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The liberating truth about the "income" tax is turning those
who would evade it
Every Which Way But Loose Part II
A collection of undeniable evidence of the
correctness of
CtC
Do you remember those old sci-fi movies (and numerous 'Lost in
Space' and 'Star Trek' episodes) in which an evil robot or a
computer collapses into terminal dysfunction after being
presented with data that "does not compute"? The machine
would flail about dangerously for a bit (or smoke and shake, and
threaten to explode) before finally going limp, silent and
harmless.
"LOOK OUT, DOCTOR SMITH!! DANGER!! WARNING!!"
Some
CtC Warriors are being drafted to play the part of the
intrepid heroes of these space operas lately, with federal and
state "income" tax agencies in the role of the neurotic robot.
SINCE AUGUST OF 2003, when the revelations of
CtC were first published,
tens of thousands
of readers of 'Cracking
the Code- The Fascinating Truth About Taxation In America' have taken
control of their own resources, in accordance with, and respect for, the
law. The total amount reclaimed by these good Americans so far is
upward of several billion dollars.
During the same period,
the IRS has 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. This effort has involved the resort to many (and
increasingly) bizarre evasions and theatrics.
IN THIS SERIES, we take a close look at many of these gimmicks,
ploys and dodges. The action in these episodes will range from silly
one-shot, quickly-abandoned agency stalls to drawn-out, elaborate
efforts to resist or evade or discourage
CtC-educated filers ending in dramatic slap-downs of the
law-defying tax agency.
One consistent feature of all of these episodes is
the special clarity with which they illustrate the accuracy and
completeness of what
CtC reveals about the "income" tax. Unlike the vast majority
of
CtC-educated refunds and other victories in applying the
law in which the
deep vetting to which every claim is subject is done out of
view, with no evidence of the process except the filing and the
check or transcript, what happens in the cases highlighted in
this series takes place only after unambiguous, close tax-agency
attention to the claim.
Thus, these cases present a wake-up splash of
reality to those who struggle to persist in denial about the
truth, completeness and correctness of
CtC (some of whom actually argue with a straight face that
the hundreds of thousands of complete refunds issued over all
those years now from the feds and more than three dozen state
and local tax agencies are a sustained "slip through a crack"!).
Here it is in a word:
NOT ONE OF THE
SURRENDERS DOCUMENTED IN THIS SERIES WOULD OR COULD HAPPEN
UNLESS THE FILINGS AND CLAIMS MADE WERE CORRECT AND PROPER UNDER
THE LAW. NOT
ONE. Each of the victories
presented here took place with the knowledge and participation
of tax agency personnel. In almost every case, those victories
took place over and despite the outright resistance of those
officials.
Similarly, NOT ONE of the contortions and evasions
documented in this series would be attempted unless the filings
and claim against which they are deployed is correct and proper
under the law. It is the insurmountably correct character of
these educated filings that compels the tax agencies to resort
to smoke, mirrors and bluster.
Because these things DID and DO happen, the correctness of
CtC-educated filings and claims, and the view of the law on
which they are based, is indisputable.
Enjoy.
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Dr. Jim Administers The Cure
DEDICATED TO LIBERTY AND THE RULE OF LAW, real
American grown-up Dr. James _ has done some educated
enforcement, just as the Founders meant for all Americans to do.
Having concluded that his earnings as a doctor in private
practice during 2011 didn't qualify as taxable, Jim said so in
the manner provided for by law, stood his ground, and shut down
a two-year IRS attempt to take more than $120K of his property
in connection with that year.
The end result of the argument was an IRS admission
that Jim's very considerable earnings do not qualify as "income" as
that term is meant in the tax law, and he had zero tax liability for
2011.
Here is Jim's filing presenting his testimony into the
record. It will be noted that Jim chose to do things a little
differently than most-- the information returns he was obliged
to address were 1099-MISCs, but rather than rebut them as most
folks do (a few hundred versions of which can be seen at links
on
this page), Jim chose to use modified Forms 4852, instead
(in keeping with the principles discussed
here).
AS SOMETIMES HAPPENS, THE IRS decided to try to
chivvy Jim back into the copper-top barn. This effort began
with a 'notice of deficiency' in June of 2013 and then dragged
on for nearly two years, until the agency finally admitted
defeat in February of 2015.
Jim never went to "tax court", choosing instead to
just let his return testimony and a clarifying statement made
once the agency finally began to threaten to levy suffice. What
follows is the series of threatening agency notices
(interspersed with cryptic stalls where you can practically see
the robotic gears clashing as its presumptive fictions encounter
confidently-presented facts), Jim's calm and educated response,
and the denouement in which what had become an asserted "balance due"
of $120,158.13 by December, 2014 collapsed to an acknowledged $0
by February of 2015.
Enjoy.
And finally:
WELL DONE, JIM!!! Both in standing, and in
testifying. You are the sort of person that makes America
exceptional.
But...
Watch out for that robot! I THINK IT'S GOING TO
EXPLODE!!
Isn't it too bad everyone hasn't done like Jim 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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EVERY WHICH WAY BUT
LOOSE- XXIV
CtC Warrior Scott MacNeilage filed a conventional,
educated return for 2006 rebutting assertions that he
had received earnings from taxable-activities in May of
2007. Much to his surprise and annoyance, in April
of 2008, an IRS stooge, in the apparent hope that Scott
lacked complete understanding or confidence in his
knowledge of the law, decided to subject him to some
hassles. The stooge issued a "CP2000" proposing
that rather than the $0 calculated on his return, Scott
owed the federal government more than $26,000.00 in
outstanding tax liability for 2006:
As the note on the copy he sent me for posting makes
clear, Scott was neither confused nor intimidated.
He responded accordingly, with the following:
Non-plussed, the stooge quickly cranked out a "stall
letter" while considering its next step:
Eventually that call got made-- and almost within the 60
days promised! (This may be a new record for
"timeliness" in this regard...) Unfortunately, it
was not a good call:
Scott shook his head, and picked up the phone. He
ended up getting offered a ridiculous cock-and-bull
"troll ate my homework" story about his CP2000 response
having "been misplaced" (I wonder how many "ignorance
tax" filers ever hear nonsense like this?).
Nonetheless, Scott patiently responded again:
The IRS response? ANOTHER "We need time to decide
whether to face the fact that you've escaped the fog..."
notice:
Happily this time, at long last, the 'service' realized
that Scott has moved firmly into the army of
illuminated, never-going-back-to-slavery CtC-educated
Americans. Not even three weeks later the white
flag got hoisted and the 'service' reluctantly turned
its dark attention to other targets:
Watch out for that robot! I THINK IT'S
GOING TO EXPLODE!!
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EVERY WHICH WAY BUT
LOOSE- XXIII
CtC Warrior D. Young's educated, proper and
oh-so-inconvenient to the IRS "bring in all possible
revenue by whatever means necessary" mission has
prompted a brand new variety of tax agency obfuscation,
as the truth turns the 'service' every which way but
loose. This new notice, "LTR 2893C", is of the
"We're pretending to not understand what your filing
means" "fog" class of dodges, and really is a piece
of work. Let's read it through:
(The entire notice is a bit longer
than the portion presented above, also explaining
interest additions that apply when an actual tax goes
unpaid, and giving options and instructions for
contacting the 'service'...)
Now, keeping always in mind that the object of this
"notice" is to give the 'service' cover for its failure
to honor D.'s filing and return her property while
preserving plausible deniability against possible
criminal charges for fraud and simultaneously sowing a
little confusion...
First of all, the "notice" invites the reader to imagine
that the amounts listed as Social Security and Medicare
withholdings (from the "wrong box(es)") aren't "federal
withholdings"! (Maybe those withheld amounts were
sent to France?)
The "notice" goes on to support this invitation to
fantasy by describing the numbers in those "wrong box(es)"
as not referring to amounts withheld at all, but rather
as being "record[s of] charges to your income to
provide for your future Medicare and Social Security
benefits..."
Really? Congress thinks differently.
When we look at the rules under which these "wrong box(es)"
on W-2s are to be filled out we find this specification:
"(6) the total amount deducted and withheld as tax
under section 3101 [of 26 USC]". Pretty
unambiguous.
Looking at section 3101 itself, we find:
§ 3101. Rate of tax
(a) Old-age, survivors, and disability
insurance
In addition to other taxes, there is hereby
imposed on the income of every individual a tax
equal to the following percentages of the wages
(as defined in section 3121 (a)) received by him
with respect to employment (as defined in
section 3121 (b))—
| In cases of wages received
during: |
The rate shall be: |
| 1984, 1985, 1986
or 1987 1988 or 1989
1990 or thereafter
|
5.7 percent 6.06
percent
6.2 percent
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(b) Hospital insurance
In addition to the tax imposed by the
preceding subsection, there is hereby
imposed on the income of every individual a
tax equal to the following percentages of
the wages (as defined in section 3121 (a))
received by him with respect to employment
(as defined in section 3121 (b))—
(1) with respect to wages received
during the calendar years 1974 through
1977, the rate shall be 0.90 percent;
(2) with respect to wages received
during the calendar year 1978, the rate
shall be 1.00 percent;
(3) with respect to wages received
during the calendar years 1979 and 1980,
the rate shall be 1.05 percent;
(4) with respect to wages received
during the calendar years 1981 through
1984, the rate shall be 1.30 percent;
(5) with respect to wages received
during the calendar year 1985, the rate
shall be 1.35 percent; and
(6) with respect to wages received
after December 31, 1985, the rate shall
be 1.45 percent.)
Plainly, the amounts listed in those "wrong box(es)" are
amounts of federal withholding (and are withheld as
payments of the "income" surtax imposed and arising when
[and if] "wages (as defined in section 3121 (a))
[have been] received by [an individual] with respect to
employment (as defined in section 3121 (b))" ).
(Further, and without regard to the issue of whether D.
actually had any "income" against which they could have
been "charged", they AREN'T "charges... ...to provide
for [D.'s] future Medicare and Social Security
benefits", as is flatly declared by the United States
Supreme Court in Helvering v. Davis 301 US 619 (1937):
"The
proceeds of both [employee and employer FICA] taxes
are to be paid into the Treasury like
internal-revenue taxes generally, and are not
earmarked in any way."
...and in Flemming v. Nestor 363 US 603 (1960):
"The
noncontractual interest of an employee covered by
the Act cannot be soundly analogized to that of the
holder of an annuity, whose right to benefits are
based on his contractual premium payments."
The court explains, also in Flemming v. Nestor, that:
"To
engraft upon Social Security system a concept of
'accrued property rights' would deprive it of the
flexibility and boldness in adjustment to
ever-changing conditions which it demands..."
It's that simple. There is no legal relationship
of any kind between what is withheld under the auspices
of the "Federal Insurance Contributions Act" (FICA) and
the receipt, or possible future receipt, of Social
Security or Medicare benefits-- and this is true even
for those whose earnings really are "wages" as that term
is defined in the law.)
BUT THAT WAS ALL just the warm-up. The real thrust
of this obfuscation-by-notice is the rest of the line
debunked above: "...[these charges] may not be used
as deductions to your Income Tax. Only the amount
in Box 2 of a W-2 may be used to reduce or eliminate
tax." (As an aside, I am struck by the
capitalization of "Income Tax". Is the tax now an
object of worship for these folks?)
Where do we start?! First of all, amounts withheld
under the protocols involved here don't get used as
"deductions"-- they are credits against a tax liability,
if any tax is owed. The (doubtless)
bullet-sweating IRS staffer tasked with drafting this
verging-on-mail-fraud "notice" knows this, of course.
My guess is that he is trying to work some plausible
deniability into the picture by suggesting that a
provision in the FICA to the effect that any amounts
properly withheld can't be deducted from one's total
amount of "income" declared as having been received--
even though one hasn't actually received those amounts--
was on his "confused" mind, and is the cause of the ...
(That provision, which, in the original enactment of the
Social Security Act of 1935 reads:
SEC. 803. For the purposes of the income tax
imposed by Title I of the Revenue Act of 1934 or by
any Act of Congress in substitution therefor, the
tax imposed by section 801 shall not be allowed as a
deduction to the taxpayer in computing his net
income for the year in which such tax is deducted
from his wages.
is entertainingly reflected in the following language
from the FICA chapter in the current IRC (chapter 21),
which I suppose might put anyone into a state of honest
confusion:
§ 3123. Deductions as constructive payments
Whenever under this chapter or any act of Congress,
or under the law of any State, an employer is
required or permitted to deduct any amount from the
remuneration of an employee and to pay the amount
deducted to the United States, a State, or any
political subdivision thereof, then for purposes of
this chapter the amount so deducted shall be
considered to have been paid to the employee at the
time of such deduction.
Anyone who has persisted in harboring doubts about the
fact that these tax protocols only apply to
federally-connected persons who have voluntarily,
deliberately and knowingly accepted them by, for
instance, joining the civil service should be disabused
of that mistake after reading provisions of this
kind...)
This leads into the second complex pretense deployed in
this "notice", because what ARE properly used as
deductions involve provisions of law by which portions
of what DOES constitute "income" are subtracted from the
gross amount of "income" declared, resulting in a net
amount which ends up being the measure of any resulting
tax (against which tax credits can then be taken, when
available). That is, deductions have no purpose or
effect unless there is "income" in play.
This exercise of craft is emphasized by the careful
wording of the next line: "Only the amount in Box 2
of a W-2 may be used to reduce or eliminate tax."
The fact is, the "amount in Box 2 of a W-2"-- the
nominal "federal income tax withheld" amount-- CAN'T be
used "to reduce or eliminate tax"; it is a PAYMENT of
the tax, when and if it is subsequently determined that
a tax is actually owing for the period in question.
Only reducing the amount of "income" being taxed can
"reduce or eliminate tax" (such as by taking an
available deduction-- see how this clever nonsense goes
full circle?). But wording the line the way it has
been done blends it with the morass of prior
disinformation into a comprehensive fog, if you'll
pardon the incongruity of the expression.
Now we come to the heart of the whole exercise, because
everything discussed about this "notice" so far has been
part of an elaborate effort to dodge the simple fact
that, like the "amount in Box 2 of a W-2", the amounts
in boxes 4 and 6 of a W-2 (the famous "wrong box(es)")
are only lawfully retainable by the government AS
PAYMENTS OF TAX, and can ONLY be retained when "wages
(as defined in section 3121 (a)) [have actually been]
received by [an individual] with respect to employment
(as defined in section 3121 (b))". If such
"wages" HAVE NOT been received, the government simply
has no claim to the withheld amounts, no matter what
kind of nonsense it cares to suggest about their
character or the reason for their appearance in a
filing.
There's the bottom line on this bogus "notice".
The 'service' is seeking to evade the substance of D.'s
filing, and, secondarily, to discourage D. from
proceeding with her claim for the return of her property
by trying to baffle her with b*llsh*t-- because that's
all its got to work with.
Watch out for that robot! I THINK IT'S
GOING TO EXPLODE!!
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EVERY WHICH WAY BUT
LOOSE- XXII
"FRIVOLOUS!" "WE PROPOSE...!" "WE CHANGED
YOUR ACCOUNT!" CtC Warrior Justin_ heard all of
that from the IRS in its effort to thwart
his filing for 2006. First there was this:
...to which Justin responded with this:
...and
this.
The 'service' then trotted out this:
...to which Justin responded with
this.
Then this arrived in the mail:
...but before Justin even got around to responding to
this nonsense (which seeks to recapture
Justin's "telephone tax" refund-- the only thing he
had claimed and received for the year), the 'service'
grimaced and abandoned the exercise with the following
admission that the more-than-$130,000.00 he earned
during 2006 in his perfectly normal,
non-federally-connected activities simply doesn't
qualify as "income" and that, although he had paid in
nothing, had had nothing withheld, and had no credits to
apply, he owed no "income" tax for the year (even the
variety called "Social Security and Medicare
contributions"):
Watch out for that robot! I THINK IT'S
GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like
Justin, 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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EVERY WHICH WAY BUT
LOOSE- XXI
"WE PROPOSE...!" "WE CHANGED YOUR ACCOUNT!"
"YOU OWE US A LOT OF MONEY!!!" CtC Warrior
K. T. heard all of that from the IRS in its effort to
thwart
his filing for 2006. K. had filed an educated
return, including rebuttals to a variety of ignorant
payer allegations that money paid to him was a result of
his engaging in taxable activities, in April of 2007.
A year later, the IRS decided it'd have a go at scaring
K. into reversing (and perjuring) himself. This
effort took the form of a "disputation" with K.'s
reported "income" totals, and a proposed balance due of
more than $44,000.00, based on the agency's self-serving
preference for the allegations of K.'s payers:
K. was not impressed, and not intimidated, having a
complete,
CtC-solid knowledge of the law. He responded
accordingly:
...and the 'service', being squarely faced with
confirmation that it was dealing with a serious,
dedicated, no-going-back-to-the-farm warrior for the
truth, did likewise:
This is K.'s SECOND such victory on behalf of the truth
and the rule of law. His first, putting to rest an
assertion of a $43,000.00+ balance for 2005 last year,
can be enjoyed at
www.losthorizons.com/tax/MoreVictories23.htm.
Watch out for that robot! I THINK IT'S
GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like K.,
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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EVERY WHICH WAY BUT
LOOSE- XX
Warrior Bill Granger, who has won several victories so
far but also has a couple of corrections-of-the-record
filings being strenuously resisted by the IRS, has been
getting a particularly sustained run-around by an agency
desperate to dodge reality in regard to Bill's filing
for 2004. Just a few weeks ago, the dodging got
truly surreal.
On November 7, that agency sent Bill the following
"ignore that man behind the curtain" scary-paper (of the
sort dissected in detail in episode VII of this series):
Note the reference to "the information you filed as a
return of tax, or purported return of tax, on Apr. 18,
2008", which, it is alleged, has been "determined"
to be "frivolous" and has thus prompted this "notice".
Now, Bill hadn't filed anything related to 2004 last
April, but he HAD sent something concerning that year to
the 'service' that would have arrived in an IRS office
around the 18th of that month. What Bill had sent
was a response to this:
(This is a compilation of material from the front and
back of the original.)
Here is that response, which was mindlessly
characterized by the Robot as "the information you
filed as a return of tax, or purported return of tax, on
Apr. 18, 2008", about which a "determination" is
alleged to have been made by someone. Read it with
sympathy for Bill for his having to put up with this
extended tax agency evasion, but also with amusement,
and appreciation of how plainly the entirely fictional
nature of these IRS scary-paper assaults is exposed by
this particular example.
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William R. Granger
April 14, 2008
Certified Mail :____________________________
Internal Revenue Service
ACS Support – STOP 5050
PO Box 219236
Kansas City, MO 64121-9236
Re: Letter 4903 dated Apr. 07, 2008
To: Ms. Debra K. Hurst
I am in receipt of your letter wherein you
state “We previously asked you for
information about your tax return(s) shown
on the back of this letter.” The
reverse side references a 2004 Form 1040.
You further go on to say “We have no record
of receiving your reply….”
Please be advised that I deny your
assertions in their entirety. Your
office has NEVER requested my 2004 return,
other than an Appeals Officer who wrongfully
denied me due process by alleging she didn’t
have this return; which was sent to her
twice. Furthermore, the IRS has been
provided this return on multiple occasions.
Please permit me to provide you a chronology
regarding my 2004 return:
April 14, 2005 1040 completed and subscribed
by me
April 15, 2005 1040 Placed in the US Mail
under certified mail number 7000 0600 0027
5139 4202
April 23, 2005 Received in your Fresno, CA
office, as denoted by signature card bearing
your stamp. Received by L. Vasquez at
1:16pm. This was my first submission.
August 2005 I requested, by
phone, a copy of account transcripts for
several tax years
September 2, 2005 Received transcripts
from Ms. Linda Thornton, making no mention
of any missing returns
October 31, 2005 Received another reply
letter from Mr. Corliss M. Hicks, of your
RAIVS Unit in Doraville, GA, stating he had
no record of my returns from 2001-2004, even
though Ms. Thornton provided transcripts for
those very years.
November 16, 2005 I emphasized that I
had filed these returns, and informed Mr.
Hicks I held receipts for deliveries of
these returns; I renewed my request for
detailed information regarding these
accounts, and he never replied, and he
certainly made no request for copies. Even
so, I mailed him copies of all 1040s for
these years, hoping to find someone
competent in the IRS. This
was the second submission to the IRS.
November 30, 2005 I met with a MR.
Waters at the IRS Appeals Office in
Richmond, VA to discuss several tax years in
question. At that time, I presented
him with tax returns for multiple years,
which included 2004. This was the
third submission to the IRS.
March 10, 2007 I received a
“REMINDER NOTICE,” Letter 3228, from YOUR
KANSAS CITY PO BOX, YOUR STOP 5050, kindly
‘reminding’ me of allegations of debt; the
significant part being your note on
the back simply saying “TYPE OF RETURN” and
identifying my 2004 1040, but making no
comment as to its status. I promptly
wrote you and explained your inference that
my 2004 1040 was in question confused me,
and requested further information as to the
problem. My letter was sent certified,
number 7006 2760 0003 9158 8080, and was
received in your offices at 10:30 am, on
4/24/2007. I told you then, as I
tell you now, my 2004 1040 has been in your
custody since 4/23/2005. YOUR OFFICE
NEVER REPLIED, NOR DID IT EVER MAKE ANY
REQUEST FOR MY 2004 RETURN.
During recent events involving my attempts
to get a competent hearing from the IRS
Appeals Office in Memphis, I was compelled
to send yet another copy of my 2004 1040 to
the IRS. I did so under certified
mail, number 7007 0220 0002 6782 0476, which
was received on 10/19/07. That package
contained a copy of the 1040, and the Return
Receipt verifying a timely filing.
That was the fourth submission to the IRS.
Once again the IRS misplaced this return
such that AO Mrs Banks felt justified in
moving forward without my submissions. I
therefore sent it again, via FAX, on
11/1/07, making this my fifth submission to
the IRS.
Now along comes
your office, claiming ignorance of any
communications from me, and “no record of my
filings.” So I am here again
providing a COPY of my 2004 return, with yet
another original signature.
Since this is a copy of my original
submissions, I will sign close to, but not
over the copy of the original signature.
This is my sixth submission to the IRS,
having never received any reply at any time,
nor any request for more information.
This record of submissions, followed by
absolutely no feedback to me from your
offices, demonstrates an IRS pattern of
obfuscation apparently intended to thwart my
subscribed testimony, with the apparent goal
of substituting a return more to its liking.
There is absolutely no authority for you to
disregard my return, especially without
notifying me in accordance with IRC 6210.
If you believe you have such authority
please inform me. All Americans
would be surprised to know the IRS can
replace a return with whatever facts it
deems correct.
For the record, I am sending you this two
page cover letter, five pages of 1040
w/supporting documents, and a copy of the
delivery receipt.
William R. Granger
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Nothing more needs to be said, I think, except,
Watch out for that robot! I THINK IT'S
GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like Bill,
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.
|
|
EVERY WHICH WAY BUT
LOOSE- XIX
Warrior Bruce G. got run through the whole gamut of IRS
dodges and balkiness revealed (and debunked) in this
series, the Lost Horizons Newsletter 'Tax Tip' feature,
the FAQ pages and elsewhere on this site before finally
prevailing with his filing for 2004. This all
began with an IRS "Proposed Assessment" for 2004, a year
for which Bruce, being at the time not yet CtC-educated,
had never filed:
Having gotten that belated education, Bruce responded on
February 5, 2008 with
an original return, which rebutted "information
returns" created about him by others, and declared that
none of his earnings met the legal definition of
"income".
Bruce had the misfortune of being selected for a
sustained "frighten/confuse him back into the pen"
campaign, however...
First came a Notice of Deficiency:
Bruce responded with the following:
Meanwhile, a "LTR 3176" for the same year had also shown
up in Bruce's mailbox:
Bruce responded with a personalized version of
this.
The IRS wasn't going to give up that easily, though...
In August, this upgraded version arrived:
Bruce again responded in a straightforward, educated (if
understandably exasperated) manner:
Crossing his response in the mail came the next salvo of
increasingly desperate B.S.:
Are we having fun yet?!
Bruce once again rapped out a cogent, pointed reply:
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Certified Mail #
Scottsdale, AZ 85260
September 4, 2008
Internal Revenue Service
P.O. Box 9019
Holtsville, NY
11742-9019
RE: Notice CP22A dated
August 25, 2008
Dear Unnamed IRS Employee:
I do not agree with the
contents of your notice!
I filed and signed under
penalty of perjury my 2004 Form 1040 and
also signed a similar statement on the
attached 1099-B spreadsheet!
Your notice is merely an
assertion. You have no authority to
make any unilateral changes to my return,
even under the assumption that it is somehow
“frivolous” to thus be able to employ the
protocol prescribed at 26 USC 6020(b).
The Internal Revenue Manual specifically
excludes the Form 1040 from the list of
prescribed tax forms that may be executed by
the Secretary under that section! What
you have done and are presently doing is
illegal!
Section 6201(d) of the
Internal Revenue Code is reprinted below for
your convenience:
Sec. 6201- Assessment authority
(d) Required reasonable verification of
information returns
In any court proceeding, if a taxpayer
asserts a reasonable dispute with respect to
any item of income reported on an
information return filed with the Secretary
under subpart B or C of part III of
subchapter A of chapter 61 by a third party
and
the taxpayer has fully cooperated with the
Secretary (including providing, within a
reasonable period of time, access to and
inspection of all witnesses, information,
and documents within the control of the
taxpayer as reasonably requested by the
Secretary), the Secretary shall have the
burden of producing reasonable and
probative information concerning such
deficiency in addition to such information
return.
Additionally, please provide
me a copy of the record of assessment for
2004 pertaining to the amount on the
attached copy of your Notice CP22A as is
allowed by the provisions of 26 USC 6203:
“…Upon request of the
taxpayer, the Secretary shall furnish the
taxpayer
a copy of the record of the
assessment;…” (bolding and underlining
added)
within 30 days from the date
of your receipt of this letter as confirmed
by postal return receipt or through
www.usps.com.
An aggregate record will not
satisfy this request. Adequate
compliance with this request requires
documentation sufficient to clearly
establish my personal liability. I
demand an actual photocopy, with the
signature of the assessment officer
included. The reason for this request
is both to establish the existence of the
assessment, and to determine for myself the
assessment's complete compliance with all
related provisions of law.
The making of this request is
not to be considered or construed as an
admission of "taxpayer" status or of
liability for any tax or penalty.
Refusal to cooperate with this request will
be recognized as an acknowledgement that I
am NOT, in fact, liable for the tax or
penalty alleged to be due and owing or
otherwise collectible in any manner on the
above-mentioned Notice CP22A.
Unless the IRS has factual
knowledge of my private finances superior to
my own and can prove such per 26 USC 6201
and 6203, please provide that information so
I can respond. If you don’t have personal
knowledge of the facts, I will assume this
matter closed.
Sincerely,
Bruce G.
|
The bad actors at the agency still weren't quite ready
to give up...
This came next:
Bruce, probably really straining by now to keep his
temper, delivered this in response:
Finally, responsible parties at the 'service' had had
enough. Throwing up their hands, they shrugged and
did what should have been done eight months prior:
Bruce, having seen the agency's manic and corrupt
obstinacy in action for so long in this case, didn't let
it rest at that. He promptly FOIA'd for a
transcript of his IRS "account" for 2004, just to verify
that reality has indeed been properly acknowledged.
It has:
(Note that the $5000 Frivolous Penalty "charged" to
Bruce back in August makes no appearance on the
transcript, having obviously been a completely
fictitious assertion...)
Way to hang tough and tight, Bruce!
But,
Watch out for that robot! I THINK IT'S
GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like
Bruce, 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.
|
|
EVERY WHICH WAY BUT
LOOSE- XVIII
CtC Warrior Cathy Walsh learned the truth about the tax
just a year ago or so, and wasted no time in putting her
new knowledge to work. On April 16, 2008, Cathy
notified the IRS that she had woken up and moved out of
the barn:
The 'service' ruminated for awhile, and then
replied that Cathy's views were all very well,
but nothing could be done without an appropriate
return:
(Reference is made here to both 2004 and 2005,
each of which Cathy has acted to address-- her
claim for the latter year appears to STILL be
turning the agency every which way but loose,
and will doubtless find it's way onto this page
at a future date...)
Cathy responded as requested:
Click
here to see Cathy's amended return.
Three-and-a-half months of delay ensued before
the 'service' finally responded with a what
proves to be a desultory, perhaps even
reflexive, "disallowance" notice:
Shortly afterward, it appears that some
responsible party actually checked a calendar
and did a little arithmetic:
Way to go, Cathy! The air is nice outside
that barn, isn't it?
***
Watch out for that robot! I THINK IT'S
GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like
Cathy, 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.
|
|
EVERY WHICH WAY BUT
LOOSE- XVII
CtC Warriors Chris and Janis Ortwein had the briefest
encounter with the robot on record so far, I think...
In April of 2007, Chris and Janis filed a
routine, educated return rebutting erroneous payer
assertions. It was much to their surprise that
nearly a year later, the IRS deposited a smelly little
present in the Ortwein mailbox:
Chris and Janis were surprised and annoyed at
this baseless flailing about by the agency, but
ended up not even having to bother with a reply.
Someone at the IRS apparently recognized the
agency's faux pas, and two days before the
indicated response date, a friendly (or at
least, polite) "closing notice" arrived:
Total turn-around time: 28 days...
Watch out for that robot! I THINK IT'S
GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like Chris
and Janis, 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.
|
|
EVERY WHICH WAY BUT
LOOSE- XVI
CtC Warrior "Anonymous in Illinois" had to deal with a
few speed-bumps thrown in his path by the state of
Illinois before getting back all of the property that
had been withheld from him and put into the state's
keeping during 2007 against the possibility that his
economic activities throughout that year might've been
"income"-taxable. Anon. stuck to his guns, though,
and while Illinois' efforts to evade the law delayed the
satisfaction of his claim for almost a year, when that
satisfaction came, it came with appropriate interest
added...
We begin with Anon.'s Illinois refund claim, filed on
March 20, 2008 (see it
here). Illinois responded on June 16 with the
following disingenuous dodge:
Note that Illinois alleges that Anon. submitted
an IL-4852, and that the problem was that the
IL-4852 wasn't substantiated as to the amount
withheld by (among other possibilities) a
federal Form 4852 (such as the one that WAS
attached to Anon.'s IL-1040).
Anon. promptly responded with Page 2 of the
notice, as requested, and both the federal form
originally submitted and an Illinois version of
the same form (after substituting "payer" on the
latter form where "employer" had inappropriately
appeared by default):
Almost a full six moths later-- it apparently
taking the state DOR that long to settle on its
next evasion-- Anon. received an acknowledgement
of his response, but with yet another demand for
more substantiation:
Keep in mind that it is a virtual certainty that
the state has complete information on the
amounts withheld from Anon. from the person that
did the withholding... Nonetheless, Anon.
played along one more time (albeit a bit
impatiently):
That was it-- the state had emptied its bag of
tricks. Less than a month later, Anon.'s
property was returned, with interest:
Watch out for that robot! I THINK
IT'S GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like Anon.
in Illinois, 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 (while you still can-- see
below...).
|
|
EVERY WHICH WAY BUT
LOOSE- XV
CtC Warrior William Barnes won his fourth victory for
the rule of law only after a little tussle with the
bureaucracy in Pennsylvania...
On October 11, 2008, William had filed his educated
return, claiming a complete refund of everything that
had been withheld from his earnings and given over to
the state (see the filing
here). Annoyingly, some bureaucrat in the the
state Department of Revenue decided to act badly, and
adopted the pretense that William's claim as to the
amount withheld was unreliable (despite the virtual
certainty that the bureaucrat had corroborating
information from the withholding entity sitting on his
or her desk-- see
here and
here for more on this):
William was impatient, but untroubled. He
responded accordingly:
And, having no other pretexts for continued bad
behavior, so did Pennsylvania:
Watch out for that robot! I THINK
IT'S GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like
William, 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 (while you still can-- see
below...).
|
|
EVERY WHICH WAY BUT
LOOSE- XIV
A Special CONTEST Episode of this
series
I want to start out by cautioning those with high
blood-pressure to have any needed medication handy, or
perhaps to simply forego this episode entirely. If
you should proceed, and it should occur to you that the
IRS employee whose work you're reading gets paid a whole
lot of money every year ($63K - $82K, plus benefits,
according to an ad for the position posted earlier this
week on newjerseyjobnetwork.com) either to deliberately
produce this drivel, or despite being incapable of
producing anything better, your health may be in
danger...
The Background
CtC Warrior Monte Reimann has already won several
victories on behalf of the rule of law.
Nonetheless, the IRS-- still struggling to evade the law
in order to continue shoveling huge gouts of American
wealth to favored cronies of the political class-- has
been attempting to dodge his filings for some older
years. Monte has been turning the rogue agency
every which way but loose...
Part of this little battle of truth and the law versus
b.s. and pretense has involved some back-and-forth with
an IRS "appeals officer". The latest missive from
this fine public servant furnishes us with both the
entertaining substance of this EWWBL episode, and the
gameboard for a fine exercise in baloney-hunting.
Here it is in all its foggy and squishy-brown glory:
|
Dear Mr. Reimann:
As you may know, I have been assigned your
case for Appeals consideration and to try to
resolve the issues before your necessity to
appear before the Tax Court. We at Appeals are
neither advocates of the Government nor you as
the taxpayer. Our job is to ascertain the facts
and apply the law and to advise both parties,
the Government and you, as to the hazards and
chances of prevailing on each issue. To that
end, I have several requests of you.
It appears that you protest the examination
determination that you are subject to income tax
on alleged wages paid to you. Due to the fact
that you filed Form 4852 and deny the taxability
of wages, but do claim the benefits of alleged
withholdings, I am confused as to your position
and request clarification.
With your filed returns, your transmittal
letter states that you rebut claims by the
issuer of Forms W-2 that the amounts disclosed
as wages under IRC Sec. §3401 (a) and §3121 (a)
are incorrect and not subject to tax. I have
numerous factions of confusion on this
statement. First, can you confirm that you did
not work for these issuers of Form W-2's or
provide me a statement that the reported
earnings are not yours by ownership? If you did
not provide any service for these issuers, would
you please be so kind as to provide me a copy of
the letter you sent them stating that the Forms
were issued in error. Or is your position simply
that they are not taxable under the cited
authority?
If the wages are in fact exempt from taxation
under the Sections you cite, which I find to be
not applicable and not the case for these
Sections, I ask you for your similar authorities
allowing you to claim the benefit of the
withheld taxes. Under the same theory, any tax
withholding would also be exempt and not
applicable. I can find no Code section that
provides for your taking benefit of these
withholdings if you claim the wages are exempt
from taxation. If fact, under your authorities
that you have cited, if the amounts are not
"wages" as you have claimed, then those payments
are also not subject to withholding. As such,
the withholding of any taxes would constitute an
error on your alleged employer's part. As an
error, you would have to present a claim to them
for the error; that would not be a matter
between you and the Internal Revenue Service.
Please present me a copy of your correspondence
that you have sent to the respective issuers of
Form W-2 requesting that they correct the Form
that they have issued, and also your request for
a refund of taxes withheld from you by them.
Upon receipt of that correspondence, we will
investigate with them as to why they have not
provided you with their response. Otherwise, I
find that any claim for refund is between you
and them and is not an issue before me.
Additionally, since you are not denying that
you received a check or monetary payment, you
certainly did not receive the total amount
listed on said Forms W-2. So unless your
received some sort of "income" or benefit on the
gross amount, I am at a loss as to your
authority to claim, what perceived to be, a
double benefit for the withheld taxes since you
did not receive that income. I would enjoy
receiving your authorities on this position.
Finally, I might agree that IRC Sec. §3401
and §3121 may not be applicable to you with
regard to the issues raised by examination and
your returns. However, I do find that IRC Sec.
§61 is inherently applicable and overrides any
consideration of IRC Sec. §3401 and §3121 with
respect to you. I request that you provide me
your authorities as to why IRC Sec. §61 is not
applicable with regard to the money you appear
to have conceded as receiving from the issuers
of Form W-2. I can find no authorities that will
override Sec. §61 and also find that your
chances of prevailing in Tax Court on this issue
to be negligible.
You have also disclosed and reported income
from a bank account as interest income, and also
cancellation of debt income. I would be
interested in receiving your authorities as to
how the amounts paid to you under the allegedly
incorrect Sec. §3041 and §3121 differ from those
amounts you have in fact declared and disclosed
under IRC Sec. §61. As far as reporting and
disclosure are required, the same authorities
that are applicable to the interest and
cancellation of debt income are also applicable
to the amounts received from the Form W-2
issuers. I find conflict in your position with
regard to this issue, and this creates another
area of hazards of litigation for you should you
proceed to trial.
Please provide me with the requested
clarification and authorities at your earliest
convenience. If I do not hear from you by April
30, 2009, I will close your Appeals
consideration of your case and forward the file
on to Area Counsel for Trial preparation. I look
forward to hearing from you soon.
Sincerely,
Michael Chambers
Appeals Officer
|
The Contest
In a word: Take this
nonsense apart!
This "letter" is riddled
with a mind-boggling array of misstatements,
mischaracterizations and pretenses of misunderstanding.
It could be described as an 876-word fallacy, or a
demonstration of the extremes to which the spouting of
non sequiturs can be taken by a practiced master of that
sordid little art. Your job as a contestant is to
parse out each fallacious nugget and briefly explain its
failings.
The acceptable format for
an entry in the contest will be that of a reply to this
farcical nonsense, but within that general format, you
have complete latitude. You can do bullet-points,
insertions, or whatever else suits your fancy, as long
as the entry is comprehensible and presentable.
The prize for the winning
entry-- which will be judged on thoroughness of
parsing/debunking and presentability-- is a beautiful 'I
Cracked the Code' T-shirt!
You've only got ten days
to tear this thing up, Warriors, so start your
computers!
Send your entries to me
at survey 'at' losthorizons.com, as a .doc, .rtf, .txt
or .htm file, please I can convert some WordPerfect
files, but without complete reliability, so these should
be avoided.
And The Winner Is...
Justin Laue, with the following cogent,
scholarly and calm rebuttal of Michael Chambers'
incoherence (which I think Justin saw as a
product of low capacity rather than outright bad
faith...):
|
Dear Mr. Chambers,
Thank you for the opportunity to present
the facts of this case; hopefully we can
come to a swift
resolution. To that end, I am herein
providing answers to your various
questions.
First of all, it is a bit difficult to
clearly ascertain what your specific
questions are as you make several
contradictions and misstatements. “Due
to the fact that you… deny the
taxability of wages”, “wages are
in fact exempt from taxation” are
examples of statements that you
attribute to me that I have not made
and are not true, but then you correctly
state that I claimed the “amounts [paid
to me] are not “wages””
as defined in IRC Sec. 3401(a) and
3121(a). On this latter statement, you
seem to agree, and, regardless, is
established fact as I am the one with
personal knowledge and testified to this
on my return.
In your letter, you asked me to “confirm
that [I] did not work for these issuers
of Form W-2’s or provide
[you] a statement that the reported
earnings are not [mine] by ownership.”
However, as I am sure you
are aware, the Form W-2 is not for
reporting “work” or “earnings” but
rather “wages” paid from an
“employer” to an “employee”, and that,
in fact, any private-sector exchange of
work and/or earnings
between me and anyone else is beyond the
scope of this case.
You then state that, as I had received
no “wages” then the issuer of the Form
W-2s had no business
submitting withholdings to the IRS on my
behalf and that it should then be a
matter between myself and
that issuer. In general, I might agree,
however the law provides that these
amounts are to be treated as
“overpayments” (see IRC Sec. 6401, 6402
and 31(a)(1)). In fact, the law
specifically states, “An amount
paid as tax shall not be considered not
to constitute an overpayment solely by
reason of the fact that
there was no tax liability in respect of
which such amount was paid.” (Sec.
6401(c))
I am at a loss to understand the
question you put forth in your fifth
paragraph. Simply put, I am to be
credited with the “overpayment”
irrespective of any liability I
eventually had, and thus also,
irrespective
of any “income” I may, or may not, have
received. I am not seeking benefit of
any sort; I only seek to
recover property incorrectly diverted to
the IRS as accorded me by law.
Regarding IRC Sec 61, it would suffice
to show what it cannot mean: the Supreme
Court has repeatedly
stated that the income tax is not and
cannot be an unapportioned direct tax
(see United States Supreme
Court, Brushaber v. Union Pacific R.
Co., 240 U.S. 1 (1916), Stanton v.
Baltic Mining Co., 240 U.S. 103
(1916), and Peck v. Lowe, 247 U.S. 165
(1918)) such that “the income tax is,
therefore, not a tax on
income as such. It is an excise tax with
respect to certain activities and
privileges which is measured by
reference to the income which they
produce. The income is not the subject
of the tax: it is the basis for
determining the amount of tax”
(Congressional Record, Proceedings and
Debates of the 78th Congress,
March 2, 1943, to April 5, 1943).
It can be clearly shown that congress
has never meant for the income tax to be
a direct tax. Sec. 61 is
derived from The Revenue Act of 1928
which had the benefit of The
Classification Act of 1923. The first
item listed in Sec. 61 is “Compensation
for services”. When the meanings of the
terms “Compensation”
and “services” (as well as, then,
“position” and “employee”) are
substituted from the classification act,
“Compensation for services” has
virtually identical meaning to “wages”
as defined in IRC Sec. 3401(a)
and 3121(a). Thus, under the principle
of ejusdem generis (see United States
Supreme Court, Circuit City
Stores v. Adams, 532 US 105, 114-115
(2001) and Norfolk & Western R. Co. v.
Train Dispatchers, 499 US
117 (1991)), the following items in Sec.
61 would likewise be inherently
restricted to sources of income
derived from federal privilege (and
thus, an excise tax, not a direct tax).
As to the items of income I declared on
my return, I had received Form 1099s
from the persons or
entities making those payments (I
included these Form 1099s with my
return). According to the
directions for the use of Form 1099,
this form is only to be used by a “Trade
or Business” (i.e.
“performing the functions of public
office”, IRC Sec. 7701(26)). Therefore,
in submitting the Form 1099s,
these persons or entities were declaring
under oath that they are performing the
functions of public
office. As I have little or no personal
knowledge of the nature these persons or
entities, I must take this
testimony at face value. These payments
would clearly then be within the meaning
of Sec. 61. If I come
to find that these forms were also
incorrectly used, and that these persons
or entities are not to be
considered a “Trade or Business,” I will
surely be submitting an amended return
to correct this.
I hope these answers expand your
understanding of the case. If necessary,
I could go into much greater
depth in support of each of my answers
but in the interest of clarity I tried
to make them brief.
Sincerely,
|
CONGRATULATIONS, JUSTIN!!
Watch out for that robot! I THINK
IT'S GOING TO EXPLODE!!
***
Isn't it too bad everyone hasn't done like Monte
and Justin, 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 (while you still can-- see
below...).
|
|
EVERY WHICH WAY BUT
LOOSE- XIII
I'm pleased to be able to share a great little story
this week, the beginning of which I had learned back in
2007, but the end of which hadn't been passed along to
me until just a few months ago.
A CtC-educated filer who has unfortunately chosen to
remain anonymous had routinely secured a complete refund
of everything withheld from him and given over to the
federal government in connection with the "income" tax
scheme during 2005:
However, a little over a year later, some designated
"disinformation/discouragement officer" at the IRS
decided to take a shot at blustering and bullsh*tting
Anon. back into the pen and onto his knees:
I haven't seen the return filed by Anon. for this year,
and he may well have made the mistake of listing FICA
"income" tax withholdings as "excess social security tax
withheld" per the misunderstanding about the purpose of
that line on a 1040
discussed here. However, as Anon. very
cogently points out in his response to this disingenuous
agency effort, that issue is entirely moot at this
point:
The D/D officer wasn't ready to give up, though. A
few months later, Anon. got THIS in the mail:
(Math skills don't appear to be part of the D/D officer
job description...)
Anon., doubtless sighing in exasperation at the apparent
need to say everything twice to scoundrels trying to run
a scam and not willing to take the first "NO!" for an
answer (perhaps in the hope that it was just a fluke or
an extended typo), repeated himself (and much more
politely than some would have done, under the
circumstances):
This time the D/D office got the message: this is a
CtC-educated American, who therefore knows the truth and
has a proper, unbending respect for the rule of law and
his own rights and civic responsibilities. No
doubt with a sigh of his own, the law-defier behind this
sleazy effort abandoned it as a bad business.
It shouldn't ever have been begun, of course, but if the
agency took THAT attitude, a whole lot of its 122,000
workers wouldn't have anything to justify their very
considerable remuneration, and would lose their jobs,
and THEN where would the economy be? But wait!
They could now all be put to work at public expense
building wind turbines or other such items that somehow
the market doesn't find to be worth building
voluntarily! Maybe THAT'S what Obama's new "New
Deal" is really all about...
Watch out for that robot! I THINK
IT'S GOING TO EXPLODE!!
Isn't it too bad everyone hasn't done like
Anon., 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 (while you still can-- see
below...).
|
Every Which Way But Loose I
Every Which Way But Loose III
Also, see the
Victories Highlights page for additional specially-notable
CtC-educated victories, and, to enjoy hundreds and hundreds
of straightforward "just-the-check-and-no-hassles" victories enjoyed
by the CtC-educated for years now,
click here.
|
Are You Ready For
More Power?
"Peter Hendrickson has done it again! 'Upholding
The Law' does for individual liberties what 'Cracking
the Code' did for tax law compliance: exposes the
reader to the unalienable truth!"
-Jesse Herron, Bill Of Rights Press, Fort Collins,
Colorado
AND DON'T MISS
NEW
from Pete Hendrickson,
the man who Cracked the Code of the United States
"income" tax;
became the first American in history to recover
EVERYTHING withheld from him, Social Security and
Medicare "contributions" included;
and has ever since been the target of unrelenting
assaults by a government willing to do just about
anything to thwart the spread of the truth!!
In this new volume, you'll learn about:
|
Plus,
...and much, much more!
|
|
|
Is this information of any value to you? If so,
please consider a donation to help keep it available.
Donations can be sent to:
Peter Hendrickson
232 Oriole St.
Commerce Twp., MI 48382
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