushaber v. Union Pacific Railway Co.", which was decided January 21, 1916, and from which:

"... it is hereby held that the income accruing to nonresident aliens in the form of interest from the bonds and dividends on the stock of domestic corporations is subject to the income tax imposed by the act of October 3, 1913.”

The second paragraph states:

“Nonresident aliens are not entitled to the specific exemption designated in paragraph C of the income-tax law, but are liable for the normal and additional tax upon the entire net income from all property owned, and of every business, trade, or profession carried on in the United States,” computed upon the basis prescribed in the law.”

Now, the first paragraph says that nonresident aliens are subject to the tax. The second paragraph says that nonresident aliens are liable for the tax and that they are not allowed to claim the exemption designated as paragraph C. That implies that Citizens are allowed to claim the exemption in paragraph C, and that Citizens are not liable for the tax, because they are not subject to the tax, because it was not specified in paragraph one that Citizens are subject. Now let’s read the third paragraph, and keep in mind that we are going to look for a Paragraph C in the United States Code that exempts Citizens from income tax. The third paragraph states:

“The responsible heads, agents, or representatives of nonresident aliens, who are in charge of the property owned or business carried on within the United States, shall make a full and complete return of the income therefrom on Form 1040, revised, and shall pay any and all tax, normal and additional, assessed upon the income received by them in behalf of their nonresident alien principals."

Now there’s the proper legal use of Form 1040. It is to be used by United States Citizens to report the income of his or her foreign principals. It is not to be used to report the Citizen's own personal domestic income. Again, this is the only place where I have ever seen a legal explanation from the government for the proper legal use of Form 1040, and now I think you know why. Form 1040 is to be used by withholding agents to report the income of foreign principals. It is not to be used by U.S. Citizens to report their own income, and that’s why voluntary self assessment and voluntary compliance are so important to the IRS. Because the current mythical system doesn’t work unless the Citizen voluntarily misapplies the law and uses the wrong form to mistakenly, voluntarily assess his own domestic income for a foreign income tax. Form 1040 is also properly required to claim certain credits and deductions (discussed later), as well as for Federal employees to utilize in minimizing the “kickback” duty under 4 U.S.C. 111.

This Treasury Decision, 2313, references the Supreme Court decision Brushaber v. Union Pacific Railroad Co., so it is time to step back, and get a little background information.

The Constitution

The first thing we’re going to do is look at what the Constitution says about taxation. The limitations in the Constitution restricting the direct taxation of individuals and their property are found in Article 1 in two different sections. Both sections specifically restrict the Federal government as to how it may lay direct taxes on the Citizens. Article 1, Section 2, Clause 3 states:

"Representative and direct taxes shall be apportioned among the several states which may be included within this union, according to their respective numbers"

and Article 1, Section 9, Clause 4 states:

"No capitation or other direct tax shall be laid, unless in apportionment to the Census or enumeration herein before directed to be taken."

These basic sections of the Constitution have never been repealed or amended. The Constitution still forbids the direct taxation of individuals, their property, and their rights, unless the tax is apportioned to the State governments for collection.

And Article 1, Section 10, Clause 1 states:

“No State shall enter into any treaty, alliance, or confederation; grant letters of marquee and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts; pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts, or grant any title of nobility.” (emphasis added)

This Clause in the Constitution is why NEITHER the Federal, nor the State governments have any authority, either OVER, or TO UNILATERALLY ALTER, PRIVATE EMPLOYMENT CONTRACTS as stated in Justice Taney’s letter (recorded as a Court Decision).

In 1895, Congress tried to pass an Act that imposed income taxes on the interest and dividends of U.S. Citizens on deposit in U.S. banks. This Act was immediately struck down in Pollock vs. Farmer’s Loan and Trust Co. (157 US 429), wherein the Supreme Court ruled that it is unconstitutional to impose an income tax on the interest and dividends of United States Citizens on deposits in U.S. banks. The court ruled that the tax was unconstitutional because it was a direct tax that was not apportioned as required by the Constitution. This decision has never been reversed or overturned.

Excerpts from the Pollock decision include:

"...Ordinarily, all taxes paid primarily by persons who can shift the burden upon someone else, or who are under no legal compulsion to pay them, are considered indirect taxes; but a tax upon property holders in respect of their estates, whether real or personal, or of the income yielded by such estates, and the payment of which cannot be avoided, are direct taxes..."

(emphasis added)

and,

"...Subsequently, in 1869, .... The question arose whether the law which imposes such a tax upon them was constitutional. The opinion of the Attorney General thereon was requested by the Secretary of the Treasury. The Attorney General, in reply, gave an elaborate opinion advising the Secretary of the Treasury that no income tax could be lawfully assessed and collected upon the salaries of those officers who were in office at the time the statute imposing the tax was passed, holding on this subject the views expressed by Chief Justice Taney. His opinion is published in Volume XIII of the Opinion of the Attorney General, at page 161. I am informed that it has been followed ever since without question by the department supervising or directing the collection of the public revenue..." (emphasis added)

and;

"...A tax upon one's whole income is a tax upon the annual receipts from his whole property, and as such falls within the same class as a tax upon that property, and is a direct tax, in the meaning of the Constitution..."

(emphasis added)

and,

"...We have unanimously held in this case that, so far as this law operates on the receipts from municipal bonds , it cannot be sustained, because it is a tax on the powers of the States, and on their instrumentalities to borrow money, and consequently repugnant to the Constitution. ..it follows that, if the revenue from municipal bonds cannot be taxed because the source cannot be, the same rule applies to revenue from any other source not subject to the tax; and the lack of power to levy any but an apportioned tax on real and personal property equally exists as to the revenue therefrom. (emphasis added)

Admitting that this act taxes the income of property irrespective of its source, still we cannot doubt that such a tax is necessarily a direct tax in the meaning of the Constitution In England, we do not understand that an income tax has ever been regarded as other than a direct tax. In Dowell's History of Taxation and Taxes in England, given, and an income tax is invariably classified as a direct tax.." (emphasis added)

and, even in dissent:

..that personal property, contracts, obligations, and the like, have never been regarded by Congress as proper subjects of direct tax. The United States Constitution provides Congress the power to lay and collect taxes directly only as long as it is apportioned with regard to the census or enumeration."

(emphasis added)

Then, in 1913 Congress passed the 16th Amendment which says,

“Congress shall have power to lay and collect taxes on income, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.”

So that changed everything, right? Well, NO ! That is not what the Supreme Court ruled. What the Supreme Court ruled, in Brushaber v. Union Pacific R.R. Co. and in Stanton v. Baltic Mining Co., is that since the provisions of Article I, requiring that direct taxes be apportioned, were not repealed, they are still in full force and effect. And, that since the language of the 16th Amendment specifies that the income tax is to be a tax without apportionment, then it cannot be a direct tax, because otherwise the Constitution would inherently contradict itself, which cannot be allowed to happen. Article I cannot prohibit direct taxation unless apportioned, while the 16th Amendment grants the power to lay direct taxes without apportionment, because then the Constitution would inherently contradict itself and could no longer serve as a valid foundation for our Law. So, to specifically prevent the Constitution from contradicting itself, the Supreme Court ruled that since the 16th Amendment provides for an income tax without apportionment, then the income tax cannot be a direct tax.

But, there are only two major classes of taxation authorized in the Constitution; direct taxes and indirect taxes. So, if the income tax cannot be a direct tax, then it must be an indirect tax. Indirect taxes are classified into three minor categories in the Constitution: imposts, duties and excises, and are ONLY imposed on revenue taxable activities and/or events. If you remember, the income tax started in 1861 as an income Duty, imposed only on foreign imports and Federal employees, which was contained and allowed within the Constitutional category of duties. As a foreign duty it was only imposed on the flow of foreign goods into America, NOT DOMESTIC GOODS, NOR DOMESTIC INCOME except that earned by federal employees and officers (Civil War).

Obviously today, the income tax is not currently being enforced as a duty, so the questions are: "Did the 16th Amendment create a new congressional power to tax directly ?", and; "How did the 16th Amendment change the income tax ?".

The answer to the first question was supplied by the Supreme Court in Stanton v. Baltic Mining Co., 240 US 112 (1916), stating:

"...by the previous ruling, it was settled that the provisions of the 16th Amendment conferred no new power of taxation but simply prohibited the previous complete and plenary power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged.." (emphasis added)

The Supreme Court clearly states that the 16th Amendment DID NOT create a new power to tax the People in a direct fashion without apportionment, AS IS FRAUDULENTLY CLAIMED BY THE IRS. So, if it is not a direct tax, then it is still an indirect tax, but, possibly, no longer a duty. Then; "What kind of tax is the income tax now?"

In the "previous ruling" referenced above, Brushaber v. Union Pacific R.R. Co . 240 US 1 (1916), the court stated:

"...taxation on income was in its nature an excise ...” ,and

"...taxes on such income had been sustained as excises in the past...".

specifically,

"Moreover, in addition, the conclusion reached in the Pollock case did not in any degree involve holding that income taxes generically and necessarily came within the class of direct taxes on property, but, on the contrary, recognized the fact that taxation on income was in its nature an excise entitled to be enforced as such unless and until it was concluded that to enforce it would amount to accomplishing the result which the requirement as to apportionment of direct taxation was adopted to prevent, in which case the duty would arise to disregard form and consider substance alone,..." (emphasis added)

The Court ruled that the 16th Amendment effectively transformed the income tax from an indirect duty to an indirect excise (imposed on revenue taxable ativities). It is not a direct tax without apportionment. And, if we examine the law closely, that is exactly what we find; that the income tax is imposed and applied under the law, as an indirect excise, ONLY imposed on specific entities, privileged and Federal, and specific taxable activities and events that are identified in the law as “included types” or potential “sources” of “taxable income”

So, legally, exactly what is an excise tax ? Fortunately, the Supreme Court used to know what it was doing, and both of these decisions, Brushaber and Stanton, refer you to another case handed down five years earlier, Flint v. Stone Tracy Co 220 U.S. 107 (1911) , in which the Supreme Court ruled that excise taxes are taxes:

“laid on the manufacture, sale or consumption of commodities within the country,

upon licenses to pursue certain occupations and

upon corporate privileges;

the requirement to pay such taxes involves the exercise of the privilege and if business is not done in the manner described no tax is payable...it is the privilege which is the subject of the tax and not the mere buying, selling or handling of goods.” (emphasis added)

The Supreme Court effectively establishes with this ruling that excise taxes are manufacturing taxes, sales taxes, and taxes on privileges. Privileges in the form of either licenses to pursue certain occupations, corporate privileges, and any other privileges granted to the individual by the government as well. One of these other privileges, is the privilege of being protected by the United States government in a foreign country under a tax treaty The government normally would have no jurisdiction or ability to protect you or your business interests in a foreign country, but because of the existence of the tax treaty with that foreign government, your business is protected by the U.S. government outside their jurisdictional boundaries (the United States). That protection, being afforded by the tax treaty, is construed to be a privilege granted to you by the government; and therefore, the income earned in that foreign country under the tax treaty, is privileged income and subject to the income tax.

And that is why the General Index shows that there are only two code sections that apply to Citizens, both having to do with foreign countries. And that is why the form that is actually required by the law is Form 2555 - Foreign Earned Income. Because that is the privileged income that you have as "taxable income", upon which you have liability to satisfy, resultant from engaging in a revenue taxable activity. And that is the only filing requirement that you have as an individual American Citizen under the law. If you have no foreign earned income under tax treaties and no foreign principals to whom money is paid, then you don’t have to file anything under the letter of the law because other income, domestic income, is earned by Right, not privilege. It is a long and well established rule of law that the government cannot tax your Rights, nor may it tax the proceeds derived from the simple exercise of those Rights, and the law accurately reflects and captures that Constitutional truth. It is the IRS that ignores the truth, ignores the law, ignores the implementing regulations and tramples your Citizen's Rights into the mud, because, as you will see, their actions are certainly not supported by the law, or even properly, legally authorized under it.

There is no requirement to file a Form 1040 reporting your own domestic income because the form is only supposed to be used by non-resident aliens and those U.S. Citizens who serve as "withholding agents" to aliens and who have foreign principals to whom moneys are being paid, and Federal employees. As the "agents" for those foreign principals they are required to deduct and withhold and pay the income tax, not on their own income, but on the income of the foreign principals, who do not possess the same rights as a Citizen. As Federal employees they are “transferees” under the I.R. Code and subject to making a “return of income” to the U.S. Treasury.

Now, the reason why these facts are so little known in America, and in the legal community itself, is that if you just look up the Brushaber v. Union Pacific R.R. Co. decision and read it quickly, it appears that the Supreme Court tells the U.S. Citizen (Brushaber) that the tax is constitutional and he has to pay it. It reads as if the Citizen is being told by the Court that he has to pay the income tax. But, the fact of the matter is Frank Brushaber was the U.S. agent for a group of foreigners who had stock in the Union Pacific Railroad. Under the 16th Amendment he (Brushaber) and the Union Pacific Railroad were both made withholding agents and were both ordered by the government to deduct, withhold and pay over the income tax to the government, on the foreigners' income from the stock.

Now, Frank Brushaber filed this suit on behalf of his foreign principals, who had no standing as foreigners in the U.S. courts to file themselves, and that is why Brushaber's name is on the decision. The foreigners lost the suit. The foreigners were essentially told by the courts that it was a privilege to be allowed to have access to the United States marketplace and earn income there. That privilege is granted by the U.S. government, which is given, in the Constitution, full authority over foreigners in America and foreign affairs with other nations. The Court determined that it is the U.S. government that allows foreigners the privilege of earning money in America, therefore; any income that they earn under that extended privilege is taxable income, and the Citizen who acts as the foreigner's agent has to withhold and pay the income tax to the federal Government. In this case the Citizen essentially got told by the court that you have to pay the tax because you’re the withholding agent for these foreigners upon whom the income tax is imposed. The first sentence of the case “write-up” clearly states that the decision is about TARRIFF LAWS.

But the decision simply isn’t written up so that it’s clear about the circumstances of the case. You have to research it thoroughly. If you just look it up, it looks like the U.S. Citizen, Frank Brushaber, gets told by the government, "the tax is Constitutional, and you have to pay it", and, over the passage of time, the IRS has found it very easy to deceive the American people as to the true nature of this Supreme Court decision because of the way this decision is written. In fact, if you call the IRS and ask them why the income tax is Constitutional, they will answer that the Supreme Court ruled it was Constitutional in Brushaber v. Union Pacific Railroad Co. But they won't tell you that this was a case about tarriff laws and the taxation of foreigners, AND HAS ABSOLUTELY NOTHING TO DO WITH THE DIRECT TAXATION OF CITIZENS, as fraudulently claimed by the IRS for over 60 years. So that everyone understands this, it should be said that Title 15 U.S.C. § 17, states:

§ 17 Anti-trust laws... ...

The labor of a human being is not a commodity or article of commerce...

and therefore cannot be made subject to any indirect excise tax as though it were such.

Finally, from the Congressional Research Service in 1979:

SOME CONSTITUTIONAL QUESTIONS

REGARDING THE FEDERAL INCOME TAX LAWS

Howard Zaritsky, Legislative Attorney

American Law Division

May 25, 1979

Report No. 79-131 A

... In Brushaber v. Union Pacific R.R. Co. (1916), the Supreme Court held that the income tax , including a tax on dealings in property, was an indirect tax, rather than a direct tax, and that:

"the command of the amendment that all income taxes shall not be subject to the rule of apportionment by a consideration of the source from which the taxed income may be derived forbids the application to such taxes of the rule applied in the Pollock case by which alone such taxes were removed from the great class of excises, duties, and imposts subject to the rule of uniformity and were placed under the other or direct class." 240 U.S. 1 18-19 (1916)

This same view was reiterated by the Court in Stanton v. Baltic Mining Co. (1916) in which the court stated that the:

"Sixteenth Amendment conferred no new power of taxation but simply prohibited the previous complete and plenary power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged." 240 U.S. 112 (1916)

Therefore, it is clear that the income tax is an "indirect" tax of the broad category of "Taxes, Duties, imposts and Excises," subject to the rule of uniformity, rather than the rule of apportionment......

CHAPTER 2

APPLICATION

Internal Revenue Definitions

Chapter 79, from Subtitle F - Procedure and Administration, contains many of the legal definitions for the terms used in Title 26. Specifically Section 7701, which states.

§ 7701 Definitions.

(a). When used in this Title, where not otherwise distinctly expressed or manifestly incompatible with the intent thereof--

(1). Person - The term "person" shall be construed to mean and include an individual, a trust, estate, partnership, association, company or corporation.

...

(3) Corporation. The term “Corporation” includes associations; joint stock companies, and insurance companies.

(4) Domestic. The term “domestic” when applied to a corporation or partnership means created or organized in the United States or under the law of the United States or of any State.

(5) Foreign. The term “foreign” when applied to a corporation or partnership means a corporation or partnership which is not Domestic.

...

(9). United States. The term ''United States'' when used in a geographical sense includes only the States and the District of Columbia.

(10) State. The term ''State'' shall be construed to include the District of Columbia, where such construction is necessary to carry out provisions of this title. ...

(26). Trade or business. - The term "trade or business" includes the performance of the functions of a public office.

...

(30). United States person. - The term "United States person" means-

(A) a citizen or resident of the United States,

(B) a domestic partnership

(D) any estate or trust (other than a foreign estate or foreign trust , within the

meaning of section 7701(a)(31)).

(31). Foreign estate or trust. - The terms "foreign estate" and "foreign trust" mean an estate or trust, as the case may be, the income of which from sources without the United States which is not effectively connected with the conduct of a trade or business within the United States, is not includible in gross income under Subtitle A.

First note that the word "person" is not restricted to meaning just people. For purposes of the application of the tax laws, "person" means any entity subject to the tax laws. Next, notice that the definition of Domestic (4) references “any State”, and the definition of State (10) says that it includes (only) the District of Columbia.

Additionally, if one examines the statutory evolution of the definition of the word "State" in the I.R. Code, one finds in the 1939 I.R. Code (when Hawaii and Alaska were Territories) the following:

§ 3797 (a)(10). State. The term "State shall be construed to include the Territories and the District of Columbia, where such construction is necessary to carry out the provisions of this title. (emphasis added)

In the 1954 recodification of the I.R. Code (after Alaska became a State and Hawaii is still a territory), § 3797(a) was moved to § 7701(a), where we find:

§ 7701 (a)(10). State. The term "State shall be construed to include the Territory of Hawaii and the District of Columbia, where such construction is necessary to carry out the provisions of this title. (emphasis added)

And finally, in 1959 (after Hawaii became a State), the definition in the Code for the word "State" was updated, and now we find:

§ 7701 (a)(10). State. The term "State shall be construed to include the District of Columbia, where such construction is necessary to carry out the provisions of this title. (emphasis added)

Which is how the statute stands today. Clearly the 50 States of the union are omitted. Lest there be any question that Congress is capable of including the States in this sort of definition where it intends to, one should note carefully the statutory definition provided at 26 U.S.C. § 6103(b)(5) for "State", which does include the several (50) states.

§ 6103(b)

...

(5) State

The term "State" means -

(A) any of the 50 States, the District of Columbia, the Commonwealth of Puerto

Rico, the Virgin Islands, the Canal Zone, Guam, American Samoa, and the

Commonwealth of the Northern Mariana Islands, and

(B) ....

This indicates that any entity in one of the fifty States of the Union is outside (not covered by) the jurisdiction established by this Code for the purposes of applying and properly understanding the internal revenue laws. Citizens are not under the direct jurisdiction of the U.S. government, but rather, are under the jurisdiction of the STATE government, NOT THE FEDERAL. NOW THIS DOES NOT mean that you are a non-resident alien. It just means that you are a Sovereign American Citizen WHO IS OUTSIDE AND ABOVE THE FEDERAL ABILITY (and territorial jurisdiction) TO DIRECTLY TAX, and therefore is not subject to the control, or rule, or taxation of the Federal government on your domestic activities engaged in by Right.

We see this understanding confirmed in the Code of Federal Regulations at 26 CFR 1.911-2(h) where it states:

“Reg. 1.911-2(h) Foreign country. The term “foreign country” when used in a geographical sense includes any territory under the sovereignty of a government other than that of the United States” (emphasis added)

That means every State in the nation could apparently be legally considered, by statutory definition, as “FOREIGN” to (or outside of) the I.R. Code, because they have their own Sovereign governments. When the American States united to form a central government they retained full sovereign governmental authority over their own territory and people. Leaving the “United States” as the sovereign authority over ONLY those territories NOT YET CONFIRMED AS STATES, or conceded by the States to the “United States” (D.C., enclaves, military bases, etc.). The regulation above explains that each and every one of the fifty States could be deemed to be outside the power of the I.R. Code, because they are under their own sovereign governments.

Because of these definitions, and others, there seems to be a lot of confusion and conflicting works by authors making claims regarding these definitions and others specifically, "State" and "United States", AND "Citizen" and "nonresident alien". Many books and articles in the Patriot community in America today claim that since the legal definition of the term "United States" appears to NOT include the 50 States, because the term “State” does not actaully include the 50 states, then Citizens of the 50 States are technically not Citizens of the United States under the IR Code, and therefore are not subject to the income tax, because the tax is only imposed on a citizen of the United States (areas of Federal jurisdiction). Thus a Citizen of a State is a non-resident alien for purposes of the tax code, and is not subject. As already explained and shown in great detail, this argument appears to be flawed. As we have alreaday seen, NON RESIDENT ALIENS ARE THE ACTUAL SUBJECT, AND ONLY SUBJECT, OF THE INCOME TAX ! If you declare yourself to be a nonresident alien, you are declaring yourself subject to the tax. It will just be a matter of time before the IRS shows up at your door demanding that YOU, THE ALIEN (according to your own declaration), pay the tax. This is a destroyed legal argument and cannot succeed in the courts.

This confusion results from the fact that THERE ARE MULTIPLE DEFINITIONS for these terms contained in the law. However, each definition is specifically attached to, and relevant for, ONLY certain code sections (generally one chapter, or one Code section) referenced in the definition itself. This is the wrong argument to base your legal claims on if you are going to try and take on the IRS in court, IT IS NOT RECOGNIZED. PLEASE DO NOT DEPEND ON THIS LEGAL ARGUMENT OR YOU WILL LOSE.

I further would point out that Citizens CAN VOTE, and ALIENS CANNOT. If you voted (or are registered (or eligible) to vote) THEN YOU ARE OBVIOUSLY A CITIZEN OF THE UNITED STATES, and cannot (and SHOULD not) claim that you are "alien" (resident or otherwise) to the government for the purpose of applying the tax laws (but not the voting laws ?)!

If you want to know how to really beat the IRS, read this whole book and join the Disciples of Truth and the Save a Patriot Fellowship to stay informed, because citizenship is the very best tax umbrella possible - you are not subject, if you exercise your rights, and DON'T volunteer for silly programs.

NOW, it is TRUE and CORRECT to understand that YOUR ESTATE can be considered exempt (not taxable), in that it is private property, beyond jurisdictional reach of the Federal government to tax directly (in the States) and NOT under their control or ownership. BUT that DOES NOT make you a foreigner or an alien, JUST A SOVEREIGN CITIZEN who owns property THAT, UNDER THE CONSTITUTION, CANNOT BE TAXED DIRECTLY . (Can the Federal government impose taxes on the people of England ? Of course NOT. Why not ? - THEY HAVE NO JURISDICTIONAL AUTHORITY OVER THAT PROPERTY ! RIGHT ! Well they have NO DIRECT authority or control OVER YOUR PROPERTY EITHER ! (get IRS HUMBUG - The BEST book on the Market ! for more understanding on this.)

Furthermore the Constitution FORBIDS the Federal government from interfering in PRIVATE CONTRACTS, LIKE YOUR EMPLOYMENT CONTRACT IN THE PRIVATE SECTOR. Because the Constitution FORBIDS THIS, the United States government HAS NO UNILATERAL AUTHORITY OVER EITHER YOU, AS AN EMPLOYEE IN THE PRIVATE SECTOR, OR YOUR EMPLOYER, WITHOUT YOUR/THEIR VOLUNTARY COOPERATION AND PERMISSION. As you will see, the law records these legal facts

Those Citizens (of the 50 States) NOT working for the Federal government, technically, under the IR Code, have income which is part of their estate, NOT derived from the United States [government], NOT includible in gross income under subtitle A, wherever their income is “not effectively connected with the conduct of a trade or business (“the functions of a public office within the United States” - see § 7701(a)(26) ), per the definition given in § 7701(a)(31) .

I know this sounds strange and is a little tricky, but re-read this, and think about it. Are you FREE and REPRESENTED, or are you SUBJECT and RULED ? YOU (the Citizens) ARE THE AUTHORITY AND THE TRUE SOVEREIGN in this nation. Sovereigns DON’T PAY TAX, they IMPOSE it on THEIR SUBJECTS, and collect it from them

And what does the Supreme Court say about Federal jurisdiction in the Territories and 50 States ?

“The laws of Congress in respect to those matters {outside of Constitutionally delegated powers} do not extend into the territorial limits of the States, but have force only in the District of Columbia, and other places that are within the exclusive jurisdiction of the national government.” [Caha v. United States, 152 US 211]

“Constitutional restrictions and limitations were not applicable to the areas of land, enclaves, territories and possession over which Congress had exclusive legislative authority” [Downes v. Bidwell, 182 US 244]

“Special provision is made in the Constitution for the cession of jurisdiction from the States over places where the Federal government shall establish forts or other military works. And it is in these places, or in territories of the United States, where it can exercise a general jurisdiction.” [New Orleans v. United States, 35 US (10 Pet.) 662 (1836)]

“It is well established principle of law that all federal legislation applies only within the territorial jurisdiction of the United States unless a contrary intent appears” [Foley Brothers, Inc. v. Filardo, 336 US 281 (1948)]

“Jurisdiction is essential to give validity to the determinations of administrative agencies and where jurisdictional requirements are not satisfied, the action of the agency is a nullity..” [City Street Improv Co. v. Pearson, 181 C 640, 185 P. (1962) O’Neil v. Dept. of Professional & Vocational Standards, 7 CA2d 393, 46 P2d 234]

“...the commerce clause...has always been understood as limited by its terms; and as a virtual denial of any power to interfere with the internal trade and business of the separate states” [United States v. DeWitt, 76 US 41 9 Wall 4, 19 L. Ed 593]

“The law requires proof of jurisdiction to appear on the record of the administrative agency and all administrative proceedings” [Hagans v. Lavine, 415 US 533]

Subtitle A - Income Tax - the Foreign Tax

Remember that the third paragraph of Treasury Decision 2313 essentially says that (withholding) "agents", or "representatives", are going to withhold tax (from nonresident aliens). But, what is the legal definition of a "Withholding Agent", who appears to be the legal entity responsible for the withholding and payment of income taxes ? Again, from 26 U.S.C. 7701(a):

§ 7701 Definitions.

...

(16). Withholding Agent. - The term "Withholding Agent" means any person required to deduct and withhold any tax under the provisions of sections 1441, 1442, 1443,, or 1461.” ...

So, it appears as though a withholding agent can definitely withhold tax, can’t he ? Well, let us look at what is truly authorized by these Code Sections referenced here in the definition. The first thing to point out is that all of the code sections that start with ‘14’ are in Chapter 3 of Title 26. Chapter 3 is titled:

“WITHHOLDING OF TAX ON NONRESIDENT ALIENS

AND FOREIGN CORPORATIONS”.

These sections, 1441, 1442, 1443, and 1461, cited in the definition of a Withholding Agent, state:

§ 1441. Withholding of Tax on Nonresident Aliens .

(a) General rule. Except as otherwise provided in subsection (c) all persons, in whatever capacity acting having the control, receipt, custody, disposal or payment of any of the items of income specified in subsection (b) (to the extent that any of such items constitutes gross income from sources within the United States), of any nonresident alien individual, or of any foreign partnership hall deduct and withhold from such items a tax equal to 30 percent thereof, except that in the case of any items of income specified in the second sentence of subsection (b), the tax shall be equal to 14 percent of such item. (emphasis added)

(b) Income items. ...

Section 1441 only authorizes withholding from nonresident aliens.

§ 1442 . Withholding of tax on foreign corporations.

(a) General rule. In the case of foreign corporations subject to taxation under this subtitle, there shall be deducted and withheld at the source in the same manner and on the same items of income as is provided in Section 1441 a tax equal to 30% thereof. ...

(b) Exemption. Subject to such terms and conditions as may be provided by regulations prescribed by the Secretary, subsection (a) shall not apply in the case of a foreign corporations engaged in trade of business in the United States if the Secretary determines that the requirements of subsection (a) impose an undue administrative burden and that the collection of the tax imposed by section 881 on such corporation will not be jeopardized by the exemption.

(c) Exception for certain possessions corporations. For purposes of this section, the term "foreign corporation" does not include a corporation created or organized in Guam, American Samoa, the Northern Marianna Islands, or the Virgin Islands or under the law of any such possession if the requirements of subparagraphs (A), (B), and (C) of section 881(b)(1) are met with respect to such corporation.

Section 1442 only authorizes the withholding from foreign corporation.

§ 1443 Foreign Tax Exempt Organizations

(a) Income subject to section 511.

...

(b) Income subject to section 4948.

....

Section 1443 only authorizes the withholding from foreign tax exempt organizations.

The last section referenced in the definition of a Withholding Agent, 1461, states:

§ 1461 Liability for withheld tax.

Every person required to deduct and withhold any tax under this chapter is hereby made liable for such tax and is hereby indemnified against the claims and demands of any person for the amount of any payments made in accordance with the provisions of this chapter. (emphasis added)

Section 1461 says withholding agents are made liable for the payment of taxes they withhold from individuals (foreigners). Well, what do you know ? Here is a code section where someone is made liable for such tax. And who is made liable ? The withholding agents are made liable for the tax, and that triggers the filing requirements of § 6011. Remember § 6011 ? We were looking for someone who was made liable for payment of the tax, and here it is. Section 6011 is the filing requirement for withholding agents, not Citizens, or even individuals. Withholding agents are made liable in § 1461 for the payment of taxes withheld, and that liability triggers the filing requirements associated with and under § 6011. And who are Withholding agents authorized to withhold income taxes from ? Foreigners, and foreigners only. And what else does § 1461 also say, that they are : "... indemnified against the claims and demands of any person for the amount of any payment made in accordance with the provisions of this chapter".

And what Chapter is this from ? Chapter 3 - Withholding from Foreigners. And that means that if they wrongfully withhold from someone other than a foreigner, like a Citizen, they’re not indemnified from claims against them for wrongful withholding. So, U.S. Citizens who have income tax wrongfully withheld from them, can sue the withholding agent to have those moneys returned.

Who are the Withholding Agents ? Well, your bank is a Withholding Agent, your stock broker is a Withholding Agent, your employer is NOT a Withholding Agent. Your employer is your employer and employers are defined for purposes of implementing the employment taxes imposed in Subtitle C (see 26 USC 3401(d)), and they don’t have anything to do with income taxes under Subtitle A, other than the fact that they are apparently authorized to withhold income taxes at the source by a W-4, which we are going to look at in a minute. It is clear that by statutory definition Withholding Agents can only withhold from foreigners, and that they are only indemnified for withholding under Chapter 3, which, as we have seen, is only from foreigners.

We have just examined the complete legal authority of a "Withholding Agent" to withhold taxes and, as you can see for yourself, there is no legal authority anywhere in the law for a Withholding Agent to withhold subtitle A income tax from a U.S. Citizen. WHY ? Because the tax is not imposed on the domestic income of Citizens earned by Right, and therefore would never need to be withheld from them ?

Remember the mysterious paragraph C, that nonresident aliens cannot claim, referenced in the third paragraph of Treasury Decision 2313. Here is Section 6654 - Failure by individual to pay estimated income tax. Take careful note of paragraph (e)(2)(C).

§ 6654. Failure by individual to pay estimated income tax.

(a) Addition to the tax. In the case of any underpayment of estimated tax by an individual, except as provided in subsection (d), there shall be added to the tax under chapter 1 and the tax under chapter 2 for the taxable year an amount determined at an annual rate established under section 6621 upon the amount of the underpayment (determined under subsection(b)) for the period of the underpayment (determined under subsection (c)).

.....

(e) Exceptions.

(1) Where tax is small amount ......

(2) Where no tax liability for preceding taxable year.

No addition to tax shall be imposed under subsection (a) for any taxable year if -

A) the preceding taxable year was a taxable year of 12 months,

B) the individual did not have any liability for tax the preceding

taxable year, and

C) the individual was a Citizen or resident of the United States

throughout the preceding taxable year.

(3) Waiver in certain cases ... (emphasis added)

When you file a Form 1040, what you are actually doing is paying estimated income tax. And this Section, 6654, addresses the failure by an individual to pay estimated income tax. Subsection (e) addresses the exceptions for that failure. Within subsection (e), Subsection (2) provides that where there is "no tax liability for preceding taxable year" then "No addition to tax shall be imposed under subsection (a) for any taxable year if" the conditions in subparagraph (A), (B) and (C) are met.

Remember that Citizens do not have any liability for tax on domestic income, according to the Paperwork Reduction Act tables in the Code of Federal Regulations relating to the tax imposed, and the liability established, under Chapter 1 Section 1 - Tax Imposed. It is the nonresident aliens who are liable for this tax (and their withholding agents), according to Treasury Decisions 2313.

Now let’s look at conditions (A) and (B) as well. (A) says, “the preceding taxable year was a taxable year of 12 months”. Well, just about everyone satisfies that condition, and (B) says: “the individual did not have any liability for tax for the preceding taxable year”. We've seen that all Citizens who do not have foreign earned income or foreign principals satisfy this condition, and then we have, again, (C) “the individual was a Citizen or resident...” . Citizens and residents aliens are excepted from the failure to pay. Here is the mysterious paragraph C referenced in Treasury Decision 2313, excepting Citizens from the failure to file and pay estimated income tax.

If you still are skeptical and don’t believe me, here's Section 1.1441-5 from The Code of Federal Regulations.

26 C.F.R. 1.1441-5 Claiming to be a person not subject to withholding.

(a) Individuals. For purposes of chapter 3 of the code an individual's written statement that he or she is a Citizen of the United States may be relied upon by the payer of the income as proof that such individual is a Citizen or resident of the United States. This statement shall be furnished to the withholding agent in duplicate. An alien may claim residence in the United States by filing form 1078 with the withholding agent in duplicate in lieu of the above statement.

(b) Partnerships and Corporations. .....

This corresponds to Section 1441 of the United States Code which we reviewed earlier. It clearly states:

"For purposes of chapter 3 of the Code an individual’s written statement that he or she is a Citizen or resident of the United States may be relied upon by the payer of the income as proof that such individual is a Citizen or resident of the United States.”

and therefore, is not subject to the withholding of income taxes. This is confirmed in Publication 515, the instruction booklet from the IRS, to the employer, on how to implement the subtitle A withholding regulations. In this booklet it states

WITHHOLDING EXEMPTIONS AND REDUCTIONS

You should withhold any required tax if facts indicate that the individual, or the fiduciary, to whom you are to pay the income is a nonresident alien. However, the alien may be allowed an exemption from withholding or a reduced rate of withholding as explained here.

Evidence of Residence. If an individual gives you a written statement stating that he or she is a Citizen or resident of the United States, and you do not know otherwise, you do not have to withhold tax. An alien may claim U.S. residence by filing with you, Form 1078, Certificate of Alien Claiming Residence in the United States... (emphasis added)

Why ? Because as we have seen, under the law, the tax is not imposed on the domestic income of Citizens, or resident aliens as it turns out, and therefore there is never any need to withhold this tax from those Citizens, as the instructions accurately point out. That is the extent of the Subtitle A income tax as it is actually imposed under the law. So what have you been paying ?

Subtitle C - Employment Tax - the Social Security tax

Now we are going to look at the laws implementing the Subtitle C, Employment tax, for Social Security purposes, which program, tax and subtitle first appeared in the law in the 1930s, some 23 years AFTER the income tax was supposedly created by the 16th Amendment (false belief as previously shown - the tax actually started in 1861).

That brings us to Title 26 , subtitle C, Chapter 24, Section 3402 - Income Tax Collected at Source. This is where most employers believe they are authorized to withhold income tax from Citizens. Please note carefully the language of subsections (n) and (p). For some reason, however, the tax industry in America doesn’t seem to be able to read more than subsection (a) of this code. But it is a canon of law that “THE LAW MUST BE CONSTRUED FROM ITS FOUR CORNERS, SO AS TO GIVE MEANING TO ALL OF ITS PARTS”.

§ 3402. Income tax collected at source

(a) Requirement of withholding. (1) In general. Except as otherwise provided in this section, every employer making payment of wages shall deduct and withhold upon such wages a tax determined in accordance with tables or computational procedures prescribed by the Secretary....

...

(n) Employees incurring no income tax liability Not withstanding any other provisions of this section an employer shall not be required to deduct and withhold any tax under this chapter upon a payment of wages to an employee if there is in effect with respect to such payment a withholding exemption certificate furnished to the employer by the employee certifying that the employee -

(1) incurred no liability for income tax imposed under subtitle A for

his preceding taxable year, and

(2)anticipates that he will incur no liability for income tax imposed

under subtitle A for his current taxable year.....

....

(p) Voluntary withholding agreements The Secretary is authorized by regulations to provide for withholding -

(1) from remuneration for services performed by an employee for his

employer which does not constitute wages, and

(2) from any other type of payment with respect to which the Secretary

finds that withholding would be appropriate under the provisions of this chapter,

if the employer and the employee, or in the case of any other type of payment the person making and the person receiving the payment, agree to such withholding. Such agreement shall be made in such form and manner as the Secretary may by regulations provide. For purposes of this chapter (and so much of subtitle F as relates to this chapter) remuneration or other payments with respect to which such agreement is made shall be treated as if they were wages paid by an employer to an employee to the extent such remuneration is paid or other payments are made during the period for which the agreement is in effect ...(emphasis added)

As you can see in Subsection (a) it says: "Except as otherwise provided in this section every employer making payment of wages shall deduct and withhold upon such wages a tax...” . If one does not read this whole section carefully, it appears that employers are authorized to withhold income taxes from your wages. But after reading subsections (n) and (p) carefully it is clear that if you tell your employer that you have no liability under subtitle A, and give him a Statement of Citizenship as referenced in 26 CFR 1.1441-5, and that you will not volunteer to agree to such withholding, and will not voluntarily participate in Social Security for reasons of religious objection, then the employer is not required to withhold tax, and in fact has no legal authority left in the law, under which withholding could be legally authorized or effected.

And then there is this next section from the same chapter.

§ 3404 Return and Payment by Governmental Employer.

If the employer is the United States, or a State, or political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing, the return of the amount deducted and withheld upon any wages may be made by any officer or employee of the United States, or of such State, or political subdivision, or of the District of Columbia, or of such agency or instrumentality, as the case may be, having control of the payment of such wages, or appropriately designated for that purpose.

Notice carefully HOW THE WORD “RETURN” IS USED HERE. This is the "return of income" to the Federal government required from Federal employees under the Federal Employment "Kickback" agreement, often referred to as INCOME TAX. The "return" referenced is clearly NOT A FORM to be filed, but a "kickback" (an actual returning of funds) to the Treasury by the "employer" - The United States GOVERNMENT. NOBODY ELSE IS REQUIRED TO KICKBACK ANYTHING to the U.S. Treasury..

Now, who are the employers and the employees actually defined in the law, and addressed by these sections, and precisely what are wages. This next section is also from Title 26, Subtitle C, Chapter 24, where we also find Section 3401, which says:

3401 Definitions.

....

(c) Employee. For purposes of this chapter, the term "employee" includes an officer, employee or elected official of the United States, a State, or any political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing. The term "employee" also includes an officer of a corporation.

(d) Employer. For purposes of this chapter, the term "employer" means the person for whom an individual performs or performed any service, of whatever nature, as the employee of such person, ...

Only FEDERAL workers and Officers (of Federal corporations) ARE STATUTORILY DEFINED AS EMPLOYEES "for purposes of this chapter". Are you a Federal employee ? AND OF COURSE if ONLY Federal workers are employees, WHO IS THE ONLY POSSIBLE EMPLOYER in this chapter ? THE FEDERAL GOVERNMENT. Are you an officer of a Federal corporation or a Federal employee ? (If you are an officer of a private corporation, this statute does not affect you, but even if it did, it could only effect you in regards to the corporate tax affairs, NOT personal matters.) BY DEFINITION (of “employee”), THIS WHOLE CHAPTER HAS NOTHING TO DO WITH INDIVIDUALS IN THE PRIVATE SECTOR EXCEPT WHEN THEY VOLUNTEER (for Social Security), It ONLY addresses Federal "employees" working for the Federal "employer". Why ? Because Congress cannot control any employment agreement except its own (the government’s).

We further see the limited federal jurisdiction, reflected by the statutorily defined areas of coverage for these subtitle C taxes, which do NOT include the 50 states, in Chapter 21 for the FICA (Federal Insurance Contributions Act) tax. Section § 3121 states:

§ 3121. Definitions.

...

(e) State, United States, and Citizen. For purposes of this chapter

(1) State. The term ''State'' includes the District of Columbia, the

Commonwealth of Puerto Rico, the Virgin Islands, Guam, and American Samoa.

(2) United States. The term ''United States'' when used in a geographical sense includes the Commonwealth of Puerto Rico, the Virgin Islands, Guam, and American Samoa. An individual who is a Citizen of the Commonwealth of Puerto Rico (but not otherwise a Citizen of the United States) shall be considered, for purposes of this section, as a Citizen of the United States.

And again, in Chapter 23, Federal Unemployment Tax Act (FUTA), contains Section 3306, which states:

§ 3306. Definitions.

...

(j) State, United States, and American employer. For purposes of this chapter -

(1) State. The term ''State'' includes the District of Columbia, the Commonwealth of Puerto Rico, and the Virgin Islands.

(2) United States. The term ''United States'' when used in a geographical sense includes the States, the District of Columbia, the Commonwealth of Puerto Rico, and the Virgin Islands.

(3) American employer. The term ''American employer'' means a person who is -

(A) an individual who is a resident of the United States,

(B) a partnership, if two-thirds or more of the partners are residents of the United

States,

(D) a corporation organized under the laws of the United States or of any State.

An individual who is a Citizen of the Commonwealth of Puerto Rico or the Virgin islands (but not otherwise a Citizen of the United States) shall be considered, for purposes of this section, as a Citizen of the United States...

What happened to Guam and American Samoa ? Clearly there are supposed to be distinct differences in the extent of the taxing Authority established in each of these programs (FICA & FUTA), under each of these Chapters (21 and 23). Please note the difference in these statutes, which do NOT include the 50 states, and 6103(b)(5), WHICH DOES.

However, both sections define the terms “United States” and “State” for use within their respective chapters ONLY. AND SO WE SEE THAT CONGRESS IS CLEARLY CAPABLE of making it explicitly clear where the fifty states are included in the term “STATE” or “UNITED STATES”, AND WHERE THEY ARE NOT. Obviously, where the States are NOT “included”, IT IS DONE INTENTIONALLY, and not by accidental omission. THE INTENT is to document the limitation of power granted. THE IRS IGNORES ALL STATUTORY LIMITATIONS ON THEIR POWER AND ACTS AS THOUGH THEY ARE GOD, and you MUST OBEY THEM OR SUFFER ! BALONEY, not according to the law !

So which of these definitions is applicable and active in Chapter 22 ? NEITHER !! Chapter 22 has no Code section that REDEFINES these terms for use in that Chapter, so its definitions for those terms arise and are controlled under Subtitle F - Procedure & Administration, in Section 7701 (remember), which states:

§ 7701. Definitions.

(a) When used in this title, where not otherwise distinctly expressed or manifestly incompatible with the intent thereof -

...

(9) United States The term ''United States'' when used in a geographical sense includes only the States and the District of Columbia.

(10) State. The term ''State'' shall be construed to include the District of Columbia, where such construction is necessary to carry out provisions of this title.

...

Now Section 1 - Tax imposed, is contained in Chapter 1 - Normal Taxes & Surtaxes. Chapter 1 does not have a Code section that redefines these terms for use within it, so the definitions are provided by Section 7701(a)(9) and (10) shown above (for the whole TITLE according to the opening text of subsection (a))

So, what’s really happening in the private work place? "Voluntary withholding agreements" under subsection (p) of section 3402, that’s what’s really happening. When you file a W-4 with your employer, and specify the number of deductions you are claiming on it, you are voluntarily authorizing your employer to withhold income taxes from you. Naturally, he honors your voluntary request. But, if you gave him a statement of citizenship instead of a W-4, he would not have any legal authorization at all, anywhere in the law, to withhold any taxes from you. And the employer is instructed not to withhold income taxes under such circumstances in Publication 515.

One need only look as far as Section 7806 to see that Section 3402 - Income tax collected at source isn't really a legal mandate to withhold income tax at the source , but is rather an authority to withhold employment tax on "wages" when requested to do so (even Section 61 doesn't include "wages"), .

§ Section 7806 - Construction of Title.

(a) Cross references. The cross references in this title to other provisions of law, where the word "see" is used, are made only for convenience, and shall be given no legal effect.

(b) Arrangement and classification. No inference, implication, or presumption of legislative construction shall be drawn or made by reason of the location or grouping of any particular section or provision or portion of this title, nor shall any table of contents, table of cross references, or similar outline, analysis, or descriptive matter relating to the contents of this title be given any legal effect. The preceding sentence also applies to the side notes and ancillary tables contained in the various prints of this Act, before its enactment into law.

As you can see the descriptive title of Sec. 3402. Income Tax Collected at Source, HAS NO LEGAL EFFECT ! The actual legal authorities established by the law are the limited authorities established by the actual wording of the code section paragraphs. (That is why I'm showing you the actual code sections here. Can your accountant do this with his claims ? How about your lawyer ? I have yet to meet anyone in the country who can rebut this presentation of law which is why you need to know about this.) Section 3402 authorizes the collection of employment taxes on WAGES from Federal employees, not the collection of income taxes on INCOME from all persons.

A W-4 is the "voluntary agreement" referenced in subsection (p) of § 3402. Through its execution, you voluntarily create "taxable income" in your name for Social Security purposes, and further request the withholding of income tax from your wages when you specify a number of deductions to be taken.

According to 26 CFR 1.1441-5 a Statement of Citizenship may serve as the "withholding exemption certificate" referenced in subsection (n) of § 3402. And a W-2 may be USED AS A SUBSTITUTE FOR A FORM 1040, as indicated by the Federal Register. The most direct proof that the IRS violates the RIGHTS of the Citizens of the United States of America by controlling their labor through an UNLAWFUL DEBT PROCESS (not tax law), based in "voluntarily" executed legal instruments (W-4, 1040, etc.) that establish a DEBT in the name of, and under the guise and pretense, of TAX, is THEIR OWN NOTICE IN THE FEDERAL REGISTER. This notice appeared in the Federal Register dated Sept. 11, 1946 at 117A-39. It reads:

FORM W-2. Withholding statement.

This is a statement of wages paid during the calendar year and the amount of income tax withheld on such wages, if any. The original and duplicate are furnished by the employer to employee at the close of the calendar year or upon termination of his status as an employee. The original is used as an optional Income Tax Return by the employee in lieu of Form 1040.

(emphasis added)

The FACT that the IRS is INSTRUCTED TO ACCEPT THE W-2 FORM AS A SUBSTITUTE FORM 1040 IS PROOF that the IRS' true authority is limited to the collection of a "kickback" on Federal "wages". The term "wages" in the I.R. Code technically means ONLY covered earnings that are paid to Federal government employees for personal services. Covered under the Social Security provisions, and includible in gross income under Subtitle A of the I.R. Code. IF THE IRS had authority to collect on other forms of income, (i.e. interest, dividends, pensions, etc.) THEY WOULD NOT BE INSTRUCTED TO IGNORE THESE OTHER FORMS OF INCOME AND ACCEPT THE W-2 (that the employer, the Federal government, is required to make) IN LIEU OF A FORM 1040, now would they ?.

Wages

20 CFR 404.1041 Wages.

(a) the term "wages" means remuneration paid to you as an employee for employment unless specifically excluded....

(b) if you are paid wages it is not important what they are called. Salaries, fees, bonuses and commissions on sales or on insurance premiums are wages if they are paid for employment.....

20 CFR 404.1003 Employment.

Employment means, generally any service covered by social security performed by an employee for his or her employer...

20 CFR 404.1004 What work is covered as employment.

(a) General requirements of employment. Unless otherwise excluded..., the work you perform as an employee for your employer is covered as employment under social security if one of the following situations applies:

(1) You perform the work within the United States...

(2) You perform the work outside the United States and you are a Citizen or resident...

OK. Is that all clear. Maybe this will help:

20 CFR 404.1001 Introduction

(a)(1) In general, your social security benefits are based on your earnings that are on our records... you receive credit only for earnings that are covered for social security purposes. The earnings are covered only if your work is covered. If you are an employee.....Some work is covered by Social Security and some work is not. Also, some earnings are covered by social security and some are not. It is important that you are aware of what kinds of work and earnings are covered so that you will know whether your earnings should be on our records.

(2) If you are an employee, your covered work is called "employment."...

(3) If your work is "employment" your covered earnings are called "wages".

I'm sorry, ISN'T THIS WHERE WE STARTED with WAGES. Don't you just love circular legal definitions that define themselves with references to variations of themselves ? I mean, I hope you don't just think I'm making this up on my own. I couldn't dream this stuff up, ever.

Discussion on Wages

The term "wages" is also defined in Section 3401 in Subtitle C, where it does not relate to anything but Employment taxes, for Social Security purposes, under Chapter 24. WAGES HAVE NOTHING TO DO WITH INCOME TAXES UNDER SUBTITLE A. "Wages" are "covered earnings". Covered earnings are earnings that are taxed, at your request, for the purpose of accumulating "credits" to be used in calculating future Social Security benefit payments.

Section 3401(a) states:

§ 3401 Definitions.

(a) Wages. For purposes of this chapter, the term "wages" means all remuneration (other than fees paid to a public official) for services performed by an employee for his employer, including the cash value of all remunerations paid in any medium other than cash.

This definition eludes to the existence of an employment agreement between two parties. It states that wages are only what is received for personal services performed by an employee for his employer . Hence, the term "wages" does NOT extend beyond that relationship/agreement. This fact brings out the importance of knowing just WHO is an "employee", and WHO is the "employer" referred to within the Internal Revenue Code (in this chapter) and what exactly constitutes “wages”, because, as we have seen, IN THIS CHAPTER, THAT CAN ONLY BE THE FEDERAL GOVERNMENT according to the definition of "employee".

These definitions have been expanded BY PRESUMPTION and voluntary permissions, NOT law, to include private sector employers participating in the Social Security program as collectors and "payers", by voluntary assumption through application. So, when you have given a Social Security number to your boss on a W-4, he then becomes your "employer", by virtue of your request, and you then have "wages" (covered earnings), and you thus become an "employee", and your work is called "employment", and you become subject to the federal tax code administering the Social Security tax provisions imposed on those who voluntarily assume them under the misguided and mistaken belief that one day (somewhere, far off in the future) they will get a “benefit” from their participation. History says otherwise. Those who fail to learn the lessons of history are doomed to repeat them.

If you do not participate in Social Security or choose to NOT provide your social security number, then you are NOT "legally" an "employee", and you just have earnings, NOT "wages", and you just have a job not "employment", and you have a boss, not an "employer". Especially if you don't work for the Federal government. ALL WITHHOLDING FROM CITIZENS HINGES ON “COVERED” EARNINGS (wages) for the Social Security tax program. And your boss became an “employer" when he voluntarily applied for an EIN (employment identification number) to participate in the Social Security system as a WITHHOLDER OF EMPLOYMENT TAXES (employer) under subtitle C, NOT subtitle A. Some of these definitions (descriptive paragraphs) are in Title 20 - Education, because just like public schooling, Social Security is VOLUNTARY, not mandatory (one can choose a private school, and one can choose a private retirement program, if he wishes). As a final point it should be noted that 404.1001(a)(5)(b) also states:

"...We generally do not include rules that are seldom used..."

LIKE CITIZENS THAT DON'T PARTICIPATE IN SOCIAL SECURITY !

Now, code section 26 U.S.C. § 3406, which is used to justify or order backup withholding, states:

§ 3406. Backup Withholding.

(a)Requirement to deduct and withhold.

(1) In general. In the case of any reportable payment, if -

(A) the payee fails to furnish his TIN to the payor in the manner required,

(B) the Secretary notifies the payor that the TIN furnished by payee is incorrect,

(D) there has been a payee certification failure described in subsection (d), then the payor shall deduct and withhold from such payment a tax equal to 31 percent of such payment.

(2) Subparagraphs (c) and (d) of paragraph (1) apply only to interest and dividend payments. Subparagraphs (C) and (D) of paragraph (1) shall apply only to reportable interest or dividend payments .....

So if anyone tries to backup withhold from your SALARY OR WAGES, you ask him where that's authorized in the law, because these sections ONLY APPLY TO INTEREST AND DIVIDENDS and patronage dividends. Section 3406 is worth examining a little closer. Paragraphs B and C within it, state that a notice is required from the Secretary; i.e. NO NOTICE = NO legal authority to “Backup Withhold” - the Secretary must make a formal request, or the payor cannot do it. Subsection A specifies a failure of a “manner required” to provide a number. So we will examine the “manner required” for reporting of remuneration to non-employees, which is specified in 26 U.S.C. 6041 et. seq., dependent upon the source of the payment (bank, broker, corporation, etc.), as we will see.

Also, it is worth noting that 26 U.S.C. Section 3451 states:

§ 3451. Income Tax Collected at Source on Interest, Dividends and Patronage Dividends.

(a) Requirement of withholding. Except as otherwise provided in this subchapter, the payor of any interest, dividend or patronage dividend shall withhold a tax equal to 10 percent of the amount of the payment.

(b) Special Rules.

(1) Time of Withholding. Except as otherwise provided in this subchapter, for the purposes of this subchapter--

(A) any payment of interest, dividend, or patronage dividend shall be treated as made, and

(B) the tax imposed by this section shall be withheld,

at the time of such interest, dividend, or patronage dividend is paid or credited.

So, there is NO authority, anywhere in the law, to backup withhold income tax from the payments or earnings of a United States Citizen who is NOT an employee with covered earnings (wages), only foreigners. If you have given a Statement of Citizenship to your broker (agent), that agent cannot backup withhold from your interest and dividends legally, even if he is ordered to, because the Statement of Citizenship relieves the agent from the duty of (and destroys the legal authority to) withhold(ing) income tax from that individual, as stated in Publication 515.

The following Code Section, 6041, is where the reporting of income to non-employees (contracted persons) on a Form 1099 originates. Also note that (uncovered) “wages” may be reported here. It states, in pertinent parts:

§ 6041. Information at source.

(a) Payments of $600 or more. All persons engaged in a trade or business and making payment in the course of such trade to another person, of rent, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, or other fixed or determinable gains, profits and income (other than payments to which section 6042(a)(1), 6044(a)(1), 6047(e), 6049(a), or 6050(N)(a) applies, and other than payments with respect to which a statement is required under the authority of section 6042(a)(2), 6044(a)(2), or 6045), of $600 or more in any taxable year, or, in the case of such payments made by the United States, the officers or employees of the United States having information as to such payments and required to make returns in regard thereto by the regulations, hereinafter provided for, shall render a true and accurate return to the Secretary, under such regulations and in such form and manner and to such extent as may be prescribed by the Secretary, setting forth the amount of such gains, profits and income, and the name and address of the recipient of such payment.

.......

(c) Recipient to furnish name and address. When necessary to make effective the provisions of this section, the name and address of the recipient of income shall be furnished upon demand of the person paying the income. (emphasis added)

and for brokers,

6045. Returns of brokers

(a) General rule. Every person doing business as a broker shall, when required by the Secretary, make a return, in accordance with such regulations as the Secretary may prescribe, showing the name and address of each customer, with such details regarding gross proceeds and such other information as the Secretary may by forms or regulations require with respect to such business...

and for banks,

6049. Returns regarding payments of interest.

(a) Requirement of reporting . Every person -

(1) who makes payments of interest (as defined in subsection (b)) aggregating $10

or more to any other person during any calendar year, or <BR>

(2) who receives payments of interest (as so defined) as a nominee and who

makes payments aggregating $10 or more during any calendar year to any

other person with respect to the interest so received, shall make a return

according to the forms or regulations prescribed by the Secretary, setting forth

the aggregate amount of such payments and the name and address of the

person to whom paid. ....

and for corporate distributions,

6042. Returns regarding payments of dividends and corporate earnings and profits

(a) Requirement of reporting

(1) In general Every person -

(A) who makes payments of dividends aggregating $10 or more to any

other person during any calendar year, or

(B) who receives payments of dividends as a nominee and who makes

payments aggregating $10 or more during any calendar year to any

other person with respect to the dividends so received, shall make a

return according to the forms or regulations prescribed by the

Secretary, setting forth the aggregate amount of such payments

and the name and address of the person to whom paid...

6044. Returns regarding payments of patronage dividends

(a) Requirement of reporting

(1) In general. Except as otherwise provided in this section, every

cooperative to which part I of subchapter T of chapter 1 applies, which

makes payments of amounts described in subsection (b) aggregating $10

or more to any person during any calendar year, shall make a return

according to the forms of regulations prescribed by the Secretary, setting

forth the aggregate amount of such payments and the name and

address of the person to whom paid...

Now, do you see any requirement anywhere, in any of these code sections, to use a social security number when making reports on these types of earnings ! WHY DO YOU SUPPOSE THEY (banks, brokers, corporations) ALL TRY TO DEMAND A NUMBER FROM YOU ? COULD IT BE THE RESULTING TAX AND DEBT IMPLICATIONS ? CAN THEY LEGALLY REQUIRE YOU TO SUPPLY ONE ? NOT ACCORDING TO THE LAW !

SO, do you see any requirement to provide an SSN, or any other number, to a payor who will be reporting your (ANY) earnings on a Form 1099, INSTEAD of on a Form W-2 ? No, its not there.

As stated, this section (6041) and the others, are the code sections where the use of the Form 1099 originates (reporting payments to individuals NOT "covered" by Social Security). Carefully note that this reporting requirement DOES NOT REQUIRE a Social Security number, a TIN, or any other number from the individual. These sections ONLY requires the NAME and ADDRESS of the recipient. So give your clients (and/or your employer) your name and address on a Statement of Citizenship ( as specified in C.F.R. 1.1441-5 Claiming to be a Person Not Subject to Withholding), refuse to supply a social security number on a W-4 (because it is voluntary), and tell them to report your earnings on a Form 1099 instead of on a Form W-2 using your name and address as specified in the United States Code. Does that really sound so tough ? Without a SSN on the Form 1099, the IRS computers will not recognize that income as “taxable income”, and consequently, will never try to collect tax on it, income or employment. In fact there is some question as to whether these reports, without SSNs, ever even get entered into the IRS computer systems because without an SSN, or some other number, the record will never “link” to any “person” or report, for IRS examination or audit purposes, and therefore is useless information that can never be utilized by the “system”. Why bother enter it, it just takes up computer hard disk space?

Oh, you say, YOU ALREADY GAVE YOUR EMPLOYER A W-4. DID HE TELL YOU IT WAS VOLUNTARY, or claim it was mandatory ? If he did, that was fraud. Did he tell you that you can terminate the W-4 with written notice to him indicating such desire on your part ? Probably NOT. So, why not use the law AND TERMINATE YOUR W-4 AGREEMENT tomorrow with this letter.

{American Citizen}

{Citizen Address}

{City}, {ST}. {ZIP}

{Employer Contact Name}

{Employer Company Name}

{Employer Street Address}

{Employer City, ST Zip-Code}

Re: Notice of Termination of Current W-4 Agreement.

Dear {Employer Contact Name},

This letter is to inform you that I am no longer voluntarily participating in the social security system. Through a recent intensive study of the law, and of the Bible, I have reached the personal religious and legal conclusion that it is fundamentally evil to attempt to enumerate human flesh. This conclusion is based on the biblical prophecy contained in Revelation Chapter 13:

16 And he causeth all, both small and great, rich and poor, free and bond, to receive a

mark in their right hand, or in their foreheads;

17 And that no man might buy or sell, save he that had the mark, or the name of the

beast, or the number of his name.

18 Here is wisdom. Let him who hath understanding count the number of the beast,

for it is the number of a man; ...

It is my belief that this biblical prophecy is being realized in America today through the preponderant misuse of social security numbers by the government and its financial institutions, where men are coerced into betraying their faith in God and His security, and are convinced or forced into replacing that faith with a false allegiance to the electronic systems of mankind, administered through the assigned numbers. I prefer, and my personal religious beliefs demand, that I place my faith in God himself, rather than the "social security" of mere mortal men and their government promises of “security”.

The laws and regulations providing for the withholding of employment taxes associated with the Social Security program are found in Title 26, Subtitle C, Chapters 21 through Chapter 24. The legal provisions for the implementation of the Social Security program and the withholding of tax are contained therein.

Section 3402(a), which provides for the withholding of income tax from employees, by employers, clearly states:

§ 3402. Income tax collected at source

(a) Requirement of withholding.

(1) In general. Except as otherwise provided in this section, every employer making payment of wages shall deduct and withhold upon such wages a tax determined in accordance with tables or computational procedures prescribed by the Secretary....

The conditions necessary, to be granted an exception from the tax withholding requirement of this statute, as provided by the specific language of this section, are specified at 3402(n), which states:

(n) Employees incurring no income tax liability

Not withstanding any other provisions of this section an employer shall not be required to deduct and withhold any tax under this chapter upon a payment of wages to an employee if there is in effect with respect to such payment a withholding exemption certificate furnished to the employer by the employee certifying that the employee -

(1) incurred no liability for income tax imposed under subtitle A for

his preceding taxable year, and

(2)anticipates that he will incur no liability for income tax imposed

under subtitle A for his current taxable year.....

....

The attached duplicate Statements of Citizenship provide to you the certification necesary, as specified by this subsection, for you to except myself from the withholding of this subtitle A income tax from my wages; as I have certified to you therein that I have no statutory liability for tax under subtitle A, as required by law.

Furthermore, in the Code of Federal Regulations at Section 31.3402, which corresponds to 26 USC 3402(p), it states in pertinent parts:

31.3402 (p) -1 Voluntary withholding agreements.

(a) In general. An employee and his employer may enter into an agreement under section 3402 (p) to provide for the withholding of income tax…

(b) … an employee who desires to enter into an agreement under section 3402 (p) shall furnish his employer with Form W-4 (withholding exemption certificate) executed in accordance with the provisions of section 3402 (f) and the regulations thereunder. The furnishing of such Form W-4 shall constitute a request for withholding....

Furthermore, 26 C.F.R. 31.3402 (p) -1(b)(2) states :

"An agreement under Section 3402(p) shall be effective for such period as the employer and the employee mutually agree upon. However, either the employer or the employee may terminate the agreement prior to the end of such period by furnishing a signed written notice to the other." (emphasis added)

Per the instructions provided by these regulations, this is my formal notice to you, my "employer", that I wish to formally terminate between us any and all W-4 agreements on file with you, as per 26 CFR Sec. 31.3402 (p) -1(b)(2), effectively immediately. Consequently, all use of my social security number in making reports to the IRS must cease immediately, and the company must stop immediately the withholding of all employment taxes imposed under Subtitle C of Title 26, because, since I am no longer a voluntary participant in the Social Security program, I am no longer subject by law or regulation to the withholding or payment of those taxes associated with the administration of that welfare "benefits" program; because the laws and regulations implementing the Social Security program only apply to those individuals who have voluntarily chosen to participate in it.

Although the FICA statutes are in Chapter 21, rather than Chapter 24, where the above cites are taken from, Chapter 21, like Chapter 24, is also part of the administration of Subtitle C - Employment Taxes (from Title 26). The different chapters of Subtitle C, ALL implement different elements of the Social Security program provisons and taxes (FICA, MED, FUTA, etc.). BUT THEY ARE ALL TAXES, whose withholding is completely dependent upon there being a current, active W-4 (request for withholding) between the employee and the employer.

The fact that social security is not mandatory in the 50 states of the Union is clearly revealed by the definitions provided for "State" and "United States" in Title 26 Section 3121 of Chapter 21, controlling the territorial limits for mandatory implementation of the program. Subsection (e) of 3121 provides:

(e) State, United States, and citizen

For purposes of this chapter -

(1) State

The term ''State'' includes the District of Columbia, the Commonwealth of Puerto Rico,

the Virgin Islands, Guam, and American Samoa.

(2) United States

The term ''United States'' when used in a geographical sense includes the

Commonwealth of Puerto Rico, the Virgin Islands, Guam, and American Samoa. An

individual who is a citizen of the Commonwealth of Puerto Rico (but not otherwise a

citizen of the United States) shall be considered, for purposes of this section, as a

citizen of the United States.

These limited subtitle C definitions of areas covered clearly show that the Subtitle C Employment Taxes are NOT direct mandatory taxes in the 50 states, which would be a violation of the Constitution of the United State of America, but are voluntary taxes for Citizens in the states who wish to assume them, collected indirectly by employers at the employee's request, and are totally dependent upon the employee's voluntary decision to participate in the Social Security program, and the providing to the employer by the employee of a request to withhold (on a W-4), which I am refusing to do from this time forward. If you continue to withhold these taxes after taking receipt of this letter terminating your legal authority to withhold social security tax from me, you will be guilty of manifesting a condition of involuntary servitude upon my person, in violation of the 13th Amendment to the Constitution of the United States of America, and will thus become liable to me for all damges that accrue as result of your unlawful encumbrance upon my remuneration, and deprivation of my rights to property. The fact that the laws record the fact that I am allowed to terminate my request for withholding is irrefutable proof of these facts.

The fundamentally voluntary nature of the Social Security program is evidenced by the decision of the United States Supreme Court in the case of Railroad Retirement Board v. Alton Railroad Co, 295 U.S. 330, 55 S. Ct. 758 (1935), wherein the court ruled that Congress did not have authority to create a mandatory benefits program and cannot compel U.S. Citizens to participate in any benefits program:

"The catalogue of means and actions which might be imposed upon an employer in any business, tending to the satisfaction and comfort of his employees, seems endless. Provision for free medical assistance, nursing, clothing, food, housing, and education of children, and a hundred other matters might with equal propriety be proposed as tending to relieve the employee of mental strain and worry. Can it fairly be said that the power of Congress to regulate interstrate commerce extends to the prescription of any or all of these things ? It is not apparent that they are really and essentially related solely to the social welfare of the worker, and therefore remote from any regulation of commerce as such ? We think the answer is plain. These matters obviously lie outside the orbit of congressional power."

This letter terminates your authority to withhold from my paychecks the employment taxes imposed under Subtitle C, and terminates my permission to use my social security number in making reports to the IRS, which would have the effect of mis-representing my person as one who is continuing to voluntarily participate in the social security program, which is not true

If you believe that there is a statutory authority that exists for you to continue to withhold tax from my pay under Subtitle A - income taxes, that allows you to continue to use my social security number for making reports to the IRS for such Subtitle A reporting purposes, please cite the Code section within Subtitle A (Chapters 1 through 6 of Title 26) that you believe grants you the authority to withhold income tax from a United States Citizen, and to use my social security number for such Subtitle A reporting, in your response to this letter. If you cannot cite a statutory authority under Subtitle A to withhold tax from a United States Citizen and use my social security number in conjunction with Subtitle A tax reporting, I will presume that you understand that you no longer have any legal authority under which you may operate to withhold taxes from my paychecks or use my social security number, and consequently, you will cease immediately all such withholding from my pay, and cease all use of my social security number for reporting purposes. Thank you for your prompt attention to this matter.

Sincerely,

{American Citizen}

========================================================

NOW COULD THAT BE ANY EASIER TO DO !

If your employer (or his lawyer) is worried about IRS penalties, show them:

§ Sec. 6724. Waiver; definitions and special rules.

(a) Reasonable cause waiver . No penalty shall be imposed under this part with respect to any failure if it is shown that such failure is due to reasonable cause and not to willful neglect.

This shows that your employer and clients cannot be penalized by the IRS if you have provided the correct documentation when making your requests (see C.F.R. 1.1441-5 Claiming to be a Person Not Subject to Withholding). Certainly, being relieved of the duty of withholding tax (Publication 515) under the presentation of Statement of Citizenship is “reasonable cause” and not “willful neglect”.

Furthermore,

“ 1989 Internal Revenue Code Section 6676, 26 USC. § 6676 (1989) set forth the penalties for failing to supply the IRS with identifying numbers as required by the code...a $50.00 penalty will be imposed for failure of an employer to provide an identifying number on any document filed with the IRS unless it is shown that the failure was due to reasonable cause and not willful neglect. The Treasury Regulation interpreting the Statute states:

Under Section § 301.6109-1 (c) a payor is required to request the identifying number of the payee. If after such a request has been made the payee does not furnish the payor with his identifying number the penalty will not be assessed against the payor.

(emphasis added) Treas. Reg. § 3l0.6676-1 (1989)”

It is interesting to note that section 3403 - Liability for Tax, states:

§ 3403. Liability for tax.

The employer shall be liable for the payment of the tax required to be deducted and withheld under this chapter, and shall not be liable to any person for the amount of any such payment. (emphasis added)

There you go, the employer is liable! The employers are liable, and that triggers the filing requirements of Section 6001 , remember, where "Every person liable...". It’s the employers who are liable, and the withholding agents who are made liable, and both of those sections, 6001 and 6011, establishing the associated filing requirements, are there so that the government can prosecute anyone who withholds income taxes and doesn’t pay them over to the Federal Treasury. Remember that Section 6001 referenced "employers" in its third sentence ? This is why, according to Section 3403 "THE EMPLOYER SHALL BE LIABLE", not the individuals. By its own specific language Section 6001 only relates to those "persons" who are liable - the employers.

These are the ONLY code sections in existence that establish liability for the payment of income tax, other than the limited liability for foreign earned income imposed and established by Chapter 1, Section 1 - Tax imposed (the income tax), which we have already examined. There are no other Code Sections anywhere in the United States Code that establish liability for payment of the income tax. And as you have seen, what the U.S. Citizens are actually liable for under the law is the payment of income tax on privileged (foreign or federal) sources, not domestic income earned by Right.

And from the Supreme Court on this subject:

“The reasonable construction of the taxing statutes does not include vesting any tax official with absolute power of assessment against individuals not specified in the statutes as persons liable for the tax without an opportunity for judicial review of this status before the appellation of “taxpayer” is bestowed upon them and their property seized.” [Botta v. Scanlon, 228 F. 2nd 304 (1961)] .

It is Voluntary

“Let me point this out now. Your [subtitle C “employment”] income tax is 100 percent voluntary and your liquor tax is 100 percent enforced tax. Now the situation is as different as day and night. Consequently, your same rules just will not apply...” (BUT SOMEHOW, TODAY, THE IRS CLAIMS THEY DO !)

Dwight E. Avis, Head of ATF, IRS - House Ways and Means Subcommittee Hearings - 1953

"You are among the millions of Americans who comply with the tax law voluntarily."

(1992 Form 1040 Tax Instruction Booklet)

"Two aspects of the Federal Income Tax system - voluntary compliance with the law and self-assessment of tax - make it important for you to understand your rights and responsibilities as a taxpayer. 'Voluntary compliance' places on the taxpayer the responsibility for filing an income tax return. You must decide whether the law requires you to file a return. If it does, you must file your return by the date it is due." (IRS Publication 21)

"The IRS's goal is to increase the rate at which taxpayers voluntarily pay their taxes from the current 82.3% to 90% by 2001." (The Washington Post front page Dec. 2, 1993 - "IRS Hopes Change")

"Each year American taxpayers voluntarily file their tax returns and make a special effort to pay the taxes they owe." (Johnie M. Walters IRS Commissioner, 1971 Form 1040 Booklet)

"Our tax system is based on individual self-assessment and voluntary compliance." (Mortimer Caplin, IRS Commissioner, 1975 IRS IR Audit Manual)

"The mission of the service is to encourage and achieve the highest possible degree of voluntary compliance." (Donald C. Alexander, IRS Commissioner, Federal Register, March 1974)

"The IRS's primary task is to collect taxes under a voluntary compliance system. (Jerome Kurtz IRS Commissioner, 1980 IR Annual Report)

"We have a voluntary compliance system." (Fred Goldberg, IRS Commissioner, Nightline with Ted Koppel, Apr.13, 1990)

and finally, from the Supreme Court of the United States of America, the highest authority in the land:

"Our system of taxation is based on voluntary assessment and payment, not upon distraint (force)." (United States v. Flora, 362 US 145 (1958))

This is a whole page full of statements that the IRS has made, in public, to the media and the People, regarding the "true nature of our tax situation". The sources are quoted. In these, the IRS repeatedly states over and over again that Citizens comply with the tax laws voluntarily, and that our tax system is based on voluntary compliance and self assessment, and now you know why. Because if the Citizen does not voluntarily comply, and through his own ignorance of the law, misapply the code and use the wrong form, the whole system fails. And that’s why they say it’s voluntary, because under the law, it is. And, if you do comply voluntarily, then they can use against you the information that you provided on the Form, because the courts have ruled that when you perform a voluntary self assessment (file a Form 1040), you establish the liability for payment of the tax necessary for the IRS to collect and enforce the amount assessed.

But there is no statutory liability imposed on Citizens for the payment of income tax on domestic income, only foreign income under tax treaties and on income from federal sources. You, the Citizen, create your own liability for the income tax that grants the IRS the jurisdictional authority to enforce and collect the numbers you show on your return when you voluntarily perform that self assessment using the wrong form. And, it doesn’t matter that you misapplied the law or used the wrong form; you establish the liability voluntarily with the assessment, and it is then legal, and you owe it. You have to pay it, and they can enforce it if you don't. And if they find anything incorrect or fraudulent on the return, they can assess penalties and interest because the assessment was incorrect or not done properly.

I don’t know if anybody noticed, but if you look back to the table in 26 CFR 602.101, where we saw the OMB Document Control Numbers required by Section 1.1-1, on the next line 1.23-5 appears, which does require the form numbered 1545-0074, Form 1040. Some of you may have noticed this and thought I was trying to slip one by you. So, here’s 1.23-5

26 CFR 1.23-5 Certification Procedures.

(a) Certification that an item meets the definition of an energy-conserving component or renewable energy source property. Upon request of a manufacturer of an item....the Assistant Commissioner shall certify ... that :

(1) the item meets the definition of insulation (see ........

This is from the Code of Federal Regulations, and it starts:

"Certification procedures. (a) Certification that an item meets the definition of an energy-conserving component or renewable energy source property..."

Section 1.23-5 is the renewable energy resource credit. If you want to claim this deduction, or that credit, you have to file Form 1040, because it’s the proper legal vehicle or mechanism through which that deduction is claimed. And there are a lot of other deductions and credits and legal reasons why Form 1040 would be required. If you want to claim a refund, you have to file Form 1040, because that’s the established legal mechanism through which a Citizen claims a refund. If you want to claim certain credits, or take certain deductions, you have to file Form 1040 because that is the legal mechanism through which those credits and deductions are claimed. But, if all you want to do is satisfy the liability for tax on taxable income that you as a Citizen have, without claiming any deductions, or taking any credits, then the only form that you are required to file is Form 2555, not Form 1040. Because Form 2555 is the only form required by law, the proper vehicle for you to use to satisfy the liability you have for income tax as an individual Citizen, according to the law. So, how does the IRS get away with doing what they have been doing for so long?

Remember that if you want to claim a refund, you MUST file a Form 1040 because it is the legal mechanism through which a refund is claimed !! This is why they deceptively withhold from you when you are young and start working at your first job. You are young and naive, and know nothing about the tax law and they take advantage of your ignorance and withhold more than is necessary. You are gradually conditioned, or programmed, to file a return TO GET A REFUND, NOT to pay the tax. Then when you get older, you've been filing the Form 1040 all your life, so you continue doing what you did all along, ignorantly; because you are no longer filing to get a refund, NOW YOU'RE FILING TO PAY A TAX THAT YOU ARE NOT LIABLE BY LAW TO PAY !

IF ALL YOU WANT TO DO IS SATISFY YOUR LIABILITY, YOU DO NOT USE FORM 1040.

CITIZENS USE FORM 2555 to satisfy liability ! At least that's what the law says !

That's because, as far as individuals are concerned,

THE INCOME TAX IS STILL JUST A FOREIGN TAX !

I know old habits are hard to break, and that all of this information doesn't agree with what you have been told to believe all of your life, and in fact, doesn't seem possible, but keep reading because the truth is far stranger than fiction and the law records the truth. And, as you will see, IGNORANCE CAN BE ELIMINATED WITH KNOWLEDGE, ITS STUPIDITY THAT REMAINS FOREVER, and

THE TRUTH WILL SET YOU FREE !

CHAPTER 3

ENFORCEMENT

Remember earlier, the question was raised: "What is taxable income ?" Section 63 is the code section that the IRS claims establishes what "taxable income" is. It states:

§ 63. Taxable income defined

(a) In general. Except as otherwise provided in subsection (b), for purposes of this subtitle, the term "taxable income" means gross income minus the deductions allowed by this chapter (other than the standard deduction).

(b) Individuals who do not itemize their deductions ..........

The IRS claims that since the definition of "taxable income" references "gross income" (defined in Section 61), then everything that anybody makes that is listed in Section 61 is taxable income and must be reported. That is the complete and total argument that the IRS makes in its demand for income taxes. Section 61 states:

§ 61. Gross income defined.

(a) General definition. Except as otherwise provided in this subtitle, gross income means all income from whatever source derived, including (but not limited to) the following items:

(1) Compensation for services, including fees, commissions, fringe benefits and similar items;

(2) Gross income derived from business;

(3) Gains derived from dealings in property;

(4) Interest;

(5) Rents;

(6) Royalties;

(7) Dividends;

(8) Alimony and separate maintenance payments;

(9) Annuities;

(10) Income from life insurance and endowment contracts;

(11) Pensions;

(12) Income from discharge of indebtedness;

(13) Distributive share of partnership gross income;

(14) Income in respect of a decedent; and

(15) Income from an interest in an estate or trust.

(b) Cross references.

For items specifically included in gross income, see part II

(Sec. 71 and following). For items specifically excluded

from gross income, see part III (Sec. 101 and following).

Do you see where subsection (a) lists possible sources and where subsection (b) says where to find the items specifically included in gross income. Do you understand the difference between a possible source and an included item. What exactly are those “items specifically included” ?

Part II. Items specifically included in gross income.

§ 71. Alimony and separate maintenance payments.

§ 72. Annuities; certain proceeds of endowment and life insurance contracts.

§ 73. Services of child.

§ 74. Prizes and awards.

§ 75. Dealers in tax-exempt securities.

(76. Repealed.)

§ 77. Commodity credit loans.

§ 78. Dividends received from certain foreign corporations by domestic

corporations choosing foreign tax credit.

§ 79. Group-term life insurance purchased for employees.

§ 80. Restoration of value of certain securities.

(81. Repealed.)

§ 82. Reimbursement of moving expenses.

§ 83. Property transferred in connection with performance of services.

§ 84. Transfer of appreciated property to political organizations.

§ 85. Unemployment compensation.

§ 86. Social security and tier 1 railroad retirement benefits.

§ 87. Alcohol fuel credit.

§ 88. Certain amounts with respect to nuclear decommissioning costs.

(89. Repealed.)

§ 90. Illegal Federal irrigation subsidies.

I have not received any income from any of these items specifically included, have you ? The IRS, of course, claims that the sources are the actual included items, ignoring entirely the precise language (and obvious repercussions) of subsection (b).

Do the regulations help clear up this confusion between items and sources ? Well, yes they do.

Sources are described by the Secretary of the Treasury in the Code of Federal Regulations and are the legally binding definition of 'sources' that must apply to an income for it to be classified as 'Gross Income'.

Subchapter N establishes the legal limitations of the sources subject to tax, based on income from sources within or without the United States. For U.S. citizens, the sources subjected to taxation are treated in Section 911 and 931. In Section 911, a U.S. citizen living and working abroad, and thus having sources without the U.S., is subjected to taxation. In Section 931, the sources subjected to taxation are those sources earned within a possession of the United States. For U.S. citizens, who were born in the U.S., who are domiciled in the U.S., and who have sources of income within the U.S., there is no income tax imposed on any source. From Title 26, we have:

Subchapter N. Tax based on income from sources within or without the United States

Part I. Source rules and other general rules relating to foreign income.

Part II. Nonresident aliens and foreign corporations

Part III. Income from sources without the United States

(Sections 911 and 931 are contained herein)

Part IV. Domestic international sales corporations.

Part V. International boycott determinations.

Which Part applies to the domestic income of a U. S. Citizen ? Furthermore, the Code of Federal Regulations, at 1.861- 8(a), states:

"...The rules contained in this section apply in determining taxable income of the taxpayer from specific sources and activities under other sections of the Code referred to in this section as operative sections. See paragraph (f)(1) of this section for a list and description of operative sections." (Emphasis added)

The Federal Regulations make reference to 'sources' within the United States . These are the only sources listed from which income must derive in order for it to be taxable for the purpose of the Income Tax. Paragraph (f)(1), mentioned above, states:

Code of Federal Regulations 1.861-8(f)(1)

(i) Overall limitation to the foreign tax credit.

(ii) [Reserved]

(iii) DISC and FSC taxable income.

(iv) Effectively connected taxable income. Nonresident alien individuals and foreign

corporations engaged in trade or business within the U.S.

(v) Foreign base company income.

(vi) Other operative sections.

(A) ...foreign source items of tax...

(B) ...foreign mineral income...

(D) "...foreign oil and gas extraction income..."

(E) "...citizens entitled to the benefits of section 931 and the section 936 tax

credit..."

(F) "...residents of Puerto Rico..."

(G) "...income tax liability incurred to the Virgin Islands..."

(H) "...income derived from Guam..."

(I) "...China Trade Act corporations..."

(J) "...income of a controlled foreign corporation..."

(K) "...income from the insurance of U.S. risks..."

(L) "...international boycott factor...attributable taxes and income under section

999..."

(M) "...income attributable to the operation of a agreement vessel

under section 607 of the Merchant Marine Act of 1936..."

This is very important in light of the fact that the U.S. Supreme Court has determined that the Congress acts intentionally and purposely in the inclusion or exclusion of something in a law. Or simply, if a particular source is not on the list, it is effectively 'excluded' from 'Gross Income'. There are no other “OPERATIVE” sections.

The above list/regulation can be described merely as a fence, the Secretary was given the task to encircle and delineate the only area from which 'Gross Income' and hence 'taxable income' can be derived or accepted from. The above list is in fact the only definition of 'sources' anywhere in the regulations. 'Whatever' is within the fence is 'allowed' to be listed as 'Gross Income'. If it is not within the confines of the Secretary's 'fence' or 'regulation', it is 'exempt'. Some with a vested interest in your money, will argue that the word 'whatever' in the 16th Amendment means 'any and all'... yes, we AGREE that it does.. 'any and all 'sources'. The Secretary has defined them, then Congress agreed with the Secretary. And they are restricted to the above list as it is the only list which defines sources. A list for Citizens with domestic income does not exist! Remember that the power of the Congress is limited and so are it's laws.

Let's put it still another way...

It is not always what is in a law that is important. Sometimes what is not stated in a law is also equally important. Especially if you're assuming something is in a law, when it clearly is not.

1.) Section 61 states that income from 'sources' is gross income, which is taxable.

2.) Section 861 lists the 'sources' from within and without the U.S.

3.) Section 862 lists 'sources' that are only foreign.

Where is the section of law showing the U.S. domestic 'sources' ? It doesn't exist anywhere in the law. In good faith, let's take a look at Section 861. When you examine Sectio 861's regulations, you find the admission in 1.861-8 (a)(4), that income must come from a specific source to be taxable. If you examine the sources in 1.861-8 (f)(1), you will find that the domestic sources are only applicable to non-resident aliens and foreign corporations. The others listed are foreign sources that U.S. citizens would definitely be taxed upon

The four sources listed in (f)(1) are again repeated as non-exempt income pursuant to 26 CFR section 1.861-8 (T)(d)(2)(iii). And pursuant to 1.861-8 (T)(d)(2), all income that is exempt, excluded (not listed), or that is eliminated from the law, is exempt income.

The only remaining question is, why is it that the IRS believes that they can render an Act of Congress, The Paperwork Reduction Act of 1980, superfluous and of no legal effect, when we point out that the only form required to be filed pursuant to section 1.1-1 of the Code is the 2555 foreign earned income form ? Especially when they try to pass off this section of Code as the law taxing all U.S. citizens on their income from taxable sources.

AND THEY (the sources) ARE NOT THE ACTUAL ITEMS INCLUDED. You can see that the definition of gross income has been written to deceptively appear to include all of these, but, I would like you to remember that in 1895 the Supreme Court ruled in Pollock v Farmers Loan & Trust Co. that it is unconstitutional to impose an income tax on the interest and dividends of U.S. Citizens on deposit in U.S. banks. Both of those items are listed here in section 61. Interest is number (4) and Dividends is number (7). And the Supreme Court further ruled in Stanton v Baltic Mining Co. in 1916, that no new power of taxation was conferred by the 16th Amendment.

So, if it was unconstitutional before the 16th Amendment, and no new power was conferred by it; How can Section 61 be constitutional when it states that interest and dividends are part of gross income and will be taxed ? Well, we have to look at what the law shows for how Section 61 is supposed to be implemented and applied.

This version of Section 61 that is shown above is from the current 1986 version of the Code. The previous version of the Code is from 1954. This Section, 61, is nearly identical in both versions, except for the following footnote shown in the 1954 version:

"Source: Sec. 22(a), 1939 Code, substantially unchanged"

For some reason the footnote was dropped when the law was recodified in 1986. It is not known why the footnote was dropped in 1986, but it is very important because, as you can see, the footnote identifies the source of Section 61 as being Section 22(a) in the 1939 code, the last codified version previous to the 1954 version. Being able to research the source of a law is very important to determining how that law is supposed to be properly applied under the law. Without a review of the source materials it is very difficult to accurately determine how a law was originally intended to be applied, and the courts, of course, only have authority over the law, under, and to the extent of, its original intent. So we go to Section 22(a) in the 1939 code, and we see that the format has changed, but indeed, the substance is pretty much the same as in 1986.

SEC. 22 GROSS INCOME.

(a) General Definition.-"Gross Income" includes gains, profits, and income derived from salaries, wages, or compensation for personal service ... of whatever kind and in whatever form paid, or from professions, vocations, trades, businesses commerce or sales, or dealings in property, whether real or personal, growing out of the ownership or use of or interest in such property; also from interest, rent, dividends, securities, or the transaction of any business carried on for gain or profit, or gains or profits and income derived from any source whatever....

But in order to understand how Section 61 is supposed to be applied today, it is very important to know and understand how Section 22 was implemented and applied in 1939,. The two sections are inextricably linked in such relevant fashion, and the answer to our question of how Section 61 can be Constitutional, given the Pollock decision, can only be found by a thorough examination of this relationship.

If we go back to the 1918 statutes we can examine the origins of Section 22, which are found in Section 213, which states:

Sec. 213. That for purposes of this title....the term “gross income” -

(a) includes gains, profits, and income derived from salaries, wages or compensation for personal service (including in the case of the President of the United States, the judges of the Supreme and inferior courts of the United States, and all other officers and employees, whether elected or appointed, of the United States, Alaska, Hawaii, or any political subdivision thereof, or the District of Columbia , the compensation received as such), of whatever kind and in whatever form paid, or from professions, vocations, trades, businesses, commerce, sales, or dealings in property, whether real or personal, growing out of the ownership or use of or interest in such property; also from interest, rent, dividends, securities, or the transaction of any business carried on for gain or profit, or gains or profits and income derived from any source whatever. ...

(emphasis added)

And further insight can be gained from a review of Section 931 from the 1954 Code. It states:

Sec 931. Income from sources within possessions of the United States.

(a) General rule. In the case of individual Citizens of the United States, gross income means only gross income from sources within the United States if the conditions of both paragraph (1) and paragraph (2) are satisfied:

(1) 3-year period. If 80 percent or more of the gross income of such Citizen... was derived from sources within a possession of the United States; and

(2) Trade or business. If 50 percent or more of his gross income ... was derived from the active conduct of a trade or business within a possession of the United States either on his own account or as an employee or agent of another.

...

(h) Employees of the United States. For purposes of this section amount paid for services performed by a Citizen of the United States as an employee of the United States or any agency thereof shall be deemed to be derived from sources within the United States. (emphasis added)

You will notice that Congress is making reference to the gross income WHERE THE U.S. GOVERNMENT (UNITED STATES) IS THE SOURCE of that income, or where it is the “sovereign” authority (possessions). ALSO CAREFULLY NOTE THAT THIS SECTION REVEALS THAT THE TERM “UNITED STATES”, in the I.R. Code, MEANS THE “U.S. GOVERNMENT”, NOT THE NATION OR THE WHOLE COUNTRY. THIS IS VERY IMPORTANT. It indicates that where the phrase “within the United States” or “without the United States” is used, it is NOT being used in the geographical sense (deceptively), BUT IS BEING USED TO INDICATE THE FEDERAL GOVERNMENT as the (ONLY) lawfully affected “source” of the income ! Now go back and reread again everything to this point with that understanding and see if this doesn’t all begin to make REAL sense, as never before !

BECAUSE they (the U.S. government) ONLY have AUTHORITY over their OWN AFFAIRS (their employment contracts). They DO NOT HAVE AUTHORITY over PRIVATE contracts in “foreign countries” without tax treaties, or over private contracts in the 50 states. So lets investigate that.

(Notice how the definition of “gross income” has been vaguely re-written with each new “codification” of the law, so that without researching its history, it is virtually impossible to determine from today’s statute (61) that there is a limitation to FEDERAL SOURCES inherent in the definition of “gross income” THIS IS IRS HUMBUG)

Furthermore, as you can see in the following table, shown here from the Code of Federal Regulations, Index of Parallel Tables - 1991 enabling regulations for the 1939 code sections, it clearly shows that Section 22, under the 1939 code, was implemented under Title 26, Part 519.

CFR INDEX PARALLEL TABLE

1991 Enabling sections

_____________________________________

26 U.S.C. (1939 I.R.C.)

22 ........................................... 26 Part 519

40 ........................................... 26 Part 1

62 ............................................26 Parts 509,513,514,520,521

143-144 .................................. 26 Part 521

....

The next table reveals what Part 519 is:

CHAPTER 1 - INTERNAL REVENUE SERVICE

DEPARTMENT OF THE TREASURY

(Parts 500 to 529)

____________________________________________

SUBCHAPTER G - Regulations Under Tax Conventions

Part

500 [Reserved]

501 Australia ..........................

502 Greece ............................(x)

503 Germany .........................(x)

504 Belgium ...........................

505 Netherlands ....................

506 Japan ...............................

507 United Kingdom .............

509 Switzerland .....................(x)

510 Norway ............................

511 Finland ...........................

512 Italy .................................

513 Ireland.............................(x)

514 France ............................(x)

515 Honduras .....................

516 Austria ............................(x)

517 Pakistan ..........................(x)

518 New Zealand ..................

519 Canada ........................

520 Sweden ...........................(x)

521 Denmark..........................(x)

Part 519 is the Canadian Tax Treaty. What Section 61 actually defines (through the inherited limitation of Section 22), under the letter of the law; are the sources of taxable income under the foreign tax treaty with Canada. It does not define the domestic sources of taxable income. It defines the Canadian sources, under the Canadian Tax Treaty.

The countries shown in the table with an '...(x)' (ed.'s addition) are the countries with whom America has current tax treaties, in effect today (1996). However, since the Canadian Tax Treaty expired in 1993, Part 519 is now shown as reserved for future use in this Table, and Section 61 no longer has any legitimate application within Title 26 (IR Code) for the purpose of defining what gross income is (except, perhaps, under other tax treaties and for Federal employees subject to the “kickback” on Federal “wages” under Chapter 24).

But, most Citizens are ignorant of the law, they’re ignorant of the application of the law, they’re ignorant of the history of the law and these Court rulings, and the IRS relies on and takes advantage of that ignorance. The IRS relies on your ignorance, and your wrongfully self assessing the tax by using the wrong form. And legitimately, under the law, that’s not the way the law is actually applied, nor was it ever intended to be applied in such fashion.

Now the word “income” is not defined by itself anywhere in the Internal Revenue Code, so what has the Supreme Court said about the definition of the word/term “income” alone ?

“The word (income) must be given the same meaning in all of the Income Tax Acts of Congress that was given to it in the Corporation Excise Tax Act (of 1909)” [Merchant’s Loan and Trust Co. v. Smietanka, 255 US 509 (at pp. 518 & 519)]

“Whatever difficulty there may be about a precise and scientific definition of ‘income’ it imports, as used here...the idea of gain or increase arising from corporate activities...[Doyle v. Mitchell, 247 US 179]

“Certainly the term ‘income’ has no broader meaning in the 1913 Act than in that of 1909” [Straton’s Independence v. Howbert, 231 US 399, 416, 417]

“...we assume that there is no difference in its meaning as used in the two Acts.” [Southern Pacific Co. v. John Z. Lowe, Jr., 247 US 330, 335]

For purposes of this book income is taken to mean

“gain or profit on capitol or labor, or a combination of both”.

ENFORCEMENT

POSITIVE LAW

All of the laws of the United States have been codified into what is called the United States Code (USC). There are 50 Titles within the Code. The Titles that have been passed into what is known as "positive" law, are the Law of the nation, and can be legitimately used as "evidence" of statutory violations that result in formal "charges" against persons in our society. This can be seen to be true if one reviews Title 1 USC Section 204, which states:

§ 204. Codes and supplements as evidence of the laws of United States and District of Columbia; citation of Codes and supplements.

(a) United States Code... Provided, however that whenever titles of such Code shall have been enacted into positive law the text thereof shall be legal evidence of the laws therein contained, in all courts of the United States, the several states, and the territories and insular possessions of the United States. (emphasis added)

Each Title that has been passed into positive law records and indicates such passage within the Title itself. The 50 Titles (Positive Titles with *) and their Subjects are listed on the next page.

The Fifty Titles

* Title 1 General Provisions * Title 28 Judiciary and Judicial Procedure

Title 2 The Congress Title 29 Labor

* Title 3 The President Title 30 Mineral Lands and Mining

* Title 4 Flag and Seal, Seat Of * Title 31 Money and Finance

Government, and the States * Title 32 National Guard

* Title 5 Government Organization and Title 33 Navigation and Navigable

Employees Waters

Title 6 Surety Bonds (repealed-Title 31) Title 34 Navy (repealed-Title 10)

Title 7 Agriculture * Title 35 Patents

Title 8 Aliens and Nationality Title 36 Patriotic Societies and

* Title 9 Arbitration Observances

* Title 10 Armed Forces * Title 37 Pay and Allowances Of the

* Title 11 Bankruptcy Uniformed Services

Title 12 Banks and Banking * Title 38 Veterans' Benefits

* Title 13 Census * Title 39 Postal Service

* Title 14 Coast Guard Title 40 Public Buildings, Property, and

Title 15 Commerce and Trade Works

Title 16 Conservation Title 41 Public Contracts

* Title 17 Copyrights Title 42 The Public Health and Welfare

* Title 18 Crimes and Criminal Procedure Title 43 Public Lands

Title 19 Customs Duties * Title 44 Public Printing and Documents

Title 20 Education Title 45 Railroads

Title 21 Food and Drugs Title 46 Shipping

Title 22 Foreign Relations and Title 47 Telegraphs, Telephones, and

Intercourse Radiotelegraphs

* Title 23 Highways Title 48 Territories and Insular

Title 24 Hospitals and Asylums Possessions

Title 25 Indians * Title 49 Transportation

Title 26 Internal Revenue Code Title 50 War and National Defense

Title 27 Intoxicating Liquors

All persons living under the laws of the United States are bound by the "positive" laws in the Titles of the U.S. Code, whereas those Titles that are not passed into positive law appear to be limited in application to specific classes of persons and places, because the Federal government DOES NOT HAVE TERRITORIAL JURISDICTION OVER ALL PEOPLE (SOVEREIGNS) or places (STATES), for ALL matters. Title 26, the Title containing the I.R. Code, HAS NEVER BEEN PASSED INTO POSITIVE LAW and therefore DOES NOT APPEAR TO APPLY TO ALL PEOPLE BECAUSE ACCORDING TO THIS STATUTE, IT IS NOT LEGAL “EVIDENCE OF THE LAWS....OF THE UNITED STATES” and therefore cannot have general applicability to the public. Who does this Title apply to, then, if NOT all people?

Title 44, Section 1505 sheds some light on this issue, it states:

§ 1505. Documents to be published in Federal Register

(a) Proclamations and Executive Orders; Documents Having General applicability and Legal Effect; Documents Required To Be Published by Congress.

There shall be published in the Federal Register -

(1) Presidential proclamations and Executive orders, except those not having

general applicability and legal effect, or effective only against Federal

agencies or persons in their capacity as officers, agents, or employees

thereof; .... (emphasis added)

Basically this section provides that before ANY ACT OF GOVERNMENT becomes

binding on ALL PERSONS in the nation, that, if regulations are specified, those regulations must be PUBLISHED in the Federal Register. Title 26 has NEVER been passed into positive law, nor have many of its regulations (specifically deficiency, lien, levy and enforcement regulations) ever been printed in the Federal Register as being invocable or applicable under Title 26. Therefore, those unpublished regulations, CANNOT LAWFULLY BE APPLIED TO ANYONE EXCEPT FEDERAL EMPLOYEES, as provided for in 44 USC 1505. Are you a Federal Employee ? Would you like to see what has been published in the Federal Register regarding Title 26 Section 1 ? How's this:

[Federal Register: April 22, 1996 (Volume 61, Number 78)]

[Proposed Rules]

[Page 17614-17667]

From the Federal Register On-line via GPO Access [wais.access.gpo.gov]

========================================================

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Parts 1, 31, 35a, 301, 502, 503, 509, 513, 514, 516, 517, 520, and 521

[INTL-O62-90; INTL-0032-93; INTL-52-86; INTL-52-94]

RINS 1545-AO27; 1545-AR90; 1545-AL99; 1545-AT00

General Revision of Regulations Relating to Withholding of Tax on

Certain U.S. Source Income Paid to Foreign Persons and Related

Collection, Refunds, and Credits; Revision of Information Reporting and

Backup Withholding Regulations; and Removal of Regulations Under Part

35a and of Certain Regulations Under Income Tax Treaties

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking and withdrawal of notice of

proposed rulemaking.]

NOW ISN'T THAT EXACTLY WHAT I TOLD YOU, and showed you earlier !

Furthermore, the Supreme Court has established that where the enforcement authority of laws in the Internal Revenue Code (Title 26) is dependent upon the regulations promulgated by the Secretary, they must be published:

"we think it is important to note that the Act's civil and criminal penalties attach only upon violation of regulations promulgated by the Secretary; if the Secretary were to do nothing, the Act itself would impose no penalties on anyone."

California Bankers Assn. v. Schultz, 416 U.S. 21,26 (1974) (emphasis added)

Without published regulations (where regulations are statutorily required) there is no legitimate legal enforcement authority held. Now, the Code of Federal Regulations (CFR), Index and Finding Aids - Parallel Table of Authorities shows the location (statutory association) of the published regulations. All regulations with general applicability to the American public must be published in the Federal Register under their authorizing Title and Part. The statutes applicable to assessment, collection and enforcement laws in Title 26 (I.R. Code), and their STATUTORY APPLICABILITY are shown as follows:

PUBLISHED REGULATIONS

Section Published Regulation in: Description

====== ===================== ======================

6020 27 CFR Part 53,70 Return Prepared by Sec.

6201 27 CFR Part 70 Assessment Authority

6203 27 CFR Part 70 Method of Assessment

6212 NO REGULATION Notice of Deficiency

6213 NO REGULATION ...Petition To Tax Court

6214 NO REGULATION Determinations By Tax Court

6215 NO REGULATION Assessment ... By Tax Court

6301 27 Part 70,24,25,250,270,275 Collection Authority

6303 27 Part 70 Notice & Demand For Tax

6321 27 Part 70 Liens For Tax 6331-43 27 Part 70 Levy and Distraint 6651 27 Part 70,24,25,194 Failure to File or Pay 6671 27 Part 70 Penalty Assessed 6672 27 Part 70 Failure to Collect and Pay Over

6701 27 Part 70 Penalties For Understatement 7201 NO REGULATION Attempt to Evade or Defeat 7203 NO REGULATION Willful Failure to File... 7207 27 Part 70 Fraudulent Returns 7212 27 Part 170,270,275,285,290,295,296 Interference with I.R. Laws 7401 27 Part 70 Judicial Proceedings Authority 7402 NO REGULATION Court's Jurisdiction to Enforce 7403 27 Part 70 Judicial Action To Enforce Lien

7454 NO REGULATION Burden of Proof ... Transferee Cases

7601 27 Part 70 Canvass of District.... 7602 27 Part 70,170,296 Examination of Books .... 7603 27 Part 70 Service of Summons 7604 27 Part 70 Enforcement of Summons 7605 27 Part 70 Time & Place For Examination 7608 27 Part 70,170,296 Authority of Enforcement Officers

As you can see NONE of the published implementing regulations are associated with Title 26, and THERE ARE NO REGULATIONS AT ALL PUBLISHED FOR 6212 - Deficiencies, 6213, 6214, 6215 - Tax Court, 7201, 7203 - Evasion & Willful failure penalties, 7402 Jurisdiction to enforce. Which of course means that THEY APPEAR TO ONLY APPLY TO FEDERAL EMPLOYEES (TRANSFEREES) who MUST RETURN INCOME TO THE TREASURY AS PART OF THEIR EMPLOYMENT AGREEMENT (under 4 USC 111). ALL OF THE PUBLISHED AUTHORITIES ARE FOR TITLE 27 Alcohol, Tobacco & Firearms. THEY DO NOT AND CANNOT APPLY ANYWHERE ELSE UNTIL PUBLISHED IN THE FEDERAL REGISTER UNDER TITLE 26 as being applicable to all Citizens.

This is confirmed at 26 C.F.R. 601.702., where it addresses and specifies the consequences of a failure to publish in the Federal Register. It states therein:

“(ii) Except to the extent that a person has actual and timely notice of the terms of any matter referred to in subparagraph (1) of this paragraph which is required to be published in the Federal Register, such person is not required in any matter to resort to, or be adversely affected by, such matter if it is not so published or is not incorporated by reference therein pursuant to subdivision (1) of this subparagraph. Thus, for example, any such matter which imposes an obligation and which is not so published or incorporated by reference will not adversely change or affect a person’s rights.”

And finally from the Supreme Court on this issue:

“Failure to adhere to agency regulations may amount to denial of due process: if regulations are required by Constitution or statute.” [Curley v. United States, 791 F. Supp. 52]

“for federal tax purposes, federal regulations govern.”

[Dodd v. United States, 223 F Supp 785, Lyeth v. Hoey, 305 US 186,, 59 S. Ct 155]

“...these regulations called for by the statute itself, have the force of law, and violations thereof incur criminal prosecutions, just as if all the details had been incorporated into the congressional language. The result is that neither the statute nor the regulations are complete without the other, and only together do they have any force. In effect, therefore, the construction of one necessarily involves the construction of the other.” [United States v. Mersky 361 U.S. 438].

Assessment Authority

So, what does the IRS do ? The IRS claims that Section 6201 grants them the authority to assess income taxes directly. It states:

§ 6201. Assessment authority.

(a) Authority of Secretary. The Secretary is authorized and required to make the inquiries, determinations, and assessments of all taxes imposed by this title, or accruing under any former internal revenue law, which have not been duly paid by stamp at the time and in the manner provided by law. Such authority shall extend to and include the following:

(1) Taxes shown on return. The Secretary shall assess all taxes determined by the

taxpayer or by the secretary as to which returns or lists are made under this title.

(2) Unpaid taxes payable by stamp.

(A) Omitted stamps. ...

(B) Check or Money Order not duly paid. ...

(3) Erroneous income tax prepayment credits. ....

.........

(b) Amount Not To Be Assessed.

(1) Estimated income tax. No unpaid amount of estimated income tax required to be

paid under section 6654 or 6655 shall be assessed.....

Are income taxes paid by stamp ? No! Now, are you beginning to understand why the IRS wants you to voluntarily file a return ? Because subparagraph (a)(1) here gives them the authority to assess taxes shown on returns. But, let’s suppose you don’t file a return; what authority is left ? Well, Subsections 2 and 3 are left: "(2) Unpaid Taxes Payable By Stamp", (again, are income taxes payable by stamp) and: ”(3) Erroneous Income Tax Prepayment Credits". That’s it. That's the true extent of the authority to assess taxes under the law “1- Taxes shown on returns (done voluntarily), 2 - unpaid taxes payable by stamp (stamp taxes on alcohol and tobacco products, and 3- prepayment credits (withheld taxes). So where is the legal authority to assess income taxes not shown on a return ? (for individuals who do not file). IT DOESN’T EXIST IN THE LAW.

Now, it’s interesting to note, down at the bottom of 6201, it also states "(b) Amount Not To Be Assessed. (1) Estimated income tax.-No unpaid amount of estimated income tax required to be paid under section 6654 or 6655 shall be assessed". Remember, 6654 (e)(2)(C), your exception to the failure to file? Right here under 6201 their claimed authority, it states that if 6654 applies, no unpaid amount of estimated income tax assessed here is required to be paid.

So, if there is no return, the IRS has no legal authority to assess income taxes, and surprisingly enough, they admit that. So they just claim Section 6020 applies. The IRS claims that Section 6020 allows them to prepare and file a Form 1040 return for those individuals who refuse to do so voluntarily. It states:

§ 6020. Returns prepared for or executed by Secretary.

(a) Preparation of return by Secretary. If any person shall fail to make a return required by this title or by regulation prescribed thereunder, but shall consent to disclose all information necessary for the preparation thereof, then, and in that case, the Secretary may prepare such return, which being signed by such person, may be received by the Secretary as the return of such person.

(b) Execution of return by Secretary.

(1) Authority of Secretary to execute return. If any person fails to make any return required by any internal revenue law or regulation made thereunder at the time prescribed therefor, or makes, willfully or otherwise, a false or fraudulent return, the Secretary shall make such return from his own knowledge and from such information as he can obtain through testimony or otherwise.

(2) Status of returns. Any return so made and subscribed by the Secretary shall be prima facie good and sufficient for all legal purposes. (emphasis added)

As you can see Subsection (a) says:

"but shall consent to disclose all information necessary in that case, the Secretary may prepare such return...".

Subsection (a) clearly requires consent from the Citizen. So the IRS claims that Subsection (b) is what applies. Subsection (b) says:

"if any person fails to make any return required by any internal revenue law or regulation made thereunder at the time prescribed therefor, or makes, willfully or otherwise, a false or fraudulent return, the Secretary shall make such return from his own knowledge and from such information as he can obtain through testimony or otherwise."

Here, the Secretary is authorized, in fact required, to file forms for individuals if they fail to do so. So, if the Secretary was required; why do they charge Citizens with the failure to file ? The only requirement that can be found in the law is for the Secretary. It’s the secretary that fails the requirement to file the assessment forms, not the Citizen. IT IS VIRTUALLY IMPOSSIBLE UNDER THE LAW TO LEGITIMATELY CHARGE ANY CITIZEN IN THE COUNTRY WITH FAILURE TO FILE A FORM 1040, BECAUSE THIS REQUIREMENT (the Secretary’s) IS THE ONLY REQUIREMENT TO FILE THAT CAN BE FOUND IN THE LAW, AND THE W-2 IS SUPPOSED TO “SUBSTITUTE” FOR A FORM 1040 WHEN NONE IS PROVIDED BY THE TAXPAYER according to the publications in the Federal Register. Also note that the Secretary must sign (subscribe) the return for it to be valid (prima facie). THEY REFUSE.

So, the IRS claims that 6020(b) authorizes them to file a Form 1040 for a Citizen who refuses to do so voluntarily. However, the Internal Revenue Manual, in Chapter 5200 , addresses the proper legal use and invocation of 6020(b). It states:

5290. Refusal to file - IRC 6020(b) Assessment Procedure.

5291. Scope

(1) This procedure applies to employment, excise and partnership returns .... the following returns will be involved:

(a) Form 940 - Employer's Annual Federal Unemployment Tax Return

(b) Form 941 - Employer's Quarterly Federal Tax Return

(c) Form 942 - Employer's Quarterly Tax Return for Household Employees

(d) Form 943 - Employer's Annual Tax Return for Agricultural Employees

(e) Form 11-B - Special Tax Return - Gaming Devices

(f) Form 720 - Quarterly Federal Excise Tax Return

(g) Form 2290 - Federal Use Tax Return on Highway Motor Vehicles

(h) Form CT-1 - Employer's Annual Railroad Retirement Tax Return

(i) Form 1065 - U.S. Partnership Return of Income

It clearly states that:

"This procedure applies to employment, excise and partnership tax returns".

Does that say that 6020(b) applies to individual returns ? No, it doesn’t. It applies to employment excise and partnership tax returns. And look at what forms it states they are authorized to file under 6020(b):

"Form 940 ... 941 ... 942 ... 943 ... 11-B ... 720 ... 2290 .. CT-1 ... and ... 1065"

End of list. Is Form 1040 listed here? No, it is not! Form 1040 is not one of the forms that the IRS is actually authorized to file under Section 6020(b), according to the Internal Revenue Manual itself! 6020(b) is authorized only for employment, excise & partnership tax returns.

Why? Because, the tax is not imposed in a direct fashion on the domestic income of U.S. Citizens and Form 1040 IS NOT REQUIRED BY LAW FROM ANYONE who is not a withholding agent or non-resident alien. And, again in the Internal Revenue Manual (IRM), at Section 5293.1 it states:

Returns Prepared Under IRC 6020(b)

5293.1

General.

(1) If the taxpayer fails to file employment, excise and partnership tax returns by the specified date, the return should be prepared under the authority of IRC 6020(b).....

Does that say individual returns ? No ! Again it emphasizes employment, excise and partnership returns only, not individual returns.

Finally at IRM 5293.1 (7) it states:

(7) In unable to locate situations when the proprietors, partners or responsible officers and assets cannot be located and:

(a) when their SSNs can be determined process the returns and follow the guidelines in IRM 5263 for returns without full payment; or

(b) when their SSNs cannot be determined, close the delinquency using TC (transaction code) 593 with the proper closing code. (see the guidelines in IRM 5235(2)(c).

Now, what do subtitle C Social Security numbers have to do with delinquencies under subtitle A ? Why would they close a delinquency simply because there is no Social Security number for the individual ? Why is a Social Security number necessary to have an income tax delinquency ? Social security numbers, under the law, have nothing at all to do with income taxes under Subtitle A ! They (SSNs) are only to be used for the administration of the Subtitle C - Employment Tax laws contained in chapters 21 through 25.

The improper use of 6020(b) can be further exposed by a review of Sections 6061 and 6065.

§ 6061. Signing of returns and other documents. Except as other wise provided by sections 6062 (Signing of corporation returns) and 6063 (Signing of partnership returns) , any return, statement, or other document required to be made under any provision of the internal revenue laws or regulations shall be signed in accordance with forms or regulations prescribed by the Secretary.

(emphasis added)

§ 6065. Verification of returns. Except as other wise provided by the Secretary, any return, declaration, statement, or other document required to be made under any provision of the internal revenue laws or regulations shall contain or be verified by a written declaration that it is made under the penalties of perjury.

Section 6061 states:

"any returns, statements or other documents required to be made under any provision of the internal revenue laws or regulations shall be signed in accordance with forms or regulations".

And Section 6065 states:

"any return declaration, statement, or other document required to be made under any provision of the internal revenue laws or regulation shall contain or be verified by a written declaration that it is made under the penalties of perjury".

Ever seen one ? Furthermore, Section 6020 subsection (b)(2) stated:

"Any return so made and subscribed by the Secretary shall be prima facie good and sufficient for all legal purposes."

I have never seen a substitute Form 1040, prepared by the IRS, that was either signed, or sworn to. Obviously that would be a violation of these laws. The IRS is required by law to sign these documents, but they refuse to do so, because they know they’re acting outside the authority authorized under the law and actually contained within the Revenue Manual. They know that if they sign the documents, they will assume the liability for the wrongful claims made on them. They do not want to do that, so they refuse to sign. They fill it all out and send it to you, for you to sign. They refuse to validate their own work with a signature as required under the law. but they demand that you, the Citizen, honor this fraudulent work with payment, without anyone from the government ever validating it for you or swearing that it's true. It is a violation of the law, but the Citizens generally accede to the demands, and out of ignorance, they comply. But the fact of the matter is: the law supports you, the Citizen, and does not support the United States government. Finally the Delegation Orders actually filed at the District offices, delegating the Authority to prepare and execute returns under 6020(b) read:

INTERNAL REVENUE SERVICE

SOUTHWEST REGION Order No. DD-OKC-150, Rev. 5

OKLAHOMA CITY DISTRICT CR: SD-61

DELEGATION ORDER Date of issue: Nov 27 1987

Effective Date: Nov 27 1987

Subject:

AUTHORITY TO EXECUTE RETURNS

Authority is redelegated to Revenue Officers, GS-9 and above to

prepare and execute the following returns on behalf of the District

Director under Section 6020(b) of the Internal Revenue Code.

Form 940, Employer's Annual Federal Unemployment Tax Return;

Form 941, Employer's Quarterly Federal Tax Return;

Form 942, Employer's Quarterly Tax Return for Household Employees;

Form 943, Employer's Annual Tax Return for Agricultural Employees;

Form 11-B, Special Tax Return - Gaming Services;

Form 720, Quarterly Federal Excise Tax Return;

Form 2290, Federal Use Tax Return on Highway Motor Vehicles;

Form CT-1, Employer's Annual Railroad Retirement Tax Return; and

Form 1065, U.S. Partnership Return of Income

This authority may not be redelegated.

This order supersedes Delegation Order DD-OKC-150 (Rev. 4) dated

December 13, 1984

Reference: Treasury Regulations 301.6020-1 (b)

Commissioner Delegation Order No. 182 (rev. 1)

IRM 5292

K. J. Sawyer

District Director

This list agrees completely with the Forms shown as authorized under 6020(b) in the Internal Revenue Manual itself. The IRS cannot produce a delegation order for any district in the country authorizing the preparation or execution of a Form 1040. Although this Delegation Order is for Oklahoma City, the Orders for the other District Offices are exactly the same. So, how does the IRS get away with the fraud that they have been perpetrating on the American People. WE ARE IGNORANT. Amazingly enough, the IRS computer systems have been properly programmed and will not trigger or initiate a collection action against a Citizen of the United States of America, UNLESS THEY ARE FED FRAUDULENT INFORMATION by an IRS employee.

This is, of course, exactly what the IRS does ! If you have ever received a letter from the IRS you can look and see, usually in the upper right hand corner area, what the CP number of the letter is. CP stands for Computer Paragraph. All of the IRS's collection correspondence is generated by computers, and under the Paperwork Reduction Act all of it must be documented and properly authorized. The Internal Revenue Manual contains an explanation relating the proper legal use of each of these CP codes and corresponding letters. The Manual clearly shows that the letters generated by the computers that relate to individuals carry a TWO DIGIT CP CODE. The Manual further shows that all BUSINESS accounts are addressed with letters that use a THREE DIGIT CP CODE. All of the three digit CP Code Letters ARE RESERVED FOR USE WITH BUSINESSES. It is the those Business letters that individuals wrongfully receive that threaten enforced collection of the income tax. If you have one, see what the CP Code on your letter is. If it carries three digits: you are the victim of IRS ANARCHY, FRAUD and attempted EXTORTION BY COMPUTER FRAUD. What the IRS illegally does is post a computer code (or assessment date) on your Individual Master File (IMF) in the computer, that deceives the computer into believing that YOU ARE AN (assessed) BUSINESS instead of an individual. That fraudulent entry is used by the computer systems to wrongfully trigger a collection action against a Citizen, which action is, in reality, reserved for use ONLY against businesses, because the computer knows that Citizens are not actually liable.

THE IRS MUST DEFRAUD ITS OWN COMPUTER SYSTEM TO INITIATE A COLLECTION ACTION AGAINST A CITIZEN. Once that fraudulent business code is illegally posted on your IMF, that IMF, the IRS's own document, can be used as prima facie evidence in court against them to expose the fraudulent and illegal nature of their activities and actions.

The result of this assessment process is supposed to be a signed formal Assessment Certificate, executed by an authorized Assessment Officer. It cannot be disputed that the Form 23C is the legal certificate of assessment. Form 23C is described in Document 7130, IRS Printed Product Catalog as:

23C

Assessment Certificate-Summary Record of Assessments

Form 23C is used to officially assess tax liabilities. The completed form is retained in the service center case file as a legal document to support the assessment made against a taxpayer. This status notice is reissued to update the status notice file. TR:R:A Internal Use (emphasis added)

Usually, no Form 23C can be produced by the IRS to substantiate the fraudulent claim that a legal assessment actually exists, or has ever been performed, to be be enforced in your matter. If no assessment exists - what are they collecting ? The assessment data shown on the face of IRS levy and lien documents has almost always been placed within the IRS computer fraudulently, without the actual creation of any legal assessment documents. This is clearly fraud by computer fraud.

If you are ignorant, and unaware of the fraud that they have committed you will not be able to stop their illegal theft of your property, perpetrated under this fraudulent deception of their own computer systems. THERE OUGHT TO BE A LAW ! OOPS, actually there is: Title 18 U.S.C:

§ 1030. Fraud and Related Activity in Connection With Computers.

(a) Whoever - .....

(5) intentionally accesses a Federal interest computer without authorization, and by

means of one or more instances of such conduct alters, damages, or destroys

information in any such Federal interest computer, or prevents authorized use of any

such computer or information, and thereby -

(A) causes loss to one or more others of a value aggregating $1,000 or more

during any one year period; or...

(b) Whoever attempts to commit an offense under subsection (a) of this section shall be

punished as provided in subsection (c) of this section....

In America, all persons are entitled to due process of law under the Administrative Procedures Act. The provisions of this Act within the law apply to ALL government agencies, including the IRS. Title 5 U.S.C. 556, part of this Act, states:

§ 556. ...Burden of Proof...,

...

(c) Subject to PUBLISHED rules of the agency and within its powers, employees presiding at hearings may, ....

(d) Except as otherwise provided by statute, the proponent of a rule or order has the burden of proof. ... (emphasis added)

and § 558 states:

§ 558. ... Imposition of sanctions...,

(a) This section applies, according to the provisions thereof, to the exercise of a power or authority.

(b) A sanction may not be imposed or a substantive rule or order issued except within jurisdiction delegated to the agency and as authorized by law.

(emphasis added)

And what have the Courts said about the Due Process requirements ?

“Due process in administrative hearings includes a fair trial conducted in accordance with fundamental principles of fair play and applicable procedural standards established by law, and administrative convenience or necessity cannot override this requirement.” [Russell-Newman Mfg. Co. v. N.L.R.B., C.A. Tex 1966, 370 F2d 980]

“Due process requires that when government adjudicate or make binding determinations which directly affect legal rights of individuals, they use procedures which have traditionally been associated with judicial process.” [Amos Treat & Co. v. Securities & Echange Commission, 306 F2d 260 (1962), 113 US App. D.C. 100]

“Although administrative agencies may be relieved from the observance of strict common law rules of evidence, their hearings must still be conducted consistently with fundamental principles which are intrinsic to due process of law.” [Southern Stevedoring Co. v. Voris, C.A. Tex 1951, 190 F2d 275]

“Administrative due process requires: (1) opportunity to be heard, (2) due notice of hearing , (3) fair conduct of hearing, (4) support in record for decision, (5) submission of proposed findings and tentative report, and (6) opportunity to file and to be heard upon exceptions to the report.

[Ideal Farm, Inc. v. Benson, D.C. N.J. 1960, 181 F Supp 62, affirmed 288 F2d 608, Certiorari denied 83 Sct 1087, 327 US 965, 10 Led2d 128]

“The requirement of fair trial is binding on administrative agencies as well as on the courts” [U.S. v. Brad, D.C. Cal 1968]

“The fair hearing essential to meet minimal requirements of due process includes not only rudimentary fairness in conduct of hearing when and where held, but also reasonable fair opportunity to be present at time and place fixed to cross-examine any opposing witnesses, to offer evidence, and to be heard at least briefly in defense.” [Jeffries v. Olsen, D.C. Cal 1954, 121 Fsupp 163]

“A full hearing is one in which ample opportunity is afforded to all parties to make, by evidence and argument, a showing fairly adequate to establish the propriety or impropriety, from the standpoint of justice and law, of the step to be taken.” [Boston and M.R.R. v. U.S., D.C. Mass. 1962, 208 Fsupp 661]

“Agencies have latitude to expedite hearings in the public interest and to dispense with evidentiary hearings in view of the nature of questions raised after a notice of action is requested, but an agency cannot act on mere inspection of a file without giving notice and opportunity to request a hearing, except in a narrow class of real emergency cases.” [Pennsylvania Gas & Water Co. v. Federal Power Commission, 427 F2d 568 1970, 138 U.S. App. D.C.]

“Under the Adminstative Procedures Act, the proponent of a rule or order has the burden of proof. Burden of proof means going forward with the evidence.” [Bosma v. U.S. Dept. of Agriculture, C.A. 9, 1984, 754 F2d 804]

(I guess I mean a law or ruling that the courts are willing to enforce rather than ignore.) The Courts and the judges are choosing to ignore these facts of law and rulings, which they are aware of, but which they will not address, because they have consciously chosen to derive their living from your ongoing suffering, and they don't really care about the Constitution, America or a Limited government. They pay lip service to these words, but their revenue related rulings and decisions have ignored them, and are obviously more concerned with an expansion of their own Communist-Socialist-Fascist agenda under an unauthorized and unconstitutional expansion of government powers, including their own to re-write the laws as passed by Congress. The courts have no authority to create new legislation, or re-write existing laws simply because the courts deem those laws susceptible of improvement. Article 1, Section 1, Clause 1 of the Constitution specifically states:

"All legislative powers herein granted shall be vested in a Congress ..."

No legislative powers or authority, to create new laws or alter existing ones, are granted to the courts in the Constitution.

After the IRS illegally makes up a return that they illegally refuse to sign, and fraudulently deceive the computers into initiating the correspondence related to a collection action, they illegally create a deficiency within that return.

§ 6211. Definition of a deficiency.

(a) In general. For purposes of this Title in the case of income, estate, and gift taxes imposed by subtitles A and B and excise taxes imposed by chapters 41, 42, 43, and 44, the term "deficiency" means the amount by which the tax imposed by subtitle A or B, or chapter 41, 42, 43, or 44, exceeds the excess of -

(1) the sum of

(A) the amount shown as the tax by the taxpayer upon his return,

if a return was made by the taxpayer and an amount was

shown as the tax by the taxpayer thereon, plus

(B) the amounts previously assessed (or collected without

assessment) as a deficiency, over -

(2) the amount of rebates, as defined in subsection (b)(2), made....

This section clearly states: "... in the case of income, estate, and gift taxes imposed by Subtitles A & B ... " . Deficiencies are clearly based on Subtitle A and Subtitle B taxes (and the excise taxes in Chapters 41, 42, 43 & 44 - Subtitle D). So why is the IRS using the record of earnings collected under Subtitle C (Employment Taxes) in order to calculate deficiencies ? That is what the IRS uses in its demands for tax payments. The record of earnings or wages paid and reported by your employer and the withholding agents under your SSN (subtitle C). The IRS is wrongfully and illegally using the record of earnings created under the Subtitle C Employment Tax laws, for Social Security purposes and foreigners, to demand that you, the Citizen, pay income tax on those domestic earnings. And that record of earnings does not come from any income tax withholding or payment requirements under Subtitles A or B. It comes from the employment taxes imposed in Subtitle C. The record of earnings belonging to the Citizen is coming from their voluntary participation in the social security program; whereby a social security number is provided to an employer on a W-4, who then withholds the taxes on wages for social security purposes under Subtitle C authorizations. We’ve already seen that income tax can only be withheld from foreigners, not from Citizens, unless it is requested on a Form W-4 (where you specify deductions) !

Then the IRS takes that Subtitle C information and wrongfully and illegally uses it to demand Subtitle A Income taxes on those Subtitle C records of earnings. But this code section, § 6211, states that a deficiency can only be based on Subtitle A and Subtitle B requirements, not Subtitle C So the IRS is in violation of the law to claim that there is a deficiency based on that record of earnings. But that’s what they do and they will continue to do it as long as you allow a record of earnings to accumulate under your name and social security number. As long as payers have your social security number and make reports to the IRS using that social security number the IRS is going to wrongfully and illegally use the information created under those subtitle C regulations to demand that you pay income taxes imposed under Subtitle A on foreigners. So after they illegally “manufacture” a deficiency by creative claim, they send it to you:

§ 6212. Notice of Deficiency.

(a) In general. If the Secretary determines that there is a deficiency in respect of any tax imposed by subtitle A or B or chapter 41, 42, 43, or 44, he is authorized to send notice of such deficiency to the taxpayer by certified mail or registered mail.

But remember, there are no implementing regulations associated with this Code section, so it can ONLY apply To Federal Employees for purposes of “assessing” the return of income (kickback) due from Federal sources.

Now, Document 6209 is used to decode the computer codes on the "Individual Master File" (IMF) records ! It clearly shows the meaning of these obscure and little known codes, which are extremely important. If you receive a "Notice of Deficiency" you should immediately, formally request a copy of your IMF, because 99 times out of 100 it contains a CODE 01, which means:

IMF Filing Requirement Codes

Form 1040- U.S. Individual Income Tax Return

00 No return filed

01 Return not required to be mailed or filed.

02 Form 1040A or 1040EZ filer it. (Package 50)

03 Form 1040, with Schedule A and B only. Principal non-business filer (Package 10)

04 Form 1040, Schedules A, B, D and E. Full non-business filer (Package 20).

05 Form 1040, Schedules A, B, D, E, C and F. Form 1040 business filer (Package 30).

06 Form 1040SS filer (Virgin Islands it (DO 66), Guam, and American Samoa-DO 98).

07 Form 1040PR it filer (Puerto Rico-DO 66)

08 Account is inactive. Return not required to be mailed or filed.

09 Form 1040NR filer.

10 Form Schedule F Business with Farm Package. (Package 40)

11 IMF Child Care Credit present. (Package 00)

12 Schedule R / R P present. (Package 80)

That's right, CODE 01 means "RETURN NOT REQUIRED TO BE MAILED OR FILED". It is RIGHT THERE on YOUR IMF, waiting to PROVE YOUR CASE, if you make one.

After fraudulently creating a deficiency (that goes unpaid) the IRS wrongfully levies your property in third party hands, and files a debt lien on your property at the county courthouse.

§ 6321. Lien for taxes.

If any person liable to pay any tax neglects or refuses to pay the same, after demand, the amount (including any interest, additional amount, addition to tax, or assessable penalty, together with any costs that may accrue in addition thereto) shall be a lien in favor of the United States upon all property and rights to property, whether real or personal, belonging to such person. (emphasis added)

The IRS refuses to say how, or under what code section, they have determined that individual Citizens are LIABLE for tax on DOMESTIC income, THEY JUST PRETEND you are, and hope you don't know any better !

The requirements for the recording of Federal tax liens at State courthouses have been made fairl uniform by the adoption of the Uniform Federal Lien Registration Act by the various State legislatures. It generally requires (from the Virginia Code):

§ 55-142.3

Duties of filing officers

A. If a notice of federal lien, a refiling of a notice of federal lien, or a notice of revocation of any certificate described in subsection B is presented to the filing officer and

1. He is the clerk of the State Corporation Commission, he shall cause the notice to be marked, held and indexed in accordance with the provisions of subdivision (4) of §8.9-403 as if the notice were a financing statement within the meaning of that Code; or

2. He is any other officer described in §55-142.1, he shall endorse thereon his identification and the date and time of receipt and forthwith file it alphabetically or enter it in an alphabetical index showing the name and address of the person named in the notice, the date and time of receipt, the serial number of the district director in the case of tax liens, the title and address of the official or entity certifying the lien, and the total amount appearing on the notice of lien, and shall index and record the same where judgments are indexed and recorded.

Now I have never ssen an IRS Notice of Federal Tax Lien that had all of these required elements present on its face, or within its recordation at a courthouse, which means that they have not been filed in accordance with the law, and may therefore be legally unenforceable, and possibly, attackable and removable under the various State codes.

The next thing the IRS tries to do is levy property held by third parties. The Authority they claim for this is Section 6331.

§ 6331 Levy and distraint.

(a) Authority of Secretary. If any person liable to pay any nay tax neglects or refuses to pay the same within ten days after notice and demand, it shall be lawful for the Secretary to collect such tax (and such further sum as shall be sufficient to cover the expenses of the levy) by levy upon all property and rights to property (except such property as is exempt under section 6334) belonging to such person or on which there is a lien provided in this chapter for the payment of such tax. Levy may be made upon the accrued salary or wages of any officer, employee, or elected official, of the United States, the District of Columbia, or any agency or instrumentality of the United States or the District of Columbia by serving a notice of levy on the employer (as defined in section 3401 (d)) of such officer, employee or elected official. ..... (emphasis added)

This clearly states:

"Levy made be made upon the accrued salary or wages of any officer, employee, or elected official of the United States, the District of Columbia, or any agency or instrumentality of the United States or the District of Columbia.”

Subsection (a) establishes the authority of the Secretary that limits the authority of all the other Subsections (b), (c), (d), (e,) and (f) in this Code section. Who does Subsection (a) say levy may be made on? "Officers, employees or elected officials of the United States government".

Furthermore, it is a CANON of LAW that:

"A cardinal rule of statutory construction is that a statute be construed from its four corners and not by singling out a particular word or phrase."Commonwealth Natural Resources, Inc. v. Commonwealth, 219 Va. 529, 536, 248 S.E. 2d 791, 795 (1978).

and that further, a legislative enactment:

"should be interpreted, if possible, in a manner which gives meaning to every word." Monument Assoc. v. Arlington County Bd, 242 Va. 145, 149, 408 S.E. 2d 889, 891 (1991)

I also note that it is a canon of common-law that

"the intent of the law is the force of the law"

Note 5 in the Annotated Code (U.S.C.A.) for Title 26 U.S.C.A.§ 6331 states the LAWFUL INTENT of the Congressional legislators in creating this statute. It states:

"Note 5. Purpose. This section was enacted to subject salaries of federal employees to the same collection procedures as are available against all other taxpayers, including employees of a state."

Does this section apply to Citizens or individuals? No, it does not. It explicitly states who it does apply to, and Citizens are not included. It only grants an authorization to levy federal employees. But this subsection is being wrongfully invoked all over the country to seize property from American Citizens who don’t really owe income tax on domestic income, but who are too ignorant of the law to defend themselves from a wrongful government attack. This section was specifically enacted to subject just federal employees to levy. Now it references the "same collection procedures as are available against all other taxpayers" but, the IRS refuses to site them or establish what they may be. Apparently they feel that Section 6331 is the only code section in Title 26 that they can rely on for levy, and clearly, it does not apply to U.S. Citizens, only federal employees. Perhaps this opinion letter, which you can obtain from the IRS Enrolled Agent for yourself, will help you to both understand, and explain to others, just exactly how the LEGAL IRS levy process is supposed to operate, according to the law.

TAXES - ACCOUNTING- AUDITS - ESTATE PLANNING - PAYROLL

17511 North Greenbluff Road Colbert, Washington 99005

Tel (509) 238-4697 Fax (509) 238-4697

May 27, 1997

IRS Enrolled Agent Opinion Letter

on the True IRS Authority to Levy Property

Dear Citizen,

At your request I have researched the Internal Revenue Code, Title 26 U.S.C., regarding Seizures and Levies. The questions you were concerned with were the procedures for levying a private person’s property. Some of which are: Where does the IRS get its authority without a court order ? Does the property have to be turned over without a court order ? Are the rights, as guaranteed by the United States Constitution, violated ?

About my experience, I am an Enrolled Agent. Enrolled Agents are defined in the IRS Regulations Circular 230, as a person who has demonstrated technical competence in interpreting and administrating the Internal Revenue Code and regulations thereunder. This person has withstood an extensive background check as to moral and ethical practices and has passed a strenuous test in all areas of taxation administered by the Internal Revenue Service. Enrolled Agents are licensed by the Treasury Department and must continue to show proficiency in the tax laws and regulations with documented continuing professional education hours in order to maintain their licenses.

The IRS frequently serves levy notices on third parties who may be holding your property. The IRS knows that all of the notices of levy that are sent to you or your employer are incorrect unless you are involved in a privileged activity as noted at the end of this letter. The primary reason is their has been no assessment, because the IRS can not legally assess a Private Citizen who has his/her income from only private sources.

Further, in reading the information as stated on the levy, a person is required to turn over property because a tax liability exists and the person named has refused to pay. You cannot refuse to pay something that cannot exist. There can be no assessment pursuant to 26 U.S.C. § 6201, without this there can be no levy, this is evidenced by the court also as follows:

"In order to place a lien/levy against property, the IRS must make a valid assessment of taxes pursuant to 26 U.S.C. § 6203. After the assessment is made, the IRS must send a § 6212 "Notice of Deficiency" to the taxpayer. Then the IRS must provide a "Notice and Demand for Payment" of assessed tax as required by § 6303(a). Only after full compliance with these procedures, may the IRS take a lien on the delinquent taxpayer's property." [Brewer v. U.S., 764 F. Supp. 309, 315 (S.D.N.Y. 1991)]

There are two concepts for me to get across. It is important to discuss the difference between a "levy" and a "seizure". A "seizure" means the act of taking into custody or control something which before was not in custody or control. A "levy" is not a single act, but rather is the whole process by which the money needed to pay a tax is raised, either by exercising control over something already in custody and control of the government or by distraining and seizing property not already in custody of the government. The levy process includes the sale of levied property and the application of the proceeds to the unpaid tax.

I must now advise you that a, "Notice of Levy", is not a levy or seizure. The "Notice of Levy" has no legal effect in the private sector unless it is accompanied with a Judicial Court Order and a "Notice of Seizure". The following cites will demonstrate that a "Notice of Levy" carries no authority to "Levy", and that a "Levy" must be done through "seizure" of the property.

“A Notice of Seizure should be given for a Notice of Levy to be successful. That the levy was impermissible in the absence of the required Notice of Seizure.” [Arford v. United States, 934 F 2d 229 (9th Cir. 1991)].

"A 'Levy' for-delinquent taxes requires that property be brought into legal custody through seizure, actual or constructive, and is absolute appropriation of property levied on, and a mere NOTICE OF INTENT TO LEVY DOES NOT CONSTITUTE A LEVY" (Emphasis added). [Freeman v. Meyer. 152 F. Supp. 383, Affd 253 F. 2d 1295 (3rd Circuit 1968)].

"A 'Levy' requires that property be brought into legal custody through seizure, actual or constructive, and is absolute appropriation in law of property levied on, and MERE NOTICE OF INTENT TO LEVY IS INSUFFICIENT" (Emphasis added).

[United States v. O'Dell, 160 F. 2d 304, 307 (6th Circuit 1947)].

“The IRS is to comply strictly to the conditions imposed by statute in the seizure and levy process.”

[Goodwin v. United States, 935 f 2d 1061, (9th Cir. 1991)].

“A stickler for enforcing the statutory notice it is entitled to receive, the government should be no less punctilious with respect to the statutory notice it is required to give.”

[Kulway v. United States, 917 F 2d 729, 735 (2nd Cir. 1990)].

There are specific procedures that must be followed for a garnishment to be lawful unless one voluntarily consents. This is also known by IRS Agents as evidenced by the Internal Revenue Manuel, page 57(16), titled "Legal Reference Guide for Revenue Officers" (February 9, 1990) States: "A proper levy against any amounts held as due and owing by employers, banks, stockholders, etc. must issue from a warrant of distraint and not mere notice" it then cites United States v. O'Dell, supra.

I hope I have covered the definitions of seizures and levies for you. Now I will use Title 26 U.S.C. to tell you the procedures the IRS must use. I will start with "seizures". The authority for "seizures" comes from Internal revenue Code sections 7321 and 7608 as follows: As stated in Goodwin v. United States and Kulway v. United States, (supra) the IRS compliance with the Lien-seizure-levy process must be strict and literal.

§ 7321. Authority to seize property subject to forfeiture.

Any property subject to forfeiture to the United States under any provision of this title may be seized by the Secretary.

§ 7608. Authority of internal revenue enforcement officers.

(a) Enforcement of subtitle E and other laws pertaining to liquor, tobacco, and firearms. Any investigator, agent, or other internal revenue officer by whatever term designated, whom the Secretary charges with the duty of enforcing any of the criminal, seizure, or forfeiture provisions of subtitle E or of any other law of the United States pertaining to the commodities subject to tax under such subtitle for the enforcement of which the Secretary is responsible may--

(1) carry firearms;

(2) execute and serve search warrants and arrest warrants, and serve subpoenas and summonses issued under authority of the United States;

(3) in respect to the performance of such duty, make arrests without warrant for any offense against the United States committed in his presence, or for any felony cognizable under the laws of the United States if he has reasonable grounds to believe that the person to be arrested has committed, or is committing, such felony; and

(4) in respect to the performance of such duty, make seizures of property subject to forfeiture to the United States.

(b) Enforcement of laws relating to internal revenue other than

subtitle E

(1) Any criminal investigator of the Intelligence Division or of the Internal Security Division of the Internal Revenue Service whom the Secretary charges with the duty of enforcing any of the criminal provisions of the internal revenue laws, any other criminal provisions of law relating to internal revenue for the enforcement of which the Secretary is responsible, or any other law for which the Secretary has delegated investigatory authority to the Internal Revenue Service, is, in the performance of his duties, authorized to perform the functions described in paragraph (2).

(2) The functions authorized under this subsection to be performed by an officer referred to in paragraph (1) are--

(A) to execute and serve search warrants and arrest warrants, and serve subpoenas and summonses issued under authority of the United States;

(B) to make arrests without warrant for any offense against the United States relating to the internal revenue laws committed in his presence, or for any felony cognizable under such laws if he has reasonable grounds to believe that the person to be arrested has committed or is committing any such felony; and

As noted in these sections, Internal Revenue Enforcement Officers, when enforcing both Subtitle E taxes and other taxes as defined in 7608, are given authority to make seizures of "property subject to forfeiture". It becomes important to know at this point exactly what property comes within the meaning of "property subject to forfeiture" since if the property is outside the scope of the meaning of "property subject to forfeiture", the Internal Revenue Enforcement Officer is not authorized to seize it.

The definitions of "property subject to forfeiture" are found in Internal Revenue Code sections 7301 through 7304, as follows:

§ 7301. Property subject to tax:

(a) Taxable articles--Any property on which, or for or in respect whereof, any tax is imposed by this title which shall be found in the possession or custody or within the control of any person, for the purpose of being sold or removed by him in fraud of the internal revenue laws, or with design to avoid payment of such tax, or which is removed, deposited, or concealed, with intent to defraud the United States of such tax or any part thereof, may be seized, and shall be forfeited to the United States.

(b) Raw materials--All property found in the possession of any person intending to manufacture the same into property of a kind subject to tax for the purpose of selling such taxable property in fraud of the internal revenue laws, or with design to evade the payment of such tax, may also be seized, and shall be forfeited to the United States.

(c) Equipment--All property whatsoever, in the place or building, or any yard or enclosure, where the property described in subsection (a) or (b) is found, or which is intended to be used in the making of property described in subsection (a), with intent to defraud the United States of tax or any part thereof, on the property described in subsection (a) may also be seized, and shall be forfeited to the United States.

(d) Packages--All property used as a container for, or which shall have contained, property described in subsection (a) or (b) may also be seized, and shall be forfeited to the United States.

(e) Conveyances--Any property (including aircraft, vehicles, vessels, or draft animals) used to transport or for the deposit or concealment of property described in subsection (a) or (b), or any property used to transport or for the deposit or concealment of property which is intended to be used in the making or packaging of property described in subsection (a), may also be seized, and shall be forfeited to the United States.

§ 7302. Property used in violation of internal revenue laws.

It shall be unlawful to have or possess any property intended for use in violating the provisions of the internal revenue laws, or regulations prescribed under such laws, or which has been so used, and no property rights shall exist in any such property. A search warrant may issue as provided in chapter 205 of title 18 of the United States Code and the Federal Rules of Criminal Procedure for the seizure of such property. Nothing in this section shall in any manner limit or affect any criminal or forfeiture provision of the internal revenue laws, or of any other law. The seizure and forfeiture of any property under the provisions of this section and the disposition of such property subsequent to seizure and forfeiture, or the disposition of the proceeds from the sale of such property, shall be in accordance with existing laws or those hereafter in existence relating to seizures, forfeitures, and disposition of property or proceeds, for violation of the internal revenue laws.

§ 7303. Other property subject to forfeiture.

There may be seized and forfeited to the United States the following:

(1) Counterfeit stamps--Every stamp involved in the offense described in section 7208 (relating to counterfeit, reused, canceled, etc., stamps), and the vellum, parchment, document, paper, package, or article upon which such stamp was placed or impressed in connection with such offense.

(2) False stamping of packages--Any container involved in the offense described in section 7271 (relating to disposal of stamped packages), and of the contents of such container.

(3) Fraudulent bonds, permits, and entries--All property to which any false or fraudulent instrument involved in the offense described in section 7207 relates.

§ 7304. Penalty for fraudulently claiming drawback.

Whenever any person fraudulently claims or seeks to obtain an allowance of drawback on goods, wares, or merchandise on which no internal tax shall have been paid, or fraudulently claims any greater allowance of drawback than the tax actually paid, he shall forfeit triple the amount wrongfully or fraudulently claimed or sought to be obtained, or the sum of $500, at the election of the Secretary.

These code sections give us the comprehensive list of property which Internal Revenue Enforcement Officers have authority to seize. If any property does not fall within the above descriptions it is not "property subject to forfeiture" and the Internal Revenue Enforcement Officers have no authority to seize it.

The levy process includes the power of seizure as authorized in section 7321 and 7608, which is evidenced by sections 7701(a)(21) and 6331(b), as follows.

§ 7701. Definitions

(a)

...

(21) Levy--The term "levy" includes the power of distraint and seizure by any means.

§ 6331(b) Seizure and sale of property

--The term "levy" as used in this title includes the power of distraint and seizure by any means.

The word "distraint" basically means to retain possession of property, by force if necessary, once it is in the possession of the government. the phrase "by any means" applies to the seizures when and where authorized, and to distraining the property once in the government's possession. Internal Revenue Officers are thus given very broad authority to carry out their legitimate functions.

The authority to "levy" comes from Internal Revenue Code Section 6331, as follows:

§ 6331. Levy and distraint.

(a) Authority of Secretary--If any person liable to pay any tax neglects or refuses to pay the same within 10 days after notice and demand, it shall be lawful for the Secretary to collect such tax (and such further sum as shall be sufficient to cover the expenses of the levy) by levy upon all property and rights to property (except such property as is exempt under section 6334) belonging to such person or on which there is a lien provided in this chapter for the payment of such tax.

Levy may be made upon the accrued salary or wages of any officer, employee, or elected official, of the United States, the District of Columbia, or any agency or instrumentality of the United States or the District of Columbia, by serving a notice of levy on the employer (as defined in section 3401(d)) of such officer, employee, or elected official. If the Secretary makes a finding that the collection of such tax is in jeopardy, notice and demand for immediate payment of such tax may be made by the Secretary and, upon failure or refusal to pay such tax, collection thereof by levy shall be lawful without regard to the 10-day period provided in this section.

(b) Seizure and sale of property--The term "levy" as used in this title includes the power of distraint and seizure by any means. Except as otherwise provided in subsection (e), a levy shall extend only to property possessed and obligations existing at the time thereof. In any case in which the Secretary may levy upon property or rights to property, he may seize and sell such property or rights to property (whether real or personal, tangible or intangible).

(c) Successive seizures--Whenever any property or right to property upon which levy has been made by virtue of subsection (a) is not sufficient to satisfy the claim of the United States for which levy is made, the Secretary may, thereafter, and as often as may be necessary, proceed to levy in like manner upon any other property liable to levy of the person against whom such claim exists, until the amount due from him, together with all expenses, is fully paid.

(d) Requirement of notice before levy

(1) In general--Levy may be made under subsection (a) upon the salary or wages or other property of any person with respect to any unpaid tax only after the Secretary has notified such person in writing of his intention to make such levy.

(2) 30-day requirement--The notice required under paragraph (1) shall be--

(A) given in person,

(B) left at the dwelling or usual place of business of such person, or

(C) sent by certified or registered mail to such person's last known address, no less than 30 days before the day of the levy.

(3) Jeopardy--Paragraph (1) shall not apply to a levy if the Secretary has made a finding under the last sentence of subsection (a) that the collection of tax is in jeopardy.

(4) Information included with notice--The notice required under paragraph (1) shall include a brief statement which sets forth in simple and non-technical terms--

(A) the provisions of this title relating to levy and sale of property,

(B) the procedures applicable to the levy and sale of property under this title,

(C) the administrative appeals available to the taxpayer with respect to such levy and sale and the procedures relating to such appeals,

(D) the alternatives available to taxpayers which could prevent levy on the property (including installment agreements under section 6159),

(E) the provisions of this title relating to redemption of property and release of liens on property, and

(F) the procedures applicable to the redemption of property and the release of a lien on property under this title.

(e) Continuing levy on salary and wages--The effect of a levy on salary or wages payable to or received by a taxpayer shall be continuous from the date such levy is first made until such levy is released under section 6343.

(f) Uneconomical levy--No levy may be made on any property if the amount of the expenses which the Secretary estimates (at the time of levy) would be incurred by the Secretary with respect to the levy and sale of such property exceeds the fair market value of such property at the time of levy.

You can see that there are conditions that must be met before the Secretary is authorized to levy on property or rights to property. First, you must be a person "liable" to pay a tax. Second, you must have been sent a "notice and demand" for payment of the tax. Third, you must have neglected or refused to pay the tax. And fourth, ten days must have elapsed after the notice and demand. (The ten day period does not apply in the case of a jeopardy determination).

After a levy is authorized, the property upon which the levy extends is given in Section 6331(b), which says that the Secretary may levy "only to property possessed and obligations existing at the time thereof". If the property is not already possessed by the Secretary, the property may be brought into the Secretary's possession by seizure and distraint, but remember only property "subject to forfeiture" may be seized, Section 6331 embraces the power given under Sections 7321 and 7608, it does not expand upon it.

Section 6331(b) has given us a very important definition. It has given us the definition of "property subject to levy", a phrase which makes its appearance in certain key places in both the Internal Revenue Code and in the Treasury Regulations. "Property subject to levy" basically means property which is not exempt from levy under section 6334.

The term "Secretary" is defined in section 7701(a)(11):

§ 7701. Definitions

(a)

...

(11) Secretary of the Treasury and Secretary,--

(A) Secretary of the Treasury--The term "Secretary of the Treasury" means the Secretary of the Treasury, personally, and shall not include any delegate of his.

(B) Secretary--The term "Secretary" means the Secretary of the Treasury or his delegate.

Thus, "Secretary" means "The Secretary of the Treasury or his delegate".

Basically, the only property the Secretary (or his delegate) would already have in his possession would be accrued salaries or wages of federal or District of Columbia employees which have not yet been paid out of the federal coffers. Such accrued salaries or wages would be the only Property upon which the Secretary could levy without having to effectuate a seizure, and this is confirmed within section 6331(a) itself.

Section 6331(a) states that a levy can be made on accrued salaries or wages by serving a "notice of levy" on the employer of an officer, employee, or elected official, of the United States, the District of Columbia, or any agency or instrumentality of the United States or the District of Columbia. This confirms what was said before since the accrued salaries or wages of such officers, employees, or elected officials represents an obligation of the Secretary existing at the time the levy is made. Since these described individuals are paid from the Federal Treasury, the Secretary of the Treasury already has possession of the funds which would be used to pay the obligation, and the "notice of levy" is simply the Secretary's notice that said funds are being applied to unpaid taxes instead of being paid to the officer, employee, or elected official. No seizure is necessary, and thus no "notice of seizure" (explained later) is ever issued. The notice of levy is usually served on the head of the Federal (or District of Columbia) agency (or the agent designated by him who is charged with payroll duties).

When the IRS must bring property into the possession of the Secretary by seizure, then we have to refer to section 6335, as follows:

§ 6335. Sale of seized property.

(a) Notice of seizure--As soon as practicable after seizure of property, notice in writing shall be given by the Secretary to the owner of the property (or, in the case of personal property, the possessor thereof), or shall be left at his usual place of abode or business if he has such within the internal revenue district where the seizure is made. If the owner cannot be readily located, or has no dwelling or place of business within such district, the notice may be mailed to his last known address. Such notice shall specify the sum demanded and shall contain, in the case of personal property, an account of the property seized and, in the case of real property, a description with reasonable certainty of the property seized.

So you see that whenever the IRS makes a seizure, they are required by law to issue a "Notice of Seizure"(Form 2433). This notice also has another effect. Remember, at the outset of this letter, I stated that a "levy" was not a single act, but rather the whole process by which money was raised and applied to an unpaid tax. The levy process includes seizure and sale of the property, along with the actual application of the proceeds.

However, a levy must be made within six years (see Section 6502(a) after the tax is assessed, and there may come a time when a levy proceeding occurs near the end of the six year period. So, for the purpose of determining the exact point in time when the law would consider that the levy was made, section 6502(a) states;

§ 6502. Collection after assessment.

...

(b) Date when levy is considered made--The date on which a levy on property or rights to property is made shall be the date on which the notice of seizure provided in section 6335(a) is given.

The 9th Circuit Court agrees with these procedures. In Arford v. United States (supra), a Notice of Seizure was a procedural requirement in order to effectuate the actual levy upon the seizure of Arford's retirement pay. This finding is in accord with 26 U.S.C. section 6502(b) which provides that a levy occurs on the date the Notice of Seizure is given pursuant to 26 U.S.C. section 6335(a), and not before.

The IRS levies on accrued salaries or wages by serving a "notice of levy" (Form 668-A or 668-W) on the employer of a Federal or District of Columbia officer, employee, or elected official. This is the only time the Internal Revenue Code states that the service of a "Notice of Levy" makes a levy. In all other cases, section 6502(b) tells us that a levy is considered made only when the "Notice of Seizure" is given.

Now, after reading all this, it should occur to you that the IRS's power to levy is actually very limited. Only property already possessed by the Secretary is subject to levy, and only property subject to forfeiture can be seized and brought into the possession of the Secretary if that property is not already possessed by the Secretary. So to summarize, seizure is limited by statute to certain specific items. Sections 7321 and 7608(b)(2)(C) strictly limit seizure authority to "property subject to forfeiture". Such property is described in sections 7301 through 7304. Property not subject to forfeiture cannot be seized, and a levy on any other property must be made on items already in the possession of the government. Section 6331(b) further states that a levy extends only to "property possessed".

Of course, there is a third way the Secretary may acquire possession of property which is not already in his possession, but you won't find it written in the Internal Revenue Code. The third way is simply an extension of the Secretary's authority under section 6301 to accept collection of internal revenue taxes which are voluntarily paid to him. If the IRS can get property turned over to the Secretary on a voluntary basis, then this property becomes property subject to levy and the Secretary may then levy upon it.

Yes, the IRS is actually bluffing non-federal employers, banks, and other third-party asset holders into turning over property to the Secretary when no authority to enforce such is given in the Internal Revenue Code! I will explain how the bluff works and why any employer, bank, or other third-party asset holder may simply refuse to turn over such property to the Internal Revenue Service, and that there is no penalty for not turning over such assets.

The first part of the bluff is Treasury Regulation 301.6331-1(a)(1), which states:

"Levy may be made by serving a notice of levy on any person in possession of, or obligated with respect to, property or rights to property subject to levy, including receivables, bank accounts, evidence of debt, securities, and salaries, wages, and other compensation."

Of course, we know now that when the regulation says that the levy may be made by serving a "Notice of Levy" on anyone having property "subject to levy", it means that the levy is made on accrued salaries or wages when the "Notice of Levy" is served on the employer of federal or District of Columbia employees, and, in the case of any other property already possessed by the Secretary, when the "Notice of Levy" is served on the person who has such property. This is a proper procedure for the IRS to adopt since section 6331(b) provides for a levy on any other property already possessed, but does not specifically state how such levy is to be carried out. In the case of a seizure, section 6502(b) already told us that the levy is made when the "Notice of Seizure" is given.

Now, the average person reading this regulation doesn't know what "property subject to levy" is, and when the "Notice of Levy" is served on him, he is led to believe that the law requires him to turn over to the IRS any property he has which belongs to the delinquent taxpayer. You now know, after reading all of the above, that this is not the case.

The bluff continues when the IRS cites Code section 6332, as follows:

§ 6332. Surrender of property subject to levy.

(a) Requirement--Except as otherwise provided in this section, any person in possession of (or obligated with respect to) property or rights to property subject to levy upon which a levy has been made shall, upon demand of the Secretary, surrender such property or rights (or discharge such obligation) to the Secretary, except such part of the property or rights as is, at the time of such demand, subject to an attachment or execution under any judicial process.

(b) (Not reproduced here. Deals only with life insurance and endowment contracts)

(c) Special rule for banks--Any bank (as defined in section 408(n)) shall surrender (subject to an attachment or execution under judicial process) any deposits (including interest thereon) in such bank only after 21 days after service of levy.

(d) Enforcement of levy

(1) Extent of personal liability--Any person who fails or refuses to surrender any property or rights to property, subject to levy, upon demand by the Secretary, shall be liable in his own person and estate to the United States in a sum equal to the value of the property or rights not so surrendered, but not exceeding the amount of taxes for the collection of which such levy has been made, together with costs and interest on such sum at the underpayment rate established under section 6621 from the date of such levy (or, in the case of a levy described in section 6331(d)(3), from the date such person would otherwise have been obligated to pay over such amounts to the taxpayer). Any amount (other than costs) recovered under this paragraph shall be credited against the tax liability for the collection of which such levy was made.

(2) Penalty for violation--In addition to the personal liability imposed by paragraph (1), if any person required to surrender property or rights to property fails or refuses to surrender such property or rights to property without reasonable cause, such person shall be liable for a penalty equal to 50 percent of the amount recoverable under paragraph (1). No part of such penalty shall be credited against the tax liability for the collection of which such levy was made.

Again, we see that the law requires the surrender of "property subject to levy" upon which a levy "has been made". And again, the average person doesn't know exactly what all this means. You now know from reading the above that a levy "has been made" when a "Notice of Levy" is served on a person who has property "subject to levy", which means the "Notice of Levy" is given to some other delegate of the Secretary of the Treasury who has such property in his possession (or, in the case of accrued salaries or wages, to the head (or designated payroll agent) of a Federal or District of Columbia agency or instrumentality). It now becomes clear that this Code section was directed to other Treasury Secretary Delegates or heads of Federal or District of Columbia agencies or instrumentalities who may have possession of property, rights to property, or accrued salaries or wages belonging to the delinquent taxpayer, and the law requires them to surrender such property when the "Notice of Levy" is served on them..

Section 6332(c) also hints that there are penalties for failure to turn over property after a "Notice of Levy" has been served. You now know enough to know that this penalty would only apply if you have "property subject to levy" and you fail to surrender it upon demand by the Secretary. This was all discussed earlier and unless you're a person having such property in your possession or control, this penalty cannot possibly apply to you.

The IRS agents should take their case to court to allow you to be heard or your rights to due process will be violated. And indeed this is essentially what the IRS is supposed to do in every case. To enforce collection of a delinquent tax, the IRS needs a court order, just like any other judgment creditor. A Notice of Levy is not sufficient to reach property unless the asset holder is tricked by it into voluntarily turning it over to the revenue agent, or the property is already in the custody and control of the Secretary. The procedure to reach property by suit is given in the Internal Revenue Code under Code section 7401, as follows:

§ 7401. Authorization.

No civil action for the collection or recovery of taxes, or of any fine, penalty, or forfeiture, shall be commenced unless the Secretary authorizes or sanctions the proceedings and the Attorney General or his delegate directs that the action be commenced.

And section 7403, as follows:

§ 7403. Action to enforce lien or to subject property to Payment of tax.

(a) Filing--In any case where there has been a refusal or neglect to pay any tax, or to discharge any liability in respect thereof, whether or not levy has been made, the Attorney General or his delegate, at the request of the Secretary, may direct a civil action to be filed in a district court of the United States to enforce the lien of the United States under this title with respect to such tax or liability or to subject any property, of whatever nature, of the delinquent, or in which he has any right, title, or interest, to the payment of such tax or liability. For purposes of the preceding sentence, any acceleration of payment under section 6166(g) shall be treated as a neglect to pay tax.

(b) Parties--All persons having liens upon or claiming any interest in the property involved in such action shall be made parties thereto.

(c) Adjudication and decree--The court shall, after the parties have been duly notified of the action, proceed to adjudicate all matters involved therein and finally determine the merits of all claims to and liens upon the property, and, in all cases where a claim or interest of the United States therein is established, may decree a sale of such property, by the proper officer of the court, and a distribution of the proceeds of such sale according to the findings of the court in respect to the interests of the parties and of the United States. If the property is sold to satisfy a first lien held by the United States, the United States may bid at the sale such sum, not exceeding the amount of such lien with expenses of sale, as the Secretary directs.

This is the due process written into the Internal Revenue Code. If the IRS wants to enforce collection of a tax, they have to file suit in Federal District Court, obtain a judgment, and execute the judgment with a court order in order to lawfully enforce the collection of the delinquent tax. The only obvious exception to this is when the Secretary already has possession of some property, in which case no court order is needed to reach the property since the property is already possessed.

Of course, the IRS likes to bluff people into voluntarily turning property over to them by serving "Notices of Levy" on them, as if this "makes" a levy and as if the person must surrender to the IRS any property he has belonging to the delinquent taxpayer. This is not the case, but as long as enough people fall for this bluff the IRS is going to continue using this ploy since it is far less expensive and far more efficient than having to go to court.

So the question comes down to this: What am I to do if I am ever served with a "Notice of Levy" ? Before I answer this, you must realize that you do not have to surrender any property to the IRS on the basis of such a notice, unless of course you are in custody or control of property "subject to levy". If the government wants to compel you to surrender any property belonging to the delinquent taxpayer, they must get a court order just like in any other garnishment proceedings. Basically, you should just sit back and wait for the Department of Justice to file suit. This way you will be protected by the court should you have to turn any property over to the government.

If you think that you can avoid being sued by complying with the "Notice of Levy" and turning over the property to the IRS, you would be wrong. It is true that you would avoid being sued by the Department of Justice, but you would then expose yourself to being sued by the person whose property you turned over. His cause of action would be against you since you turned his property over to the government without a court order, without his consent or permission, and without being required to surrender the property under any statute. He would have no cause of action against the IRS since the IRS basically did nothing wrong, and they were acting within the scope of their authority by accepting any property voluntarily turned over to them.

No protection is offered by section 6332(d), as follows:

§ 6332. Surrender of property subject to levy.

...

(e) Effect of honoring levy--Any person in possession of (or obligated with respect to) property or rights to property subject to levy upon which a levy has been made who, upon demand by the Secretary, surrenders such property or rights to property (or discharges such obligation) to the Secretary (or who pays a liability under subsection (d)(1)) shall be discharged from any obligation or liability to the delinquent taxpayer and any other person with respect to such property or rights to property arising from such surrender or payment.

This section relies on 6331 and both sections require a levy on property.

Because there is no judicial process and no levy has been made the person taking property based on a "Notice of Levy" is not relieved from liability to the person owning the property. Also, this section was written for the government's own Treasury Secretary Delegates or heads (or designated payroll agents) of Federal or District of Columbia agencies or instrumentalities who turn over "property subject to levy" upon which a levy "has been made". Unless you're a delegate of the Secretary of the Treasury or head (or designated payroll agent) of a Federal or District of Columbia agency or instrumentality you are not indemnified and you are exposed to a lawsuit by the owner of the property should you turn it over to the IRS.

The IRS will attempt to make you believe they have the authority pursuant to

§ 6331, however their own documents prove them wrong. As stated in the rules and regulations filed in the Federal Register 11-23-73:

"this treasury decision recodifies the portion of 26 CFR Part 301 entitled "Discovery of Liability and Enforcement of Title" into 27 CFR Part 70"

Federal Register, Vol 38, NO 226-Monday, November 26, 1993

27 CFR Part 70 is exclusively for the enforcement of Alcohol, Tobacco and Firearms. Unless you are providing services and or are involved in this type of activity the taking of money on a Notice of Levy is theft.

Turn the property over, and the owner will sue you. Don't turn the property over, and the government may sue you, but should this happen you will have a judicial order which will protect you and your company from civil action. The best thing to do, under the circumstances, is to simply not turn over any property to the IRS unless you get a court order ordering you to do so. The "Notice of Levy" has no legal muscle behind it as explained earlier.

When served with a "Notice of Levy", my suggestion would be to write a letter to the IRS agent who signed the notice and ask him the following questions:

1. What is property "subject to levy" as used in section 6332, and is the property you are demanding property "subject to levy upon which a levy has been made"? Please note that I am aware of section 6502(b), which states that a levy is made on the date the section 6335(a) "Notice of Seizure" is given. Has the "Notice of Seizure" been issued?

2. Please explain the indemnification process under section 6332(d) if I turn the property over to you and the owner of the property sues me.

3. Is this "Notice of Levy" the result of a judgment entered by a court?

Since it does not appear to be a court order, and does not have a case number or a Judicial signature. What will happen to me if I do not turn this property over to you?

All of these are legitimate questions which should express genuine concerns you have about the whole levy procedure. Of course, the IRS will try to hint that you should turn the property over in order to avoid any penalties and court proceedings, but when they answer question #3, they will be forced to tell you that they will simply have to go to court in order to reach the "Levied" property. If you've ever been the garnishee in a garnishment proceeding, it is really not that bad. I would also suggest you give the agent a copy of this letter.

This letter should have answered most of your questions about levies and what your duties are if you should ever receive one. If you have any further questions, please do not hesitate to contact me again.

Please use the check sheet that I have attached to help you when you receive a Notice of Levy to see if it is valid or just an attempt to deceive you.

___________________________

John J Schlabach, Enrolled Agent

Enrollment # 50614

Third Party Checklist For Determining Validity of IRS Notices of Levy

Do not proceed to the next step (question) unless the answer to each and every question below is YES. If the answer to ANY question is NO, the levy is invalid and is LEGALLY UNENFORCEABLE. YOU MAY BE HELD PERSONALLY LIABLE FOR HONORING SUCH A “NOTICE” WITHOUT AN ATTACHED COURT ORDER. Inform the IRS that you are unable to honor the “levy” untill ALL of the legal requirements for such have been met.

1.) Is there a copy of the court ordered warrant of distraint and Notice of Lien included with the Notice of Levy ?

2.) Does the tax that the IRS claims is owed arise from taxable activities subject to miscellaneous excise taxes under Title 26 USC, subtitle E, or those that would pertain to the enabling regulations of Title 27 CFR Part 70 (alcohol, tobacco, and firearms), or are you a Federal employer as defined in Title 26, section 3401(d) (in one of the U.S. territories and responsible for administering provisions under 26 USC subtitle C ?

3.) Was a valid Notice and Demand for unpaid tax sent to the individual whose property is the target of the levy ?

4.) Has a vaild Notice of Lien been filed with the appropriate court at least 10 days after the Notice and Demand was received, and has the court issued a warrant of distraint pusuant to IRS section 7403 ?

5.) Has the IRS sent at least three notices to the individual asking for payment and has the individual refused to pay ?

6.) Has the IRS sent a Notice of Intent to Levy to the individual at least 30 days prior to the date on the Notice of Levy you received ?

7.) Is the Notice of Levy signed by an IRS agent and is there a delegation order in existence giving that particular agent the authority to issue a Notice of Levy ?

If ALL of the above conditions have been satisfied, the levy could be valid. However, if you turn over property in response to an improper levy, the individual who owns the property can sue you personally for punitive as well as actual damages (26 CFR 301.6332-1c).

IT IS YOUR RESPONSIBILITYAS THE FIDUCIARY TO INSURE THAT ALL OF THE LEGAL REQUIREMENTS ARE MET !

And what has the Supreme Court said about this issue, when wrongfully used in the private sector:

“the idea of wage garnishment in advance of judgment, of trustee process, of wage attachment, or whatever it is called is a most inhuman doctrine”... in a vast number of cases the debt is a fraudulent one, saddled on a poor ignorant person who is trapped ... in which he is charged double for something he could not pay for even if the proper price was called for, and then hounded into giving up his pound of flesh...” [Sniadach v. Family Finance Corp., 395 U.S. 340, 341]

Sound familiar ?

This Enrolled Agent also offers an opinioni letter on tax liability if you are interested:

TAXES - ACCOUNTING- AUDITS - ESTATE PLANNING - PAYROLL

17511 North Greenbluff Road Colbert, Washington 99005

Tel (509) 238-4697 Fax (509) 238-4697

April 17, 1997

IRS Enrolled Agent Opinion Letter

on the Citizen’s Liability for Income Tax

Dear Citizen:

At your request I have researched the Internal Revenue Code (Title 26 U.S.C.) relative to an individual income tax return. I cannot tell you not to file an income tax return unless you have no tax liability. Each person involved, on his/her own, must make this determination.

First let me tell you something about myself I am an Enrolled Agent. Enrolled Agents are defined in the IRS Regulations Circular 230 as a person who has demonstrated technical competence in interpreting and administering the Internal Revenue Code and regulations thereunder. This person has passed a strenuous test in all areas of taxation administered by the Internal Revenue Service. Enrolled Agents are licensed by the Treasury Department and must continue to show proficiency in the tax laws and regulations with documented continuing professional education hours in

order to maintain their licenses.

There are two important issues that you need to address. What is the subject of the tax? Where is the liability for that tax? These questions are addressed more in detail later in this research letter. Let us look at some statutes that might concern you. Lets start with the failure to file return, supply information, or pay tax, as stated in section 7203 as

follows.

§ 7203, Willful failure to file return, supply information, or pay tax

Any person required under this title to pay any estimated tax or tax, or

required by this title or by regulations made under authority thereof to

make a return, keep any records, or supply any information, who willfully

fails to pay such estimated tax or tax, make such return, keep such

records, or supply such information, at the time or times required by law

or regulations, shall, in addition to other penalties provided by law, be

guilty of a misdemeanor and, upon conviction thereof, shall be fined not

more Than $25,000 ($100,000 in the case of a corporation), or imprisoned

not more than I year, or both, together with the costs of prosecution. In

the case of any person with respect to whom there is a failure to pay any

estimated tax, this section shall not apply to such person with respect to

such failure if there is no addition to tax under section 6654 or 6655 with

respect to such failure. In The case of a willful violation of any

provision of section 60501, the first sentence of this section shall be

applied by substituting "5 years" for "1 year".

As you can see by the highlighted words there are two essential elements that must be present. First, you must be required to pay a tax, or be liable for paying a tax. This means it is a crime only if you are a person required by law or regulation to pay a tax, file a return or keep such records. It is, therefore, important to determine if you are a person

"required" to perform these functions. This will be the first subject discussed in this letter.

The government has to prove these elements in order to subject you to punishment. They must first prove you had `taxable income", that you are "liable" for a tax, and that the "liability" made you a "required person." If any of these elements cannot be proven, you cannot be subject to punishment.

Let's first see whether or not you are a "person liable." To start with, I look at the two code sections that address this issue under: Title 3, Section 552a(e)(3) [[The Privacy Act], and Title 44, Section 3504(c)(3)(C) [[The Paperwork Reduction Act].

The Privacy Act states that the Agency requesting information must:

(3) inform each individual whom it asks to supply information, on the form

which it uses to collect the information or on a separate form that can be

retained by the individual---

(A) the authority (Ether granted by statute, or by executive order of the

President) which authorizes the solicitation of the information and whether

disclosure of such information is mandatory or voluntary;

(B) the principal purpose for which the information is intended

to be used; (C) the routine uses which may be made of the information, as

published pursuant to paragraph (4)(D) of this subsection; and

(D) the effects on him, if any, of not providing all or any part of the

requested information...

The Paperwork Reduction Act states that the Director of the Office of Management and Budget must include with his/her information request:

“a statement to inform the person reviewing the request why the

information is being collected, how it is to be used, and whether responses

to the request are voluntary, required to obtain a benefit, or mandatory..."

Now, here we have two statutes directing the government to tell us whether giving the IRS an income tax return is voluntary or mandatory. The IRS responds to the directives of the Privacy Act and Paperwork Reduction Act Notice with the following statement:

"Our legal right to ask for information is Internal Revenue Code section

6001, 6011 and 6012(a) and their regulations. They say that you must file a

return or statement with us for arty tax you are liable for. Your response

is mandatory under these sections."

I have to point out to you that the IRS again uses the word "liable for".

Now, let's look at the Internal Revenue Code to see what it has to say. The

two sections 6001 and 6011 follow as written in the code of 1994.

§ 6001. Notice or regulations requiring records, statements, and special returns

Every person liable for any tax imposed by this title, or for the collection thereof, shall keep such records, render such statements, make such returns, and comply with such roles and regulations as the Secretary may from time to time prescribe. whenever in the judgment of the Secretary it is necessary, he may require any person, by notice served upon such person or by regulations, to make such returns, render such statements, or keep such records, as the Secretary deems sufficient to show whether or not such person is liable fur tax under this title. The only records which an employer shall be required to keep under this section in connection with charged tips shall be charge receipts, records necessary to comply with section 6053(c), and copies of statements furnished by employees undersection 6053(a).

§ 6011. General requirement of return, statement, or list

(a) General rule--When required by regulations prescribed by the Secretary any person made liable for any tax imposed by this title, or with respect to the collection thereof, shall make a return or statement according to the forms and regulations prescribed by the Secretary. Every person required to make a return or statement shall include therein theinformation required by such forms or regulations.

In these two sections we are instructed to file a return or statement for any tax we are liable for. indeed, Section 6001 refers to "Every person liable for My tax imposed by [The Internal Revenue Code]..." and Section 6011 refers to "...any person made liable for any tax imposed by [The Internal Revenue Code]..." But, as you can see, nowhere in either of these two sections are we told who is liable for, in this case, the income tax. The government has in effect, told us that a response is mandatory if we are liable for the tax, but neglected to tell us whether or not we are liable for the tax. The government has been very explicit in telling us that a response, either a return or statement, is mandatory for My tax that we are liable for; however, the government has remained silent in telling us who is liable for the tax. Thus, even after reading the government's official notices under the Privacy Act and Paperwork Reduction Act, we still do not know if an income tax return is required of us. In my opinion, by maintaining silence on this central issue, the government has not complied with either the spirit or the letter of the law of the two Acts. This opinion is shared by courts as well:

"`Silence' is species of conduct, and constitutes an implied representation

of the existence of facts in question... When silence is of such character

and under such circumstances that it would become a fraud...it will operate

as an estoppel." [Carmine v. Bowen, 64 AT. 932]

Since the government has not told you whether you are required to file an income tax return, you have asked me to research this matter. Since you must be a "person liable" to be a "person required", lets address this issue.

The right to tax comes from the United States Constitution, the supreme law of the land, which authorizes the federal government to impose two broad categories of taxes: direct taxes under Article I, Section 2 and Article I, Section 9, and indirect taxes under Article I, Section 8. Direct taxes are required to be apportioned among the states, while indirect taxes must be uniform throughout the United States.

Briefly, a direct tax is a tax on an ownership interest which the owner cannot pass on, while an indirect tax is on an event where the transaction and the impact of the tax can be passed on, in whole or in part, to others. In order for a tax to fall into the indirect tax category the individual liable for the tax cannot be the ultimate, final consumer. This is so since the one paying the tax can then add it on to the price of the thing being taxed and recover it (pass it on) when it is sold. The ultimate, final consumer would have no way to recover (pass on) the tax, so any tax which the ultimate, final consumer is liable for would be a direct tax based on an ownership interest.

"The Sixteenth Amendment does not extend the power of taxation to new or

excepted subjects” [Pack v Lowe, 247 U.S. 165].

"The Sixteenth Amendment conferred no new power of taxation”

[Stanton v Baltic Mining Co., 240 US.103, at 112].

"The individual, unlike the corporation, cannot be taxed for the mere

privilege of existing., The corporation is an artificial entity which owes

its existence in charter powers to the State, but the individual's right to

live and own property are natural Rights for which an excise cannot be

imposed." [Redfield v Fisher, 292 P.813, at 819].

"Neither can the tax be sustained on the [natural] person, measured by income.

Such a tax would be, by nature, a capitation rather than an excise."

[Peck v Lowe, 247 US. 165.] [emphasis added]

"Income has been taken to mean the same thing as used in the Corporate

excise Tax of 1909 (36 Stat. 112). The individual worker does not receive a

profit or gain from his/her labors - merely an equal exchange of funds for

services." [Brushaber v. Union Pacific R.R., 240 US. 1, l7,36S.CT.236,24t].

"The taxpayer must be liable for the tax. Tax liability is a condition

precedent to the demand. Merely demanding payment, even repeatedly, does

not cause liability" [Bothke v. Terry, 713 F. 2d 1405, at 1414(1983)].

"The Treasury Department cannot, by interpretive regulations, make income

of that which is not income within the meaning of the revenue acts of

Congress, nor can Congress, without apportionment, tax as income that which

is not income within the meaning of the Sixteenth Amendment."

[Helvering v.Edison Bros. Stores, 133 F.2d 575].

Also, please note the voluntary nature of Social Security or the use of the W-4? The only place in the code that addresses the Social Security issue is in Title 26 U.S.C. subtitle C, chapter 21 (Social Security Tax Act) of the Internal Revenue Code starting in subchapter A. Subtitle C includes sections 3101 through 3510 of Title 26 U.S.C..

The first issue is whether subtitle C is relative / jurisdictional to you. To make this determination please note in Subtitle C at subchapter c, §3121, which has specific definitions which relate to Social Security. In this jurisdictional section at 3121(e) State, United States and citizen reads as follows:

3121. Definitions

...

(e) State, United States, And Citizen

For purposes of this chapter-

(l) State

The term `State" includes the District of Columbia, the Commonwalth of Puerto Rico, theVirgin Islands, Guam, and American Samoa.

(2) United States

The term `United States" when used in a geographical sense includes the

commonwealth of Puerto Rico, the Virgin Islands, Guam, and American Samoa.

An individual who is a citizen of the Commonwealth of Puerto Rico (but not otherwise a citizen of the United States) shall be considered, for purposes of this

section, as a citizen of the United States.

The jurisdiction in this section is very specific as you can see. Because there is no section that makes it mandatory in the 50 Union States it must be voluntary for citizens in these States.

To better understand these provisions, and the different jurisdictions, you have to understand that Congress creates laws for TWO distinct and separate jurisdictions:

1) Washington, D.C., enclaves in the 50 states (i.e.: land that has been ceded by the State to the federal government), and the territories and possessions, such as Puerto Rico, Virgin Islands, Guam, etc.

2) The 50 states.

The principal difference in the jurisdictions is that the Constitution of the United States of America has to be strictly adhered to in making laws that affect the 50 states. However in Washington, D.C., enclaves and territories, Congress has EXCLUSIVE jurisdiction, which means they can make any law they want to; The Constitution is not considered. (Article 1, Section 8 U.S. Const). See also CAHA v U.S. 152 U.S. 211:

The laws of Congress in respect to those matters (outside of Constitutionally delegated powers) do not extend into the territorial limits of the states, but have force only in the District of Columbia, and other places that are within the exclusive jurisdiction of the national government."

DOWNES v. BIDWELL, 182 U.S. 244 is also very explicit:

"Constitutional restrictions and limitations were not applicable to the

area of lands, enclaves, territories and possessions over which Congress

had exclusive legislative authority."

The Supreme Court has ruled consistently on this issue ever since America's inception. In fact, the latest case was U.S. v. LOPEZ, 115 5. CT. 1624 (1995). The Court ruled a law applicable in Washington, D.C. was not applicable in San Antonio, Texas, because it did not conform to Constitutional restrictions.

Since an income tax is a tax on income created by a transaction which is (and must be) directly associated with, or effectively connected with, some particular type of revenue-taxable "privileged" activity [i.e. alcohol, firearms, tobacco, or other privileged activity or excise], the Internal Revenue Code and its implementing and controlling federal regulations must specify the particular type or kind of tax arising from a revenue-taxable, privileged activity that makes one a "person liable" or "made liable". For example, Internal Revenue Code Section 5005 establishes that liability for the tax on distilled spirits is placed on the distiller or the importer. Section 5043 places the liability for the tax, from wine, on the proprietor of the bonded wine cellar or on the importer. Section 5703 places the liability for the tax on cigars and cigarettes on the manufacturer or importer. Also, to be classified as an indirect tax, the individual liable for the tax must not be the ultimate, final consumer.

In support of this, took at some closely related taxes. Section 2502(c) establishes liability for the gift tax on the donor, the one giving the gift, not the donee, the one receiving the gift.

Section 2002 establishes liability for the estate tax on the executor, not on the inheritors receiving the property. "Section 2002, liability for payment. The tax imposed by this chapter shall be paid by the executor."

Since you must be liable for an income tax on your own income, neither section 6001 nor section 6011 require you to file an income tax return. However, I want to continue and discuss 6012, which is the section many believe require income tax returns be filed.

§ 6012. Persons required to make returns of income

(a)General rule -- Returns with respect to income taxes under subtitle A

shall be made by the following:

(1 )(A) Every individual having for the taxable year gross income which

equals or exceeds the exemption amount, except that a return shall not be

required of an individual--

(i) who is not mauled (determined by applying section 7703), is not a

surviving spouse (as defined in section 2(a)), is not a head of a household

(as defined in section 2(b)), and for the taxable year has gross income of

less than the sum of the exemption amount plus the basic standard deduction

applicable to such an individual,

(ii) Who is a head of a household (as so defined) and for the taxable year

has gross income of less than the sum of the exemption amount plus the

basic standard deduction applicable to such an individual,

(iii) who is a surviving spouse (as so defined) and for the taxable year

has gross income of less than the stun of the exemption amount plus the

basic standard deduction applicable to such an individual, or

(iv) Who is entitled to make a joint return and whose gross income, when

combined with the gross income of his spouse, is, for the taxable year,

less than the sum of twice the exemption amount plus the basic standard

deduction applicable to a joint return, but only if such individual and his

spouse, at the close of the taxable year, had the same household as their

home.

To determine who must make returns lets see what type of taxes can be assessed, by whom and for what classification of tax. For this we must go to Section 6201 Assessment Authority, which reads as follows:

§ 6201. Assessment Authority

(a) Authority Of Secretary

The Secretary is authorized and required to make the inquiries,

determinations, and assessments of all taxes (including interest,

additional amounts, additions to the tax, and assessable penalties) imposed

by this title, or accruing under any former internal revenue law, which

have not been duty paid by stamp at the time and in the manner provided by

law.

Such authority shall extend to and include the following:

(l) Taxes Shown On Return

The Secretary shall assess all taxes determined by the taxpayer or by the

Secretary as to which returns or lists are made under this title.

(2) Unpaid Taxes Payable By Stamp

...

Title 26 U.S.C. § 6201 gives the secretary the authority to assess taxes not duly paid by stamp or by the individual who has assessed himself, ie: voluntary tax. Stamp taxes are associated with subtitle E of the Internal Revenue Code Title 26 or Title 27. Ie: Alcohol, Tobacco and Firearms. Here, again, you have to determine what activity you are involved in and does this activity pay taxes by stamp.

The First Amendment of the Constitution of the United States protects the freedom of speech and of the press. The freedom to speak, you must understand, also involves the freedom not to speak. If you do not have the right not to speak, (i.e.-- if the government could compel you to speak) then you have no freedom of speech. Since this right extends to printed and written materials, you have a First Amendment Right not to fill out government forms and not to give the government information.

The Fourth Amendment of the Constitution of the United States protects your privacy. You have a Fourth Amendment Right to keep your personal financial affairs private, and not to voluntarily give that information to the government. The Fourth Amendment provides that if the government wants to examine your books and records, a court order must be obtained. The mailing of a tax form along with instructions on how to complete it is not, for Fourth Amendment purposes, a valid order compelling a response.

The Fifth Amendment of the Constitution of the United States protects you as well, stating:

"No person shall ... be compelled in any criminal case to be a witness against himself"

The fifth amendment seems to apply only to criminal matters, but the Supreme Court ruled in McCarthy v. Arndstein, 266 US. 34, that the fifth amendment " applies alike to criminal and civil proceedings." Similar rulings have stated;

"There can be no question that one who files a return under oath is a witness within the meaning of the Amendment.” [Sullivan v. United States, 15 F. 2nd 809], and

'The information revealed in the preparation and filing of an income tax

return is, for Fifth Amendment analysis. "the testimony of a "witness" as

that term is used herein.' [Garner v. United States, 424 US. 648].

Since you can't be compelled to be a witness against yourself, and since the Supreme Court has twice held that the filing of an income tax return is an act of being a witness against one's self, it follows that any statute compelling the filing of an income tax return would violate the protections of the Fifth Amendment.

The effect of the government's actions has been noted by the Supreme Court:

"Because of what appears to be a lawful command on the surface, many

citizens, because of their respect for what only appears to be law, are

cunningly coerced into waving their rights due to ignorance."

[U.S. v. Minker, 350 US. 179, at 187].

Section 6012, moreover, specifies a condition that must be met before the income tax return "shall be made". The individual has to have "for the taxable year a gross income of the exemption amount or more". Based on the following code sections, I will show you where no individual has any item of' gross income that is includable:

First, look at the definition of "taxable year":

§ 7701. Definitions.

(a) When used in this title, where not otherwise distinctly

expressed or manifestly incompatible with the intent thereof--

....

(23) Taxable year. -- The term "taxable year" means the calendar

year, or the fiscal year ending during such calendar year, upon the basis

of which the taxable income is computed under subtitle A. "Taxable year"

means, in the case of a return made for a fractional part of a year under

the provisions of subtitle A or under regulations prescribed by the

Secretary, the period for which such return is made. (Section 441 (b) also

defines Taxable year: For purposes of this subtitle, the term "taxable

year" means--(l)"the taxpayer's annual accounting period").

The definition of' "taxable year" is important since the law requires that taxable income is to be computed on the basis of a taxable year:

"Section 441(a) COMPUTATION OF TAXABLE INCOME--- Taxable income shall be computed on the basis of the taxpayer's taxable year."

Now, let us took at the definition of "taxpayer' and `person":

§ 770l. Definitions

(a) When used in this title, where not otherwise distinctly expressed or manifestly incompatible with the intent thereof--

(1) Person--The term "person" shall he construed to mean and include an individual, a trust, estate, partnership. association, company or corporation. [Which is only an artificial, not a natural, person / human being.]

...

(14) TAXPAYER --The term "taxpayer" means any person subject to any

internal revenue tax.

So, by substituting the term "person subject to any internal revenue tax"for the term "taxpayer" in section 441(a), the section requires the tax to be computed on the basis of the taxable year of the person subject to the income tax, Using the same substitution as above, you find:

§ 451.

(a) General rule. -- The amount of any item of gross income

shall be included in the gross income for the taxable year in which

received by the taxpayer, unless, under the method of accounting used in

computing taxable income, such amount is to be properly accounted for as of

a different period.

The point is this: Taxable income is required to be computed on the basis of the taxable year of the person subject to the income tax, II the person does not have a liability, he cannot have a taxable year in which any amount can he included,

Based on all of the above, it is my professional opinion, supported by the Court in U.S. v, Flora, 362 US, 145. at 176, that the filing of an individual income tax return is voluntary Quoting the Court:

"Our system of taxation is based oil voluntary assessment and payment, not

upon distraint." [U.S.. v. Flora, id.]

Also, by the testimony of Mr. Avis before Congressional subcommittee hearings on the Internal Revenue Investigation: “Your income tax is 100 percent voluntary tax, and your liquor tax is 100 percent enforced tax. Now, the situation is as different as night and day." (Exhibit A)

You may be asking yourself why is it that so many people file tax returns each year ? Let me give you a statement by Adolph Hitler, "If you tell or report a lie often enough and long enough people will eventually believe it." This is what has happened to the people of lie United States of America. Every year the IRS sends millions of forms to people, along with instructions, on how to I'll them out. The people do not question the form nor do they determine if there is a liability, but just fill in the lines and send them back with whatever money the form requires. No one ever asks what law requires them to fill out this form and does it apply to them.

Furthermore, the Privacy Act Notice says that the government must tell you the effects, if any, of not filing the return. Until 1981, the Privacy Act Notice read as follows: `If a return is not filed, or if we don't receive the information we ask for, the law provides that a penalty may be charged (the "penalty" being a penalty for filing and paying the tax late). Since 1982, the Privacy Act Notice has been revised, reading: "If you do not file a return, do not provide the information we ask for, or provide fraudulent information, the law provides that you may be charged penalties and, in certain cases, you may be subject to criminal prosecution." No mention was made in the previous Privacy Act Notice since it only referred to not filing a return or providing information. Added to the Privacy Act Notice in 1982 was a caution about "fraudulent information" and "in certain cases, you may be subject to criminal prosecution".Since it is true that filing a false or fraudulent return is a crime under Code sections 7206 and 7207, the "certain cases" referred to in the later Privacy Act Notice are undoubtedly cases where a false or fraudulent return has been filed; however, the Privacy Act Notice still has not told us that not filing a return is a punishable offense.

If you remember, at the outset of this letter I said that in order for the government to punish you for not filing an income tax return, certain elements must be present: they must first prove you had "taxable income"; then, they must prove that income made you "liable" for a tax; next, they must prove that "liability" made you a "required person", and lastly, that you failed to file a "required return", and if any one of these elements cannot be proven, you cannot be subject to punishment. The word "willfully", when used in a criminal statute, means an act done with a bad purpose. Felton v. United States, 96 US. 699: Potter v. United States, 155 US. 438: Spurr v. United States, 174 US. 728, or without justifiable excuse. Felton v. United States, supra; Williams v. People, 26 Colo. 272, 57P. 701: People v. Jewell, 138 Mich. 620, 101 NW 835; St. Louis I. M. & S Ry. Co. v. Batesville & W. Tel. Co., 80 Ark. 499, 97 SW 660; Clay v. State, 52 Tex. Cr. 555, 107 8W 1129; or Stubbornly, obstinately, perversely.Wales v. Miner, 89 lad. 1l8, at 127; Lynch v. Commonwealth, 131 Va. 762; 109 SE. 427; Claus v. Chicago Gt. W. Ry. Co., 136 Iowa 7, 111 N.W. 15; State v. Harwell, 129 N.C. 550; 40 S.E. 48. The word is also employed to characterize a thing done without grounds for believing it is lawful. Roby v. Newton, 121 Ga. 679, 49 S.E. 694, or conduct marked by a careless disregard whether or not one has the right so to act. United States v. Philadelphia & R. Ry Co., 223 Fed. 207, at 210; State v. Savra. 129 Iowa 122; 105 N.W. 387; State v. Morgan, 136 N.C. 628,48 S.F. 670.

Thus, since the government's Privacy Act Notice and Paperwork Reduction Act Notice do not meet its intended purpose and does not specifically say that filing an income tax return is required, the courts have recognized that the word "willfully" in these statutes generally connotes a voluntary. Intentional violation of a known legal duty. U.S. v. Bishop, 412 US. 346.

The Supreme Court has ruled as recently as January 8, 1991, that a belief that one is not required to file an income tax return, based upon professional advice, precludes the "willfulness" requirement [Cheek v.U.S., 498 US. 192, at 207 (1991)].

To sum up, the government must prove that you have a liability and they must disprove your claim that you believed filing an income tax return was not required or is voluntary, and instead prove that you intentionally did not file one. This is a decision that you have to make on your own. If you have a tax liability you will have to file a return.

With all the facts and evidence presented herein. you should have no problem defending yourself should the government try to criminally prosecute you for not filing an income tax return if you have no liability.

I sincerely hope that all points have been clarified. If any additional questions arise

please do not hesitate to write me again.

Sincerely,

John J. Schlabach, Enrolled Agent

Enrollment # 50614

The Criminal Investigative Division

It states in the Internal Revenue Manual (IRM), in Chapter 1100, at Section 1132.75:

1132.75

Criminal Investigative Division

The Criminal Investigative Division enforces the criminal statutes applicable to income, estate, gift, employment, and excise tax laws involving United States Citizens residing in foreign countries and nonresident aliens subject to Federal income tax filing requirements.

(emphasis added)

Now you show me the corresponding section, anywhere in the law or the IRM, that would provide authority over Citizens NOT RESIDING IN FOREIGN COUNTRIES", but living and working in America !

This, of course, supports and agrees completely with the claim that the income tax is STILL JUST A FOREIGN TAX, as it is accurately recorded in the law. It also supports the charge that the IRS is exceeding the LIMITED authorities established for it under the law and illegally operating in an anarchistic fashion.

There has never been a LEGAL criminal investigation of any U.S. Citizen living and working in the United States of America in the history of the IRS. C.I.D. HAS NO LEGAL AUTHORITY OVER THE DOMESTIC AFFAIRS OR ACTIVITIES OF CITIZENS IN AMEICA, at least that is what the law records. Everything the IRS does to Citizens in America is illegal, occurring within a complete vacuum of law, MUCH THE SAME AS THE GESTAPO OPERATED IN NAZI GERMANY !

That brings us to CHAPTER 75. - . CRIMES, OTHER OFFENSES AND FORFEITURES, and Sections 7201 and 7203, which are typically the statutory charge(s) in a court of law against a Citizen. They state:

§ 7201. Attempt to evade or defeat tax.

Any person who willfully attempts in any manner to evade or defeat

any tax imposed by this Title or the payment thereof shall, in addition to other penalties provided by law, be guilty of a felony and, upon conviction thereof, shall be fined not more than 100,000 ($500,000 in the case of a corporation), or imprisoned not more than 5 years, or both, together with the costs of prosecution.

§ 7203. Willful failure to file return, supply information, or pay tax.

Any person required under this title to pay any estimated tax or tax, or required by this title or by regulations made under authority thereof to make a return, keep any records, or supply any information, who willfully fails to pay such estimated tax or tax, make such return, keep such records, or supply such information, at the time or times required by law or regulations, shall, in addition to other penalties provided by law, be guilty of a misdemeanor and, upon conviction thereof, shall be fined not more than $25,000 ($100,000 in the case of a corporation) or imprisoned not more than 1 year, or both, together with the costs of prosecution. In the case of any person with respect to whom there is failure to pay any estimated tax, this section shall not apply to such person with respect to such failure if there is no addition to tax under section 6654 or 6655 with respect to such failure. In the case of a willful violation of any provision of section 60501, the first sentence of this section shall be applied by substituting "felony" for "misdemeanor", and "5 years" for "1 year". (emphasis added)

Now, it’s worth pointing out that these Sections are penalty statutes, and that the government tries to skip right over the part of a trial where they identify an actual violation of law and charge you with it. They try to skip right over the requirement to explain what actual statutory violation has occurred, and leap right to the penalty phase. When accused, one has the right to demand to know what the underlying statutory infraction is, that has caused and justified the invocation of the penalty statute. One should demand to know what statutory violations the IRS has based the penalty charge on, and guess what; the IRS cannot site a statutory violation upon which the penalty is based, given the facts of law presented in this book.

I’d further like to point out that both of these sections specifically say,

"Any person required under this title..."

This next section, also from Chapter 75, redefines the term "person" for use in Chapter 75.

§ 7343. Definition of the term person.

The term "person" as used in this chapter includes an officer or employee of a corporation, or a member or employee of a partnership, who as such officer, employee or member is under a duty to perform the act in respect of which the violation occurs. (emphasis added)

Now does this say that the term 'person' includes ALL individuals ? No! The term “person” is redefined for purposes of use within Chapter 75 to mean only government employees and (government) corporate officers. But it is not redefined right up there in Section 7203 where it says, "any person"; you have to read through the whole chapter to get to the redefinition of the term “person” at the end of the chapter in order to recognize that Section 7203 was never intended to be applied against any Citizen, who didn’t, or wasn’t, acting in the capacity of a government employee or corporate or partnership officer with legal responsibility for (corporate) tax liability ?

Section 7203 is here to file against the Federal employees who commit fraud in regards to the Federal employee “kickback”, and against corporate officers who fail to honor their legal responsibilities to report and pay the tax on the privileged income that the corporation may be making. It is not a statutory section that authorizes criminal penalties against the common Citizen, or even individuals.

Furthermore, this Section clearly states:

"... this section shall not apply to such person with respect to such failure if there is no addition to tax under section 6654 ..."

Do you remember § 6654 (e)(2)(C), the Citizen's exception to the failure to pay, where no addition to tax shall be imposed if there is no liability and the individual was a Citizen or resident ? The same paragraph C referenced in Treasury Decision 2313 ? How can Section 7203 possibly be used against individual Citizens, given this specific language within the statute itself ? Do you remember that the Secretary is “required” under 6020(b) ? Do you remember that a W-2 is supposed to SUBSTITUTE for a Form 1040 ? Do you really need a lawyer to read these English sentences and understand what they mean ? Can’t you see for yourself how fraudulent and wrongful, in fact, criminal, all of this Federal persecution is ? And how many people in America have answered the doorbell only to find a band of jack-booted, gun toting IRS thugs at the door to seize their property, books and records, supposedly in enforcement the subtitle A income tax laws. What does the law really say about that ?

§ 7608. Authority of internal revenue enforcement officers.

(a) Enforcement of subtitle E and other laws pertaining to liquor, tobacco, and firearms

Any investigator, agent, or other internal revenue officer by whatever term designated, whom the Secretary charges with the duty of enforcing any of the criminal, seizure, or forfeiture provisions of subtitle E or of any other law of the United States pertaining to the commodities subject to tax under such subtitle for the enforcement of which the Secretary is responsible may

(1) carry firearms;

(2) execute and serve search warrants and arrest warrants, and serve subpoenas and

summonses issued under authority of the United States;

(3) in respect to the performance of such duty, make arrests without warrant for any

offense against the United States committed in his presence, or for any felony

cognizable under the laws of the United States if he has reasonable grounds to

believe that the person to be arrested has committed, or is committing, such felony;

(4) in respect to the performance of such duty, make seizures of property subject to

forfeiture to the United States.

(b) Enforcement of laws relating to internal revenue other than subtitle E

(1) Any criminal investigator of the Intelligence Division or of the Internal Security

Division of the Internal Revenue Service whom the Secretary charges with the duty

of enforcing any of the criminal provisions of the internal revenue laws, any other

criminal provisions of law relating to internal revenue for the enforcement of which

the Secretary is responsible, or any other law for which the Secretary has delegated

investigatory authority to the Internal Revenue Service, is, in the performance of his

duties, authorized to perform the functions described in paragraph (2).

(2) The functions authorized under this subsection to be performed by an officer

referred to in paragraph (1) are -

(A) to execute and serve search warrants and arrest warrants, and serve

subpoenas and summonses issued under authority of the United States;

(B) to make arrests without warrant for any offense against the United States

relating to the internal revenue laws committed in his presence, or for any felony

cognizable under such laws if he has reasonable grounds to believe that the

person to be arrested has committed or is committing any such felony; and

laws.....

So where is carry firearms as an authority to enforce Subtitle A ? It doesn’t exist in the law. NO IRS agents, who are involved with subtitle A enforcement procedures in the field, ARE LEGALLY AUTHORIZED TO CARRY FIREARMS DURING SUCH DUTY, and it is a violation of the law for them to do so !

Do you really think this is the America our founders envisioned for this era ? And finally, concerning Federal criminal prosecutions in the States, the Supreme Court says:

“...the Federal government has nothing approaching a police power.”

[United States v. Lopez, No. 93-1260, 115 S. Ct. 1624, 131 L. Ed. 2d 626]

Title 18 - Federal Crimes

All TRUE LAWFUL crimes (by the general public) against the United States are spelled out in Title 18 (Chapters 1 through 121), which is positive law. In order to be a legitimate, lawful, and valid (Constitutional) criminal charge by the Federal Government against an individual, the violation of the laws in the other Titles must be linked to a crime listed and spelled out in Title 18. THERE IS NO SUCH LINK FOR ALLEGED TITLE 26 VIOLATIONS..

It is a fact that there are only THREE Federal Crimes provided for in the Constitution: treason, piracy and counterfeit. The Interstate Commerce Act has been used to expand the authority of the Federal government over inter-state activities, but Title 26 charges do not relate to interstate activities. You cannot be legally arrested, charged or tried in a federal court because the Federal government has no territorial jurisdiction over you because they are not the Sovereign government authorized to enforce law in the lands of the 50 states. YOU ARE NOT A FEDERAL EMPLOYEE, NOT A FEDERAL TRANSFEREE, AND TITLE 26 HAS NEVER BEEN PASSED INTO POSITIVE LAW OR PUBLISHED IN THE FEDERAL REGISTER as generally applicable, therefore it does not and cannot legally apply to you. YOU CANNOT BE TRIED LEGALLY OR LEGITIMATELY BY A FEDERAL COURT FOR THIS CHARGE.

Now you show me the tax crimes provided for in the positive laws of Title 18 - Federal Crimes. It is not there. If you DO NOT CHALLENGE THEIR (inherent) CLAIM OF TERRITORIAL JURISDICTIONAL AUTHORITY OVER YOU (and claim of Federal crime committed) and fail to refute their presentment of such claim properly, then it is legally presumed that such jurisdiction and charge do in fact exist legitimately, when in fact, they do not.

The record of court actions, called case law, shows how U.S. judges have imposed

their personal (rather than LAWFUL) discretion and opinions upon persons through the corrupt process of making "new law" under "personal" precedent, and not lawful or judicial precedent. In so doing they ignore Due Process of Law and make it possible to illegally control the lives, liberties and property of naive/ignorant persons present in the courtroom, who do NOT understand the legal limitations imposed on the Federal government by our Constitution, or who, for some unstated reason, choose not to make those limitations part of their defense arguments before the jury. case law is only binding on the litigants in the case out of which the ruling comes.

Case law cannot be expanded to apply to other complaints or cases because Article I of the Constitution says "all legislative powers shall be vested in a congress", which of course means that judges can't create or make up new laws as they have been fraudulently doing. Only Congress can make new law, or alter existing law. (It does say "all legislative powers", NOT 'some' or 'most'.)

These NON positive laws and unpublished regulations (imposed only on certain classes of people) have been enforced as though every person is required under them. By misusing the rules of the court, the judges are providing themselves with a self-serving personal discretionary power outside of the law, effectively, fraudulently and illegally, usurping authority over the matter, and your life and property.

The evidence begins with Rule 1 in the Federal Rules of Procedure.

Rule 1. Scope.

These rules govern the procedure in all criminal proceedings in the courts of the United States as defined in Rule 54(c);...

The term "Courts of the United States" is not specifically defined, so Rule 1 puts us on notice that the scope of the criminal proceedings cognizable in the Courts of the United States is found in the definitions in Rule 54(c). Omitting irrelevant definitions, Rule 54(c) states:

Rule 54(c) Application of terms. As used in these rules the following terms have the designated meanings.

...

"Act of Congress" includes any act of Congress locally applicable to and in force in the District of Columbia, in Puerto Rico, in a territory or in an insular possession.

...

"Federal Magistrate" means a United States magistrate as defined in 28 USC Sec. 631-639. a judge of the United States or another judge or judicial officer specifically empowered by statute in force in any territory or possession, the Commonwealth of Puerto Rico, or the District of Columbia, to perform a function to which a particular rule relates.

...

"Judge of the United States" includes a judge of a district court, court of appeals, or the Supreme Court....

"Law" includes statutes and judicial decisions.

...

"State" includes District of Columbia, Puerto Rico, territory and insular

possessions. (emphasis added)

Were you in any of these places when you were arrested (or taxed) ?

By use of the word "includes", in the definition of "State", those things NOT explicitly listed are EXCLUDED. This means that not one of the fifty States of the United States of America is included in this definition of the term "State". With this we are told that criminal proceedings in the courts of the United States are limited to the District of Columbia, Puerto Rico, and a territory or in an insular possession; which is backed by the definition of "Act of Congress" and confirms the knowledge of the U.S. courts that Congress is limited to making laws applicable to its own employees and the District of Columbia, Puerto Rico, territories and insular possessions of the United States government.

I know that this is not what attorneys are taught to argue, but this is what they should be arguing in defense of their clients' best interests, rather than allow the government's presumption of authority over them (the client).

STATE TAXATION

Actually this part is easy. Title 18 USC § 8 and Title 12 USC § 411 both state that “Federal Reserve Notes are United States obligations”:

18 U.S.C. § 8 Obligation or other security of the United States defined.

The term ''obligation or other security of the United States'' includes all bonds, certificates of indebtedness, national bank currency, Federal Reserve notes, Federal Reserve bank notes, coupons, United States notes, Treasury notes, gold certificates, silver certificates, fractional notes, certificates of deposit, bills, checks, or drafts for money, drawn by or upon authorized officers of the United States, stamps and other representatives of value, of whatever denomination, issued under any Act of Congress, and canceled United States stamps.

12 U.S.C. § 411. Issuance to reserve banks; nature of obligation; redemption.

Federal reserve notes, to be issued at the discretion of the Board of Governors of the Federal Reserve System for the purpose of making advances to Federal reserve banks through the Federal reserve agents as hereinafter set forth and for no other purpose, are authorized. The said notes shall be obligations of the United States and shall be receivable by all national and member banks and Federal reserve banks and for all taxes, customs, and other public dues. They shall be redeemed in lawful money on demand at the Treasury Department of the United States, in the city of Washington, District of Columbia, or at any Federal Reserve bank.

And Title 31 USC § 3124 clearly states:

§ 3124. Exemption from taxation

(a) Stocks and obligations of the United States Government are exempt from taxation by

a State or political subdivision of a State. The exemption applies to each form of taxation that

would require the obligation, the interest on the obligation, or both, to be considered in

computing a tax, except -

(1) a nondiscriminatory franchise tax or another nonproperty tax instead of a franchise

tax, imposed on a corporation; and

(2) an estate or inheritance tax. (emphasis added)

So now, don’t you get paid in Federal Reserve Notes ? So how can your State tax them ? Furthermore, most of the State Codes invoke and incorporate by direct reference Section 61 of the United States Code as the State definition of “gross income” So, all of the Section 61 arguments shown previously become applicable and relevant to the proper and legal administration of the State tax laws and procedures.

CHAPTER 4

RECOURSE

The IRS is required to abate wrongful claims (assessments, liens, levies), per the requirements of 26 U.S.C. § 6404(a)(3) addressing this legal duty of the Secretary (too abate), This section states in pertinent part:

§ 6404. Abatements.

(a) General rule. The Secretary is authorized to abate the unpaid portion of the assessment of any tax or any liability in respect thereof, which ...

(1) is excessive in amount, or

(2) is assessed after the expiration of the period of limitation properly applicable thereto, or

(3) is erroneously or illegally assessed."

and you should be familiar with:

§ 7214. Offenses by officers and employees of the United States

(a) Unlawful acts of revenue officers or agents

Any officer or employee of the United States acting in connection with any revenue law of

the United States -

(1) who is guilty of any extortion or willful oppression under color of law; or

(2) who knowingly demands other or greater sums than are authorized by law, or

receives any fee, compensation, or reward, except as by law prescribed, for the

performance of any duty; or

(3) who with intent to defeat the application of any provision of this title fails to perform

any of the duties of his office or employment; or

(4) who conspires or colludes with any other person to defraud the United States; or

(5) who knowingly makes opportunity for any person to defraud the United States; or

(6) who does or omits to do any act with intent to enable any other person to defraud

the United States; or

(7) who makes or signs any fraudulent entry in any book, or makes or signs any

fraudulent certificate, return, or statement; or

(8) who, having knowledge or information of the violation of any revenue law by any

person, or of fraud committed by any person against the United States under any

revenue law, fails to report, in writing, such knowledge or information to the Secretary;

(9) who demands, or accepts, or attempts to collect, directly or indirectly as payment

or gift, or otherwise, any sum of money or other thing of value for the compromise,

adjustment, or settlement of any charge or complaint for any violation or alleged

violation of law, except as expressly authorized by law so to do; shall be dismissed

from office or discharged from employment and, upon conviction thereof, shall be fined

not more than $10,000, or imprisoned not more than 5 years, or both. The court may

in its discretion award out of the fine so imposed an amount, not in excess of one-half

thereof, for the use of the informer, if any, who shall be ascertained by the judgment of

the court. The court also shall render judgment against the said officer or employee for

the amount of damages sustained in favor of the party injured, to be collected by

execution.

Since no formal, legal "Certificate of Assessment", Form 23C, can be shown to exist as the legal basis for IRS claims (because they are never actually executed), it is absolutely clear that no proper, legal assessment has ever been made or executed (subscribed) as required by 26 USC § 6020(b) . Furthermore, since it is clear that the IRS bases its claims on the Subtitle C taxes and tax records, and not Subtitles A or B (as specified by 6404(b)), the legal facts of the matter make absolutely clear that the Secretary has a formal legal duty to abate the wrongful liability because it has been erroneously AND illegally created (non-assessed). The proper code section to apply for this matter is 26 U.S.C.

§ 654(e)(2)(C) . Under the terms of these statutes the IRS has no legal alternative, but to abate the wrongful liability and illegal assessment indicated by these claims.

If the Secretary refuses to perform this legal duty, as required by law , one can supposedly find recourse in the Federal District Court under Title 28 U.S.C. 1361 which states:

§ 1361. Action to Compel an Officer of the United States to Perform his Duty.

"The district courts shall have original jurisdiction of any action in the nature of mandamus to compel an officer or employee of the United States or any agency thereof to perform a duty owed to the plaintiff."

TITLE 18 - CRIMINAL STATUTES

Legal recourse is supposed to be available to the Citizen in both the Criminal courts under Title 18, and in the Civil courts under Title 42 at the Federal level, and in the State courts under the Fraud and Computer fraud statutes of the States’ law. First we will look at the Title 18 Criminal statutes that may be useful, and that you should be aware of at any rate:

§ 241. Conspiracy Against Rights..

If two or more persons conspire to injure, oppress, threaten, or intimidate any inhabitant of any State, Territory, or District in the free exercise or enjoyment of any right or privilege secured to him by the Constitution or laws of the United States, or because of his having so exercised the same; or

If two or more persons go in disguise on the highway, or on the premises of another, with intent to prevent or hinder his free exercise or enjoyment of any right or privilege so secured -

They shall be fined not more than $10,000 or imprisoned not more than ten years, or both; and if death results, they shall be subject to imprisonment for any term of years or for life.

and,

§ 242. Deprivation of Rights Under Color of Law. .

Whoever, under color of any law, statute, ordinance, regulation, or custom, willfully subjects any inhabitant of any State, Territory, or District to the deprivation of any rights, privileges, or immunities secured or protected by the Constitution or laws of the United States, or to different punishments, pains, or penalties, on account of such inhabitant being an alien, or by reason of his color, or race, than are prescribed for the punishment of Citizens, shall be fined not more than $1,000 or imprisoned not more than one year, or both; and if bodily injury results shall be fined under this title or imprisoned not more than ten years, or both; and if death results shall be subject to imprisonment for any term of years or for life.

To preserve the concept of “equal rights under the law” this code section can be relied upon by anyone who can show that a deprivation of rights under “color of law” has been perpetrated against them..

Now, how about something to deal with people who don’t really work for a LEGALLY existant Federal agency, and cannot show such under the law, but still insist on trying to take your property.

§ 912. Officer or employee of the United States

Whoever falsely assumes or pretends to be an officer or employee acting under the authority of the United States or any department, agency or officer thereof, and acts as such, or in such pretended character demands or obtains any money, paper, document, or thing of value, shall be fined not more than $1,000 or imprisoned not more than three years, or both.

§ 913. Impersonator making arrest or search

Whoever falsely represents himself to be an officer, agent, or employee of the United States, and in such assumed character arrests or detains any person or in any manner searches the person, buildings, or other property of any person, shall be fined not more than $1,000 or imprisoned not more than three years, or both.

Now, to deal with fraudulent activities and claims, made by the IRS (or anyone), we have:

§ 1001. Statements or Entries Generally. .

Whoever, in any matter within the jurisdiction of any department or agency of the United States knowingly and willfully falsifies, conceals or covers up by any trick, scheme, or device a material fact, or makes any false, fictitious or fraudulent statements or representations, or makes or uses any false writing or document knowing the same to contain any false, fictitious or fraudulent statement or entry, shall be fined not more than $10,000 or imprisoned not more than five years, or both.

and for those fraudulent assessment dates on your IMF (where no assessment documents can actually be produced or shown to exist in association with the dates shown on the IMF):

Now, how about all those fraudulent documents they send you:

§ 1018. Official certificates or writings

Whoever, being a public officer or other person authorized by any law of the United States to make or give a certificate or other writing, knowingly makes and delivers as true such a certificate or writing, containing any statement which he knows to be false, in a case where the punishment thereof is not elsewhere expressly provided by law, shall be fined not more than $500 or imprisoned not more than one year, or both.

§ 1030. Fraud and Related Activity in Connection With Computers.

(a) Whoever -

(1)

(5) intentionally accesses a Federal interest computer without authorization, and by

means of one or more instances of such conduct alters, damages, or destroys

information in any such Federal interest computer, or prevents authorized use of any

such computer or information, and thereby -

(A) causes loss to one or more others of a value aggregating $1,000 or more

during any one year period; or...

(b) Whoever attempts to commit an offense under subsection (a) of this section shall be

punished as provided in subsection (c) of this section.

(c) The punishment for an offense under subsection (a) or (b) of this section is -

(3)

(A) a fine under this title or imprisonment for not more than five years, or both,

in the case of an offense under subsection (a)(4) or (a)(5) of this section which

does not occur after a conviction for another offense under such subsection, or

an attempt to commit an offense punishable under this subparagraph; and

(B) a fine under this title or imprisonment for not more than ten years, or both, in

the case of an offense under subsection (a)(4) or (a)(5) of this section which

occurs after a conviction for another offense under such subsection, or an

attempt to commit an offense punishable under this subparagraph.

This computer fraud is present in virtually every IMF record in the IRS computer system of any individual who has ever been pursued by the IRS for income tax on non-privileged sources..

If you get threatened for raising these issues of law at a meeting or hearing:

§ 1513. Retaliating against a witness, victim, or an informant

(a) Whoever knowingly engages in any conduct and thereby causes bodily injury to another

person or damages the tangible property of another person, or threatens to do so, with intent

to retaliate against any person for -

(1) the attendance of a witness or party at an official proceeding, or any testimony

given or any record, document, or other object produced by a witness in an official

proceeding; or

(2) any information relating to the commission or possible commission of a Federal

offense or a violation of conditions of probation, parole, or release pending judicial

proceedings given by a person to a law enforcement officer; or attempts to do so, shall

be fined not more than $250,000 or imprisoned not more than ten years, or both.

(b) There is extraterritorial Federal jurisdiction over an offense under this section.

As to the controlling of one’s labor for the purposes of satisfying INFERRED and IMPLIED DEBT (not tax) obligations, imposed on unwilling and unspecified DEBTORS, and not by law, but by fraud, we have:

§ 1581. Peonage Obstructing Enforcement.

(a) Whoever holds or returns any person to a condition of peonage, or arrests any person with the intent of placing him in or returning him to a condition of peonage, shall be fined not more than $5,000 or imprisoned not more than five years, or both.

(b) Whoever obstructs, or attempts to obstruct, or in any way interferes with or prevents the enforcement of this section, shall be liable to the penalties prescribed in subsection (a).

and finally from Title 18,

§ 3045. Internal revenue violations

Warrants of arrest for violations of internal revenue laws may be issued by United States magistrates upon the complaint of a United States attorney, assistant United States attorney, collector, or deputy collector of internal revenue or revenue agent, or private Citizen; but no such warrant of arrest shall be issued upon the complaint of a private Citizen unless first approved in writing by a United States attorney.

TITLE 42 - CIVIL RIGHTS

In Title 42, in support of Civil Complaints for the misuse of a person’s SSN, we have:

§ 408. Penalties.

(a) In general. Whoever -

(1) ..

(8) discloses, uses, or compels the disclosure of the social security number of any person in violation of the laws of the United States; shall be guilty of a felony and upon conviction thereof shall be fined under title 18 or imprisoned for not more than five years, or both. (emphasis added)

This addresses and controls the misuse, or compelled use, of a SSN in the private sector.

And these next sections are the code sections that provide Civil redress for violations of an individual’s Consitutional Rights.

§ 1981. Equal Rights Under the Law.

(a) Statement of equal rights.

All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts, to sue, be parties, give evidence, and to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white Citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other.

(b) ''Make and enforce contracts'' defined

For purposes of this section, the term ''make and enforce contracts'' includes the making, performance, modification, and termination of contracts, and the enjoyment of all benefits, privileges, terms, and conditions of the contractual relationship.

(c) Protection against impairment

The rights protected by this section are protected against impairment by nongovernmental discrimination and impairment under color of State law.

§ 1981a. Damages in Cases of Intentional Discrimination in Employment.

(a) Right of recovery

(1) Civil rights.

In an action brought by a complaining party under section 706 or 717 of the Civil

Rights Act of 1964 (42 U.S.C. 2000e-5, 2000e-16) against a respondent who

engaged in unlawful intentional discrimination (not an employment practice that is

unlawful because of its disparate impact) prohibited under section 703, 704, or 717 of

the Act (42 U.S.C. 2000e-2, 2000e-3, 2000e-16), and provided that the complaining

party cannot recover under section 1981 of this title, the complaining party may

recover compensatory and punitive damages as allowed in subsection (b) of this

section, in addition to any relief authorized by section 706(g) of the Civil Rights Act of

1964, from the respondent.

(b) Compensatory and Punitive Damages

(1) Determination of punitive damages

A complaining party may recover punitive damages under this section against a

respondent (other than a government, government agency or political subdivision) if the

complaining party demonstrates that the respondent engaged in a discriminatory

practice or discriminatory practices with malice or with reckless indifference to the

federally protected rights of an aggrieved individual.

(2) Exclusions from compensatory damages

§ 1982. Property Rights of Citizens.

All Citizens of the United States shall have the same right, in every State and Territory, as is enjoyed by white Citizens thereof to inherit, purchase, lease, sell, hold, and convey real and personal property.

§ 1983. Civil Action for Deprivation of Rights.

Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any Citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress. For the purposes of this section, any Act of Congress applicable exclusively to the District of Columbia shall be considered to be a statute of the District of Columbia.

§ 1985. Conspiracy to Interfere with Civil Rights.

(1) Preventing officer from performing duties

If two or more persons in any State or Territory conspire to prevent, by force, intimidation, or threat, any person from accepting or holding any office, trust, or place of confidence under the United States, or from discharging any duties thereof; or to induce by like means any officer of the United States to leave any State, district, or place, where his duties as an officer are required to be performed, or to injure him in his person or property on account of his lawful discharge of the duties of his office, or while engaged in the lawful discharge thereof, or to injure his property so as to molest, interrupt, hinder, or impede him in the discharge of his official duties;

§ 1986. Action for Neglect to Prevent.

Every person who, having knowledge that any of the wrongs conspired to be done, and mentioned in section 1985 of this title, are about to be committed, and having power to prevent or aid in preventing the commission of the same, neglects or refuses so to do, if such wrongful act be committed, shall be liable to the party injured, or his legal representatives, for all damages caused by such wrongful act, which such person by reasonable diligence could have prevented; and such damages may be recovered in an action on the case; and any number of persons guilty of such wrongful neglect or refusal may be joined as defendants in the action; and if the death of any party be caused by any such wrongful act and neglect, the legal representatives of the deceased shall have such action therefor, and may recover not exceeding $5,000 damages therein, for the benefit of the widow of the deceased, if there be one, and if there be no widow, then for the benefit of the next of kin of the deceased. But no action under the provisions of this section shall be sustained which is not commenced within one year after the cause of action has accrued.

Jurisdiction, venue and subject matter all seem to be proper according to:

§ 1988. Proceedings in Vindication of Civil Rights.

(a) Applicability of statutory and common law

The jurisdiction in civil and criminal matters conferred on the district courts by the provisions of titles 13, 24, and 70 of the Revised Statutes for the protection of all persons in the United States in their civil rights, and for their vindication, shall be exercised and enforced in conformity with the laws of the United States, so far as such laws are suitable to carry the same into effect; but in all cases where they are not adapted to the object, or are deficient in the provisions necessary to furnish suitable remedies and punish offenses against law, the common law, as modified and changed by the constitution and statutes of the State wherein the court having jurisdiction of such civil or criminal cause is held, so far as the same is not inconsistent with the Constitution and laws of the United States, shall be extended to and govern the said courts in the trial and disposition of the cause, and, if it is of a criminal nature, in the infliction of punishment on the party found guilty.

And the statutory foundation for suits to resolve problems with employers:

§ 2000e-2. Unlawful Employment Practices.

(a) Employer practices

It shall be an unlawful employment practice for an employer -

(1) to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's race, color, religion, sex, or national origin;

(2) to limit, segregate, or classify his employees or applicants for employment in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual's race, color, religion, sex, or national origin.

And, corresponding to 18 USC 1581 - Peonage, we have in Title 42:

§ 1994. Peonage Abolished.

The holding of any person to service or labor under the system known as peonage is abolished and forever prohibited in any Territory or State of the United States; and all acts, laws, resolutions, orders, regulations, or usages of any Territory or State, which have heretofore established, maintained, or enforced, or by virtue of which any attempt shall hereafter be made to establish, maintain, or enforce, directly or indirectly, the voluntary or involuntary service or labor of any persons as peons, in liquidation of any debt or obligation, or otherwise, are declared null and void.

CHAPTER 5

SUPPORTING PIECES

SO, WHY CAN'T THEY ANSWER OUR $10,000.00 CHALLENGE ?

There is a ten thousand dollar offer to any person who can show these facts are false. No accountant, tax lawyer, IRS employee or Justice Department lawyer has ever successfully challenged these facts. This contest is offered by the SAVE A PATRIOT Fellowship, which I am a member of, and highly recommend to anyone who wants to learn about these laws, or who is having trouble with the IRS and wants to fight back. It is an excellent organization and they have been helping me for four years to learn and understand what these laws are really all about, how they are supposed to be applied, and how to go about preventing the IRS from wrongfully demanding and seizing your property which, as a Citizen, is earned by right not privilege, and is therefore, NOT LAWFULLY SUBJECT TO THE INCOME TAX !

We will pay $10,000.00 to any person who can prove the following statements of fact to be false ! We have conclusive legal proof that the following legal facts are absolutely correct. That is why we can say; "American Citizens and permanent resident aliens, living and working within the States of the Union, ARE NOT SUBJECT to the filing of an IRS Form 1040 and ARE NOT LIABLE for the payment of the income tax on domestic "income" or earnings, unless those earnings or that income is derived from a privileged activity !"

FOR YEARS the IRS has ruled the American people in a manner equaled only by the Soviet KGB and the Nazi Gestapo. FEAR and BLUFF, intimidation and deception have been the IRS's major weapons. Americans have been led to believe that they "owe" an income tax on their earnings; that it is their "patriotic duty to pay income tax", and that there is no alternative to the IRS's abuse. Nothing could be further from the TRUTH.

FEAR can only prevail when victims are ignorant of the facts. The Bible teaches us that God's people perish for lack of knowledge. Therefore, consider the following:

1) Our Founding Fathers created a constitutional REPUBLIC as our form of government. The Constitution gives the federal/national government LIMITED powers. All powers not delegated to the United States, are reserved to the States respectively or to the People. The Union was created to be the servant of the People ! The United States Constitution is the Supreme Law of the land. (Article VI, Clause 2)

2) The Constitution gives the Congress the power to lay and collect taxes to pay the debts of the government, provide for the common defense and general welfare of the United States, subject to the following rules, pertaining to the only two classifications of taxes permitted by the Constitution: Direct Taxes, which are subject to the rule of apportionment (to the states for collection), and Indirect Taxes - imposts, duties and excises, subject to the rule of uniformity.

3) The government is NOT ALLOWED, by either one of the two classifications, TO TAX DIRECTLY Citizens or permanent resident aliens of the United States, in the United States. The intent of the founders was to keep the government the servant of the People, and to prevent it from becoming the master. (Article I, Section 2, Clause 3)

4) The census is taken every ten years to determine the number of representatives to be allotted to each state and the amount of a direct tax that may be apportioned to each state determined by the percentage its number of representatives bears to the total membership in the House of Representatives. (Article I, Section 2, Clause 3 and Article I, Section 9, Clause 4)

5) It was established in the Constitutional convention of 1787 that the Supreme Court of the United States would have the power of "judicial review", i.e., the power to declare laws passed by the United States Congress to be null and void if such a law or laws were in violation of the Constitution, to be determined from the original intent as found in Madison's Notes recorded during the Convention, the Federalist Papers, and the ratifying conventions found in Elliott's Debates.

6) Due to the characteristics of the second classification of taxation authorized in the Constitution, the Supreme Court called it an Indirect Tax, and it is divided into three distinct categories of taxes: IMPOSTS, DUTIES and EXCISES. These taxes were intended to provide for the operating expense of the government of the United States.

7) Duties and Imposts are taxes laid by the government on things imported into the country from abroad, and are paid at the ports of entry.

8) The Supreme Court says that "EXCISES are:... taxes laid upon the manufacture, sale and consumption of commodities within the country, upon licenses to pursue certain occupations and upon corporate privileges" (See Flint v. Stone Tracy Co., 220 US 107 (1911))

9) In 1862, Congress passed an Act (law) to create an "Income Duty" to help pay for the war between the states. A duty is an indirect tax which the federal government cannot impose on Citizens or residents of a state having sources of income within a State of the Union.

10) Congress passed an Act in 1894 to impose a tax on the incomes of Citizens and resident aliens of the United States. The constitutionality of the Act was challenged in 1895 and the Supreme Court said the law was UNCONSTITUTIONAL BECAUSE IT WAS A DIRECT TAX THAT WAS NOT APPORTIONED as the Constitution required. (See Pollock v. Farmer's Loan & Trust Co., 157 US 429 (1895))

11) In 1909 Congress passed the 16th Amendment to the Constitution that was allegedly ratified by three-fourths (3/4) of the states; it is known as the "Income Tax Amendment".

12) Some officials within the IRS, along with professors, politicians, teachers and some judges have said, and are saying, that the 16th Amendment changed the Constitution to allow a direct tax without apportionment.

13) The above persons are NOT EMPOWERED to interpret the meaning of the United States Constitution! As stated above (Fact 5), this power is granted by the Constitution to the Supreme Court, but is limited to original intent. The supreme Court is NOT EMPOWERED to function as a "social engineer", to amend or alter the Constitution as they have been doing. A change or "amendment" can only be lawfully done according to the provisions of Article V of that document.

14) The U.S. Supreme Court said in 1916 that the 16th Amendment DID NOT change the Constitution because of the fact that Article I, Section 2, Clause 3, and Article I, Section 9, Clause 4, were not repealed or altered; the U.S. Constitution cannot conflict with itself. The Court also said that the 16th Amendment MERELY PREVENTED THE INCOME DUTY FROM BEING TAKEN OUT OF THE CATEGORY OF INDIRECT TAXATION. (Brushaber v. Union Pacific R.R. Co. 240 US 1 (pg. 16) (1916))

15) After the Supreme Court decision, the office of the Commissioner of Internal Revenue issued Treasury Decision 2313, ([Order] dated March 21, 1916; Vol. 18 January-December, 1916, page 53). It states in part:"....it is hereby held that income accruing to nonresident aliens in the form of interest from the bonds and dividends on the stock of domestic corporations is subject to the income tax imposed by the Act of October 3, 1913."

16) In another Supreme Court decision in 1916, the Court, in CLEAR LANGUAGE, settled the application of the 16th amendment: by the previous ruling (Brushaber) it was settled that the provisions of the 16th Amendment CONFERRED NO NEW POWER OF TAXATION but simply prohibited the previous complete and plenary (full) power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged....(Stanton v. Baltic Mining Co., 249 US 112 (1916))

17) The United States Constitution gives the national government the exclusive authority to handle foreign affairs. Congress has the power to pass laws concerning the direct or indirect taxation of foreigners doing business in the Unites States of America. It has possessed this power from the beginning, needing no amendment (change) to the U.S. Constitution to authorize the exercise of it.

18) The DIRECT classification of taxation was intended for use when unforeseen expenses or emergencies arise. Congress, needing funds to meet the emergency, can borrow money on the credit of the United States (Article I, Section 8 Clause 2). The founding fathers intended that the budget of the United States be balanced and a deficit be paid off quickly and in an orderly fashion, through a DIRECT tax. The tax bill is given to the Senate of the Union. The bill is "apportioned" by the number of representatives of each State in Congress; therefore, each State is billed its apportioned share of the Direct tax equal to the number of votes its Representatives could employ to pass the tax. How the states raise the money to pay the bill is not a federal concern. (Article I, Section 2, Clause 3)

19) In the Brushaber and Stanton cases, the Supreme Court said the 16th Amendment did not change income taxes to another classification. So, if the income tax is an indirect excise, then how is it applied and collected ? According to the Supreme Court: "Excises are taxes laid upon the manufacture, sale and consumption of commodities within the country, upon licenses to pursue certain occupations and upon corporate privileges; the requirement to pay such tax involves the exercise of the privilege and if business is not done in the manner described no tax is payable......it is the privilege which is the subject of the tax and not the mere buying, selling or handling of goods."

QUESTION: If all RIGHTS come from God (Citizens of the States retained all RIGHTS except those surrendered as enumerated in the Constitution) and PRIVILEGES are granted by government AFTER APPLICATION FOR PRIVILEGE IS MADE BY THE CITIZEN,, then WHAT IS THE PRIVILEGE THAT THE INCOME TAX IS APPLIED AGAINST ?

ANSWER: As established in the Constitution, the federal government cannot directly tax a Citizen living within the States of the Union. Citizens possess RIGHTS; these RIGHTS cannot be converted to privileges by the government. The only individuals who would not have these rights and be liable to regulation by government are NONRESIDENT ALIENS doing business and working within the United States or receiving domestic source profits from investment instruments in America,<B AND United States Citizens working in a foreign country and taxable under TREATIES between the two governments.

20) WITHHOLDING AGENTS withhold income taxes. The only section in the Internal Revenue Code that defines this authority is section 7701(a)(16).

21) Withholding of money for income tax purposes, according to section 7701(a)(16), is only authorized under sections 1441 - Nonresident aliens, 1442 - Foreign Corporations, 1443 - Foreign Tax Exempt Organizations, and 1461- Withholding Agents' Liability for Withheld Tax.

22) Internal Revenue Manual Chapter 1100, Organization and Staffing, section 1132.75 states: "The Criminal Investigative Division enforces the criminal statutes applicable to income, estate, gift, employment, and excise tax laws involving United States Citizens RESIDING IN FOREIGN COUNTRIES and nonresident aliens subject to Federal income tax filing requirements..."(emphasis added)

23) The implementation of IRS Treasury Regulation 26 CFR 1.1441-5 is explained in Publication 515 on page 2: "If an individual gives you a written statement, in duplicate, stating that he or she is a Citizen or resident of the United States, and you do not know otherwise, you may accept this statement and are RELIEVED OF THE DUTY OF WITHHOLDING TAX."

24) The ONLY was a U.S. Citizen or permanent resident alien , living and working in a State of the Union can have taxes deducted from their pay, is by voluntarily making an application (Form SS-5) to obtain a social security number, and then entering that number on an IRS Form W-4 - Employee's Withholding Allowance Certificate, and signing it to permit withholding of "Employment Taxes". That is why the IRS pressures children to apply for social security numbers at an early age, and why Citizens are pressured to "get used" to using the number, and employers are pressured to obtain the voluntary execution of a Form W-4 immediately from all those being hired. However, no federal law or regulation REQUIRES workers to have a social security number, or to sign a W-4 to qualify for, obtain, or retain a job..

25) Karl Marx wrote in his Communist Manifesto, ten planks needed to create a communist state. The second plank is:" A HEAVY PROGRESSIVE OR GRADUATED INCOME TAX"

26) The attorney who successfully challenged the Income Tax Act of 1894, Joseph H. Choate, recognized the communist hand in the shadows. He told the United States Supreme Court: "The Act of Congress which we are impugning (challenging as false) before you is communistic in its purposes and tendencies, and is defended here upon principles as communistic, socialistic - what shall I call them - populistic as ever have been addressed to any political assembly in the world."

27) The Supreme Court agreed; and Justice Field wrote the Court's opinion, concluding with these prophetic words: "Here I close my opinion. I could not say less in view of questions of such gravity that go down to the very foundations of the government. If the provisions of the Constitution can be set aside by an Act of Congress, where is the course of usurpation to end? The present assault upon capital is but the beginning. It will be but the stepping-stone to others, larger and more sweeping, till our political contests will become a war of the poor against the rich; a war growing in intensity and bitterness."

28) Internal Revenue Code Section 6654(e)(2)(C states: ....no liability....if the individual was a Citizen or resident alien of the United States throughout the preceding taxable year.

The IRS contends the success of the self-assessment system depends upon VOLUNTARY COMPLIANCE -- EVIDENTLY SO !

Save-A-Patriot Fellowship Tel. (410) 857-4441

P.O. Box 91 Fax (410) 857-5249

Westminster, MD. 21158 BBS (410) 857-4455

Membership Info/Application Tel. (703) 532-3219

The Best Kept Secret in America

As you can see, the laws regarding Income taxes under Subtitle A and Employment taxes under Subtitle C, their corresponding authorities and powers, are being illegally mixed and wrongfully invoked in a fraudulent and improper fashion against all U.S. Citizens. That means that you, as a Citizen, can disable and prevent that wrongful use of the information simply by handling your financial affairs in a particular fashion.

The law specifically states that you do not have to give your social security number to anyone except the Social Security Administration. You must also show it on the forms that you file with the IRS. But, as we’ve seen, you don’t have to legally file any forms with the IRS, unless you have foreign earned income under a tax treaty or foreign principals with domestic income. And if you refuse to supply your social security number to your employer on a W-4, or if you revoke your application for a Social Security number and rescind your participation in the Social Security program; then you have no legal requirement to supply a social security number to anyone at all; and there will never be any record of any earnings that is created under Subtitle C employment tax laws that the IRS can wrongfully and illegally use to demand that you pay income tax on.

Now, if you would like to learn more about opting out of the Social Security system, or if you would like help with stopping the wrongful withholding of income taxes by your withholding agents, we have an information package that you can use to address those situations with your employer and withholding agents.

But, the most important thing to understand, and the secret to living and working in the United States of America tax free, without repercussions or harassment from the IRS, is understanding that Social Security is a voluntary program and that people who do not use a social security number NEVER RECEIVE CORRESPONDENCE FROM THE IRS regarding the collection of tax, because that correspondence is never issued !

There is no law that requires you to participate in social security, and if you wish, you can opt out of the program, or conversely, you can just exercise your rights under the law and refuse to disclose your social security number to your employer, or anyone, for that matter, except the Social Security Administration. Thereby totally disabling, in a completely legal fashion, the information collection mechanism that the IRS relies upon to wrongfully demand income tax payments from Citizens. If the IRS insists on illegally misusing the information collected under Social Security, we, the People, are left with no other legal option but to legally prevent its collection in the first place, in order to prevent its misuse against us. What has the Supreme Court said about religious rights ?

"A person may not be compelled to choose between the exercise of a First Amendment right and participation in an otherwise available public program. It is true that the Indiana law does not compel a violation of conscience, but where the state conditions receipt of an important benefit upon conduct proscribed by a religious faith, or where it denies such a benefit because of conduct mandated by religious belief, thereby putting substantial pressure on an adherent to modify his behavior and to violate his beliefs, a burden upon religion exists. While the compulsion may be indirect, the infringement upon free exercise is nonetheless substantial." THOMAS v. REVIEW BD., IND. EMPL. SEC. DIV., 450 U.S. 707 (1981)

and;

"The door of the Free Exercise Clause stands tightly closed against any governmental regulation of religious beliefs as such, Cantwell v. Connecticut, 310 U.S. 296, 303. Government may neither compel affirmation of a repugnant belief, Torcaso v. Watkins, 367 U.S. 488; nor penalize or discriminate against individuals or groups because they hold religious views abhorrent to the authorities, Fowler v. Rhode Island, 345 U.S. 67; nor employ the taxing power to inhibit the dissemination of particular religious views, Murdock v. Pennsylvania, 319 U.S. 105; Follett v. McCormick, 321 U.S. 573; cf. Grosjean v. American Press Co., 297 U.S. 233. On the other hand, [374 U.S. 398, 403] the Court has rejected challenges under the Free Exercise Clause to governmental regulation of certain overt acts prompted by religious beliefs or principles, for "even when the action is in accord with one's religious convictions, [it] is not totally free from legislative restrictions." Braunfeld v. Brown, 366 U.S. 599, 603. The conduct or actions so regulated have invariably posed some substantial threat to public safety, peace or order. See, e. g., Reynolds v. United States, 98 U.S. 145; Jacobson v. Massachusetts, 197 U.S. 11; Prince v. Massachusetts, 321 U.S. 158; Cleveland v. United States, 329 U.S. 14" (emphasis added)

"It is too late in the day to doubt that the liberties of religion and expression may be infringed by the denial of or placing of conditions upon a benefit or privilege.

6 American [374 U.S. 398, 405] Communications Assn. v. Douds, 339 U.S. 382, 390; Wieman v. Updegraff, 344 U.S. 183, 191-192; Hannegan v. Esquire, Inc., 327 U.S. 146, 155-156. For example, in Flemming v. Nestor, 363 U.S. 603, 611, the Court recognized with respect to Federal Social Security benefits that "[t]he interest of a covered employee under the Act is of sufficient substance to fall within the protection from arbitrary governmental action afforded by the Due Process Clause." In Speiser v. Randall, 357 U.S. 513, we emphasized that conditions upon public benefits cannot be sustained if they so operate, whatever their purpose, as to inhibit or deter the exercise of First Amendment freedoms."

"Twenty-three years ago in Cantwell v. Connecticut, 310 U.S. 296, 303, the Court said that both the Establishment Clause and the Free Exercise Clause of the First Amendment were made wholly applicable to the States by the Fourteenth Amendment. In the intervening years several cases involving claims of state abridgment of individual religious freedom have been decided here - most recently Braunfeld v. Brown, 366 U.S. 599, and Torcaso v. Watkins, 367 U.S. 488."

all from : SHERBERT v. VERNER, 374 U.S. 398 (1963)

and:

"Certain aspects of religious exercise cannot, in any way, be restricted or burdened by either federal or state legislation. Compulsion by law of the acceptance of any creed or the practice of any form of worship is strictly forbidden. The freedom to hold religious beliefs and opinions is absolute." Cantwell v. Connecticut, 310 U.S. 296, 303; Reynolds v. United States, 98 U.S. 145, 166"

"For religious freedom - the freedom to believe and to practice strange and, it may be, foreign creeds - has classically been one of the highest values of our society. See, e. g., Murdock v. Pennsylvania, 319 U.S. 105, 115 (1943); Jones v. City of Opelika, 319 U.S. 103 (1943); Martin v. City of Struthers, 319 U.S. 141 (1943); Follett v. Town of McCormick, 321 U.S. 573 (1944); Marsh v. Alabama, 326 U.S. 501, 510 (1946). Even the most concentrated and fully articulated attack on this high standard has seemingly admitted its validity in principle, while [366 U.S. 599, 613] deploring some incidental phraseology. See Kovacs v. Cooper, 336 U.S. 77, 89, 95-96 (1949) (concurring opinion); but cf. Ullmann v. United States, 350 U.S. 422 (1956). The honored place of religious freedom in our constitutional hierarchy, suggested long ago by the argument of counsel in Permoli v. Municipality No. 1 of the City of New Orleans, 3 How. 589, 600 (1845), and foreshadowed by a prescient footnote in United States v. Carolene Products Co., 304 U.S. 144, 152, n. 4 (1938), must now be taken to be settled"

all from: BRAUNFELD v. BROWN, 366 U.S. 599 (1961)

and;

"We conclude then that government regulation that indirectly and incidentally calls for a choice between securing a governmental benefit and adherence to religious beliefs is wholly different from governmental action or legislation that criminalizes religiously inspired activity or inescapably compels conduct that some find objectionable for religious reasons. Although the denial of government benefits over religious objection can raise serious Free Exercise problems, these two very different forms of government action are not governed by the same constitutional standard. A governmental burden on religious liberty is not insulated from review simply because it is indirect, Thomas v. Review Board of Indiana Employment Security Div., 450 U.S. 707, 717-718 (1981) (citing Sherbert v. Verner, 374 U.S., at 404); [476 U.S. 693, 707] but the nature of the burden is relevant to the standard the government must meet to justify the burden"

"Where the state conditions receipt of an important benefit upon conduct proscribed by a religious faith, or where it denies such a benefit because of conduct mandated by religious belief, thereby putting substantial pressure on an adherent to modify his behavior and to violate his beliefs, a burden upon religion exists" Thomas v. Review Bd. of Indiana Employment Security Div., 450 U.S. 707, (1981).

all from: BOWEN v. ROY, 476 U.S. 693 (1986)

This is conclusive.

Neither the private employer nor the Withholding Agent. in any of the 50 States of America, may lawfully make manifest a condition of involuntary servitude on any Citizen, nor may they effect a condition of virtual peonage, wherein the labor of any Citizen is controlled by unidentified and/or unspecified alleged obligations, under the guise and pretense of federal tax, through colorable use of the statutes.

As irrefutable proof that Social Security is indeed a voluntary program, I offer the following:

In Texas, the Justice Department argued for the EEOC (Equal Employment Opportunity Commission) against an employer who had, under IRS advice, refused to hire an individual who would not provide a social security number. The complaint was styled as a DISCRIMINATION action. The discrimination involves both religious convictions and national origins (Americans are not required).

The IRS refused to appear in court to defend its advice to the employer, who immediately folded when confronted in court with a team of Justice Department lawyers suing him for discrimination. (Who wants to be in court against the Justice Department without any legal facts to stand on and no witness to call ?) The IRS typically passes out incorrect or misleading information to the employer, and then refuses to appear in the court room to defend the advice that the Employers are acting on.

The case proves beyond the shadow of any doubt what-so-ever that it is NOT necessary to use a social security number in association with your personal finances and earnings, IF YOU CHOOSE NOT TO !

EXCERPTS FROM

EEOC v. Information Systems Consulting

CA3-92-0169-T

IN THE UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

1. From the EEOC's Letter of Determination, Dated May 2, 1990 (p.2)

The evidence supports the charge that there is a violation of Title VII of the 1964 Civil Rights Act, as amended,... Section 706(b) of Title VII requires that if the commission determines there is a reasonable cause to believe that the charge is true, is shall endeavor to eliminate the alleged unlawful employment practice by informal methods, of conference, conciliation, and persuasion, having determined there is reasonable cause to believe the charge is true, the Commission now invites the parties to join with it in a collective effort toward a just resolution of this matter.

2. From the Affidavit of Tim Fitzpatrick, September 29, 1989 (p.3):

After discussions with the IRS, the company discovered that if Mr. Hanson did not provide the company with a Social Security number, the company would be in violation of the Internal Revenue Regulations and subject to various penalties.

3. From the Plaintiff's Response to Defendant's Motion to Dismiss, April 1, 1992 (p.8-9)

"....the Internal Revenue Code and the Regulations promulgated pursuant to the code do not contain an absolute requirement that an employer provide an employee social security number to the IRS. Internal Revenue Code Section 6109(a)(3) states:

Any person required under the authority of this title to make a return, statement or other

document with respect to another person, shall request from such person, and include

in any such return, statement or document, such identifying number as may be prescribed

for securing proper identification of such person.

26 U.S.C. 6109(a)(3) (Supp. 1992)"

The IRS regulation interpreting section 6109 provides:

"If he does not know the taxpayer identifying number of the other person, he shall request such number of the other person. A request should state that the identifying number is required to be furnished under the law. When the person filing the return, statement, or other document does not know the number of the other person, and has complied with the request provision of this paragraph, he shall sign an affidavit on the transmittal document forwarding such returns, statements, or other documents to the Internal Revenue Service so stating..

Treas. Reg. 301.6109-1 (c) (1991)"

"The applicable IRS statute and regulation place a duty on the employer to request a taxpayer identifying number from the employee. If document must be filed and the employer has been unable to obtain the number but has made the request then the employer need only include as affidavit stating that the request was made."

The Government also avers that:

"In 1989, Internal Revenue Code Section 6676, 26 U.S.C. and 6676 (1989), set forth the penalties for failing to supply the IRS with identifying numbers as required by the code....a $50.00 penalty will be imposed for failure of an employer to provide an identifying number on any document filed with the IRS unless it is shown that the failure was due to reasonable cause and not willful neglect. The Treasury Regulation interpreting the Statute states:

Under Section 301.609-1 (c) a payor is required to request the identifying number of the payee. If after such a request has been made, the payee does not furnish the payor with his identifying number, the penalty will not be assessed against the payor.

Treas. Reg. 3106676-1 (1989)"

"Public Law 101-239, Title VII, Section 7711(b)(1), Dec. 19, 1989, 103 Stat. 2393, repealed Section 6676 of the Internal Revenue Code, 26 USC 6723 (Supp. 1992) has governed the failure to comply with information reporting requirement. However, Internal Revenue Code Section 6724, 26 USC 6724 (Supp. 1992), provides for a waiver of any penalties assessed under the code upon a showing of reasonable cause. Section 6724(a) provides:

No penalty shall be imposed under this part with respect to any failure if it is shown that such failure is due to reasonable cause and not willful neglect.

26 USC 6724(a) (Supp. 1992)"

4.) From the Consent Decree, dated November 4, 1992 (p.4)

The defendant ... shall be permanently enjoined from terminating an employee or refusing to hire an individual for failure to provide a social security number.... If an employee or applicant for employment advises the defendant that he does not have a social security number....., the defendant shall request, pursuant to Section 6724 of the Internal Revenue Service Code {sic}, 26 USC 6724, a waiver of any penalties that may be imposed for failing to include an employee social security number on forms and documents submitted to the IRS.

OBVIOUSLY, SOCIAL SECURITY IS VOLUNTARY - NOT MANDATORY !

Social Security is a fraudulent, PONZI PYRAMID con game. There is no money in any "social security" account, anywhere in the country. NOT ONE security is held anywhere in the world by the social security system. If Congress does not make an annual appropriation for Social Security payments EVERY YEAR, the program ends, JUST LIKE THAT. "What happened to all the money in my account ", you may wonder ? THERE IS NO MONEY IN YOUR ACCOUNT, THERE NEVER WAS. IT WAS ALL SPENT THE DAY IT ARRIVED AT THE SOCIAL SECURITY ADMINISTRATION.

Congress has used your retirement money to fund its deficit spending and wasteful boondoggles. They gave it to the Emir of Kuwait (to fight Saddam), they gave it to Saddam Hussein (to fight Iran), they gave it to Iran (to support the Shah), they gave it to the Shah to fight China, now they are giving it to CHINA, in a most favored nation trade status, to show how much the America People REALLY OBJECT TO and HATE COMMUNISM. They gave it to everyone in the world, except you, the rightful owner, the American Citizen. You get ASSET FORFEITURE, DIRECT TAXATION, REGULATORY SEIZURE OF PRIVATE PROPERTY, UNDECLARED WARS, the responsibility for a GLOBAL POLICE FORCE (while foreign natives make money without bothering to defend their own country). Americans get Social Insecurity, WelFraud, WACO, Ruby Ridge, Oklahoma City, an unconstitutional banking monopoly, worthless fiat paper money, a Congress run by PACs and special (foreign) interests, Government Hell-th Care, Schools that can't education, Police that can't protect, prisons that can't confine, immunity for rich criminals(the oligarchic aristocrats), a President with the morality (or lack thereof) of A WHORE, and a Federal Mafia, consisting of the whole alphabet - IRS, ATF, DEA, FBI, NSC, CIA, HUD, EPA, DOE, DOT, FAA, FCC, DOA, FRB, NRC, EEOC, OSHA, (How many more can you think of, how many of these did you vote for ?) etc., to enforce it all and ram it down our throats. All focused on stealing our wealth and prosperity, and enslaving our minds, bodies and spirits to an unconstitutional system and socialist way of life, bereft of faith in God and in complete denial of the authority of any perceived entity other than that of government law; all in the name of, for the sake of, and for the good of, "the children". Now who can argue with that ? POLITICIANS NEVER DO ANYTHING FOR THE CHILDREN, CHILDREN AREN'T OLD ENOUGH TO VOTE ! Do you feel represented, or do you feel deceived ?

Carlos dePonzi was a Count in the early 1900s who "operated" the first fraudulent "pyramid" investment cons; wherein money from later investors is directly and immediately used to "pay off" earlier investors, WITHOUT EVER INVESTING IN ANY REAL THING. Each "level" of "investors" is successively promised higher and higher rates of return, with the testimony of earlier "investors", "documenting" how well the program worked for them, as part of the sales pitch, until there are no more "investors" (read fools, or pigeons) left to enroll in the "pyramid". Of course, at that point in the con the "operators", and all the money "invested", disappear forever, never to be seen again ! Congress of course made these fraudulent cons illegal for anyone to operate, EXCEPT THE GOVERNMENT, who has been doing it ever since under the name "Social Security". They just got rid of the private competition !

In summary, if you allow earnings to be reported under your Social Security number to the IRS, the IRS will illegally use that social security information to demand that you pay income tax on those earnings. This demand is NOT supported by the law.

If you are less then 40 years of age, and you believe that you will ever see, even a dime, from Social Security, perhaps you had better go back and read again the preceding paragraphs ! Or, maybe, you really deserve your "social security", and the "benefits" you receive from it.

THE BEST KEPT SECRET IN AMERICA is that the IRS NEVER contacts or issues tax collection correspondence regarding income tax to Citizens who don't have, or don't use, a social security number in connection with their financial affairs and earnings ! This correspondence is never received because it is never issued by the IRS computers. It is never issued because the IRS computers have no earnings records upon which a fraudulent entry may made by an IRS employee to cause the initiation of any collection action.

BUT THE STORY GETS EVEN MORE SHOCKING ! Did you know that the assets "recorded" under the social security numbers (real estate, stocks, bonds, bank accounts, LABOR, etc.) are being used as the surety guarantee to the Federal Reserve Bank for the collective national debt and deficits. THAT'S RIGHT, YOUR PROPERTY IS THE GOVERNMENT'S COLLATERAL TO BE FORFEITED TO THE PRIVATE CORPORATION KNOWN AS THE FEDERAL RESERVE BANK WHEN THE GOVERNMENT DEFAULTS ON THE COLLECTIVE NATIONAL DEBT (which can NEVER be repaid at this point). Don't you think those bankers are rich enough already ? How much more are we going to let them illegally (unconstitutionally) take from us ?

WELFARE ENUMERATION

a.k.a.

SURETY BONDS FOR THE NATIONAL DEBT

During the so-called "Great Depression" the Federal government acquired massive debt

in order to finance Roosevelt's New Deal legislation. By 1938, the national debt had grown to such proportions that the entire nation was bankrupt, which was noticed by the United States Supreme Court in the Erie v. Tompkins case of that year. From that year, all of the Legislative bodies of the Federal government passed Public Policy statutes in the interest of the nation's creditors. In order to continue financing the expenditures of the Federal government, capital needed to be increased. Federal Reserve Notes which became "legal tender" under the Thomas Amendment (H. J. Res. 192, Public Resolution No. 73-10) passed by Congress in 1933, were made the medium of exchange for this capital.

Previously, these notes were redeemable in gold on demand at the Treasury Department of the United States at Washington in the District of Columbia, or in gold or "lawful money" at any reserve bank, which then could be used as capital and devoted to production. However, in order to have capital there must first be property. Property may be pledged and also the rights thereto, and converted into capital by the pledgee.

From 1936 to 1939, social security numbers where used by individuals who were effectively connected with a trade or business in interstate commerce, or who's commercial activities affected commerce and by those receiving unemployment compensation. To refinance the debt annually and avoid default, Congress in 1939, rewrote social legislation, repealing Titles VIII and IX of the Social Security Act, and allowed for the issuance of another class of Social Security number which would be issued to individuals pledging their future performance as SURETY against the national debt in exchange for the promise of cradle to grave protection. This pledge as surety in exchange for cradle to grave protection is called "Welfare Enumeration." The condition of such promise of protection throughout life provided no vested rights in the pledgee and the terms of the agreement was left solely to

the discretion of the body of policy makers (Congress) operating as agents of the trustee in bankruptcy representing the interest and rights of the creditor(s).

Property rights relating to future performance (labor) and contract are protected absolutely as they relate to the personality of an American Citizen. Execution of those rights may produce a translation of property but not necessarily a corpus of capital dedicated to the purpose of income production. A self declaration of bankruptcy by pledging one's property as surety against the national debt in essence converts one to a perpetual bankrupt and one's property so pledged to a bankrupt corporation (United States), a capital asset to be utilized by said corporation for the purposes of capitalization and revenue production earmarked as interest payable in discharge of the national (public) debt.

Until 1973, a person could walk into the nearest Social Security Field Office to apply for and be issued a "non-welfare enumerated" number. These numbers were assigned to individuals wishing to be covered under the original provisions of the Social Security Act, without the pledge of surety. In 1973, policy was changed and all social security numbers are now issued from the Social Security Administration's Central Office in Baltimore, Maryland. Today most applications for social security numbers received at the central office are processed as requests for welfare enumeration. The management and control of this national welfare policy was delegated by the Congress to the President. The President maintains control of this power under the "International Economic Emergency Policy."

The several States were seduced into the new policy in 1939, with Roosevelt's promise of federal grants-in-aid. Federal Revenue Sharing (31 U.S.C. §§6700 et seq.) is the modern version of the grants-in-aid program. In return for these grants the states would agree to uphold and maintain the pledge of life, labor and property of their respective citizenry as surety for the debt obligations of the Federal government. The politicians of these respective states gladly complied, because they viewed this as an opportunity to increase their own political power, letting the next generation of office holders worry over the long

term consequences of their acts.

Today most American's working for wages under Subtitle C of the Internal Revenue Code

are working under the "Economic Realities Test."

The terms "independent contractor," "employee'" and "employer" are not to be construed in their common law senses when used in federal social welfare legislation. N.L.R.B. v. Hearst, 322 U.S. 111 (1944) (for purposes of the National Labor Relations Act; United States v. Silk, 331 U.S. 704 (1947), and Bartels v. Birmingham, 332 U.S. 126 (1947) (for purposes of employment taxes on employers under the Social Security Act, as amended); and Rutherford Food Corp. v. McComb, 331 U.S. 722 (1947) (for purposes of the Fair Labor Standards Act). Rather, their meaning is to be determined in light of the purposes of the legislation in which they were used. In the application of social legislation employees are those who as a matter of economic reality are dependent upon the business to which they render service. Under social legislation the ultimate criteria is to protect those whose livelihood is dependent upon finding employment in the business of others. It s directed toward those who themselves are least able in good times to make provisions for their needs when old age and unemployment may cut off their earnings. The statutory coverage is not limited to those [whose work activities satisfy the common law "control" test] but rather to those who, as a matter of economic reality, are dependent upon the business t o which they render services."

Under the Welfare Enumeration scheme, what once was a free and self regulating People,metamorphosed into a collective endeavor pointed to the management of a large population under principles legally associated with mass peonage. Both the labor and persons of the citizenry being converted into little more than commodities or human resources, to be consumed and controlled for the purpose of promoting a socialistic concept of utopia founded on a hopelessly insolvent welfare state. We see liberty under God traded for empty promises of "cradle to the grave" protection.

To learn more about the evolution of the Social Security number from a license to engage in "commerce" to a pledge of surety for the national debt, read Welfare Enumeration and Suretyship under the Social Security Act

We want to know what you think about the above information. Contact us at: http://www.ime.net/none/surety.html

Here is wisdom. Let him that hath understanding count the number of the beast; for it is the number of a man;... Revelation 13:18

IS THE BEAST EATING YOU ? WHAT'S YOUR NUMBER ?

UNCERTAINTY OF THE FEDERAL INCOME TAX LAWS

For several years now, a variety of high public officials have openly declared that the federal income tax laws are incredibly complex and need to be either substantially revised or scrapped. But after making such statements, these officials invariably fail to identify what specific parts of the tax laws suffer from this condition, choosing instead to conceal them. Are the objectionable parts of the federal tax code secretly and quietly discussed behind closed Congressional committee doors? If they are, why doesn't someone inform the American public of these deficiencies so that they may likewise participate in this debate? Is it possible that it is the major and not various minor features of the tax laws which are complex, even uncertain? Is it possible that these major features are so fundamentally flawed that they simply cannot be repaired? If so, what is the legal consequence of this complexity?

It is alleged that the legal duties arising from the tax laws are clearly known to all, but there are a few exceptions to this rule. For example, in United States v. Critzer, 498 F.2d 1160 (4th Cir. 1974), at issue was the validity of the conviction of an Indian for tax evasion. Here, the Bureau of Indian Affairs had informed Mrs. Critzer that the money she derived from real property located within a reservation was not taxable; Mrs. Critzer relied upon this advice and failed to report such income. But, the IRS maintained a contrary position and indicted and convicted her for tax evasion. This conviction was reversed on the grounds that the unsettled nature of this field of law precluded any conviction:

"While the record amply supports the conclusion that the underreporting was intentional, the record also reflects that, concededly, whether defendant's unreported income was taxable is problematical and the government is in dispute with itself as to whether the omitted income was taxable," Id., at 1160.

"We hold that defendant must be exonerated from the charges lodged against her. As a matter of law, defendant cannot be guilty of willfully evading and defeating income taxes on income, the taxability of which is so uncertain that even co-ordinate branches of the United States Government plausibly reach directly opposing conclusions. As a matter of law, the requisite intent to evade and defeat income taxes is missing. The obligation to pay is so problematical that defendant's actual intent is irrelevant. Even if she had consulted the law and sought to guide herself accordingly, she could have had no certainty as to what the law required.

"It is settled that when the law is vague or highly debatable, a defendant- actually or imputedly- lacks the requisite intent to violate it," Id., at 1162.

This single case is an adequate demonstration that there is at least one part of the tax code which is unclear and that lack of clarity caused the reversal of Mrs. Critzer's criminal conviction. But there are others; see United States v. Mallas, 762 F.2d 361 (4th Cir. 1985)(a prosecution for violating an unclear legal duty abridges principles of due process); United States v. Garber, 607 F.2d 92, 97-98 (5th Cir. 1979); United States v. Dahlstrom, 713 F.2d 1423, 1429 (9th Cir. 1983); United States v. Heller, 830 F.2d 150 (11th Cir. 1987); and United States v. Harris, 942 F.2d 1125 (7th Cir. 1991). Unclear legal duties in other fields of law besides tax likewise prevent criminal convictions on due process grounds; see United States v. Insco, 496 F.2d 204 (5th Cir. 1974); People v. Dempster, 396 Mich. 700, 242 N.W.2d 381 (1976); United States v. Anzalone, 766 F.2d 676, 681-82 (1st Cir. 1985); United States v. Denemark, 779 F.2d 1559 (11th Cir. 1986); United States v. Varbel, 780 F.2d 758, 762 (9th Cir. 1986); United States v. Dela Espriella, 781 F.2d 1432 (9th Cir. 1986); and United States v. Larson, 796 F.2d 244 (8th Cir. 1986).

Under the U.S. Constitution, the Congress is authorized to impose two different types of taxes, direct and indirect. Via Art. 1, §8, cl. 1, of the Constitution, indirect taxes (excises, duties and imposts) must be uniformly imposed throughout the country. Direct taxes are required via Art. 1, §2, cl. 3, and Art. 1, §9, cl. 4, to be imposed pursuant to the regulation of apportionment. These tax categories are mutually exclusive and any given tax must squarely fit within one category or the other. To which constitutional category does the federal income tax belong? Is it a direct tax, or is it an indirect tax? Do American courts speak with unanimity about this simple question of what is the

nature of this tax?

To determine whether and to what extent there is any uncertainty or conflict of authority regarding the nature of the federal income tax requires at least a short review of the fundamental decisions concerning it. In 1894, Congress adopted an income tax act which was declared unconstitutional in Pollock v. Farmers' Loan & Trust Co., 157 U.S. 429, 15 S.Ct. 673, aff. reh., 158 U.S. 601, 15 S.Ct. 912 (1895). The Pollock Court found that the income tax was a direct tax which could only be imposedif the tax was apportioned; since this tax was not apportioned, it was found unconstitutional. In an effort to circumvent this decision, the 16th Amendment was proposed by Congress in 1909 and allegedly ratified by the states in 1913. As a result, various opinions arose regarding the legal effect of the amendment. Some factions contended that the 16th Amendment simply eliminated the apportionment requirement for one specific direct tax known as the income tax, while others asserted that the amendment simply withdrew it from the direct tax category and placed the income tax in the indirect, excise tax class. These competing contentions and interpretations were apparently resolved in Brushaber v. Union Pacific Railroad Co., 240 U.S. 1, 36

S.Ct. 236 (1916).[1] Rather than attempt a determination of what the Court held in this case, it is more important to learn what various courts have subsequently declared Brushaber to mean.

A little more than a week after the opinion in Brushaber, similar issues were present for decision in Stanton v. Baltic Mining Co., 240 U.S. 103, 112-13, 36 S.Ct. 278 (1916), which involved the question of whether an inadequate depletion allowance for a mining company constituted a direct tax on the company's property. As to Baltic's contention that "the 16th Amendment authorized only an exceptional direct income tax without apportionment," the Court rejected it by stating that this contention:

"... manifestly disregards the fact that by the previous ruling it was settled that the provisions of the 16th Amendment conferred no new power of taxation, but simply prohibited the previous complete and plenary power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged, and being placed in the category of direct taxation."

The Court clearly held that income taxes inherently belonged to the indirect/excise tax class, but had been converted by Pollock to direct taxes by considering the source of the income; the 16th Amendment merely banished the rule in Pollock. See also Tyee Realty Co. v. Anderson, 240 U.S. 115, 36 S.Ct. 281 (1916), decided the same day.

However, the victory of defining what the 16th Amendment meant was short lived and later decisions commenced a course which appears to have changed the meaning of Brushaber, or at least provided fertile grounds for an entirely different and opposite construction of it. In William E. Peck and Co. v. Lowe, 247 U.S. 165, 172-73, 38 S.Ct. 432, 433 (1918), which involved a tax imposed on export earnings, the Court seemed to indicate that what was accomplished by the amendment was the elimination of the apportionment requirement for the direct tax known as the income tax, an argument rejected in Baltic:

"The Sixteenth Amendment, although referred to in argument, has no real bearing and may be put out of view. As pointed out in recent decisions, it does not extend the taxing power to new or excepted subjects, but merely removed all occasion, which otherwise might exist, for an apportionment among the states of taxes laid on income, whether it be derived from one source or another."

The drift away from the position of the Court that the income tax via the 16th Amendment fell within the excise tax category became more pronounced with the decision in Eisner v. Macomber, 252 U.S. 189, 206, 40 S.Ct. 189 (1920), which involved the application of this tax to a stock dividend. Here, the Court plainly stated what many lawyers and some judges today think was accomplished by means of this amendment, the elimination of the apportionment requirement for the direct tax known as the income tax. In deciding this case, the Court quoted the amendment and then

redeclared its meaning:

"As repeatedly held, this did not extend the taxing power to new subjects, but merely removed the necessity which otherwise might exist for an apportionment among the states of taxes laid on income. Brushaber....," 252 U.S., at 206.

"A proper regard for its genesis, as well as its very clear language, requires also that this amendment shall not be extended by loose construction, so as to repeal or modify, except as applied to income, those provisions of the Constitution that require an apportionment according to population for direct taxes upon property, real and personal."

Is this the resurfacing of the argument that "the 16th Amendment authorized only an exceptional direct income tax without apportionment" condemned in Baltic?

From a study of Brushaber, it is thus possible for someone to rely upon those portions of the two phrases at the beginning and ending of 240 U.S. 19 to believe that "the 16th Amendment authorized only an exceptional direct income tax without apportionment." If one fell into that error, this belief would be magnified by the above highlighted portions of Eisner. Confusion abounds as to the correct interpretation of Brushaber, and this is obvious because various courts of this nation have relied upon this line of authority to reach diametrically opposing results.

The state courts have been particularly split over the nature of an income tax and whether it constitutes a direct property tax or an indirect/excise, which is not imposed on property. A small number of them hold that an income tax is a direct property tax; see Eliasberg Bros. Mercantile Co. v. Grimes, 204 Ala. 492, 86 So. 56, 58 (1920); State v. Pinder, 108 A. 43, 45 (Del. 1919); Bachrach v. Nelson, 349 Ill. 579, 182 N.E. 909 (1932); Opinion of the Justices, 220 Mass. 613, 108 N.E. 570 (1915); Trefry v. Putnam, 227 Mass. 522, 116 N.E. 904 (1917); Maguire v. Tax Comm. of Commonwealth, 230 Mass. 503, 120 N.E. 162, 166 (1918); Hart v. Tax Comm., 240 Mass. 37, 132 N.E. 621 (1921); In re Ponzi, 6 F.2d 324 (D.Mass.1925); Kennedy v. Comm. of Corps. & Taxation, 256 Mass. 426, 152 N.E. 747 (1926); In re Opinion of the Justices, 266 Mass. 583, 165 N.E. 900, 902 (1929); Hutchins v. Comm. of Corps. & Taxation, 272 Mass. 422, 172 N.E. 605, 608 (1930); Bryant v. Comm. of Corps. & Tax'n., 291 Mass. 498, 197 N.E. 509 (1935); Culliton v. Chase, 174 Wash. 363, 25 P.2d 81, 82 (1933)[2]; Jensen v. Henneford, 185 Wash. 209, 53 P.2d 607 (1936); State ex rel Manitowoc Gas Co. v. Wisconsin Tax Comm., 161 Wis. 111, 152 N.W. 848, 850 (1915); and State ex rel Sallie F. Moon Co. v. Wisconsin Tax Comm., 166 Wis. 287, 163 N.W. 639,640 (1917). A far larger number of state courts disagree with the cases noted above and have held that an income tax is not a property tax but an excise; see Purnell v. Page, 133 N.C. 125, 45 S.E. 534, 535 (1903); State v. Frear, 148 Wis. 456, 134 N.W. 673, 692 (1912); Opinion of Justices, 77 N.H. 611, 93 A. 311, 313 (1915); Ludlow-Saylor Wire Co. v. Wollbrinck, 275 Mo. 339, 205 S.W. 196 (1918); Hattiesburg Grocery Co. v. Robertson, 126 Miss. 34, 88 So. 4 (1921); Stanley v. Gates, 179 Ark. 886, 19 S.W.2d 1000, 1001 (1929); Featherstone v. Norman, 170 Ga. 370, 153 S.E. 58 (1930); Diefendorf v. Gallet, 51 Idaho 619, 10 P.2d 307, 313 (1932); O'Connell v. State Board, 95 Mont. 91, 25 P.2d 114, 119 (1933); Maxwell v. Kent-Coffey Mfg. Co., 204 N.C. 365, 168 S.E. 397, 400 (1933); Reed v. Bjornson, 191 Minn. 254, 253 N.W. 102, 109 (1934); Opinion of the Justices, 133 Me. 525, 178 A. 621, 623 (1935); Miles v. Dept. of Treasury, 209 Ind. 172, 199 N.E. 372, 377 (1935)(citing Brushaber); Marshall v. South Carolina Tax Comm., 178 S.C. 57, 182 S.E. 96, 97 (1935); Hunton v. Commonwealth, 166 Va. 229, 183 S.E. 873, 876 (1936); Reynolds Metal Co. v. Martin, 269 Ky. 378, 107 S.W.2d 251, 259 (1937); Vilas v. Iowa State Bd. of Assess. & Review, 223 Iowa 604, 273 N.W. 338, 342 (1937); Oursler v. Tawes, 178 Md. 471, 13 A.2d 763, 768 (1940); California Co. v. State, 141 Colo. 288, 348 P.2d 382 (1959); and Burns v. State Bureau of Revenue, 79 N.M. 53, 439 P.2d 702, 706 (1968).

This split of authority evident within the state cases also manifests itself in the federal appellate courts. For example, in the First Circuit it is difficult to determine the meaning of the 16th Amendment because in United States v. Turano, 802 F.2d 10, 12 (1st Cir. 1986), that court held that the "16th Amendment eliminated the indirect/direct distinction as applied to taxes on income." Next door in the Second Circuit, there is uncertainty revealed by three completely inconsistent cases. In Jandorf's Estate v. Commissioner, 171 F.2d 464, 465 (2nd Cir. 1948), that court declared, "It should be noted that estate or inheritance taxes are excises ... while surtaxes, excess profits and war-profits taxes are direct property taxes." Surtaxes are the graduated taxes of the income tax, so this court holds that the personal income tax is a direct tax. But in Ficalora v. Commissioner, 751 F.2d 85, 87 (2nd Cir. 1984), that court stated that the personal income tax was an indirect tax: "[T]he Supreme Court explicitly stated that taxes on income from one's employment are not direct taxes and are not subject to the necessity of apportionment." But compare United States v. Sitka, 845 F.2d 43, 46 (2nd Cir. 1988)(citing Parker, infra, for the proposition that the tax is direct). In the Third Circuit, it has been held in one case that all income taxes are direct, but in another that only some are direct; see Keasbey & Mattison Co. v. Rothensies, 133 F.2d 894, 897 (3rd Cir. 1943)("[A]n income tax is a direct tax upon income therein defined"); and Penn Mutual Indemnity Co. v. Commissioner, 277 F.2d 16, 19 (3rd Cir. 1960)("Pollock .... only held that a tax on the income derived from real or personal property was so close to a tax on that property that it could not be imposed without apportionment. The Sixteenth Amendment removed that barrier").

In the remainder of the Circuits, the difference of opinion as to whether the federal income tax is a direct or indirect tax is likewise as profound and confusing. In the Fourth and Sixth Circuits, the income tax has been held to be an excise tax; see White Packing Co. v. Robertson, 89 F.2d 775, 779 (4th Cir. 1937)("The tax is, of course, an excise tax, as are all taxes on income..."); and United States v. Gaumer, 972 F.2d 723, 725 (6th Cir. 1992)("Brushaber and the Congressional Record excerpt do indeed state that for constitutional purposes, the income tax is an excise tax"). However, in the Fifth, Seventh, Eighth and Tenth Circuits, arguments that this tax is an excise have been squarely rejected and determined to be frivolous. For example, in Parker v. Commissioner, 724 F.2d 469, 471 (5th Cir. 1984), the court clearly rejected the contention that this tax is an excise:

"The Supreme Court promptly determined in Brushaber... that the sixteenth amendment provided the needed constitutional basis for the imposition of a direct non-apportioned income tax.

"The sixteenth amendment merely eliminates the requirement that the direct income tax be apportioned among the states.

"The sixteenth amendment was enacted for the express purpose of providing for a direct income tax."

In Coleman v. Commissioner, 791 F.2d 68, 70 (7th Cir. 1986), the court held that an argument that this tax was an excise was frivolous on its face ("The power thus long predates the Sixteenth Amendment, which did no more than remove the apportionment requirement..."). A similar conclusion was reached in United States v. Francisco, 614 F.2d 617, 619 (8th Cir. 1980), that court declaring that Brushaber held this tax to be a direct one:

"The cases cited by Francisco clearly establish that the income tax is a direct tax, thus refuting the argument based upon his first theory. See Brushaber v. Union Pacific Railroad Co., 240 U.S. 1, 19, 36 S.Ct. 236, 242, 60 L.Ed. 493 (1916) (the purpose of the Sixteenth Amendment was to take the income tax 'out of the class of excises, duties and imposts and place it in the class of direct taxes')".[3]

Finally, in United States v. Lawson, 670 F.2d 923, 927 (10th Cir. 1982), that court expressed in the following fashion its contempt for the contention that the federal income tax was an excise:

"Lawson's 'jurisdictional' claim, more accurately a constitutional claim, is based on an argument that the Sixteenth Amendment only authorizes excise-type taxes on income derived from activities that are government-licensed or otherwise specially protected... The contention is totally without merit... The Sixteenth Amendment removed any need to apportion income taxes among the states that otherwise would have been required by Article I, Section 9, clause 4."

Therefore, while the Supreme Court rejected in Baltic the argument that "the 16th Amendment authorized only an exceptional direct income tax without apportionment," this position now prevails in the Fifth, Seventh, Eighth and Tenth Circuits. In the Second Circuit, the existing authority illogically claims that the tax is both.

A direct tax applies to and taxes property while an indirect, excise tax is never imposed on property but usually an event such as sales; see Bromley v. McCaughn, 280 U.S.124, 50 S.Ct. 46, 47 (1929).[4] Those courts which hold that an income tax is a direct property tax believe that income is property, yet those which hold that this tax is an excise declare that income is not property. If the courts of this nation cannot identify what is the nature of this ephemeral item known as income,[5] then how can the American people? While in Critzer the difference of opinion existed between two government agencies, here the difference of opinion is among many different courts, a situation far more serious than that presented in Heller. Aren't we being subjected to a monumental due process problem far bigger than that to which Mrs. Critzer was subjected?

The question of what constitutes property is an issue governed by state law; see Aquilino v. United States, 363 U.S. 509, 512-13, 80 S.Ct. 1277, 1280 (1960), and United States v. Baldwin, 575 F.2d 1097, 1098 (4th Cir. 1978). The definition of the term, "property," is very broad; see Samet v. Farmers' & Merchants' Nat. Bank, 247 F. 669, 671 (4th Cir. 1917)("Property is ... everything that has exchangeable value or goes to make up a man's wealth"). It includes money, credits, evidences of debt, and choses in action; see State v. Ward, 222 N.C. 316, 22 S.E.2d 922, 925 (1942). Income is property according to St. Louis Union Trust Co. v. United States, 617 F.2d 1293, 1301 (8th Cir. 1980). Accrued wages and salaries are likewise property; see Sims v. United States, 252 F.2d 434, 437 (4th Cir. 1958), aff'd., 359 U.S. 108, 79 S.Ct. 641 (1959); and Kolb v. Berlin, 356 F.2d 269, 271 (5th Cir.1966). Accounts receivable are property; see In re Ralar Distributors, Inc., 4 F.3d 62, 67 (1st Cir. 1993). Even private employment and a profession are considered property; see United States v. Briggs, 514 F.2d 794, 798 (5th Cir. 1975).

There appears to be no dispute about the plain requirements of the Constitution that direct taxes must be apportioned and that indirect taxes must be uniform. Likewise as shown above, there is a line of decisional authority regarding the generally accepted proposition that income is property, although there are courts which deny this. In James v. United States, 970 F.2d 750, 755, 756 n. 11 (10th Cir. 1992), the 10th Circuit made it clear that income is property. Pursuant to United States v. Lawson, supra, the 10th Circuit declares that the property known as income is subject to tax under the view that the 16th Amendment eliminated the apportionment requirement for a specific class of property known as income. However, there is ample contrary judicial authority which demonstrates that this construction of the 16th Amendment is erroneous and that the purpose, intent and meaning of the amendment was the opposite construction and that the amendment did not free this one type of property tax from the regulation of apportionment. An error in a logical argument involving a single premise affects the ultimate conclusion. If the 10th Circuit accepted the proposition that the meaning of the 16th Amendment was contrary to that asserted in Lawson, but adhered to its decision in James, a valid legal argument would logically follow that property known as income could not be taxed because the current income tax is not apportioned.

This same problem, but from an opposite perspective, is evident within the Fourth Circuit where the existing authority of Sims v. United States, supra, declares that income is property. Since that Circuit holds that the federal income tax is an excise via White Packing Co. v. Robertson, supra, and since the definition of an excise tax appearing in that Court's opinion in New Neighborhoods, Inc. v. West Virginia Workers' Comp. Fund, 886 F.2d 714, 719 (4th Cir. 1989), excludes a tax on property, does it not logically follow that there is a tremendous gap in the decisional authority within the Fourth Circuit which presents a view of the law that the property known as income might not be taxed? Based on these cases, is this tax clearly imposed?

Review of the above noted authority in other circuits and states only demonstrates how profound this problem is. In the 6th Circuit, United States v. Gaumer, supra, declares the income tax to be an excise; via Jack Cole Co. v. MacFarland, 337 S.W.2d 453, 455-56 (Tenn. 1960), the Tennessee Supreme Court has held that an excise tax cannot be used to tax the right to earn a living. Which authority do the people living in Tennessee follow? If they follow the word of their own state court, they might be charged with a tax crime, yet they have a right to rely upon the word of the courts, even when erroneous; see United States v. Albertini, 830 F.2d 985, 989 (9th Cir. 1987). A different problem emerges in the 8th Circuit where United States v. Francisco, supra, holds that an income tax is a direct property tax. Missouri is within the 8th Circuit, but the Missouri Supreme Court held in Ludlow-Saylor Wire Co. v. Wollbrinck, supra, that an income tax is an excise; if income is not property under Missouri state law,[6] then how does this federal property tax operate as to this "non-property"? Iowa is also in the 8th Circuit, but in Hale v. Iowa State Board of Assessment and Review, 223 Iowa 321, 271 N.W. 168, 172 (1937), that court held that "income is not property within the law of taxation." If state law holds that income is not property yet the federal appellate court for the same state holds the exact opposite, is not a serious uncertainty of the law, due process problem clearly evident?

The decisional authority within the 5th Circuit, Parker v. Commissioner, supra, holds that this tax is a direct property tax, but a contrary view prevails in Mississippi where its citizens are told that an income tax is an excise; see Hattiesburg Grocery Co. v. Robertson, supra. The courts in Wisconsin and Indiana, via State v. Frear, supra, and Miles v. Dept. of Treasury, supra, have found this tax to be an excise, yet the federal appellate court which encompasses these two states has an entirely different view of the object of the tax; see Coleman v. Commissioner, supra. The 10th Circuit, which sits in Denver, held in Lawson, supra, that the income tax is a property tax, yet a state court in the same city has declared that such a tax is an excise; see California Co. v. State, supra.

In Alabama, income is property via Eliasberg Bros. Mercantile Co. v. Grimes, supra; but next door in Georgia via Featherstone v. Norman,[7] it is not. While the11th Circuit appears not as yet to have passed upon the question of what type of tax the federal income tax is, consultation of Supreme Court decisions still doesn't resolve the question. By following the rationale of Brushaber and Bromley, supra, which declare the federal income tax to be an excise tax which is not imposed on property, are the people of Alabama exempt from this tax while those in Georgia are not? But by reversing the choice of Supreme Court decisions to follow in an effort to resolve this controversy merely changes the results but not the problem. By following Eisner which seems to hold that the tax is imposed on property, do the people of Alabama owe the tax while those in Georgia do not? These differing conclusions plainly reveal a serious uncertainty about what is taxed, and I do not attempt herein to offer any explanation for all of this inconsistency; the fact of the matter is that I cannot other than to allege that this is uncertainty of the law creates a serious due process problem.

The problems created by the failure of American courts to determine what is the nature of an income tax are very broad. Any particular federal tax must fit within one of the two constitutional tax categories and once the category is known, it may be determined whether the tax in question complies with the constitutional regulation for imposition of that type of tax. A direct tax which is uniformly imposed would still be unconstitutional as one imposed in the absence of apportionment. An indirect tax imposed via apportionment would likewise be unconstitutional since it would not be uniform. But if it is impossible to determine which class any given tax falls within, then it is likewise impossible to determine which constitutional regulation, if any, applies to that tax. If the courts of this nation hold that an income tax is both an excise tax and a direct one, it cannot with any degree of certainty be determined what constitutional restrictions might or might not apply to this tax or what is even the meaning of the 16th Amendment. What's more, it cannot be determine what is income, whether property or non-property.

But this is not the only fundamental problem for the federal income tax. Additionally, the question of which statute controls the duty to file income tax returns is subject to judicial dispute. In Commissioner v. Lane-Wells Co., 321 U.S. 219, 222, 64 S.Ct.511, 513 (1944), the Court noted that §54 of the 1939 Internal Revenue Code, the predecessor for Internal Revenue Code §6001, related to the filing requirement; see also Updike v. United States, 8 F.2d 913, 915 (8th Cir. 1925). In True v. United States, 354 F.2d 323, 324 (Ct.Cl. 1965), United States v. Carlson, 260 F.Supp. 423, 425 (E.D.N.Y. 1966), White v. Commissioner, 72 U.S.T.C. 1126, 1129 (1979), McCaskill v. Commissioner, 77 U.S.T.C. 689, 698 (1981), Counts v. Commissioner, 774 F.2d 426, 427 (11th Cir. 1985), Blount v. Commissioner, 86 U.S.T.C. 383, 386 (1986), and Beard v. Commissioner, 793 F.2d 139 (6th Cir. 1986), these courts held that Internal Revenue Code §6011 related to the filing requirement. In United States v. Moore, 627 F.2d 830, 834 (7th Cir. 1980), United States v. Dawes, 951 F.2d 1189, 1192, n. 3 (10th Cir. 1991), and United States v. Hicks, 947 F.2d 1356, 1360 (9th Cir. 1991), those courts held that Internal Revenue Code §§ 6011 and 6012 governed this duty. In contrast, the cases of Steinbrecher v. Commissioner, 712 F.2d 195, 198 (5th Cir. 1983), United States v. Bowers, 920 F.2d 220, 222 (4th Cir. 1990), and United States v. Neff, 954 F.2d 698, 699 (11th Cir. 1992), held that only §6012 governed this duty. But in United States v. Pilcher, 672 F.2d 875, 877 (11th Cir. 1982), none of the above sections were mentioned and it was held that §7203 required returns to be filed. It is very apparent that there is even a diversity of opinion among judges regarding which sections of the Internal Revenue Code govern the requirement to file income tax returns.

The observation of the dissenting judge in Culliton v. Chase, 25 P.2d at 89-90, that this "disagreement of the courts and judges on identical problems seems to afford the highest proof that 'reasonable doubt' does exist," is particularly appropriate here. If American courts cannot decide such fundamental questions as what is the nature of the income tax and which section of the Internal Revenue Code requires the filing of an income tax return, then it is obvious that a serious due process problem exists within the federal income tax laws.

If American courts cannot decide such fundamental questions as what is the nature of the income tax and which section of the Internal Revenue Code requires the filing of an income tax return, then it is obvious that the problem with this tax involves these basic questions. Since even the courts are split over these questions, shouldn't we just scrap the whole thing since the condition which exists is incapable of repair?

In 1913 during the debate on the first income tax act under the 16th Amendment, Senator Elihu Root commented about the complexity of that first law:

"I guess you will have to go to jail. If that is the result of not understanding the Income Tax Law I shall meet you there. We shall have a merry, merry time, for all of our friends will be there. It will be an intellectual center, for o one understands the Income Tax Law except persons who have not sufficient intelligence to understand the questions that arise under it."[8]

Apparently, nothing has changed.

END NOTES:

[1] In this decision, there is a very lengthy sentence which contains the following phrase: "... by which alone such taxes were removed from the great class of excises, duties and imposts subject to the rule of uniformity, and were placed under the other or direct class," 240 U.S., at 19. This phrase and the one at the very end of this paragraph are almost identical. This language was used to describe the contention the

Court was rejecting, not approving.

[2] The dissent in this case noted the wide divergence of the authority as to whether the tax is a direct property tax or an excise. It commented: "The disagreement of the courts and judges on identical problems seems to afford the highest proof that 'reasonable doubt' does exist," 25 P.2d, at 89-90.

[3] It is interesting to note that this court relied upon those portions of the Brushaber decision quoted previously where the Court noted the argument is was precisely rejecting. If the judges who are legal scholars are capable of completely miusunderstanding this opinion, is it not also probable that the American people and even lawyers can make the same mistake?

[4] The Court defined these two types of taxes in the following manner: "While taxes levied upon or collected from persons because of their general ownership of property may be taken to be direct.... a tax imposed upon a particular use of property or the exercise of a single power over property incidental to ownership, is an excise which need not be apportioned..."

[5] At least one court has declared that the term "income" is not defined in the Internal Revenue Code; see United States v. Ballard, 535 F.2d 400, 404 (8th Cir. 1976).

[6] The Court in Ludlow, 205 S.W. at 198, declared that income is not property: "It is apparent therefore, that when the Constitution of 1875 was adopted, the word 'property' as the basis for taxation, proportioned to value, had acquired a fixed and definite meaning preclusive of personal incomes, occupations, privileges and similar sources of revenue."

[7] See 153 S.E. at 65: "Hence a man's income is not 'property' within the meaning of a constitutional requirement that taxes shall be laid equally and uniformly upon all property within the State."

[8] See The United States Tax Court: An Historical Analysis, page 12, by Harold Dubroff. Published by CCH.

KNOWLEDGE OF THE FEDERAL TAX LAWS AND THAT CONFLICT IN THE STATE AND FEDERAL COURTS

Former Federal District Judge Harry Claiborne admitted that, while he was a federal judge he knew nothing of federal tax law, yet decided tax cases.

In Bursten v. US, 395 f 2d 976, 981 (5th. Cir., 1968), the court acknowledged:

"We must note here, as matter of judicial knowledge, that most lawyers have only scant knowledge of the tax laws."

In Lord v. Kelly, 240 FSupp 167, 169 (D. Mass., 1965), it states the judges are under IRS scrutiny.

Even though the judges and lawyers admittedly do not know the tax laws, they sit in judgment and prosecute and/or defend the average Citizen. Even though this is the case, the Citizen being charged with a tax crime is supposed to have more knowledge than the law professionals and is held accountable by these professionals.

Under the criminal law, a criminal defendant has a right to rely upon decisions of the courts and this is a separate defense; see the Albertini case from the 9th Circuit. But further, if these decisions concerning a specific point of law are themselves conflicting, there is the additional defense of uncertainty of the law.

The nature of the income tax is itself conflicting. At the state level, most of the state courts hold that the tax is an excise, while a minority line of authority holds that it is a direct property tax. The reverse is true at the federal level, with most appellate courts holding that it is a direct tax and a minority holding that it is an excise; see the attached list. Since there is no doubt that this conflict is present within the cases, this demonstrates a very serious due process problem of uncertainty in the law.

To violate a clearly known legal duty, one must plainly know the law. But when the law itself is unclear, there correspondingly cannot be a clearly known legal duty. What kind of legal environment do we have when the law itself is uncertain ? We have every right to politically complain about the split and to promote one line of authority over the other. This clearly appears to be the case with the Save A Patriot Fellowship; its members face a split in authority which makes the law uncertain. For that the Fellowship and its members have every right in the world to advocate that a particular line of authority prevails at the end of the contest over the opposing line of authority.

So, given all of this, what should you do when wrongfully approached or contacted by the IRS ? Why not REFUSE PRESENTMENT FOR CAUSE WITHOUT DISHONOR as in the letter shown below..

====================================================================

Commissioner, District Director & Chief, Legal Staff

Internal Revenue Service

1111 Constitution Ave. N.W.

Washington, D.C. 20224

AFFIDAVIT OF REFUSAL TO ACCEPT

IRS NOTICE OF DEFICIENCY

FOR CAUSE WITHOUT DISHONOR

NOTICE OF IRS DEFAULT

I, the undersigned, ________________ state and affirm that I am over the age of majority, of sound mind, and hereby TIMELY refuse acceptance, for cause and without dishonor, the presentment to me from the Commissioner of the Department of the Treasury Internal Revenue Service (IRS), by yourself, which is dated and identified at the bottom as an IRS Letter ____, and within its content as a NOTICE OF DEFICIENCY, and all Forms, Documents, and other writings sent with it (hereinafter collectively referred to as the Presentment) and return same by attaching it herewith as Exhibit A. I do so without dishonor and provide ten (10) days to have a competent person (an IRS lawyer) rebut my causes and beliefs stated herein. Failure to do so becomes their default and admission to all shown under NOTICE on page 6 of this Affidavit of Refusal.

BE AWARE that this is an exact copy of the original Affidavit, which is being retained by me to be used as evidence in court in the event such need arises.

(1) I believe that the Presentment does not contain a bona fide signature as required by law under 26 USC Sec. 6061, and that it does not conform with Rule 44, Federal Rules of Civil Procedure, which is necessary to evidence it as an official record of the U.S. Government.

(2) I believe that, by use of the "we" and "us" in the NOTICE OF DEFICIENCY, Commissioner Rossotti indicates that he is acting personally when sending out such presentment.