Time: Wed Mar 19 08:24:13 1997
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Date: Wed, 19 Mar 1997 08:23:21 -0800
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From: Paul Andrew Mitchell [address in tool bar]
Subject: SLS: [TL] How to Stop Withholding (fwd)
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<snip>
>HOW I STOPPED MY EMPLOYER FROM WITHHOLDING INCOME TAXES
>
>by "J. Otis"
>
>[Editor: The following was published in the October, 1994
>issue of "Terra Libra News." It's an example of someone
>working in a major corporation successfully persuading
>his employer to stop withholding.
>
>It's also an example of applying Freedom Technology in
>a sensible manner. Particularly important are the steps
>taken by Mr. 'Otis' to minimize the risk that terrocrats
>(terrorist bureaucrats or coercive government agents)
>will retaliate against him.]
>
>[Author's Note: The approach I'm using is based on the book
>"Vultures in Eagles Clothing." For information to order
>this book, contact Terra Libra. I use the nom de guerre
>of "J. Otis" in honor of James Otis, the Colonial attorney
>who argued so well against the Stamp Act and other abuses
>of the Crown.]
>
>[Editor: To order "Vultures in Eagles Clothing," visit Robert
>Cohen's Website at http://members.aol.com/KCohen4444/fasthome.htm.
>This site contains a wealth of Freedom Technology, as well as
>some recommended changes to the form letters provided by Lynne
>Meredith in "Vultures in Eagles Clothing." Both Robert Cohen's
>and Lynne Meredith's businesses are examples of "Sovereign
>Businesses," not subject to terrocrat "jurisdiction." They
>are also examples of how to make money promoting freedom.]
>
>Introduction
>------------
>I am a computer specialist and an independent sub-contractor,
>who works through a contract programming firm (for purposes
>of this article, I have fictionalized my company's name to
>"CompuProTech, Inc."). My odyssey through the Internal
>Revenue Code began seven months ago, when I was looking for
>ways, as a self-employed person, to minimize my tax liability.
>
>I read books by "experts," attended seminars by more "experts"
>and (in the words of Omar Khayyam) "came out by the same door
>as in I went," no wiser than before. So, I decided to take
>the plunge and research the Code myself.
>
>As I did so, I noticed some strange things. Many definitions
>of terms in the §7700 section of the code seemed to be circular,
>and some important terms were not actually defined in the
>current editions of the Code. As I tried to do a "flow trace"
>of the definitions in the Code, it began to remind me of many
>30-year old "spaghetti" COBOL programs I often have to debug.
>
>About that time, I received my first set of Terra Libra reports,
>which suggested that I may not be liable for the income tax at
>all. I sent for "Vultures in Eagle's Clothing," the excellent
>and comprehensive book by Lynne Meredith. After I read the book,
>I understood the Code in the context of relevant Supreme Court
>cases and other Titles of the U.S. Code. Based on that book and
>my previous research, I concluded that I, as a sovereign Citizen
>of one of the 50 states and a non-Governmental employee, am not
>legally liable for the 26 USC (A) §1 graduated income tax.
>
>Risk and Reward
>---------------
>Now, I had a decision to make. If I had my own business, I could
>simply file my Affidavit of State Citizenship, stop paying taxes,
>cease filing 1040 returns, and wait to see if the IRS bothered to
>notice. However, since I had taxes withheld from my paycheck,
>that option was not readily available to me. I was warned, in
>Terra Libra reports and verbally, of the risks facing me if I
>took a high-profile approach. As one person said, "The law is
>on your side, but the guns are on the IRS's side!"
>
>After much soul-searching, I decided to file exemption certificates
>with my company and to accept whatever risk came with that decision.
>There are several reasons why I decided to do so. First, while I
>do not believe in boxing lightning with my fists, neither do I
>believe in skulking around like a criminal in the exercise of my
>rights. As Emerson said, "I cannot consent to pay for a privilege
>where I have intrinsic right."
>
>Furthermore, the experience of my father's life, and of my own,
>has convinced me that one does not necessarily purchase safety
>by "keeping one's nose clean" and "staying out of trouble."
>My father tried that, and it did not protect him from career
>reversals in late middle age. More recently, I was "downsized"
>out of a job shortly after receiving a superior performance
>review and a large merit pay raise.
>
>I have learned a fundamental truth, which has penetrated to the
>marrow of my bones. The truth is that there is no safety in
>life, that "security" is an illusion, and that we lose our souls
>in the search for it (for an excellent discussion of this idea,
>see "The Wisdom of Insecurity" by Alan Watts). Indeed, the most
>secure people I know are those who know their rights, who have
>discovered their personal power, and who are prepared to stand
>upon both.
>
>How I Succeeded
>---------------
>Having made my decision, I filed a "Commercial Affidavit"
>asserting State Citizenship and Sovereignty at my local county
>courthouse. I then filed a W-8 form (Certificate of Foreign
>Status), a "Statement in Lieu of W-4" and other forms documenting
>my exempt status with my company.
>
>After one pay cycle, I noticed that taxes were still being
>withheld from my pay. I telephoned my company's payroll
>department, and discovered that my paperwork had been sent
>to the Legal Department. I called that office, and found that
>the lawyers were utterly confused by my documents. Evidently,
>they were flummoxed by the W-8 form. "Why," they asked, "is
>he claiming 'foreign status' when he is an American?" I
>responded to them with the following letter:
>
>"Dear Sirs,
>
>"The purpose of this letter is to answer your concerns about
>the truth of my sworn statements regarding withholding status
>for tax purposes. You may verify the above by sending the
>enclosed letter, copies of all of my documentation and the
>attached Affidavit of Authority and Indemnity to the Internal
>Revenue Service Center (via certified mail, return receipt
>requested). The cover letter invokes the legal doctrines of
>"clean hands" and "estoppel by acquiescence," thus providing
>CompuProTech, Inc. with legal protection from any possible
>IRS retaliation.
>
>"Since the IRS has no legal authority to require you to
>continue to withhold from my paycheck, you should expect no
>response to the letter. However, IF YOU DO RECEIVE either
>the attached Affidavit, or any other correspondence from
>the IRS, demanding that you continue to withhold taxes from
>my paycheck, please forward a copy to me. I will show any
>such letter to the U.S. Attorney. Depending upon its contents,
>I will file criminal charges against the IRS Agent who signs
>it, including (but not necessarily limited to) 26 USC §7214
>and 18 USC §241 and §242 for felony perjury, theft by
>deception, fraud by inducement, material misrepresentation,
>duress, coercion, violation of civil rights, malfeasance of
>office under color of law and extortion using the mail system.
>Contrary to popular misconceptions, there is ABSOLUTELY,
>POSITIVELY NO LEGAL IMMUNITY for any IRS Agent who commits
>perjury or acts outside the scope of his/her authority.
>
>"In closing, let me state that I both sympathize, and
>absolutely concur, with your desire to obey all applicable
>Federal laws and regulations. The burden of my argument is
>that the 26 USC (A) §1 graduated income tax DOES NOT APPLY TO
>ME. I am fully prepared to defend my position, under oath,
>before any judge and jury in America. Meanwhile, I will do
>everything within my power to protect the legal position of
>CompuProTech, Inc.
>
>"If I can be of further assistance, please contact me.
>
>"Sincerely,
>
>'J. Otis'"
>
>The "enclosed letter" and the Affidavit of Authority and
>Indemnity (referred to above) were modeled after those in
>"Vultures in Eagles Clothing." I also enclosed a copy of
>my Commercial Affidavit, a two-page summary of my legal
>arguments (following this article, on page 11), and a six-
>page Memorandum of Facts, Points of Law and Authorities,
>providing ample documentation of my legal position.
>
>Results
>-------
>Three days later, I received the following letter from
>my company's Legal Department:
>
>"Dear 'Mr. Otis,'
>
> "Re: IRS Withholding Exemption Certificate
>"Please be advised that in accordance with Internal Revenue
>Code Regulation Section 31.3402(n)-1, CompuProTech, Inc.
>will not deduct and withhold any tax under Chapter 24 of
>the Code from your wages as requested by you pursuant to
>your Withholding Exemption Certificate dated July 24, 1994.
>You should also be aware that, as required by IRC Regulation
>Section 31.3402(f)(2)-1(g), CompuProTech, Inc. will forward
>to the Internal Revenue Service your Withholding Exemption
>Certificate together with a copy of all written statements
>received by CompuProTech, Inc. from you in support of the
>claims made by you on the certificate.
>
>"If you have any questions regarding this matter, you may
>contact our office at (###) ###-####. Thank you.
>
>"Sincerely,
>
>'P. Mason,'
>Associate General Counsel"
>
>As the letter stated, corporations must routinely send
>Withholding Exemption Certificates to the IRS on a quarterly
>basis along with their Form 941 reports. Therefore, study
>the law and be thoroughly prepared before you act!
>
>Following Through
>-----------------
>To further secure my legal position, I have obtained opinion
>letters from attorneys and CPAs supporting my status as a
>non-taxpayer. In addition, I am taking the prudent step of
>protecting my assets from illegal seizure.
>
>[Editor: Obtaining legal opinion letters from licensed CPAs
>and attorneys is an extremely important and powerful aspect
>of strategy for dealing with IRS and other terrocrats. It's
>called the "Reliance Defense." It's a well-established legal
>principle, confirmed by many courts, including the US Supreme
>Court, that if you act in accordance with the legal advice of
>licensed attorneys and CPAs, you cannot be guilty of crimes
>such as "wilfull" failure to file. The Reliance Defense greatly
>reduces legal risk. See "Report #TL16G: The Reliance Defense"
>on the Free World Order Website at http://www.buildfreedom.com.
>The Reliance Defense doesn't stop terrocrats from taking civil
>action.
>
>Above, Mr. 'Otis' refers to "taking the prudent step of
>protecting my assets from illegal seizure." This is to protect
>against terrocrats taking "civil" action like stealing his car,
>his home, the contents of his bank accounts, etc. The basic
>principle is to own nothing the terrocrats would want to steal.
>For more information on how to do this, contact Asset Protection
>Services, 3531 W. Glendale Ave, #205, Phoenix, AZ 85051. Phone:
>602-336-4780. Fax: 602-336-0625. Email: trusts@amug.org. Website:
>http://www.amug.org/~trusts.]
>
>Further, I have filed with the IRS a Freedom of Information
>Act request for all files they have on me. I am aware that
>there are certain codes in their files which indicate whether
>or not one is liable for the graduated income tax. (Hint:
>Code MFR-01 means you are not required to make or file a
>return). If the IRS ever decides to take me to court, those
>codes would be powerful legal ammunition.
>
>[Editor: There have been many cases where the IRS terrocrats
>have prosecuted a tax victim for not filing, even though
>in their computer system they had classified the victim as
>"not required to file."]
>
>Also, I have applied, to the IRS, for a refund of my last
>three years' income taxes via 1040X returns. At best, I
>will get my money back, and, at worst, I have forestalled
>any threat of an audit of past tax returns. If the IRS
>wants to audit my 1040X returns, let them! They won't be
>able to disallow them, as the law is on my side.
>
>In the same envelope, I also served the IRS with a true copy
>of my Commercial Affidavit and my legal Memorandum. I have
>given the agency 30 days to respond, after which the doctrine
>of estoppel by acquiescence prevails. I have yet to hear
>from the IRS. We shall see what happens.
>
>A Broader Perspective
>---------------------
>Obviously, we all want (and have the right) to keep the
>fruits of our labor. Clearly, no person or institution has
>the right to deprive us of them without our consent. However,
>to me, there are other considerations involved.
>
>The income tax, and the welfare system it supports, assume
>that adult citizens are neither generous nor mature enough to
>voluntarily help others. The system operates on the Calvinist
>assumption that people will not do what is right unless the
>government cocks a pistol to their heads.
>
>My own experience is very different. I have observed that
>psychologically secure and personally powerful people are
>also loving and generous people. They help others because
>that is how they feel; that is the way they want to be and act.
>Such people think in terms of surplus and not scarcity.
>Whatever they give is not lost, because they can always
>replenish what they give by their own productive efforts.
>
>The New Testament says that "perfect love casts out fear."
>I don't know if that is true, but I do know that the reverse
>is true. People who are fearful, anxious and self-absorbed
>cannot love others impartially. Mature and powerful people
>give help where it is needed, and also creatively work for
>the betterment of their society. It is only the needy,
>dependent and immature who are stingy and ungenerous.
>I have decided that, as an adult, I do not need the
>government to extort money from me or to decide, on my
>behalf, who deserves my help. I am mature enough to make
>those decisions on my own. Accordingly, I have started
>tithing 10 percent of my salary to worthy causes of my own
>choosing. Why did I choose 10 percent as a figure? It is
>a traditional proportion, and it is a place to start. Over
>time, I will review my giving patterns, and adjust my giving
>to reflect my values and the changing needs of myself and
>others.
>
>There is an additional perspective that I consider helpful.
>I recently attended a retreat where, with other participants,
>we explored the concept of "selfless service." The conference
>leader expressed it as "the soul 'on-call." The idea is that
>we stand ready to offer service, help and/or assistance as the
>situation requires it. This is very different from ego-driven
>anxieties about being a "bad person" if one does not help. It
>is also different from "reform" movements, which are usually
>driven by infantile "magical thinking" and unconscious drives
>toward domination and control over others.
>
>A Biblical example of "selfless service" is the New Testament
>parable of the Good Samaritan. In the story, the Samaritan
>was not running around, looking for lost wretches to help.
>He was going about his affairs, when he noticed a man bleeding
>by the roadside. He rendered assistance, saw to it that the man
>was properly cared for, and went along his way. The Samarita
>simply did what he had to do because it needed to be done.
>
>My own experience tells me that, as we grow older and leave
>youthful anxieties, insecurities and ego-compensations behind,
>we naturally grow toward "selfless service." For this, we do
>not need "hell and sin" preaching, and we surely don't need 30
>to 40 percent of our salary stolen from us!
>
>Conclusion
>----------
>If you are currently working for (or through) someone else,
>you can get withholding legally stopped. You will have to do
>your homework, and you must be prepared to explain your
>arguments to your employer, concisely and understandably.
>Indeed, if you cannot explain your position to someone else,
>that may be a hint that you do not understand it yourself!
>
>If you choose to do as I have done, you must be psychologically
>and spiritually prepared to stand upon your rights. To me, it
>is essential to have a sound philosophy of life, so that you
>can keep things in proper perspective.
>
>
>SUMMARY LETTER TO PERSUADE EMPLOYER TO STOP WITHHOLDING
>
>by "J. Otis"
>
>[Note: This summary letter is not a "stand-alone" letter.
>Anyone using it should be sure to attach to it their affidavits
>and all other legal citations, so that their position cannot be
>dismissed as "frivolous." This letter is an "executive summary"
>which explains the essence of the matter, so that the recipient
>does not have to plow through 20 pages of dense legal
>argumentation to understand it. This letter worked for me and
>I offer it to others who may need it.]
>
>[Your name]
>[your address]
>
>[Date]
>
>[Your company's name]
>[company's address]
>
>Subject: Summary of Legal Arguments Regarding Withholding Status
>
>To whom it may concern,
>
>The purpose of this letter is to summarize and explain, as
>concisely as I can, the legal arguments supporting my claim
>to be exempt from the 26 USC Subtitle A §1 graduated income
>tax. Attached to this letter are all of the case law and
>statutory citations needed to substantiate my claims. My
>argument can be reduced to the following:
>
>* The 26 USC Subtitle A, §1 graduated income tax applies
>only to Federal employees and residents of Federal enclaves.
>
>* The Sixteenth Amendment gave Congress no new power of
>taxation. Further, the U.S. Supreme Court has repeatedly
>defined "income" as gain severed from capital.
>
>Words of Art
>------------
>As you may know, a statute must contain definitions of
>important words and terms; otherwise, it is "void for
>vagueness." In a statute, a word means precisely what
>the statute says that it means. A word, in a statute,
>can have a meaning very different from the "plain English,"
>common-sense meaning of the same word. In legal parlance,
>such specially defined words are called "words of art." In
>the attached documentation, I list many of the "words of
>art" used in the Internal Revenue Code. Suffice it to say
>here, that if words like "state," "individual," etc. meant
>in Title 26 what they mean in ordinary English, the whole
>statute would be blatantly unconstitutional. Title 26 is
>constitutional, because these terms have been redefined as
>"words of art," so as not to run afoul of the Constitution
>and case law. Most of these definitions are contained in
>Title 26 itself, but some are contained in previous editions
>of the Internal Revenue Code, or in other Titles (Titles 4
>and 5 being prominent examples).
>
>Another thing to remember is that the word "include," in
>statutory construction, means only those things referred
>to, unless the words "including, but not limited to" are
>used.
>
>Federal jurisdiction
>--------------------
>As we will remember from our civics classes, the Constitution
>gave Congress exclusive, absolute jurisdiction over Federal
>territories, including Washington, D.C. The U.S. Supreme
>Court has ruled that Congress is not bound by the Constitution
>when legislating for these areas (see Hooven v. Evatt 324 U.S.
>674). What many of us do not realize is that, by signing 1040
>forms and Social Security applications, we unwittingly declare
>ourselves "Federal citizens" subject to the untrammeled
>authority of Congress. Since nobody told us this when we
>signed these documents, we may, at common law, legally rescind
>all such signatures on grounds of constructive fraud and non-
>disclosure of pertinent facts. I have done so in my Affidavit.
>
>Also, if you enter a plea in Federal Court, you are placing
>yourself under the jurisdiction of that court, whether you
>really belong there or not.
>
>Because of the way "words of art" are defined in Title 26,
>anyone not living in Washington, D.C. or a Federal territory
>or enclave is a "foreign person" and a "non-immigrant, non-
>resident alien" for purposes of the Title. This does not mean
>that one was born in another country, or lives abroad. It
>means that one is not a "Federal citizen." After all, the
>states are "foreign" to one another and to the Federal
>government (see Black's Law Dictionary). That is why I filed
>a W-8 form with you. That is also why I filed a statement
>"In Lieu of W-4." The W-4 is the wrong form for non-Federal
>citizens, and the IRS will impose a $500 fine upon those who
>use it to claim EXEMPT status.
>
>The 16th Amendment
>------------------
>Doubtless, you were also taught in your government-controlled
>schools that the 16th Amendment gave Congress the power to
>lay a direct, unapportioned tax upon compensation for labor.
>That is dead wrong. I am sorry to have to attack well-
>established belief systems, but the facts "are what they are."
>The U.S. Supreme Court has repeatedly ruled that the 16th
>Amendment conferred no such power. After all, the 16th
>Amendment did not specifically repeal the original taxing
>clauses of the Constitution, and the Constitution cannot
>contradict itself! Therefore, the Court has ruled that the
>Amendment was simply a "perfecting" amendment (see Brushaber
>v. Union Pacific Railroad Co. 240 U.S. 1). Further, the Court
>has also repeatedly ruled that compensation for labor in the
>50 states is property upon which an "excise tax" cannot be
>imposed (see Eisner v. Macomber 252 U.S. 189).
>
>Once again, none of these rulings apply within Federal
>territories. To repeat: the 26 USC (A) §1 graduated income
>tax is constitutional because it is limited to "Federal
>citizens" and "Federal areas" where Congress is not bound by
>the Constitution and may legislate as it pleases.
>
>"State" vs. state
>-----------------
>Just as there are two "United States," so there are two of
>every state. The Buck Act (incorporated in Title 4 USC)
>redefined "the States" as "words of art" to include (only)
>Federal enclaves within the 50 states, legally ceded by the
>state legislatures to the Government. So, when the Internal
>Revenue Code says that such-and-such a provision applies to
>"all the States," it is right! What most people don't realize
>is that this does not mean North Carolina, California, etc. --
>it means "Federal enclaves within the 50 states."
>
>Conclusion
>----------
>If you are somewhat confused after reading this for the first
>time, do not feel bad. Confusion is the normal response to new
>information that challenges one's fundamental view of reality.
>Yes, I know; my arguments directly contradict everything you
>were ever taught. The largest obstacle is not legal but
>psychological. However, in law, FACT and TRUTH are sovereign,
>and, in the end, all opposition (legal, psychological or
>otherwise) must yield to their resistless sway.
>
>I hope this summary and enclosed memorandum help you better
>understand the legal action I have taken. If I can be of
>further assistance, please contact me either by mail or at
>my daytime telephone (###) ###-####.
>
>Sincerely,
>
>[signature]
>
>[Editor: For expert assistance in dealing with IRS terrocrats,
>you may want to contact American Rights Litigators, 2390 Old U.S.
>Highway 441, #3, Mt. Dora, FL 32757. Phone: 352-383-9100. Fax:
>352-383-0808. Email: arl@iag.net.]
>
>---------------------------------------------------------
>"The [one] who knows what freedom is will find
>a way to be free" -- Robert LeFevre
>
>"The Fountains of Freedom have many Sources
>and run along many Tributaries and Streams
>into the Ocean of Liberty" -- Frederick Mann.
>
>Free World Order Website -- http://www.buildfreedom.com
>
>Subscribe to the FWO List Server by sending a message
>to fwolist@sportsmen.net with the word SUBSCRIBE in the
>subject/topic field.
>---------------------------------------------------------
>
>
========================================================================
Paul Andrew, Mitchell, B.A., M.S. : Counselor at Law, federal witness
email: [address in tool bar] : Eudora Pro 3.0.1 on Intel 586 CPU
web site: http://www.supremelaw.com : library & law school registration
ship to: c/o 2509 N. Campbell, #1776 : this is free speech, at its best
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========================================================================
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