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Date: Fri, 14 Nov 1997 06:12:22 -0800
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From: Paul Andrew Mitchell [address in tool bar]
Subject: SLS: IRS Code (fwd)
<snip>
>
> Is IRS Code Constitutional?
>
> by John L. Sasscer
>
> Most people are surprised when they learn that the U.S.
>Supreme Court has ruled that the taxing limitation in Article 1,
>Section 2, Clause 3; and Article 1, Section 9, Clause 4 of the
>U.S. Constitution prohibiting the federal government from
>imposing any tax directly on the people, are still in effect and
>that the 16th Amendment did not nullify those limitations nor
>authorize any direct tax on the people.
>
> After learning this and the fact that an income tax is an
>excise tax on government granted privileges, they frequently
>assume that the Internal Revenue Code is unconstitutional because
>they believe that it imposes the income (excise) tax on
>individuals and requires them to file returns. Such a conclusion
>is in error on both points; the Code is constitutional because it
>does NOT impose an income tax on individuals nor does it require
>them to file income tax returns, despite the general
>misconceptions held by most lawyers, accountants, tax advisers,
>and patriots.
>
> Such mistaken ideas about the Internal Revenue Code (IRC)
>are understandable, for the IRC is a masterpiece of deception
>drawn up by attorneys for the IRS and designed to mislead
>citizens into believing that the IRC requires individuals to file
>income tax returns and pay income tax. In many parts of the IRC,
>what is NOT said is even more important than what IS said. The
>authors of the IRC apparently knew that most people would impart
>meanings to various sections that are not stated in the law by
>jumping to conclusions based on popular mistaken ideas.
>
> Subtitle A is the part of the Code that relates to income
>taxes, and Section 1, titled "Tax imposed," is listed under Part
>1 of Subtitle A, "titled" -- "TAX ON INDIVIDUALS." Unless the
>reader understands that the "title" of a section is not law, and
>that the wording of the body of the statute -- ONLY -- is the
>law, they would most likely consider that the words in the title
>of Part 1 imposed an income tax on individuals.
>
> In all of the various parts of Section 1 (which imposes the
>tax), it is stated that the tax is imposed on "taxable income,"
>not on individuals. Furthermore, there is no provision under
>Subtitle A or anywhere else in the IRC that makes individuals
>liable for (subject to) the income tax or requires them to pay
>it. This omission is not generally recognized unless one
>realizes that in order for individuals to be required to pay an
>income tax, there must be a provision of the law that
>specifically states that the tax is imposed on them.
>
> Without such a provision, individuals are not subject to the
>tax, and are not required to pay it. It is very clear that the
>tax in Subtitle A is imposed on "taxable income." NOT on people,
>therefore it does not conflict with the constitutional
>limitations prohibiting direct taxation of the people and on this
>basis, it is constitutional.
>
> It is important for people to understand Section 6012, which
>is one of the most deceptive sections of the IRC. It is titled,
>"PERSONS REQUIRED TO MAKE RETURNS OF INCOME," and further states:
>
> "(a) GENERAL RULE -- Returns with respect to income taxes
>under subtitle A shall be made by the following:
>
> (1)(A) Every individual having for the taxable year a gross
>income of $1,000 or more ..."
>
> Since this section applies only to those who might be
>required to make returns "with respect to income taxes under
>Subtitle A," it therefore applies to only those individuals on
>whom the tax might be imposed under Subtitle A. Since Subtitle
>A, as previously shown, imposes no tax on any individuals, there
>are no individuals against whom Section 6012 can be applied. The
>logic of this wording in Section 6012 is apparent, since
>individuals are not subject to the income tax under Subtitle A,
>they are not required to make returns under Section 6012.
>
> Next, notice that in Section 6012 the word "shall" is used,
>not the word "required," even though the word "required" is used
>frequently throughout the IRC. Shall generally has a mandatory
>meaning, but courts have ruled that it must mean the same as the
>word "may" when necessary to avoid a "constitutional conflict."
>As an example, if an individual were required to make a return,
>thereby forcing him to disclose information from his private
>papers, it would violate his right to privacy secured by the 4th
>Amendment of the Bill of Rights of the United States
>Constitution, thus creating a "constitutional conflict."
>
> Also, compelling an individual to disclose information that
>could be used against him criminally would violate his 5th
>Amendment right NOT to be required to be a witness against
>himself, thus operating to create another "constitutional
>conflict." Therefore, since Section 6012 (a) states that
>individuals "shall" make returns, it is clear that the making of
>such returns by individuals is not required by law, but is a
>voluntary action. Again we see that these words in the IRC are
>constitutional because they do not conflict with [the]
>individual's constitutionally secured rights.
>
> Reading on in Section 6012 we see that the provisions just
>discussed apply to only those individuals "having for the taxable
>year a gross income of $1,000 or more ..." Since an individual
>must have a taxable year in order to be subject to Section 6012
>(a), it is necessary to understand the meaning of "taxable year."
>"Taxable year" is a legal term that is defined in IRC Section 441
>as being the period of time for which a "taxpayer's" taxable
>income is computed. Nowhere in Section 441, or anywhere else in
>the IRC, is there any wording indicating that an individual has a
>"taxable year."
>
> Now in order to expose the continuing deception, we must
>determine the definition of the term, "taxpayer." "Taxpayer" is
>also a legal term defined in the IRC in section 7701 (a)(14).
>According to that Section, the legal term "taxpayer" does NOT
>mean "any person who pays taxes," but is defined as: " ... any
>person subject to any internal revenue tax." In IRC Section 7701
>(a)(1) the legal term "person"is defined as meaning not only an
>individual, but also a corporation.
>
> Because the U.S. Constitution forbids direct taxation of the
>people, Subtitle A does not make individuals subject to the
>federal income (excise) tax; therefore, according to the law,
>individuals are not "taxpayers" in respect to the income tax.
>Since according to Section 441, only "taxpayers" have a "taxable
>year" and individuals do not, then it is clear that Section 6012
>(a) applies to "taxpayers" only and that it does not require
>returns to be made by individuals because they are not subject to
>the federal income (excise) tax under Subtitle A. Once more, we
>see that the wording in Section 6012 is constitutional because it
>does not apply to individuals.
>
> When reading Section 6012 (a) without careful analysis the
>strange words "having income" are generally interpreted as
>meaning "receiving income." However, if one understands the
>definition of "income" as stated by the U.S. Supreme Court, the
>words are not strange. The Court in the case of Merchants Loan $
>trust Co. v. Smietanka [255 U.S. 509], ruled that the term
>"income" must be given the same definition in all income tax laws
>enacted by Congress under the 16th Amendment that it had under
>the Corporation Tax Act of 1909, which imposed a tax on profits
>of corporations.
>
> In the decision of the case of Eisner v. Macomber [252 U.S.
>207], the Supreme Court stated that "income" under the 16th
>Amendment means a "gain" or "profit." The Court stated in the
>Eisner decision that Congress has no power to define "income," so
>it has no power to change or enlarge the definition of "income"
>established by the Supreme Court. Therefore, Congress has no
>power to enact any statute changing or enlarging the Court's
>definition of "income" (profits or gains of corporations) and it
>has no power to include other items as being "income."
>
> Despite these facts, IRS spokesmen consistently misinterpret
>Section 61 (a), of the IRC, by claiming that the 15 items listed
>in that Section are defined as items of "income," when they are
>in fact, items of source (corporate gross receipts). Gross
>receipts (sources) are NOT profits or gains (income); but if
>gross receipts are entered as "income," on an income tax return,
>they are then considered to be "income" to the "taxpayer" who
>files the return, signed "under penalty of perjury."
>
> The exchange of an individual's labor for wages, salaries,
>commissions, fees, etc, is an equal exchange of his property
>(labor) for other property (money in the form of wages, salaries,
>commissions, fees, etc.) of equal value and there is no profit or
>gain in the transaction. Such an individual is not one "having
>income" (possessing a corporate profit or gain), so we see that
>Section 6012 (a) does not apply to individuals just because they
>work for a living -- a God given Right secured by the U.S.
>Constitution, or because they are engaged in other activities of
>common right. Therefore, there is no conflict with the
>Constitution on these points that should make Section 6012 (a)
>unconstitutional. The IRC imposes requirements on "taxpayers"
>only -- not on individuals.
>
> In conclusion, this writer submits the following
>observations on this subject:
>
> 1. When an individual voluntarily files his first
>income tax return (voluntary compliance) showing a tax is due
>from him (self-assessment), signed "under penalty of perjury,"
>(Federal law under 28 USC 1746 makes unsworn statements,
>certified under penalty of perjury, equal in legal force to a
>sworn statement or notarized affidavit) he unknowingly
>established prima face evidence (evidence which which, if
>unexplained or uncontradicted, is sufficient to sustain a
>judgement in favor of the issue which it supports, but which may
>be contradicted by other evidence) that he is subject to the
>income tax and that he is in the legal status of a "taxpayer"
>(any person subject to any internal revenue tax).
>
> 2. In relation to federal income (excise) tax, a
>"taxpayer" is considered to be in the same legal status as a
>corporation, which is a government created "person" that is
>subject to the direction and control of the government. A
>"taxpayer," like a corporation, has "privileges" only and has no
>constitutionally secured individual rights with which a mandatory
>interpretation of the word "shall" could create a "constitutional
>conflict."
>
> Thus, a "taxpayer" can be required to file an income
>tax return and/or do whatever else IRS regulations require him to
>do relative to federal excise taxes.
>
> 3. When criminal charges for "willful failure to file"
>are pressed, the defendant is tried as a "taxpayer," not as an
>individual posessing all of his constitutionally secured rights.
>Because of the defendant's previously filed returns being put
>into evidence without challenge, a judge can consider the
>defendant to be a "taxpayer" and therefore instruct the jury that
>the defendant is required to file income tax returns.
>
> If, however, an individual's income tax returns were filed
>because he was deceived into believing that, as an individual, he
>was required -- by law -- to file an income tax return and pay
>income tax, he could have grounds of CONSTRUCTIVE FRAUD needed
>for retroactive revocation and repudiation of all previously
>executed IRS documents to prevent their use as prima facie
>evidence in both civil and criminal proceedings. Prima facie
>evidence can be challenged and overcome by positive action
>explaining and contradicting such evidence.
>
> [Edited from `Freedom League Newsletter', March 1986]
>
<snip>
===========================================================================
Paul Andrew Mitchell, Sui Juris : Counselor at Law, federal witness 01
B.A.: Political Science, UCLA; M.S.: Public Administration, U.C.Irvine 02
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