Posted by Paul Andrew Mitchell, B.A., M.S. on April 14, 1998 at 21:06:29:
In Reply to: How to get withholding back? posted by tax12@hotmail.com on April 14, 1998 at 15:15:15:
: After one has already gotten the $$ withheld, what is the best way to get it back from the illegal I.R.S.
First, study IRC 3402, preferably beginning
at the end, and reading that section backwards.
Second, understand that the withholding agent
is liable for any taxes withheld, and for
refunding excess withholding. See sections
imposing the liability, as listed in the
definition of "withholding agent",
at IRC 7701(a)(16). If the withholding agent(s)
have withheld MORE than they should have,
their liability is to the worker whose money
they withheld (or whose money they have
already paid to the IRS).
Third, educate your withholding agent(s)
into realizing that they should: (1) refund the
excess withholding to you, and then (2) simply
inform the IRS of the adjustment, as part
of their next quarterly payment to IRS.
A simple invoice by you will constitute
a proper, and sufficient, presentment.
For example, if the withholding agent(s)
paid $125,000 to the IRS last quarter, and
$5,000 of that was excess withholding,
which should have been paid to you, then
they should pay only $120,000 at the end of
the current quarter, refund the difference
of $5,000 to you, and continue in that manner
for all subsequent quarters (all other things
being equal, or "ceteris paribus" in Latin).
Of course, in reality, their current quarterly
payment may be more, or less, depending on
any changes which have occurred in their
payroll situation since last quarterly payment.
In this way, you don't need to involve the
IRS in any administrative or judicial actions.
If the withholding agent(s) balk, your remedy
is to sue them in state court for the excess
withholding, via a petition for permanent
injunction, e.g. PETITION FOR ORDER
ENJOINING UNLAWFUL WITHHOLDING.
Remember also that you can amend administrative
records retroactively by means of a Nunc Pro Tunc
declaration. This is NOT an Ex Post Facto law;
it is merely a way of ensuring that an adminis-
trative record is made correct from its start
point, after a systematic error is identified.
The process is very simple, actually, when you
understand how it works. Be careful, however,
to avoid referring to yourself as an "employee,"
because this term means "federal employee"
in the IRC. You are a "worker" or "co-worker"
in a "Right to work state of the Union."
Sincerely yours,
/s/ Paul Andrew Mitchell, B.A., M.S.
Counselor at Law, Federal Witness
and Private Attorney General