June 25, 1996
Joe Smug, Chief Counsel
International Graft Corporation
666 Wabash
New York, New York
RE: IRS-Issued Notice of Levy John Workman "wages"
ENCLOSURE: IRS/IRC public notice memorandum
Dear Mr. Ward:
John Workman asked that I write to you concerning the notice
of levy against John's wages sent by the Internal Revenue
Service. They have evidently attempted to convince various people
at International Graft Corporation that the instrument is not
legitimate and that they don't have a legitimate federal income
tax obligation, but this is a specialty area that has just
recently been unraveled sufficiently to be presented
comprehensively. Hopefully you will receive this letter in the
spirit it is sent -- several large corporations, inclusive of
Amway, Boeing, and others are having to come to terms with the
law as it is written rather than as it has been presumed over the
last fifty or sixty years.
Enclosed you will find an IRS/IRC public notice memorandum
which serves as a thorough indictment against IRS while
simultaneously demonstrating proper application of Subtitles A &
C of the Internal Revenue Code. You might be advised that the
memorandum is publishing in state legal publications across the
country -- Thayer County, Nebraska beginning June 12, Oklahoma
County, Oklahoma beginning June 20. and in Montana, presumably in
the county where White Fish is located, beginning June 20. We've
had attorneys around the country going over the document, and the
only question has pertained to whether or not United States v.
O'Dell still applies because the Internal Revenue Code was
allegedly changed since 1947, but have overcome the objection by
demonstrating that it was merely reorganized in 1954, and that
the 1040 Form is still a voluntary filing instrument with limited
application.
The memorandum faults IRS and the Internal Revenue Code on
nine points which, with respect to the Workmans, are fatal. Fatal
meaning, IRS doesn't have a legal leg to stand on. If you will
review Sections 3401 through about 3405 of Vol. 68A of the
Statutes at Large, which is the true Internal Revenue Code of
1954, you will quickly unravel the "income tax" riddle -- it has
never applied to anyone other than officers, agents and employees
of the United States. Then if you will read the five or so pages
in 26 CFR § 601.401, you will find proper application. When
you're done with those two reasonably brief selections, go to 26
CFR § 31.0 -- application of the various Subtitle A & C taxes is
spelled out in this selection which has no corresponding
statutory provision. These three selections should bring you up
to speed with nominal effort.
Where the instant matter is concerned, look at the front of
the Notice of Levy instrument sent to International Graft: The
first obvious flaw is the absence of either a court order or
reference to a court order authorizing seizure, garnishment, etc.
While IRS has run the intimidation con game for years, the fact
is, the Internal Revenue Code preserves all existing rights and
remedies, "including trial by jury," in the first sentence of 26
U.S.C. § 7804(b). You might consider that the Fifth Amendment
clearly stipulates that no person shall be deprived of life,
liberty or property without due process of law. Unless or until
you either have a court order issued by a court of competent
jurisdiction, or have evidence of a court order, International
Graft Corporation cannot under any circumstance withhold money
due the Workmans or anyone else.
This is a constitutionally-assured right which appears in
the Constitution for the United States of America, in the
Oklahoma Constitution, in the New York Constitution, and
constitutions in the other states. And the Internal Revenue Code,
in the first sentence of § 7804(b), clearly preserves all due
process rights. It's a matter of fundamental law, and when you're
given notice, you have a due diligence requirement to learn and
comply with fundamental law.
This is of considerable importance, as if you will consult
the 1966 report on legislative intent, you will find that third
parties are not exempted from liability where they erroneously
surrender "property", including money, to the Internal Revenue
Service. Additionally, consult the Code of Federal Regulations at
27 CFR § 70.163(c). In relevant part, this subpart states as
follows:
Any person who mistakenly surrenders to the United States
property or rights to property not properly subject to levy
is not relieved from liability to a third party who owns the
property....
The statement goes on to specify that the proper owner may
seek administrative relief under 26 U.S.C. § 6343(b), or bring
suit against the Government under § 7426, but the point here,
which is key to ultimately ending IRS fraud, is that those with
fiduciary and trustee obligations to whomever has been victimized
may elect to secure appropriate remedies, inclusive of civil and
criminal, against those joined to IRS tyranny via accommodation.
I assure you that this strategy is being deployed. As the
Nuremberg trails following World War II demonstrated, tyranny
never stands on one leg. Both perpetrators by intent and
perpetrators by consent, whether for personal gain or out of
fear, must be held accountable.
To reinforce the conclusion that an "employee" is supposed
to secure return of over-payment, illicit collection, etc., from
the "employer" rather than IRS, you might read 26 CFR § 601.401
carefully. This selection demonstrates that IRS is supposed to
deal exclusively with the employer, and has nothing to do with
the employee, even when the employer is an agency of United
States Government. This brief four or five pages opens the
cracker barrel for good -- if John seeks recourse, it should be
against the "employer," which would be International Graft,
rather than IRS. We'll return to this matter momentarily.
You will also note that "notice of levy" is defined by use
at 26 U.S.C. § 6335(a). The notice instrument merely conveys
information, it is not cause for action. See Black's Law
Dictionary or another law dictionary for the legal definition of
"notice". Notices of levy are to be left for whomever seizure has
been executed against. In other words, where the instant matter
is concerned, the notice should be sent to the Workmans after the
fact, and if there was an actual seizure, IRS would have to take
possession of money due the John via an actual levy supported by
a court order. The "notice of levy" sent to International Graft
has about the same merit as an obituary claiming the John is dead
when in reality he is alive and well. In other words, there is no
fact, legal or otherwise, to support the notice instrument.
Consider application of the garnishment/levy process at 27
CFR § 70.164(d):
(d) Person defined. In addition to the definition given in
§ 70.11 of this part, the term "person," as used in 26
U.S.C.A. 6332(a) and this section, includes an officer or
employee of a corporation or a member or employee of a
partnership, who is under a duty to surrender the property
or rights to property or to discharge the obligation. In the
case of a levy upon the salary or wages of an officer,
employee, or elected or appointed official of the United
States, the District of Columbia, or any agency or
instrumentality of either, the term "person" includes the
officer or employee of the United States, of the District of
Columbia, or of such agency or instrumentality who is under
a duty to discharge the obligation. As to the officer or
employee who is under such duty, see § 70.161(a)(4)(i) of
this part. (26 U.S.C. 6332)
The key to understanding the Internal Revenue Code and
attending regulations is largely in definitions -- words of art,
where commonly understood words have specially assigned meaning.
Congress promulgated what is described as the "Dictionary Act" in
1871, and Code law has been increasingly convoluted since. Of
particular note, you might consult definitions at 27 CFR § 250.11
where you will find that the Secretary is the Secretary of the
Treasury of Puerto Rico, Revenue Agent is any duly authorized
Commonwealth Internal Revenue Agent of the Department of the
Treasury of Puerto Rico, etc. Here, however, we'll simply
reproduce the definition of "person" reference above, being at 27
CFR § 70.11:
Person. An individual, a trust, estate, partnership,
association or other unincorporated organization, fiduciary,
company, or corporation, or the District of Columbia, a
State, or a political subdivision thereof (including a city,
county, or other municipality).
In my memorandum, you will find that a certain Treasury
Order in the 1970's made a transfer of functions under Subtitle
F, which includes authority for administrative and judicial
collections, to BATF. The cites above from Title 27 of the Code
of Federal Regulations are in fact under BATF authority even
though many of the regulations mention IRS. These regulations
obviously do not have general application to the several States
and the population at large, and it will be found that the
corporations mentioned in the "person" definitions are either (1)
corporations, partnerships, etc., subject to taxes prescribed
under Subtitles D & E, with application only in the geographical
United States, or (2) where Subtitles A & C are concerned,
corporations and other such entities established and owned by the
United States, exclusive of private enterprise even if organized
under laws of the United States. This will be clearer after
you've read §§ 3401-3405 of Vol. 68A, Statutes at Large.
Ironically, taxes prescribed in Subtitles A & C are applicable
only to government agencies even in the District of Columbia,
Puerto Rico, etc., where those prescribed in Subtitles B, D & E
have general application in the geographical United States. Under
provisions of 26 U.S.C. § 3402(p), private corporations in the
District of Columbia, etc., can theoretically elect to
participate in Subtitle C programs (Social Security, railroad
retirement, etc.), but the authority does not reach the several
States and the population at large.
It is also relevant that "seizure" is defined at 27 CFR §
70.11:
Seizure. The act of taking possession of property to
satisfy a tax liability or by virtue of an execution.
Obviously, seizure must either be by way of (1) voluntary
compliance, or (2) by court order ("execution"). There is no way
to avoid this conclusion without pitching the Constitution out
the window. International Graft's fiduciary responsibility,
established by contract, is antecedent to voluntarily
surrendering money due John. International Graft principals may
voluntarily give IRS the farm, but if the crop belongs to John,
IRS must secure a court order before International Graft may
voluntarily surrender that due to John.
Let's return to the definition of "person." If you will read
§§ 3401-3405 of Vol. 68A, Statutes at Large, and 26 CFR §
601.401, as I've suggested, this will make sense: Income, Social
Security, and related taxes in Subtitles A & C of the Internal
Revenue Code are mandatory only for officers, agents and
employees of the United States and political subdivisions of the
geographical United States (D.C., Puerto Rico, etc.), exclusive
of the several States party to the Constitution. The several
States and the population at large are subject only to Congress'
Article I, Sec. 8 delegated authority; the geographical United
States is subject to Congress' absolute Article IV legislative
authority. In the several States, Congress may exercise only the
delegated, enumerated powers; in the geographical United States,
Congress may exercise any power not specifically prohibited by
the Constitution. This duality, occasionally referred to by the
United States Supreme Court as "Cooperative Federalism," is the
underlying fraud behind the Internal Revenue Code -- governments
of the several States, with no constitutional authority, have
presumed to be federal States, and have generally engaged fraud
to dupe the American people. You will find that the Supreme Court
has tacitly condemned the complicity -- see New York v. United
States, et al. (1992). The Tenth Amendment and the Separation of
Powers Doctrine prohibit officers of the several States from
accommodating federal encroachment without first securing a
constitutional amendment.
The Internal Revenue Service is the Achilles Heel of the
Cooperative Federalism scam. Nobody likes those folks, and once
the origins and nature of IRS are more commonly known, the jig is
up. Even Joe Sixpack, who occupies himself with television and
his bass boat, has a patriotic streak. When he learns that IRS
helped fund the Kama River tank and military truck factory in
Russia, that his illicitly collected tax dollars fund United
Nations brush wars around the world via the Agency for
International Development, et al., probably his ears as well as
his neck will turn red, and even he will want an accounting. He
may demand heads.
I don't want to construct a whole discourse on the subject
so will move ahead: If you will examine the "notice of levy"
instrument, you will find in the first column under "kind of tax"
that Service principals have entered "1040". The 1040 is a type
of return form, it is not a type of tax. Therefore, the notice
instrument forwarded to International graft is fraud on its face
-- no taxing statute which stipulates the transaction, service or
object of the tax appears on the form. See the necessity of a
taxing statute in United States v. Community TV, Inc., 327 F.2d
797, at page 800 (1964), and Hassett v. Welch, 303 U.S. 303, 58
S.Ct. 559, 82 L.Ed. 858.
Next, you will find that no IRS agent or officer has signed
the form under penalties of perjury:
26 U.S.C. § 6065
Except as otherwise provided by the Secretary, any return,
declaration, statement, or other document required to be
made under any provision of the internal revenue laws or
regulations shall contain or be verified by a written
declaration that it is made under the penalties of perjury.
This applies as much to IRS principals as to people subject
to revenue laws of the United States. It's one of those, "What's
sauce for the goose is sauce for the gander" things.
In this same framework, it will please you to know that the
International Graft paymaster was required to "certify" the
notice of levy. In other words, IRS dupes you into doing the
dirty work. Again, if you will consult 26 CFR § 601.401, you will
find that the "employer," being an agency of the United States,
is supposed to draft regulations for the garnishment process. So
while IRS people are operating under color of law, they are
technically roping private business owners and corporate officers
into effecting garnishment in a manner which more or less
complies with regulatory provisions. The problem, of course, is
that International Graft hasn't "promulgated" regulations, and if
you will consult Title 5 of the United States Code on the
subject, even the "employer" is required to secure a court order
prior to garnishing wages.
Another problem ... you will note that the various cites
I've related where the Code of Federal Regulations is concerned
for the most part come from 26 CFR, Part 301 & 601, and 27 CFR,
Part 70. In fact, if you will dig out the Parallel Table of
Authorities and Rules, beginning on page 751 of the 1995 Index
volume to the Code of Federal Regulations, you will find that the
only regulatory authority for 26 U.S.C. § 6331 (levy and
distraint) is under 27 CFR, Part 70. Title 27 of the United
States Code and the Code of Federal Regulations are under
exclusive administration of BATF, not IRS. There are no
corresponding regulations published in the Federal Register for
26 CFR, Part 1 or 31, the two CFR parts relating to Subtitles A &
C of the Internal Revenue Code. The need for regulations to be
published in the Federal Register is clearly set out in the
Administrative Procedures Act (5 U.S.C. § 552 et seq.), the
Federal Register Act (44 U.S.C. § 1501 et seq.), and in Title 1
of the Code of Federal Regulations, Chapter 1. If regulations are
not published in the Federal Register, application of any given
statute is exclusive to agencies of the United States and
officers, agents and employees of the United States -- see 44
U.S.C. § 1505(a) for effect and review particulars of 1 CFR,
Chapter 1.
If you will review the back of the "notice of levy" sent to
International Graft, you will find that 26 U.S.C. § 6331(a) isn't
reproduced in the statute authorities. This is another element of
document fraud as § 6331(a) is the general authority paragraph
for levy and distraint. If you will consider § 6331(a) in your
copy of Title 26, you will see that the second sentence specifies
officers, agents and employees of the United States as being
subject to levy and distraint. The first sentence is applicable
under Subtitles D & E of the Internal Revenue Code -- excise
taxes on certain privileged activity and production.
Normally when I assist people with matters relating to IRS,
I try to avoid undue peril by asking Service principals to comply
with certain provisions of law, or at least to produce authority,
etc. In this same spirit, I might suggest that you incorporate
particulars set out in this letter, and inquire concerning IRS
authority, the legitimacy of the tax, particularly with respect
to the existence or non-existence of a taxing statute, and
specifically request a letter of immunity which assures that IRS
principals responsible for issuing the "notice of levy" will bear
full legal liability should the seizure prove to be illegal or
fraudulent.
If you will make this effort on behalf of John, I think you
will posture International Graft to check out of the Federal
Income Tax business. If you will consult the Parallel Table of
Authorities and Rules, beginning on page 751 of the Index volume
to the Code of Federal Regulations, you will find that there are
no implementing regulations which extend corporate income tax to
the several States and the population at large (26 U.S.C. § 11).
Again, consult 44 U.S.C. § 1505(a) for effect -- without
implementing regulations, any given statute is applicable only to
agencies of the United States, as defined at 5 U.S.C. §§ 102 &
105, and officers, agents and employees of the United States.
Review the necessity for delegations of authority and regulations
published in the Federal Register in 1 CFR, Chapter I.
If I can be of further assistance, feel free to contact me.
John articulates that he appreciates the factory position
with International Graft so he doesn't want to get crosswise, but
you understand his position with respect to securing rights and
protection of the law. Please consider this letter notice
adequate to require due diligence on your part to determine and
comply with the law.
Regards,
/s/ Dan Meador
Dan Meador
copy: John Workman
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