There's no Income Tax law - why pay?

I haven't paid my taxes yet and the IRS still haven't sent me anything..  guess nobody has to pay taxes and can get away with it, woohoo!

Joseph R. Banister, a former fraud expert and gun carrying agent with the criminal investigations division of the Internal Revenue Service, has discovered that there is no law that requires you to file a income tax return or to pay income tax for working in America.

Just as the " fact " that the earth was once considered flat was exposed as a lie we have in our own time a lie of equal and greater size. Just as fear and ignorance once stated that the earth was flat so today our nation is ruled by fear and ignorance in regard to the so-called " income tax." The facts are these :

   1. There is no law which requires you to file an income tax return for working in America.
   2. There is no law which requires you to pay income tax for working in America.
   3. You volunteer when you sign a income tax return.
   4. You volunteer when you pay income tax.
   5. You sign away your 5th Amendment rights against self-incrimination when you sign a tax return.
   6. The money which you pay as your " income tax " goes to a private banking cartel known as the Federal Reserve System. This organization, also known as the " FED," is NOT a government agency.

The fact is that our nation is ruled by a private banking cartel, the Federal Reserve System, which, having taken control of our country and its sovereign power of making money, itself makes money out of thin air and loans it to our nation. It is the inherent breakdown of this Federal Reserve System which leads to the progressive rise in prices, a fraudulent and ever rising " national debt," the loss of the value and purchasing power of the dollar, the need for 2 parents to work to achieve a adequate income, and many other symptoms of a decaying economy. The " income tax " is the payment demanded by this private banking cartel for the " service " ( the loaning of the money which they create ) which they perform. Our representatives, including Senator Boxer, have been bought and paid for by that banking cartel which has conquered our nation and takes its tribute from the citizens who are essentially plantation slaves as they work for a private bank and its stockholders ( mostly foreign ) and not the nation.

I ask you to join me in the battle to stop the total and complete corruption of the IRS and the Federal Reserve System. We must save our workers, our nation, and our future generations from this slavery.

Don J. Grundmann, D.C., M.H.
Director
San Francisco Bay Area Freedom Law School

14 Months ago, Joe began to communicate with several "tax
protesters". In a rare occurrence, representatives from Freedom
Law School and the Free Enterprise Society, along with Bill
Conklin, Attorney Larry Becraft, Devvy  Kidd and Bill Benson were able to convince Joe (whose job it was to put people like them in jail) to actually evaluate the information that was so
objectionable to the IRS.
 
For the next 14 months, Joe poured over the information. A few
weeks ago, he submitted a 90 page report to his superiors at IRS.

In his report, Joe informed his superiors that he had found the
following information to be legally accurate and factual:
 
1) There is no federal law requiring an American Citizen, working and living in one of the 50 states, to file an income tax return or pay income tax.
 
2) The 16th Amendment did not provide Congress with any new
taxing authority, but merely reversed an earlier US Supreme Court decision, thus placing the income tax forever within the
category of a "privilege tax" (i.e. a tax for doing something
that you have no natural right to do as a Citizen).
 
3) The 16th Amendment was never properly ratified and
therefore, having never received the blessings of the Union
states, it is only a federal  law which applies to Washington
D.C. and its territories.
 
4) The United States operated each year EXCLUSIVELY by loans
provided by the Federal Reserve (which is a 100% private banking
institution and is not a government agency) and not one penny of
income tax goes to the US Treasury, but rather 100% of the tax
collected goes directly to the Federal Reserve banks. In short,
the IRS acts EXCLUSIVELY as the collection department of the
Federal Reserve banking system.

On June 23 2005, in Sacramento, CA, a unanimous jury of 12 found Banister not guilty of three counts of assisting in preparation of false tax returns and one count of conspiracy to defraud the government.

Had the IRS been successful in convincing the jury that Banister was guilty, he would have faced going to prison for up to 14 years. Since 1999, Banister had been trying to get the government to answer the questions that he and scores of other Americans have been raising about the legality and imposition of the federal income tax on the average working citizen.

Banister wrote a detailed 95-page report on this issue and presented it to his IRS superiors for an answer. He went to Washington to meet with the President, heads of Congress and the IRS. He also appeared on C-Span2 and in nationwide newspaper advertisements telling of questions he had. Rather than answering Banister’s report, the IRS encouraged Banister to resign, which he did. At every turn, the federal government refused to answer Banister’s questions.

IRS and the Department of Justice decided to “answer” Banister by charging him with four tax-related charges in November 2004. IRS claimed that a major part of these “crimes” was Banister’s speech in October 2000 at Cencal Aviation Products in Northern California. This speech was videotaped and reported on by David Cay Johnston of The New York Times.

At this two-hour meeting, Banister presented a case for the questionable nature of the way the federal income was imposed on ordinary Americans and the suspicious behavior of the government in refusing to answer these questions.

During closing statements in the trial, Assistant U.S. Attorney Robert Twiss argued to the jury that Banister used false means to “wipe out” taxes that were allegedly owed by Cencal owner Al Thompson, and that to Banister, “it was all about the money, the money.”

However, an April 2001 email between a Department of Justice lawyer named DiLeonardo, who had worked with Banister while Banister was working at the IRS, and Ron Semino, the chief of the Western Division of the Department of Justice’s Tax Division, showed that the government viewed Banister to be the most visible personality in what many people today call “the tax honesty movement.”

After Banister was indicted, IRS Commissioner Mark Everson stated: “Joe Banister, a former IRS agent, knew exactly what he was doing. Tax professionals and employers who break the law will be held accountable.”

Apparently the jury agreed with Everson that Banister knew exactly what he was doing. However, they saw no crime in what Banister was doing. Two of the jurors, who spoke with AFP right after the trial, related the thinking that led to their decision. The jury saw the tax returns contained no false information.

The jurors said they were surprised when the testimony part of the case ended, since they had yet to see or hear any evidence of a crime. They said the evidence showed that Banister was honest, straightforward, credible, believed in what he was doing and was trying to follow the law. They also believed that Banister was honestly trying to get answers, but the government consistently refused to answer his questions and address his concerns.

The government presented enough evidence to acquit Banister, they said. The jurors said they saw nothing deceitful or dishonest on Banister’s part. And, finally, they said the government simply presented no evidence of any crimes committed by Banister.

After a few hours of deliberation, the jury took a vote and six or seven of them were ready to acquit Banister of all charges. Other jurors still had doubts. But after the jury saw Banister’s video a second time, the remaining doubts as to Banister’s innocence were removed.

This defeat at the hands of one of the most visible figures in the anti-income tax movement dealt a serious blow to the IRS’s image of invincibility. It demonstrated that even in the 21st century, there are David's like Banister who can beat the IRS Goliath.

The question remains; if Banister is correct in his belief that the IRS consistently misapplies the law, who is going to hold the IRS and officials like Everson accountable?

Mr. Banister had written a 90 page report of his investigation of the Income Tax on February 11, 1999. This report is fully backed up by references to the U.S. Constitution, the IRS Code, Internal Revenue Manuals and court cases.

Mr. Banister presented this 90 page report to his superiors and asked them to present it to the highest ranks of the IRS, up to and including the Commissioner of IRS, Mr. Charles O. Rossotti. Mr. Banister informed the IRS leadership that unless they could point-by-point refute his findings, Mr. Banister would resign from his position INSTEAD OF ENFORCING A NON-EXISTENT LAW!

Apparently the Commissioner of IRS, Mr. Charles O. Rossotti and the high level officials of the IRS who each have taken an oath to "uphold and defend the U.S. Constitution from all enemies foreign or domestic," have VOLUNTARILY chosen to COMMIT TREASON on the American People by refusing to review and consider the findings of Mr. Banister. His findings squarely challenged the lawful basis of the IRS enforcing a NON-EXISTENT and VOLUNTARY INCOME TAX on the American people by use of VIOLENT FORCE!!!

On February 17, 1999, Mr. Banister was called into his Chief's office. Mr. Banister was informed that his report had been reviewed "by the highest levels of the IRS." Mr. Banister was given a memorandum which in part read: "The Internal Revenue Service will not be responding to your request and will provide you with the necessary paperwork to tender your resignation. You will be placed on administrative leave effective upon receipt of this memorandum for a period of seven calendar days to consider what actions you wish to take."

Mr. Banister's E-Mail:

Dear Friends:

Well, the day of reckoning has arrived. On February 11, 1999, in my capacity as a Special Agent and federal law enforcement officer sworn to support and defend the Constitution of the United States, I submitted a "preliminary report" to the Chief of the IRS Criminal Investigation Division for the Central California District. My report summarized my findings regarding allegations that the income tax and filing of federal income tax returns is voluntary, that the 16th Amendment was never ratified, and that income taxes are not used to pay for daily government operations.

In order to ensure that unnecessary and unwarranted delay would not occur, I requested that my report be forwarded to top officials in the IRS up to and including Commissioner Charles O. Rossotti, and I respectfully requested that the Commissioner or his designee respond to the evidence in my report within 30 days. Today, my Chief called me into his office and gave me a memorandum. The memorandum dated February 17th, 1999, read in part:

The Internal Revenue Service will not be responding to your request and will provide you with the necessary paperwork to tender your resignation. You will be placed on administrative leave effective upon receipt of this memorandum for a period of seven calendar days to consider what actions you wish to take.

I was told that officials at the highest levels of the Internal Revenue Service were consulted regarding a response to my report. Apparently, I have now joined the ranks of every other taxpayer who ever was ignored or otherwise rebuffed by the Internal Revenue Service when they petitioned the IRS for a reasonable explanation. The only conclusion that I can reach is that those officials thought it was better to rebuff my request and pass up a golden opportunity to prove my research wrong than to have to admit that so-called "tax-protesters" and other supporters of the U.S. Constitution have been right all along. Ironically, had the IRS taken the time to address my concerns, or perhaps perform the simple task of proving the allegations wrong, I would have gladly been their spokesman advising taxpayers not to fall for these untrue allegations for the rest of my career.

As the memorandum states, I have until Friday, February 26th, 1999, the day after the 86th anniversary of the alleged ratification of the 16th Amendment, to tender my resignation. This is certainly a sad day in my life. Although I was hoping for a better result, I learned today after over two years of investigation that the Internal Revenue Service is everything that the so-called "tax protesters" said it was; non-responsive, unable to withstand scrutiny, tyrannical, and agency oblivious to the rule of law and the U.S. Constitution.

The original Constitution prohibits the Congress from laying a DIRECT (income) tax on
the People unless it is in PROPORTION to the states (the last census).
• Our income tax conflicts with the original constitution: it is a DIRECT tax (the Supreme
Court and numerous federal courts have declared it so) and it has notbeen laid in PRO-
PORTION to the States.
• The IRS (and the New York Times) say our income tax, although DIRECT and UNAP-
PORTIONED, is constitutional because the 16th Amendment did away with the origi-
nal requirement that all DIRECT taxes must be in PROPORTION to the states.
• However, Bill Benson’s research shows, conclusively, that the 16th (income tax) amend-
ment is a FRAUD — it was fraudulently ratified.
• When Mr. Benson took his charge of FRAUD to federal court, the court declared that it
was a political question for Congress to decide. (Editor’s note: Since when is fraud a polit-
ical question?).
• The Congressional Research Service immediately declared Benson’s charge of FRAUD to
be a question for the courts.
• Even ifthe original constitution, or the constitution as amended by the 16th Amendment,
authorized Congress to lay a DIRECT tax on all U.S. citizens, without APPORTIONMENT,
Congress has not done so — Congress has yet to pass a law that requires most Ameri-
cans to file a tax return or to pay income tax.
• The current income tax law does NOT apply to most Americans.
Read More Detailed Evidence at Our Website: www.givemeliberty.org
The Constitutional Argument
Bill Benson’s research report, “The Law That Never Was” is based on thousands of court-
certified documents from state and federal archives. It proves conclusively the 16th (income
tax) Amendment to the Constitution in 1913 was fraudulently ratified.
His report says, in effect, that every individual in America can legally ignore the require-
ments of the Internal Revenue Code because it is well settled in American Jurisprudence
that any law which is conflict with the Constitution is abrogated, i.e., it is VOID and can be
IGNORED by the People.
Mr. Benson, a former Criminal Investigator for the Illinois Department of Revenue, has
NOT filed federal or state tax returnsor paid any federal or state tax on his income since 1986.
The Statutory Argument
Unrefuted research by Larkin Rose and John Kotmair say, in effect, that EVEN IF the
Constitution authorized an income tax, the current income tax laws do NOT APPLY AND
DO NOT REQUIRE most U.S. citizens to pay any taxes on their income.
Mr. Rose has not filed federal or state income tax returns or paid income taxes since 1996.
Mr. Kotmair has not filed federal or state income tax returns or paid income taxes since 1973.
Q: DOES THE CONSTITUTION PROHIBIT A NON-APPORTIONED DIRECT TAX ON THE PEOPLE?
A: YES! HERE IS WHAT THE ORIGINAL CONSTITUTION SAYS: “No capitation, or other
direct, tax shall be laid, unless in proportion to the census or enumeration herein before
directed to be taken.” See Article I, Section 9, Clause 4.
Q: IS THE INDIVIDUAL INCOME TAX A DIRECT TAX?
A: YES, ACCORDING TO THE COURTS.
The U.S. Supreme Court Has Declared the Tax to be a Direct Tax: “A proper regard for
its [the 16th Amendment’s] 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.” See
“http://caselaw.findlaw.com/scripts/ getcase.pl?navby=case&court=US&vol=252&page=189”
Eisner v. Macomber, (1920), 252 U.S. 189, 206, 40 S.Ct. 189. Editor’s note: Wages & salaries
are property. See Sims v. U.S., (1959), 359 U.S. 108.
The Federal Appeals Courts Have Declared The Income Tax To Be A Direct 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.” See Parker v. Commissioner, 724 F.2d
469, 471 (5th Cir. 1984).
• The court held that an argument that the income tax was an excise was frivolous on its
face. The court declared: “The power thus long predates the Sixteenth Amendment, which
did no more than remove the apportionment requirement”. See Coleman v. Commis-
sioner, 791 F.2d 68, 70 (7th Cir. 1986).
• “The cases cited by Francisco clearly establish that the income tax is a direct tax....”, See
United States v. Francisco, 614 F.2d 617, 619 (8th Cir. 1980).
• “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.” See United
States v. Lawson, 670 F.2d 923, 927 (10th Cir. 1982).
State Courts Have Declared The Income Tax To Be A Direct Tax.
Editor’s note: For a full discussion see: “Long after Brushaber vs. U.P. Railroad and Stanton
vs. Baltic Mining, the Courts Have Declared The Income Tax to be a Direct Tax.” This arti-
cle can be found on our web site. Special thanks to constitutional attorney Larry Becraft
upon whose research our article is based.
Q: IS THE INDIVIDUAL INCOME TAX IMPOSED “IN PROPORTION TO THE CENSUS.”
A: NO! IT IS NOT “IN PROPORTION TO THE CENSUS.”
The individual income tax is not tied to the population, state-by-state. Notwithstand-
ing the constitutional prohibition found in Article I, Section 9, Clause 4, the income tax it
is not apportioned among the States. Congress does not require each state to tax their citi-
zens to collect the money the federal government says it needs, over and above what it col-
lects under the taxing authority granted to it under Article I, Section 8, Clause 1 of the Con-
stitution (indirect taxes: excise, tariffs, duties and imposts)
Q: HOW CAN THERE BE A DIRECT, UNAPPORTIONED INDIVIDUAL INCOME TAX IN
AMERICA IF THE ORIGINAL CONSTITUTION PROHIBITS IT?
A: THE GOVERNMENT RELIES UPON THE VALIDITY OF THE 16TH AMENDMENT TO
THE CONSTITUTION AS ITS AUTHORITY TO IMPOSE THE CURRENT, DIRECT,
UNAPPORTIONED, INDIVIDUAL INCOME TAX.
The 16th Amendment reads: “The Congress shall have power to lay and collect taxes on
incomes, from whatever source derived, without apportionment among the several States,
and without regard to any census or enumeration.”
The IRS says it is the 16th Amendment that gives it the authority to impose the income
tax directly on the working people of America. The IRS is on record as saying; “The sixteenth
amendment to the Constitution states that citizens are required to file tax returns and pay
taxes.” IRS Publication No. 1918 (July, 96), Cat. No. 22524B.
No less an authority than the New York Times says the 16th Amendment is the gov-
ernment’s authority to impose the income tax directly on the working people of America.
The New York Times says: “Congress’s right to levy taxes on the income of individuals and
corporations was contested throughout the 19th century, but that authority was written into
the Constitution with the passage of the 16th Amendment in 1913.” The New York Times
Almanac, 2001, The World’s Most Comprehensive and Authoritative Almanac, page 161

In 1909, Congress passed the proposed 16th Amendment. It was sent to the states for
ratification by the state legislatures. There were 48 states. Three-fourths, or 36, of them were
required to give their approval in order for it to be ratified.
Knox declared the 16th amendment ratified on February 25, 1913, just a few days before
leaving office. He counted 38 states as having approved it.
• Kentucky: The Kentucky legislature REJECTED the amendment 22-9, but Knox counted
it as having PASSED 22-9.
• Oklahoma: Oklahoma voted FOR the amendment but changed the wording to mean the
OPPOSITE of the proposed amendment – even though a memo from chief legal counsel
Reuben Clark warned that states were NOT allowed to change the proposed amendment.
• Tennessee: Tennessee violated its own state constitution when they failed to delay the amend-
ment vote until a new state legislature was elected. The obvious reason for this state constitu-
tional clause was to insure that the People of Tennessee would have direct political input on the
federal constitutional amendment process. Tennessee also violated their own state constitution
by failing to read the resolution on three different days as prescribed by Article II, Section 18.
These state constitutional violations make their approval of the amendment null and void.
• Texas and Louisiana: Texas and Louisiana violated provisions in their state constitutions
prohibiting the legislatures from empowering the federal government with any additional
taxing authority.
Now the number is down to 33.
Twelve other states violated provisions in their State Constitutions, bringing the num-
ber down to 21.
Further evidence in Mr. Benson’s research report make the list dwindle down much more,
but with the number down to 21, fifteen fewer than required, this is a suitable place to rest
for the purposes of this article.
For a more detailed state-by-state account, go to: “How Some States Failed To Ratify
The Sixteenth Amendment,” which is located on our web site. Special thanks to Bill Ben-
son, upon whose research our article is based.
THE CONGRESS AND THE COURTS HAVE PLAYED “GOVERNMENTAL PING-PONG”
WITH MR. BENSON’S CONSTITUTIONAL CHALLENGE TO THE 16TH AMENDMENT.
In 1985, Mr. Benson asked a federal court to declare the 16th Amendment to be null
and void because it was fraudulently ratified. The court, instead, ruled the question to be a
political question for the Congress to decide. It said, “[Defendant] Stahl’s claim that ratifi-
cation of the 16th Amendment was fraudulently certified constitutes a political question
because we could not undertake independent resolution of this issue without expressing lack
of respect due coordinate branches of government....” See U.S. v Stahl (1986), 792 F2nd 1438.
Mr. Benson then personally delivered a copy of his voluminous research report to each
and every member of Congress. In response, the Congressional Research Service immedi-
ately issued a report, which declared that the CRS was not going to address the factual alle-
gations of Mr. Benson’s report and that the question of the fraudulent adoption of the 16th
Amendment was a question for the Courts. For a copy of the CRS report, which was writ-
ten by a CRS attorney (Ripy), go to our web site.
Mr. Benson has concluded that the 16th Amendment can be ignored, that Congress’s
power to lay a DIRECT (income) tax on the People is, therefore, limited by the original Con-
stitution (Article I, Section 9, Clause 4), and that because the income tax has not been laid
in proportion to the states, he has a fundamental right to ignore the income tax laws. He
has not filed an income tax return or paid income tax since 1986.
REGARDLESS OF THE CONSTITUTIONAL INFIRMITIES OF THE CURRENT INCOME
TAX LAW, THE TAX LAW AS WRITTEN DOES NOT APPLY TO MOST AMERICANS LIV-
ING AND WORKING IN THE UNITED STATES.
Some Evidence:
1. Sections 1461 and 7701 of the Internal Revenue Code (the “IRC”) establish that the only
person made liable to withhold and pay the income tax is a withholding agent, who is any
person required to withhold under sections 1441-1443, which pertain ONLY to nonresident
aliens and foreign entities.
2. Look in the IRC index under “income tax” to cross-reference with “citizen” or “citizen-
ship.” There are only two entries: one for citizens departing the U.S. and the other for citi-
zens living abroad. But if one cross-references “income tax” with “aliens,” there are several
PAGES of entries, most of them under subcategory “nonresident alien” where we find all
the familiar terms, such as “deductions,” “exemptions,” “gross income,” and “withholding.”
Careless indexing? Ask your tax professional.
3. Form 1040 has never been authorized by the Office of Management and Budget (“OMB”)
to be used under Section 1 of the IRC. The only form ever approved for use under Section
1 is Form 2555, titled “Foreign Earned Income.”
4. A statement of citizenship, in duplicate, from a worker has always served to relieve an
employer of duty to withhold income taxes from ANY worker’s pay, under Section 1.1441-
5 and Publication #515 (wording was altered in 1999 to disguise the provision).
5. The Internal Revenue Manual instructs the employees of the IRS that the Criminal Inves-
tigation Division is under the direction of the international branch of the IRS and is only
authorized to enforce criminal statutes applicable to taxes for U.S. citizens residing in for-
eign countries and nonresident aliens required to file federal income tax.
6. IRS revenue officers are authorized by law to conduct only civil enforcement under subti-
tle E (alcohol, tobacco, and firearms), not under subtitle A (income taxes). Among assertions
by former IRS agents is that virtually everything a revenue officer does is outside the law.
7. Code section 6020(b), invoked by the IRS when it assesses income tax on individuals who
have not filed a 1040, does not authorize them to assess income tax on individuals. Delega-
tion Orders from the Commissioner to IRS employees authorizing them to execute returns
for persons required to file, but who didn’t, do not include Forms 1040 or 2555 on the list
of authorized returns.
8. Regulations implementing the statutes governing tax liens and levies are under the juris-
diction of the Bureau of Alcohol, Tobacco, and Firearms, not the IRS.
9.  Social Security officials have confirmed that there is no law that requires a citizen to get
a social security number, for an employer to get an employer identification number, or for
either of them to participate in social security and pay employment taxes under subtitle C,
unless they want to participate in the social security program. No law requires an employ-
er to insist on getting a W-4 from a worker, nor for a worker to fill it out. Without a social
security number, a worker can have no taxable income, according to the Social Security
Administration. On 2/20/01, in an EEOC case in the Norfolk area, a worker prevailed in a
Title VII Civil Rights action after being fired for not providing a social security number, when
the employer only needed to notify the IRS that it had requested one. You can see a copy of
the letter from the SSA on our web site.
10. IRC Section 3402 imposes withholding only upon “wages” as defined exclusively at Sec-
tions 3401(a) and 3401(a)(8)(A), which reveals that remuneration paid to U.S. citizens liv-
ing and working in the U.S. is excepted from the definition of “wages” that are subject to
withholding under Section 3402. The only way it can be “wages” is under IRC Section 911,
i.e., remuneration in U.S. possessions.
11. IRC Section 3403 indemnifies and protects employers from liability for the withheld remu-
neration only if it is “wages” under Section 3401(a).
12. Senator Inouye, in a letter responding to an inquiry to a constituent who was a tax con-
sultant, stated, “Based on research performed by the Congressional Research Service, there
is no provision which specifically and unequivocally requires an individual to pay income
taxes.” You can see a copy of this letter and comments on our website.
13. The definition of “gross income,” found in IRC 61 and 26 CFR 1.61. CFR 1.61-1(a) defines
gross income as “all income from whatever source derived, unless excluded by law.” IRC 61
defines gross income as “all income from whatever source derived, including (but not lim-
ited 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...(15)
Income from an interest in an estate or trust. Tax researchers have discovered that “items”
of income in IRC 61 are not the same as “sources” of income. CFR 1.861-1 says: “Section
861 et seq... and the regulations thereunder, determine the sources of income for purposes
of the income tax.” The specific sources are listed in CFR 1.861-8(f)(1). They are: (1) over-
all limitation to foreign tax credit; (2) international and foreign sales corporations; (3) non-
resident alien individuals and foreign corporations engaged in trade or business within the
U.S.; (4) foreign base company income; and (5) a list of fifteen other operative sections - all
foreign. All this lead to the conclusion that the term “gross income” does not apply to the
income of most citizens but to the incomes of nonresident aliens and U.S. citizens earning money abroad.

Supposedly the 16th Amendment was ratified in 1913 and the "Income Tax Act of 1913" was supposedly based on the 16th Amendment. However the Supreme Court stated in Brushaber v Union Pacific RR, 240 US 1, Jan. 1916 regarding the "Income Tax Act" that "we first dispose of two propositions assailing the validity of the statute (i.e. the Income Tax Act of 1913). On the one hand because of it's repugnancy ( contradiction ) to the Constitution in other respects, and especially because it's ( the Income Tax Act of 1913 ) enactment was not authorized by the 16th Amendment." Until the Brushaber decision in 1916 it was put forth that the 16th Amendment of 1913 authorized a direct tax on the income of US Citizens living and working in the states of the Union. The "Income Tax Act" was passed in the fall of 1913  after the 16th was passed in February earlier that year apparently basing its authority on the 16th. However the court ruled in Brushaber v Union Pacific RR, 240 US 1, Jan. 1916 that the 16th Amendment could not authorize a direct tax on income because it contradicts the Constitution which does not allow a direct tax on the income of US Citizens without apportionment. And therefore the "Income Tax Act" of 1913 was not authorized by the 16th as previously put forth. In addition to that, one month after the Brushaber decision, in February of 1916, the Supreme Court ruled in Stanton v. Baltic mining, 240 U.S. 103, "...by the previous ruling (Brushaber) it was settled that the provisions of the Sixteenth Amendment conferred no new power of taxation (emphasis added) but simply prohibited the ... 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." In other words the courts concluded that all the 16th Amendment did was clarify that the income tax referred to in the language of the Amendment was an indirect excise tax, NOT a direct tax on the incomes of US Citizens as we have been lead to believe all these years. Because it was an Amendment it lead us to believe a change took place other then clarifying the nature of the income tax. i.e. that the amendment authorized a direct tax on the income of US Citizens living and working within the 50 states. However, according to the Supreme Court there has never been a legal direct tax on the income of US Citizens living and working in the states of the Union before or since the 16th Amendment. So what has everyone been paying since 1913?

Under the decision of the Supreme Court of the United States in the case of Brushaber v. Union Pacific Railway Co., decided January 24, 1916, it 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 ."

This was the Federal Income Tax Act of October 3, 1913 which supposedly imposed the direct graduated income tax on income that became subtitle A of the IRC today.

Title 26 USC, SEC. 6654. FAILURE BY INDIVIDUALS TO PAY ESTIMATED INCOME TAX.

States:

(e) Exceptions. -

1.Where tax is small amount. -- No addition to tax shall be imposed under subsection (a) for any taxable year if the tax shown on the return for such taxable year (or, if no return is filed, the tax), reduced by the credit allowable under section 31, is less than $500.

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 for the preceding taxable year, and

C. The individual was a citizen or resident of the United States throughout the preceding taxable year.

*26 C.F.R. 3402(p)-1(b)

(b) ... an employee who desires to enter into an agreement under section 3402

(p) ... shall furnish his employer with Form W-4.

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...."

Did you realize that you were REQUESTING that tax be withheld from your paycheck ? If you don't make that REQUEST, what LEGAL authority is there to withhold tax (any money) from your pay? Do you think this might be an important thing to be told to employee's? Why weren't you told? Why don't the "tax pros" tell you?

IRS Publication 515. Instruction Manuel to withholding agent on withholding of taxes states:

" 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 under the rules discussed in the publication."

This publication is based on 26 CFR, section 1.1441-5 (you will have to enter the numbers "26 * 1 * 1441-5" in the search fields to find this section) Under "Claiming to be a person not subject to withholding." Which states:

" (a) Individuals. For the purpose of chapter 3 of the Code, an individual's written statement that he or she is a citizen or resident of the United States my 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. ...

(c) Disposition of Statement and Form. The duplicate copy of each statement and form filed pursuant to this section shall be forwarded with a letter of transmittal to the Internal Revenue Service Center, Philadelphia, PA. 19255. The original statement shall be retained by the withholding agent."

This code section clearly states a US Citizen may claim that they are not subject to withholding (of income tax) IF they GIVE their EMPLOYER A STATEMENT OF CITIZENSHIP (in duplicate), INSTEAD OF PROVIDING A W-4 with a Social Security number on it. Did your employer ever show you this? Chances are they have never even heard of it! Why not?

Title 26, USC section 6331(a). Levy and Distraint states:

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

Did you see US Citizen in that section anywhere?

By the way, on the "notice of levy" form 668-W(c) which goes out to the banks and employers etc from the IRS in order to levy wages and the like, the code section sited on the back of this form is the correct section 6331 dealing with "levy and distraint". However the section sited starts with paragraph(b) and following. The above paragraph (a) which address who a levy can be served on is left out entirely.

Title 42, United States Code section 405(c)(2)(B)(i)(II) states:

"...to any individual who is an applicant  for or recipient of benefits."

If it is required, why does one apply for it?

If you read subparagraph (I)  immediately prior to the above it states that the Secretary of the Social Security Administration will ASSIGN SSN's to aliens ( meaning foreigners ) at the time of their lawful admission to the United States and, under subparagraph (II) as already quoted above: "...any individual who is an APPLICANT for or recipient of benefits..."

Numbers are automatically asigned to foreigners BUT for the rest ( citizens )only IF they APPLY. Why are they assigned to foreigners WITHOUT an application and everyone else WITH an application? If a citizen never applies, guess what? They will never get a number because for citizens it isn't REQUIRED by law.

*Title 20, United States Code section 422.103(b)(1), titled, "Applying for a number":

"An individual needing a social security number MAY APPLY FOR ONE by filing a signed Form SS-5... at any Social Security office, and submitting the required evidence..."

Title 42 - THE PUBLIC HEALTH AND WELFARE

CHAPTER 7 - SOCIAL SECURITY

States:

§ 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.

THERE ARE NO LAWS THAT ALLOW FOR THE USE OF YOUR SOCIAL SECURITY NUMBER ANYWHERE IN THE PRIVATE SECTOR WITHOUT YOUR VOLUNTARY PERMISSION TO DO SO.

*26 C.F.R.(Code of Federal Regulations) §301.6109-1(d)(3) IRS individual taxpayer identification number-

*26 C.F.R.(Code of Federal Regulations)§301.6109-1(d)(3)(i) Definition. The term IRS individual taxpayer identification number means a taxpayer identifying number issued to an alien individual by the Internal Revenue Service, upon application, for use in connection with filing requirements under this title. The term IRS individual taxpayer identification number does not refer to a social security number or an account number for use in employment for wages. For purposes of this section, the term alien individual means an individual who is not a citizen or national of the United States.

The law is consistent. In short it applies to citizens ABROAD and foreigners at home. And it repeatedly says the income tax and related laws do NOT apply to U.S. Citizens living and working in the 50 states of the union.

The only statutory liability that exists for income tax is the liability of the withholding agent and the employer for withheld taxes. The "Withholding agent" is the only "person" required under the law to withhold and pay income tax (on the earnings of foreigners). The employer withholds employment taxes.

No liability for tax is actually due to the US Treasury until the ACTUAL extent of that liability has been ASSESSED. Once a legal assessment has been executed THEN THE LIABILITY EXISTS, and the tax is due, and collection and enforcement actions may begin to secure and enforce payment.

WHEN YOU FILE A FORM 1040 YOU PERFORM A VOLUNTARY SELF ASSESSMENT THAT CREATES AND ESTABLISHES THE LIABILITY THAT PROVIDES THE NECESSARY JURISDICTION FOR THE IRS TO ENFORCE THE ASSESSMENT.

Even if you misapply the law in your self-assessment, the figures you calculate in your assessment are binding in a court of law (dumb but true). If you refuse to VOLUNTARILY assess yourself, THERE IS NO AUTHORITY IN THE LAW TO ASSESS INCOME TAXES except those "shown on returns" (see Sec. 6201. Assessment Authority), and there is no legal authority properly delegated to either prepare or execute a Form 1040 for a citizen without that citizen's explicit consent.

26 U.S.C. §7701(a)(26) 

"The term 'trade or business' includes the performance of the functions of a public office."

"Includes is a term of limitation....is a term to indicate restriction rather than enlargement."  Powers ex re. Covon v. Charron R.I., 135 A. 2nd 829,832

"In the interpretation of statutes levying taxes it is the established rule not to extend their provisions, by implication, beyond the clear import of the language used, or to enlarge their operations so as to embrace matters not specifically pointed out. In case of doubt they are construed most strongly against the government, and in favor of the citizen." Supreme Court -Gould v. Gould 245 U.S. 151(1917)United States v. Wigglesworth, 2 Story, 369, Fed. Cas. No. 16,690; American Net & Twine Co. v. Worthington, 141 U.S. 468, 474 , 12 S. Sup. Ct. 55; Benziger v. United States, 192 U.S. 38, 55 , 24 S. Sup. Ct. 189.

Title 4 USC Sec. 111. Same; taxation affecting Federal employees; income tax:
 
(a) General Rule. - The United States[Federal Government] 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.

There is no law requiring anyone to file a 1040 and the only persons that can legally be levied are officers or employees of the federal government.

So who is the taxpayer and who is the nontaxpayer?

"The taxpayer-- someone who works for the federal government but doesn't have to take the civil service examination."

-- President Ronald W. Reagan

26 USC §7701(a)(14) - The term ''taxpayer'' means any person subject to any internal revenue tax. 

"The revenue laws are a code or system in regulation of tax assessment and collection. They relate to taxpayers, and not to nontaxpayers. The latter are without their scope. No procedure is prescribed for nontaxpayers, and no attempt is made to annul any of their rights and remedies in due course of law. With them [nontaxpayers] Congress does not assume to deal, and they are neither of the subject nor of the object of the revenue laws".

Economy Plumbing and Heating Co. v. United States, 470 F. 2d 585 (1972)

THE GOOD NEWS for "nontaxpayers" is one must be engaged in a “trade or business“ to be a taxpayer, which is defined as “the functions of a public office”, within the “United States“, which is defined as the District of Columbia, in order to earn “gross income”.  This is because:

One must be engaged in a “public office” in the District of Columbia in order to earn “gross income” as a natural person.  “Gross income” that meets this criteria is described in the code simply as “income effectively connected with a trade or business from sources within the United States”.

This is confirmed by 26 U.S.C. §7701(a)(31), which says that an estate that is in no way connected with a "trade or business" and whose sources of income are outside the United States[District of Columbia] may not have its earnings identified as "gross income" and is a "foreign estate", which means it is not subject in any way to the provisions of the Internal Revenue Code:

TITLE 26 > Subtitle F > CHAPTER 79 > Sec. 7701.

Sec. 7701. - Definitions

(a)(31) Foreign estate or trust

(A) Foreign estate

The term ''foreign estate'' means an estate 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 included in gross income under subtitle A.

The I.R.C. Subtitle A income tax was an “excise tax” upon privileged "taxable activities" only. The IRS has no jurisdiction within states of the Union against anyone who does not sign a private agreement with the government by submitting a W-4 or a 1040 tax return.

How can we know if the IRS thinks we are involved in a “trade or business”:

1.  Only people who are engaged in a “trade or business” are subject to the graduated rate of tax.    See 26 U.S.C. §871(b)

2.  All income from within the District of Columbia, which is the “United States“ under the I.R.C. section 7701(a)(9) and (a)(10), must be treated as “effectively connected with a trade or business in the United States”, according to 26 U.S.C. §864(c )(3). That’s right: it is a “privilege” under 26 U.S.C. §864(c)(3) to simply “live” and earn “income” in the District of Columbia.  Here is what it says:

TITLE 26 > Subtitle A > CHAPTER 1 > Subchapter N > PART I > § 864

§864. Definitions and special rules

(c) Effectively connected income, etc.

(3) Other income from sources within United States

All income, gain, or loss from sources within the United States (other than income, gain, or loss to which paragraph (2) applies) shall be treated as effectively connected with the conduct of a trade or business within the United States.

3.  Only people who are engaged in a “trade or business“ can claim deductions on their “return”.  Otherwise, they can't.  See 26 U.S.C. §162 for proof.

4.  Only people who are engaged in a “trade or business“ can owe a tax and therefore be the target of a Substitute For Return (SFR), which is an assessment that in most cases is illegally executed by the IRS.

5.  Only people who file a 1040  can be connected to a "trade or business within the “United States".

6.  Only people who complete, voluntarily sign, and submit a W-4 and thereby identify themselves as federal "employees" can be connected to a "trade or business".  26 CFR 31.3401(c)-1 identifies all federal "employees" as "public officers".  All "public officers" are by definition engaged in a "trade or business".

7.  Those who receive Social Security Benefits.  26 U.S.C. §861(a)(8) says that Social Security benefits received must be included in “gross income” from “sources within the United States”.  Indirectly, they also must be saying that such earnings are to be treated as “effectively connected with a trade or business”, because 26 U.S.C. §7701(a)(31) says that if these earnings were not connected with a trade or business, then they cannot be reported as "gross income" and are part of a “foreign estate” not subject to the code.

The "trade or business" requirement also extends to nearly all other types of payment reporting within the I.R.C. Although publications are not law, here are just a few examples:

1.  IRS Publication 334 entitled Tax Guide for Small Businesses, Year 2002, p. 12 says:

"Form 8300.  You must file form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business, if you receive more than $10,000 in cash in one transaction, or two or more related business transactions.  Cash includes U.S. and foreign coin and currency.  It also includes certain monetary instruments such as cashier's and traveler's checks and money orders.  Cash does not include a check drawn on an individual's personal account (personal check).  For more information, see Publication 1544, Reporting Cash Payments of Over $10,000 (Received in a Trade or Business)

http://famguardian.org/TaxFreedom/Forms/IRS/IRSPub334.pdf

2.  IRS Publication 583 entitled Starting a Business and Keeping Records, Rev. May 2002, p. 8 says:

"Form 1099-MISC”.  Use Form 1099-MISC, Miscellaneous Income, to report certain payments you make in your trade or business. These payments include the following..."

http://famguardian.org/TaxFreedom/Forms/IRS/IRSPub583.pdf

3.  IRS Form 1099-MISC Instructions, 2005, p. 1 says:

"Trade or business reporting only.  Report on Form 1099-MISC only when payments are made in the course of your trade or business.  Personal payments are not reportable..."

http://famguardian.org/TaxFreedom/Forms/IRS/IRSForm1099Inst.pdf

We also know that private employers are NOT required to act as withholding agents, by the admission of the IRS' own Internal Revenue Manual:

5.14.10.2  (09-30-2004)
Payroll Deduction Agreements

2.  Private employers, states, and political subdivisions are not required to enter into payroll deduction [withholding] agreements. Taxpayers should determine whether their employers will accept and process executed agreements [W-4 withholding]before agreements are submitted for approval or finalized.

[http://www.irs.gov/irm/part5/ch13s10.html]
How the scam affects you and some things to do about it

If you are not engaged in a “trade or business”, then you aren’t even mentioned in the I.R.C. as a subject for any Internal Revenue tax.  Nearly all Americans living in states of the Union are “nonresident” to the "domestic" U.S. government in D.C., and so the above provision for "nontaxpayers" must apply to you.  To summarize if you have no “sources of income” connected with a public office in the District of Columbia, then you:

1.  Are not engaged in an excise taxable activity under the I.R.C. subtitle A.

2.  Don’t earn any “gross income” but have a "foreign estate" under 26 USC 7701(a)(31)

3.  Have no taxable “sources of income” identified in 26 CFR §1.861-8(f)(1).

4.  Are a “nontaxpayer” not subject to the I.R.C.  All portions within the I.R.C., IRS publications, and the Internal Revenue Manual that refer to “taxpayers” don’t refer to you and can safely be disregarded and disobeyed.

5.  Cannot file an IRS form 1040 under penalty of perjury now, because EVERYTHING that goes on that form is treated as “effectively connected with a trade or business”.

6.  Cannot lawfully have any CTR’s, or Currency Transaction Reports, prepared against you by any financial institution.

7.  Cannot lawfully have form 8300 filed against you by anyone.  See IRS Publication 334 entitled Tax Guide for Small Businesses, p. 12 above.

8.  Cannot lawfully have form 1099-MISC filed against you.  See IRS Pub 583, Starting a Business and Keeping Records, p. 8 above.

9.  Are not subject to withholding if you earn no income from the District of Columbia or are not engaged in a "trade or business".

Thank you very much for posting that info, it is very helpful!