The liberating truth about the "income" tax is turning those who would evade it

Every Which Way But Loose- Part IV

Since August of 2003, when the revelations of CtC were first published, the IRS has been engaged in a desperate struggle to regain its hold of fear and confusion over those now equipped with an understanding of the long-hidden secrets of the "income" tax, and to stop that understanding from spreading.  We have seen, for instance:

• two revampings of the Form 4852 during that time-- both attempting to obscure the scope of that form's proper use;

• a carefully inaccurate allusion to a typical CtC-educated filing sit as #1 on the IRS "Dirty Dozen" list for a year (then quietly get relocated to #5 and then #7 as CtC-educated filings merely increased, and continued to prevail, making the misdirection of the listing too obvious for the agency's comfort);

• Mis-directional ploys such as the "Questionnaire" discussed here;

• a multitude of constantly tweaked agency "FAQ" and "Truth About Frivolous Argument" publications seeking to instill doubts about what is taught about the law in CtC in the minds of careless readers, worthy of attention only in order to enjoy the agency's entertaining efforts to imply what it cannot simply declare, but wishes a naive reader to take from the reading.

We have also seen a series of transformations in the means by which the occasional loose-cannon IRS staffer attempts to persuade a CtC-educated filer to stand down.

For a while, fairly brazen declarations that a filing meets the statutory definition of a "frivolous return" was the popular approach.  Brazen or not, of course, these notices were always mere exercises in intimidation, which careful analysis readily revealed to be fallacious.

Everyone must come to his or her own conclusions, but consider: The notices strive hard to give the impression that the tax agency can unilaterally disregard the target's filing, and can tack on a penalty as well.  BUT they say that the agency will generously refrain from imposing the penalty, if only the target withdraws the original filed testimony and replaces it with what the agency wants attested-to (which, remember, the target is simultaneously being told would be legally meaningless, because the agency can unilaterally disregard that original testimony at will...).

What is being implied is that, either way, the amount of tax owed is going to end up being whatever the agency dictates-- the filer's return notwithstanding.  The only optional element is the additional penalty, which the agency is offering to forego out of the goodness of its heart.

Well, if this is true..., WHY SEND THIS "LETTER" AT ALL?  If the agency has the power to unilaterally make these decisions, there is absolutely no point to asking the target to do anything!

If the agency (or its client) has the power it is suggesting, its correspondent would simply get a notice along the following lines: "Dear Mr. XXX: We have calculated your tax liability for 200X, and converted $XXX of your withheld property in escrow to our ownership.  An invoice for the outstanding balance [if any] is attached.  Your filed return was frivolous, and provided us with the authority to add a $XXX penalty to your tax liability.  We have [added or foregone] this penalty." 

After all, if the agency has the unilateral authority it is attempting to suggest that it does, why would it care whether another return was filed?  (Readers of 'Cracking the Code...' will know the answer to that, of course.)

Instead, the agency DOES make this "threatening" request; and/or "proposes" calculated liabilities to which it asks its target's agreement in order to have effect (see examples of this here).  Sometimes it begins sending endless "levy notices" to the unbending filer (which notices, insofar as they concern years when only accurate, educated returns have been filed, only allege liability for a penalty, and not for any tax related to the year in question-- even when the target has received a complete refund of every penny withheld or paid-in in connection with that year...).  The sum of all of this is, of course, that the agency DOESN'T have the unilateral authority which it suggests that it does, and where accurate, educated filings are concerned, its "frivolous letters" are just exactly that: frivolous letters.

Bothke v. Terry, 713 F. 2d 1405, at 1414 (1983)

Nonetheless, as more and more warriors have forcefully pointed out to more and more IRS workers that inappropriately sending such threatening-looking letters cuts very close to the criminal under a variety of federal and state laws, the tax agency has scrambled to adjust.  For one thing, the "frivolous" notices have been carefully and repeatedly modified toward ever-more obvious legal meaninglessness, in order to deflect potential charges of constructive fraud, witness tampering, extortion, etc.

At the same time, these legally dicey threatening-sounding notices have been largely replaced by a comical kind of delay tactic, in which the agency sits on a filing in silence, and when contacted with an inquiry to the effect of "Where the h*ll is my property?!", responds with a claim that the agency can't find the filer's return and a request that the offended filer please send a fresh copy, or a series of "We need 45 days to look into the matter-- please be patient-- don't call us, we'll call you..." notices.

In this series of articles, we take a close look at many of these gimmicks, ploys and dodges in order to accurately perceive their true character, and take in and appreciate the underlying message, which is that efforts like these are engaged in only when the actor has  no real basis for its actions.

Enjoy.

EVERY WHICH WAY BUT LOOSE- XXXVII

CtC Warrior J. has made quick work of a bogus IRS effort to chivvy him back into the eyes-down, cud-chewing, barn-bound herd.  In October of 2007, J. had filed his CtC-educated return for 2006, rebutting a couple of erroneous ascriptions of "income" to him by folks who had paid him during the year, and making his formal declaration of "income" received for the year-- which happened to be $0.  See the filing here.

Not quite a year later, the tax agency decided to deliver a little "customer service". It popped the following into the mail to J.:

Needless to say, Warrior J., who takes his responsibilities as an American as seriously as our Founders did, wasn't interested in being an IRS "customer", and didn't see any of this as "service", at least not the kind of "service" he was going to tolerate:

The IRS, which is now verrrry familiar with this kind of response, and understands that those who send it aren't backing down and aren't going to be fooled again, quickly folded its tent and went to look for a non-CtC-educated person to bother instead:

One can only hope that those non-CtC-educated folks out there will wake up and start helping good patriots like J. get the out-of-control, law defying federal government back into harness where it belongs.  If they don't, we're just going to have to watch in sorrow while the harness is tightened on these folks instead, and the whip-cracking begins in earnest...

EVERY WHICH WAY BUT LOOSE- XXXVIII

CtC Warrior Ellen Brooks has a great story to share:

On April 14, 2010, Ellen filed an educated claim for the return of all property improperly withheld from her as nominal "federal income tax" during 2009 (while declining to claim the return of what was also withheld from the same payments as "Social Security" and "Medicare" income surtaxes, for reasons of her own). Click here to see Ellen's claim.

Rather than just quietly obey the law, as it usually does, on June 7, 2010, the IRS took a shot at persuading Ellen to abandon her dignity and her responsibility as a grown-up American by sending her a scary "frivolous return" notice, threatening her with harm if she didn't rescind her testimony and swear to something more suited to the tax agency's interests:

Ellen wasn't having it, but didn't even need to say anything about it. The junk-yard dog apparently realized this wasn't going to fly all on its own (despite the false reference on the form below to "...your inquiry of June 07, 2010."), and just five weeks after getting the threat, Ellen got what only CtC-educated Americans ever get: a complete back-down, with apology:

Despite the courteous words, like crocodile tears, the sincerity of such expressions are rightly suspect (especially considering the questionable provenance of the signature below them...). But in this case, the proof of the pudding is in the eating, and it was served right up not even a month later:

EVERY WHICH WAY BUT LOOSE- XXXIX

CtC Warrior W. H. has set the robot's head spinning.

On August 20, 2010, W. filed four educated claims for the return of everything deposited with the federal government by his company during 2008 as amounts withheld from  workers previously mistaken to be "employees" as the term is meant in "income tax" law, accompanied by the following explanation (in relevant part):

Starting in July of 2011, W.'s company started receiving its refunds, with appropriate interest:

You'll notice there's no check with this last notice-- one got mailed, but was damaged in transit. W. promptly sent off for a replacement.

Meanwhile...

Either while all these other checks were properly issuing, and perhaps for that reason or perhaps having taken notice of W.'s request for a replacement for the damaged check, someone in our favorite bureaucracy decided to explain to W. that... well, actually decided not to explain anything, because there isn't anything legitimate to say except "Have a nice day." Instead this someone decided to try to browbeat W. back into "ignorance tax" servitude with a threatening "frivolous" notice of just the kind discussed in 'Parsing "Frivolous" Fictions':

Being a well-educated student of CtC and serious grown-up American who knows that left to do so without people like him laying down the law and then standing solidly on its behalf, people in these rogue bureaucracies will always do the wrong thing, W. stood up tall, and laid it down firmly:

Of course, the IRS stuck to THEIR sincerely-held, well-grounded, legally-correct position, right? Well... no. A month and a half later, what arrived in H & M's mailbox was not another threat, but just this:

EVERY WHICH WAY BUT LOOSE- XL

CtC Warrior Tony Jackson has sent the robot away reeling.

On April 15, 2011, Tony filed his return concerning 2010, showing no "fed-come", and no tax due, while simultaneously rebutting assertions to the contrary made by those who paid him money that year:

On July 16, 2012, the ever-hopeful IRS took a shot at chivvying Tony back into the barn and the role of pliant livestock, resignedly serving as a fuel-source for their Leviathan client:

Inconveniently for the agency's preferences, Tony wasn't having any, and responded like a grown-up American committed to the rule of law and the Founders' intentions that their heirs should be free and in charge:

A scant few weeks later, the IRS, recognizing that it was dealing with someone who knows his rights and the law, and takes both seriously, abandoned the corrupt ploy, and went off looking for softer victims:

EVERY WHICH WAY BUT LOOSE- XLI

CtC Warrior Randy C. has Oregon's robot shouting, "WARNING! WARNING! DANGER, DOCTOR SMITH!!

In 2010, Randy filed his testimony with Oregon concerning 2009, showing no "fed-come", and no tax due, while simultaneously rebutting assertions to the contrary made by those who paid him money that year. Around a year later, on March 24, 2011, the Oregon Department of Revenue decided to take a shot at herding Randy back into the barn:

 

Randy, an educated, American grown-up, wasn't having any:

 

June 22, 2012 Randy J. Cxxxxxxxxxx P.O. Box 2160Redmond, Oregon 97756-2160 OREGON DEPARTMENT OF REVENUE 955 CENTER STREET N.E. SALEM, OR 97301-2555 RE: RESPONSE TO DISTRAINT WARRANT AND WRIT OF EXECUTION | REFERENCE NUMBER : R062453221 Via Certified Mail/Return Receipt # 7009 3410 0001 1748 9570 To: Julie, Michael or Connie, (No last names given) This letter is in response to the above mentioned notice, which is being returned to you unsigned, that I received on 06/22/2012. The Distraint Warrant is not signed under Penalty of Perjury by any Judge supported by Oath or affirmation under the 4th Amendment, nor is there any Affidavit enclosed signed under the Penalty of Perjury, supported by Oath or affirmation, received by me. This action by your agency violates due process under the 5th Amendment. Please find enclosed a “Proof of Claim” request to be answered by an agent in your department. Also be advised that I do not waive any rights in this matter. I do not consent, nor do I recognize your agency's alleged authority over me. In addition, I am not a Foreign Corporation of the State of Oregon. I am also not a Non-Resident Alien or Foreign Person subject to withholding. I also do not consent to the Title of Garnishee. Further, I request the Oath of Office and Bond information as well as the full legal names of Julie, Michael and Connie, the agents in charge of this account. Thank you for kind attention to this matter. Sincerely, Randy J. Cxxxxxxxx All Rights Reserved

June 22, 2012 Randy J. Cxxxxxxxxx P.O. Box 2160Redmond, Oregon 97756-2160 OREGON DEPARTMENT OF REVENUE 955 Center Street NE Salem, OR 97301-2555 RE: REQUEST FOR PROOF OF CLAIM Via Certified Mail/Return Receipt # 7009 3410 0001 1748 9570 To: Julie, Michael or Connie, I am in receipt of an unsigned current notice of an alleged tax bill that was generated by someone with the name Julie, Reference Number: XXX-XX-7503 100 09 12 3, that your department says I owe and is hereby officially disputed. I must request a verifiable proof of claim signed by a live natural person, under penalty of perjury and their full commercial liability. Your proof of claim must contain answers to the questions which are listed below:   1.) Am I an  Employee, Official or Agent of the United States, or a State who has taken an Oath? 2.) What is the State of Oregon's definition of income? 3.) Are Oregon's Tax Laws a model based on the Internal Revenue laws under Title 26? 4.) Are Oregon Tax Laws considered “positive law” or “color of law”? 5.) What tax liability do I have? 6.) What constitutes “tax liability”? 7.) What is considered a “taxable event”? 8.) Who originally assessed the liability? 9.) Do I sell alcohol, tobacco, or firearms? 10.) Am I a foreign corporation registered in United States or in the State of Oregon? 11.) Am I a non-resident alien? 12.) Am I a foreign person? 13.) Am I engaged in the conduct of a “Trade or Business” in the United States which “includes the performance of the functions of a public office”? If you continue your unlawful collection efforts, I will have no other recourse than to file a complaint in Marion County District Court for the following violations: • Obstruction of justice under 18 U.S.C. Chapter 73 • Conspiracy against rights under 18 U.S.C. §241 • Extortion under 18 U.S.C. §872  . • Wrongful actions of Revenue Officers under 26 U.S.C. §7214 • Engaging in monetary transactions derived from unlawful activity under 18 U.S.C. §1957 • Mailing threatening communications under 18 U.S.C. §876 • False writings and fraud under 18 U.S.C. §1018 • Taking of property without due process of law under 26 CFR §601.106(f)(1) • Fraud under 18 U.S.C. §1341 • Continuing financial crimes enterprise (RICO) under 18 U.S.C. §225 • Treason under Article III, Section 3, Clause 1 of the U.S. Constitution • Breach of fiduciary duty  in violation of 26 CFR 2635.101, Executive order order 12731, and Public Law 96-303 • Peonage and obstructing enforcement under Thirteenth Amendment , 18 U.S.C. §1581  and 42 U.S.C.  §1994 • Bank robbery under 18 U.S.C. §2113  ( in the case of fraudulent notice of levies) I would appreciate a reply to this request within thirty (30) days from your receipt of this request. If I do not receive any response within that time frame, I request that the funds unlawfully held for $1,906.00 be returned to me and the account permanently closed. Thank you for your kind attention to this matter. Sincerely, Randy J. Cxxxxxxxxx All Rights Reserved

On August 21, 2012, Oregon rolled it up and rolled away to look for a softer target:

EVERY WHICH WAY BUT LOOSE- XLII

CtC Warrior Ward Frazier is shakin' and bakin' the robot, it would seem.

On July 23, 2012, Ward received his on-paper acknowledgement of the correctness of his educated filing, and the refund due (with interest):

 

THE VERY SAME DAY, the "STOP THESE 'WISED-UP' EX-COPPERTOPS* AT ALL COSTS" office of the IRS scrambled out a new version of its bogus threat notice:

 

 

The IRS is doubtless hoping to confuse Ward and keep him from raising hell over the fact that his check hasn't yet shown up, even though the government has admitted that Ward had no "income" and owed no tax; and that all his property remains his and the government is bound by law to send it along.

 

Ward isn't confused, and has begun by taking the matter up with his congressman.

 

WAY TO GO, WARD!

You may still have to do some dukin' to get your money, but everyone's already agreed that it's yours. That means it's all over except for making the bad guys obey the law. Even though it's obnoxious that you have to do ANYTHING further, the government's agreement that you had no "income" knocks the pins out from under the contention that your claim really qualifies as "frivolous" from the get-go (and makes clear that no matter kind of nonsense it's trying to float about the nature of your claim, IT certainly has no claim to your money, in any event). So, wrapping this up shouldn't be too hard.

 

But in the meantime...

 

Watch out for that robot!  I THINK IT'S GOING TO EXPLODE!!

Isn't it too bad everyone hasn't done like Ward and read CtC-- the exclusive source of the complete, accurate and liberating truth about the "income" tax?  You can help change that, and thereby help transform America.  Click here to learn how.

 

 

*Coppertop: A human being plugged into the matrix of delusion and being fed on for energy by his slaveholder, even while imagining himself free.

EVERY WHICH WAY BUT LOOSE- XLIII

On April 17, 2012, CtC-educated American grown-ups George and Sheila called upon the United States to obey the law. George and Sheila called on the feds to acknowledge that while the couple had earned a fair chunk of money during 2010 and 2011, none of it was through activity in which the feds had a stake, and through which a federal claim to a portion thereof had arisen.

Further, because the feds had no skin in their game and no claim to its proceeds, the couple demanded the return of every penny that had been held back by payers and advanced to the United States during those years against the possibility that George and Sheila might have discovered, upon examining their records at the close of those years, that they HAD done taxable things upon which a tax liability HAD arisen.

George and Sheila went to pains to ensure that their claims and declarations were crystal-clear. With each of their testimonials and claims they included a cover letter explaining their filings. Here, for instance is the one that accompanied George and Sheila's 2011 1040 and rebuttal instruments:

You can see the complete filing made for 2011 here. You'll note that the claim is for the return of every penny withheld-- SS and Medicare taxes included-- a total of $3,470.00. The filing George and Sheila submitted concerning 2010 and involving two "Forms 4852", also for every penny and this time totaling $5,029.00, can be seen here.

About nine weeks later, just about the interval at the end of which most CtC-educated claimants simply get their money back, the IRS instead dropped a couple of speedbumps in front of George and Sheila. These consisted of notices alleging that no 2008 filing had been received from the couple, that the IRS was therefore proposing an assessment of its own for that year totaling more than $8,400.00, and that George and Sheila's 2010 and 2011 refunds were being held back and would be devoted to this alleged liability unless the couple proved that they didn't owe it.

Here are the notices:

(See the other four pages of this doc here.)

(The common second page to these notices can be seen here.)

OK, so let's summarize: Someone at the IRS reviewed George and Sheila's 2010 and 2011 filings and agreed that they are valid and correct. BUT, that someone is alleging that the couple didn't file a valid self-assessment for 2008, and contends that based on the agency's information the couple owe a liability for that years totaling more than $8,400.00.

George and Sheila knew better, and said so:

You'll have noted that George and Sheila indicate that the challenged 2008 filing is attached to this response. You can see that attachment here. Don't overlook the fact that this, too, is testimony of $0 "income" received, with both Form 4852 rebuttals and 1099-MISC rebuttals, and a claim for the return of all amounts withheld during 2008.

Faced with inarguable evidence that George and Sheila HAD, in fact, filed dispositive testimony for 2008, and with no valid way to overcome that testimony, but really wanting to in the worst way, the someone at the IRS took what has become the standard agency shot at evasion. He or she fired off "LTR 3176" paper missiles-- for the new filings.

These threat letters were plainly an effort to get George and Sheila to rescind their inconvenient testimony so the United States could keep their money even despite the "no return filed for 2008" nonsense having failed. Here is a sample (first page only-- see the generic 2nd and 3rd page of each of these here if interested), followed by George and Sheila's educated response (essentially duplicated in response to the 2011-related threat letter):

George and Sheila, good students of the law that they are, had plainly paid attention to posts on this subject such as those here and here. They responded appropriately:

Not quite ready to wave the white flag, the IRS agent took one final shot-- another "LTR 3176" sent right after the responses to the first one's arrived at the agency, but this time for the 2008 filing (because if that got by George and Sheila, the agent would regain the original pretext for keeping their 2010 and 2011 refunds). This was met with the same educated, point-by-point shredding of the "frivolous" allegation premise.

That was it for the IRS agent. Recognizing that he (or she) was dealing with stalwart, resolute and well-educated Americans who take the rule of law seriously and mean to see it prevail, the agent packed up his tent and moved on. The next thing George and Sheila got from the government-- just last week, as it happens-- were two checks for everything claimed for 2010 and 2011, plus interest:

 

WAY TO GO, GEORGE AND SHEILA!!!

But...

 

Watch out for that robot!  I THINK IT'S GOING TO EXPLODE!!

Isn't it too bad everyone hasn't done like George and Sheila and read CtC-- the exclusive source of the complete, accurate and liberating truth about the "income" tax?  You can help change that, and thereby help transform America.  Click here to learn how.

 

CtC Warrior Dennis O'Connell has prompted major gyrations from the IRS's Rook 'em, Soak 'em Robot by simply filing an educated return claiming the return of property which the government agrees was improperly withheld from him, because his earnings during 2011 don't qualify as "income" and are not subject to any related taxes. On May 21, 2012, the government acknowledged these facts very unambiguously:

 

Pretty clear, yes? "Adjusted gross income-- your figures, our figures, both $0.00."

"Taxable income-- your figures, our figures, both $0.00."

"Total tax-- your figures, our figures, both $0.00."

"Amount withheld- $30,423.34; total credits- $30,423.34; refund due- $30,423.34." Everyone's in agreement.

 

The IRS even makes clear that it did a thorough examination of Dennis's return by correcting his misplacement of Social Security tax withheld on the "Excess Social security and tier 1 RRTA tax withheld" line of the 1040 he prepared. (At the same time, the agency shamefully failed to go all the way and proactivley add that amount, and the Medicare withholdings also, to Dennis's refund as it should have done. Dennis had no "wages", as everyone agrees, and therefore he plainly can't owe any Social security or Medicare tax...)

 

BUT...

 

At the same time, hating to let another one get away, everyone's favorite agency just had to take a shot-- the same day-- at gulling Dennis into imagining that something about the return everyone agrees to be correct is at the same time somehow "frivolous":

 

 

This notice partakes of several of the carefully-designed and -placed errors keeping it from REALLY asserting that Dennis's return is "frivolous". It also incorporates the outright fabrication of using the word "individual" in the first line of its misrepresentation of the language of the "frivolous" statute, which actually specifies its application to any "person"-- an effort to keep Dennis from apprehending that there is a special definition of "person" provided for purposes of the "frivolous" statute, and it doesn't include people filing 1040s for themselves. See that definition and a discussion of the other ploys in this notice here.

 

But that's not all!!

 

ALSO ON THE SAME DAY, the "service" polluted Dennis's mailbox with a notice explaining that it was holding the property it has admitted belongs to him against the possibility that he MIGHT owe tax for another year-- 2010-- for which it claims it can't find a return, by way of the following pair of notices:

 

 

 

Wow!!

 

It's a good thing Dennis has his certified mail "green cards" showing the receipt of his 2010 return by the confused agency, and had his mailing, and the contents therein, comprehensively witnessed, in anticipation of just this kind of scam...

 

Dennis let things go for awhile deciding how to deal with this juvenile and shameful stonewalling, until December. At that point, perhaps reading his silence as uncertainty, the agency decided to push.

 

The agency sent a notice announcing that it had "charged" Dennis a "frivolous penalty"-- while at the same time acknowledging once again that Dennis's return was correct. Note that the scary letter sent includes a "tax statement" for 2011, on which no tax on earnings for that year is alleged...

 

 

In fact, the only thing the agency dares is the "assertion" (not really a "charge", if you read far enough down) of the "frivolous" penalty. Doubtless it was hoped that Dennis would just let it go unaddressed and give up by default... Not likely.

 

 

The agency hasn't backed down yet (it often takes a while for these bureaucrats to get the message and change gears). But the follow-up notice sent actually emphasizes the inconvenient reality that all the scare stuff is supposed to push out of someone's mind.

 

Note the language on the left side of this most recent threat (which is nothing more than a threat to seize any state tax refund Dennis might have coming, however broad the language in bold is made to appear). "Our records show you have unpaid taxes for the tax year ending December 31, 2011..." What do those alleged total unpaid taxes amount to for that year, for which Dennis has paid $0 despite his considerable earnings? Nothing but this "asserted" frivolous penalty:

 

 

Dennis, I'm looking forward to posting the check when it arrives, which I'm sure won't be long.

 

But in the meantime...

 

Watch out for that robot!  I THINK IT'S GOING TO EXPLODE!!

 

Isn't it too bad everyone hasn't done like Dennis and read CtC-- the exclusive source of the complete, accurate and liberating truth about the "income" tax?  You can help change that, and thereby help transform America.  Click here to learn how.

 

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the man who Cracked the Code of the United States "income" tax;

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In this new volume, you'll learn about: