What is the Federal Income Tax? by Paul Andrew Mitchell, B.A., M.S. Counselor at Law, Federal Witness and Private Attorney General All Rights Reserved (November 10, 1998) The federal "income" tax is an excise tax which is imposed upon profit or gain derived from sources that are INSIDE the "United States" [sic], or from a "United States" trade or business. In this context, the term "United States" means the territory over which Congress has exclusive legislative authority and where Congress is the local "State" government. "Income" and "source" are two entirely different terms. The "source" is the situs of the income-producing activity. The items listed at IRC 61 are "sources", NOT "income", although the grammar of section 61 is certainly ambiguous. The inside/outside distinction is crucial to a correct application of the income tax. The several states of the Union are OUTSIDE the "United States" [sic], and they are INSIDE the "United States of America" [sic]. See the Guarantee Clause for constitutional authority, and for correct use of terminology. See also the Preamble, where "United States" and "United States of America" are both used; these two terms define two disjoint geographic jurisdictions. Moreover, 28 U.S.C. section 1746 makes this all-important distinction as well, e.g. "inside the United States" and "under the laws of the United States of America"! This statute governs the perjury jurat on Form 1040!! Form 1040 is signed INSIDE the "United States" [sic], and OUTSIDE the "United States of America" (read "several states of the Union"). We never notarize Form 1040; now you know why! Yea Team!! Got it? The term "United States" here is synonymous with "the federal zone," i.e. the territory over which Congress has exclusive legislative authority and jurisdiction. Pursuant to the Downes Doctrine, indirect taxes need NOT be "uniform" within the federal zone, and direct taxes need NOT be "apportioned" within the federal zone. See the chapter entitled "16th Amendment Post Mortem," in the case of U.S.A. v. Knudson, in the Supreme Law Library at Internet URL: http://supremelaw.org/cc/knudson/judnot08.htm for a thorough discussion of this key point. Those two restrictions apply ONLY to taxes which Congress imposes inside the several states of the Union, which are "outside" ("without") the "United States" [sic], and "inside" the United States of America" [sic]. These findings are predicated upon the well established proof that the IRC is a municipal Code ("internal" means "municipal"). See the book "The Federal Zone: Cracking the Code of Internal Revenue" for all pertinent authorities, e.g. Treasury Decision 2313. See also "Congresswoman Suspected of Income Tax Evasion" in the Supreme Law Library supra, vis-a-vis IRC 3121(e). The Legislative Counsel and Congressional Research Service both agree with the major thesis of "The Federal Zone" [the book which I authored]. It makes no sense to render an excise "uniform" throughout the several states of the Union, if said excise tax is not even imposed ANYWHERE within that territorial jurisdiction! The graduated income tax does not need to be uniform OR apportioned there, because those rules are entirely irrelevant within that limited territorial jurisdiction (according to the Downes Doctrine). Think about it ... Congress has the power to impose a local, municipal tax, and that is exactly what they did with the taxes imposed by Subtitle A of the Internal Revenue Code. Just because Congress intermixed alcohol, tobacco, and petroleum taxes in the same Code, does not change the nature of the "income tax" provisions of that Code. The definition of "State", in these other excise taxes, clearly mentions the "50 States" [sic], but NOT at IRC 3121(e). See URL: http://www.law.cornell.edu/uscode/26/4612.html (a)(4)(A) THERE is the crux of their fraud!!! Confer at "inclusio unius est exclusio alterius" in Black's Law Dictionary, to wit: what was omitted, was INTENDED to be omitted (from those various, DIFFERENT definitions of "State"). In the Brushaber case, that tax was an excise imposed upon profit generated by a "domestic" (read "federal zone") corporation, because the Union Pacific Railroad Company was created by an Act of Congress, to build a railroad through the Utah Territory (BEFORE Utah joined the Union). Thus, Congress could tax the profits of that corporation BEFORE any of those profits were paid to stockholders, in the form of dividends. Treasury Decision 2313 explains all of this in fine detail; this Treasury Decision has never been repealed. The legal situs of any corporation never changes from its original domicile. Congress CANNOT create a corporation for the entire nation, because to do so violates the Tenth Amendment, and invades the province of the several states. See Daly v. The National Life Insurance Company of the United States of America, Indiana Supreme Court (1878), for clear authority on this crucial point. Thus, ALL FEDERAL CORPORATIONS are domestic (read "federal zone") corporations, by Law. "Domestic" in this context is synonymous with "federal zone". "Domestic" does NOT have the same meaning in this context as it does in the context of domestic and foreign flights at international airports. The state zone and the federal zone are perfectly disjoint, in a geographic sense. The term "state zone" has now entered our household vocabulary; for proof, search for "state zone" with the Alta Vista search engine, particularly in documents which also use the term "federal zone". Now, federal citizens [sic] are associated with a political jurisdiction which is NOT protected by the Guarantee Clause, and where the direct/indirect rules simply do NOT apply. Federal citizenship is a municipal franchise, the exercise of which CAN be taxed by the Congress, pursuant to the Downes Doctrine, because citizenship is a term of municipal law (a/k/a "private international law" [sic]). Congress cannot re-define the term "Citizen" as that term used in the Qualifications Clauses, because Congress has no power to amend the U.S. Constitution; only three-fourths of the Union states have that power. The term "Citizen" [sic] in the Qualifications Clauses, in 3:2:1, and in 4:2:1, each refers to Citizens of ONE OF the States United. See Alla v. Kornfeld for authority (cited and discussed in the Supreme Law Forum at http://supremelaw.org/wwwboard): i.e. federal citizens, as such, were NOT even contemplated when the organic U.S. Constitution was first written and ratified. Although the Guarantee Clause appears to authorize unequal protection of the Law here, the Eighth Circuit dropped the ball completely when this issue was put squarely before them, in Gilbertson's OPENING BRIEF. That Court has now failed to rule on an application by the People of the United States of America for Intervention of Right, so we are presently in a Mexican Standoff, as regards all of the far-reaching issues which arose in that OPENING BRIEF. If the People were to obtain leave to intervene, they would immediately request Rehearing En Banc, on all of these issues, and then go up to the U.S. Supreme Court "with all deliberate speed" (a term from Brown v. Board of Education). Instead, you have seen the U.S. House of Representatives repeal the IRC, effective July 4, 2002. I believe this was done because the law as explained above has begun to permeate that House of Representatives, one Representative at a time. The writing is definitely on the wall. I hope this helps. Sincerely yours, /s/ Paul Andrew Mitchell Paul Andrew Mitchell, B.A., M.S. Counselor at Law, Federal Witness, Private Attorney General, and Candidate for the U.S. House of Representatives email: Contact Us website: http://supremelaw.org # # #
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