The question then becomes, what are "the income taxes imposed by the Code?" The 861 position asserts that the Code and regulations do not impose a tax on the income of most Americans.
Posting this code paragraph is a tautology. Of course anyone whose income is subject to tax imposed by the code is liable to pay that tax.
And that position is WRONG.
One more time: US residents do not use Section 861 or Subchapter N for determining their tax liability.
We use Subchapter B.
Posting this code paragraph is a tautology. Of course anyone whose income is subject to tax imposed by the code is liable to pay that tax.
And Subchapter B lays out what is and isn't taxable if you are a US resident.
The question then becomes, what are "the income taxes imposed by the Code?" The 861 position asserts that the Code and regulations do not impose a tax on the income of most Americans.
Actually 861 says something quite different, it excepts nonredisent aliens under specific conditions, and does nothing to except compensation for labor or services which comprise the predominate portion of most Americans income.
Sec. 861. Income from sources within the United States
(a) Gross income from sources(activities) within United States
The following items of gross income shall be treated as
income from sources(activities) within the United States:(3) Personal services
Compensation for labor or personal services performed in the United States;
A LAW DICTIONARY
by John Bouvier, Revised Sixth Edition, 1856:
INCOME. The gain which proceeds from property, labor, or business; it is applied particularly to individuals;A LAW DICTIONARY
by John Bouvier, Revised Sixth Edition, 1856:
WAGES, contract. A compensation given to a hired person for his or her servicesA LAW DICTIONARY
by John Bouvier, Revised Sixth Edition, 1856:
GAIN. The word is used as synonymous with profits.A LAW DICTIONARY
by John Bouvier, Revised Sixth Edition, 1856:
PROFITS. In general, by this term is understood the benefit which a man derives from a thing. It is more particularly applied to such benefit as arises from his labor and skill;
Merriam-Webster's Collegiate® Dictionary © 2000
Main Entry: in·come
Pronunciation: 'in-"k&m also 'in-k&m or 'i[ng]-k&m
Function: noun
Date: 14th century
1 : a coming in : , <fluctuations in the nutrient income of a body of water>
2 : a gain or recurrent benefit usually measured in money that derives from capital or labor; also : the amount of such gain received in a period of time <has an income of $20,000 a year>
And section 1 makes it absolutely clear that the tax is imposed upon citizens of the United States:
26 USC 7805(a) Rules and regulations
(a) Authorization - … the Secretary [of the Treasury] shall prescribe all needful rules and regulations for the enforcement of this title [Title 26]…" [26 USC § 7805]Thus under amplifying Treasury regulations for 26 USC 1, 26 CFR 1.1-1(a),(b)
Sec. 1.1-1 Income tax on individuals.
(a) General rule. (1) Section 1 of the Code imposes an income tax on the income of every individual who is a citizen or resident of the United States and, to the extent provided by section 871(b) or 877(b), on the income of a nonresident alien individual.(b) Citizens or residents of the United States liable to tax. In general, all citizens of the United States, wherever resident, and all resident alien individuals are liable to the income taxes imposed by the Code whether the income is received from sources within or without the United States.