Code of Silence: Time for the IRS to Answer The Question!

World Magazine ^ | August 30, 2003 | Joel Belz

[TIElniff]

JOEL BELZ

Code of silence

Why won't the IRS answer a basic question about tax law? By Joel Belz

I STILL HAVE DOUBTS WHETHER THE NAME OF VERNICE B. Kuglin, who lives in Memphis, Tenn., will someday leap off the pages of America's history books along with those of Patrick Henry, Nathan Hale, and Rosa Parks. I do know that Ms. Kuglin must be a woman of some personal courage.

Ms. Kuglin, a 58-year-old pilot for FedEx, made news a few days ago when a federal court jury found her not guilty on six charges of tax evasion and willful failure to file federal tax returns. During her testimony, Ms. Kuglin said that over the last eight years she had sent numerous letters to the Internal Revenue Service requesting that the agency tell her specifically which law in the federal code requires her to pay individual taxes.

To this day, she says, she has not received an answer to that simple question. It's not, mind you, that she has received an answer she considers unsatisfactory or unclear. It's that she hasn't received an answer of any kind.

The reason I still have doubts about Ms. Kuglin's durability as a true American heroine has to do with the methods she used to make her point. (Among other things, she claimed 99 exemptions on her W-4 form.) But after watching her case?and those of other tax protesters?for the last several months, I can't help thinking they have something of an argument. And I think the IRS continues to be extraordinarily dim-headed in its response on at least two important fronts.

First, if indeed the obligation of every U.S. citizen to pay federal taxes is legitimately codified, then it shouldn't be all that difficult for the IRS to demonstrate for a layman like Ms. Kuglin just exactly how those laws apply. For some years, some pretty smart people have put together a pretty persuasive argument that the tax laws are a sham, that they have been cobbled together in an extraconstitutional manner allowing Uncle Sam to collect huge sums of money without a clear basis in law.

If these folks are wrong, more and more taxpayers are asking, why should it be so hard for the IRS and the federal government to prove the case? Why, when a minister like Gene Chapman camps out for a "fast to the death" on the steps of an IRS building, demanding an answer to the question, "Where is my tax liability in the law?"?why doesn't the IRS just provide a simple and transparent answer?

Indeed, I have actually been skeptical in the other direction. I have regularly dismissed the so-called tax-protest movement as a group of crackpots who want so badly to prove the federal government wrong that they concoct harebrained theories that can't possibly hold water. But the longer the feds and the IRS stonewall, the less skeptical I get.

Second, why must the federal government be so heavy-handed in its response to a few of the more outspoken tax protesters? Protester Irwin Schiff finds himself in federal court in Nevada this week, fighting a possible six-month jail sentence for continuing to sell his book, The Federal Mafia. The government contends that he is engaged in commercial enterprise to encourage citizens to break the law?which means that every time Mr. Schiff does anything to sell another book, he finds himself in contempt of court.

Protester Larken Rose, meanwhile, says he isn't even trying to sell anything; without advocating any particular action, he just tells people through lectures and literature what he thinks the law really says?and for that, he claims, he has had his office and home ransacked by IRS agents.

WORLD and its board and management are not tax protesters. We take seriously Christ's command to "render unto Caesar the things that are Caesar's, and unto God the things that are God's." And we understand that in a secular society, that may often mean we end up paying taxes even for causes that we find repugnant to our consciences.

At the same time, it's altogether right for citizens in a free society to call on Caesar to tell us the truth about our obligations, and to do so in a civil manner.

In Memphis a couple of weeks ago, after the jury that had exonerated Ms. Kuglin had been dismissed, the U.S. attorney who had unsuccessfully prosecuted the case asked the presiding judge to order the defendant to file her forms, pay her taxes, and "obey the law." The judge responded discreetly by noting that such a response was outside his duties.

If the judge was simply saying, "Make your law clear, sir, and maybe the lady will obey," I think he had a pretty good point.

[MACVSOG68]

This is the second time that you have mentioned this. Unless there is a recent change, you may claim enough exemptions to reduce withholding to match your expected tax liability. If there is no expected liability, 10, 20, or 99 exemptions is (or was) perfectly legitimate. I did it for years and also held up to IRS scrutiny without complaint from them.

However, as you point out, if your expected liability is 0, fine. If the IRS doesn't believe you, then you may be subject to penalties for filing a false statement. That also has happened. Also, a person's expected tax liability or lack thereof should not be the result of frivolous positions, at least from the position of the IRS. That was my point. But you are correct in pointing out that there are lawful reasons for claiming large numbers of exemptions.

[Badray]

Welcome to FR.

[ifreemantoo]

You wrote:
Hmmm. You lost me on that one. At least I have been successful in challenging the IRS. Have you...?
____________________________________________________________
Now you have me laughing. Well my first encounter, as a "traditional tax sheeple" with the IRSS was subverted by my spouse’s employer who knew that he didn't have to pay attention to a notice of levy. That was a surprise to me at the time but now I understand why he didn't have to. I had made a mistake on my taxes. However, I did not owe anything even by the standards I believed at that time.

However, I invited in the vampire and it's hard to get rid of. Now look what the vampire created. Me. If it had indeed treated me fairly as you claim you have been treated, I would say what you say probably. I know better now.

Presently, I send the gubermint conditional checks for the amounts of attempted extortion. It appears though that no one wishes to take responsibility for their actions or provide the laws making me liable. I'm having lots of fun. In fact, I sent them along with my check a copy of the IRC 2002 for them to highlight where I am liable for the I-TAX. I had 35 questions for them to respond to on 12 pages. They seem to be like you and refuse to answer.

Now the real question is have you been successful in paying only what you are liable for? Talk about academic.

Checkmate

[Badray]

" If the IRS doesn't believe you,..."

Man, did you hit the nail on the head! The IRS is the "guilty until proven innocent" agency. In Kuglin's case, since they hadn't answered her inquiries, she believed that she had no liability. But, given the lack of any consistency or clarity from the IRS even when they do answer questions, how can anyone depend on their answers, let alone their non-answers?

I applaud her for her bravery.

[ifreemantoo]

Let's see now your tax dollars go to fund every side of every argument and issue. That makes lots of sense.

Gubermint can't stop losing money or spending it on things you would never have a use for. I talked about them earlier. You admitted that gubermint doesn't follow the law just the house rules. Now they have a bad record for doing the right thing and you think somehow they will then play by the rules. House rules perhaps. I had that same argument with my child she wanted more even though she had not proven she should get more. Now you be serious please.

It appears you are a little frustrated I don't really think you meant that statement about slaves that was just a cheap shot wasn't it?

You don't seem to get it. I don't advocate a constitutional convention. If you want a national tax it either must come under uniformity, which it won't, or you start a new constitution. Period end of story.

A national sales tax will either break the law or make new law. I'm just stating the choices. You can not have it both ways at the same time. That is pie in the sky.
____________________________________________________________
‘IRS management does what it wants, to whom it wants, when it wants, how it wants with almost complete immunity,’ retired Internal Revenue Service official Tommy Henderson told the U.S. Senate Finance Committee.”

[MACVSOG68]

Presently, I send the gubermint conditional checks for the amounts of attempted extortion. It appears though that no one wishes to take responsibility for their actions or provide the laws making me liable. I'm having lots of fun. In fact, I sent them along with my check a copy of the IRC 2002 for them to highlight where I am liable for the I-TAX. I had 35 questions for them to respond to on 12 pages. They seem to be like you and refuse to answer. Now the real question is have you been successful in paying only what you are liable for? Talk about academic. Checkmate

Glad you are enjoying it. I probably wouldn't. As for your real question, I believe that I am paying only the taxes for which I am liable. I would like to be paying a lot less, and if we had a fairer system that wasn't class oriented, I might. If you believe the strength of your arguments will ultimately prevail, why not test the system. Once you get a deficiency letter you should be able to get the ball rolling, and once in court, you can submit your questions as an interrogatory in a discovery proceeding, that is, assuming the judge allows it.

[MACVSOG68]

A national sales tax will either break the law or make new law. I'm just stating the choices. You can not have it both ways at the same time. That is pie in the sky.

If a sales tax is uniform across the states, why wouldn't Congress have the authority to legislate it? Wouldn't it be an indirect tax? Why would the constitution require amending? _

[ifreemantoo]

This is to everyone else as well. Be careful of anyone who would so easily trample on our Constitution, its’ provisions and clauses.

It will lead to the unrestricted power of a few. To put us back where we came from is where we are going if we are not careful.

It has already lead to a form of slavery and socialism. Your hard-earned money is taken and given to others who should never have it and to programs you hate. It continues to build a welfare base of government workers and programs that will grow so that your vote will never matter if indeed it does now. When your taxes are at 70% and you are employing 70% of the country what will you be able to do about it? Nothing.

Take the time read the Declaration of Independence and your Constitution. Understand it and defend it.

How is it that conservatives cannot see the liberalism and socialism in our present tax system?

[ifreemantoo]

You cannot amend the apportionment or uniform provisions of the constitution according to USSC decisions as posted earlier.

Yes congress can legislate a national sales tax. It may even start out uniform but big business, special interest and politicians will eventually receive a deduction from their tax burden and at that point, it will no longer be uniform or constitutional.

Now how can I say that? Our present income tax is an excise tax yet it is levied as though direct. There is nothing uniform about it now so why do you think it will be different as a National Sales Tax? Yes sir ree Bob I get it.

It sort of like how the gubermint works if the program fails just throw more money at it. If the laws don't work well, let's legislate some new laws. It's good PR. What the heck, if we made a mistake well we can have the courts tell us what we should have legislated to cover our butts.
____________________________________________________________
‘IRS management does what it wants, to whom itHouse rules perhaps. wants, when it wants, how it wants with almost complete immunity,’ retired Internal Revenue Service official Tommy Henderson told the U.S. Senate Finance Committee.”

[ifreemantoo]

Finally, remember this, he who has the money has control and power. It is no mistake that the apportionment provision of our constitution was designed to make the government prove someone owed a tax. Yes it is harder to collect, but it is fair and it keeps the government as was intended a servant and not a slave owner.

It was also no mistake that under the disguise of easier collection of the "income" tax that our money is taken from us before we see it. Now the burden of proof has shifted.

Check out the history and laws concerning a W4. Truth be known it is supposed to be a willing agreement between you and your employer. Your employer is relying on his CPA or attorney who is relying on the gubermint for the truth. That is very much like relying on the fox to count the sheep. "You thought there were 10 chickens, (hiccup, burp) I only counted 7."

Are you starting to get it yet?
____________________________________________________________
‘IRS management does what it wants, to whom it wants, when it wants, how it wants with almost complete immunity,’ retired Internal Revenue Service official Tommy Henderson told the U.S. Senate Finance Committee.”

[ifreemantoo]

Somehow I missed this one. Section 61 defines Gross income it does not define income. Income is not defined in Section 7701 either.

I asked what legal or lawful definition of "income" is the general public required to pay attention to. Is it the accounting term as you indicated and where does it say that I should pay attention to it?

I know that I'm required to follow legislative regulations as per 6001 and 6011. Perhaps there is one pointing to a definition of "income" that I should pay attention to. If someone finds it please let me know.
____________________________________________________________
‘IRS management does what it wants, to whom it wants, when it wants, how it wants with almost complete immunity,’ retired Internal Revenue Service official Tommy Henderson told the U.S. Senate Finance Committee.”

[MACVSOG68]

It has already lead to a form of slavery and socialism. Your hard-earned money is taken and given to others who should never have it and to programs you hate. It continues to build a welfare base of government workers and programs that will grow so that your vote will never matter if indeed it does now. When your taxes are at 70% and you are employing 70% of the country what will you be able to do about it? Nothing. Take the time read the Declaration of Independence and your Constitution. Understand it and defend it. How is it that conservatives cannot see the liberalism and socialism in our present tax system?

I couldn't agree more with that. Unfortunately incremental rather than revolutionary change is the only realistic answer. The first is to replace the burdensome tax system we have today. Reversing the socialistist makeup of America that began in 1933 is going to take slow incremental change. It is likely that it will never happen, though. We have probably come too far down the road now. Containment may be the only solution.

[MACVSOG68]

Somehow I missed this one. Section 61 defines Gross income it does not define income. Income is not defined in Section 7701 either. I asked what legal or lawful definition of "income" is the general public required to pay attention to. Is it the accounting term as you indicated and where does it say that I should pay attention to it? I know that I'm required to follow legislative regulations as per 6001 and 6011. Perhaps there is one pointing to a definition of "income" that I should pay attention to. If someone finds it please let me know.

You're probably not going to find any gold in that one. The law uses the term "gross income" to distinguish it from "taxable income". The code specifically addresses the imposition of taxes on taxable income.

[ifreemantoo]

Sec. 6001. - Notice or regulations requiring records, statements, and special returns
Every person liable for any tax imposed by this title, or for the collection thereof, shall keep such records, render such statements, make such returns, and comply with such rules and regulations as the Secretary may from time to time prescribe…

Sec. 6011. - General requirement of return, statement, or list
(a) General rule
When required by regulations prescribed by the Secretary any person made liable for any tax imposed by this title, or with respect to the collection thereof, shall make a return or statement according to the forms and regulations prescribed by the Secretary.

Language below is almost identical again. (I know it's just a coincidence.)


*Code section 4374 shall be paid, on the basis of a return (liability)for the tax imposed in 4371.Definition Code Sections is 4372.

*Code section 5703 makes the manufacturer of tobacco products liable for taxes imposed by section 5701. Definition Code Sections is 5702

*Code Section 5005 makes a distiller liable for taxes imposed by section 5001.Definition Code Sections is 5002

*Code Section ?XX? makes every married individual with taxable income liable for taxes imposed in Code section 1.
Definition Code Sections is 61.

Something is missing here. What makes you liable? It is not the definition section. It is section 1 either. This section only imposes.

Or is there a magical code section of liability that we can’t see or read?

[MACVSOG68]

The site below has a letter posted on in which the IRS responds to certain questions. I believe all of the questions we have discussed including your most recent post are covered in the letter. I'm sure the IRS can better defend themselves than can I. Regards



http://groups.yahoo.com/group/legality-of-income-tax/message/3671

[ifreemantoo]

Thanks for the link it had some interesting information I'd forgotten and one piece that helped me understand your thinking.

It seems that the fox is telling the hens why they are dinners for the fox. According to the fox, that is the end of the story. Nooooooooooooot exactly.

"undeniable accessions to wealth, clearly
realized, and over which the taxpayers have complete dominion." is from Commr v Glenshaw Glass Co. I quoted the footnotes earlier.

You know how religious cults use scripture out of context and content to make a new following. That case was based on the 1939 code not the 1954 code. This is clearly apparent when at footnotes 9 & 11 there is an explanation about income in the "constitutional sense". All that was done is the court tipped it's hat to it and did what it wanted to anyway. Nevertheless, it is still there. The truth is always there you just gotta look and use a little discernment.

The only definition for income is as a corporate profit as shown in my earlier posts. That's why income is not defined in the code. If the definition was inserted "corp prof" what do you think would happen?

I want the fox to prove it to me and ain't his dinner.

Frankly the biggest and largest cult following are those who file a traditional 1040. They have no idea as to why they do. Throw a couple of official looking code sections and an ambiguous court decision at them and wala you feel obligated to pay.

I will address benign section 6012 later. This is all the time I have for now.

[MACVSOG68]

Frankly the biggest and largest cult following are those who file a traditional 1040. They have no idea as to why they do. Throw a couple of official looking code sections and an ambiguous court decision at them and wala you feel obligated to pay.

You're never going to convince everyone, no matter how many so called ambiguous court decisions they see. For me it's fairly straighforward, rather than ambiguous.

• The 16th Amendment was passed to permit taxing of "income"
• Title 26 was passed by Congress with the full intent to tax "income", especially "income" from wages,
• In America, both the economic and accounting definitions of "income" would include wages and salaries,
• Courts have supported both the wages issue and the liability issue

  Given all that, it's hard to understand how the cultists are those who believe in complying with the rule of law (whether they like that law or not).

  Yes, there are inconsistencies in the code, and ambiguities that are continually challenged and reconciled. I simply can't put those two basic issues into that category.

[ifreemantoo]

Mac more smoking glass and mirrors. I don't make arguments about the 16th being ratified or not and I considered it constitutional as well as Title 26, which includes Title 27.

Congress having the power to make taxes is redundant. What congress was attempting to do was pass a direct tax on incomes. They failed miserably. Here is why:

Senator Brown of Nebraska second draft on June 17, 1909 submitted the following updated joint resolution for a constitutional amendment:

“That Congress shall have power to lay and collect *direct* taxes on incomes without apportionment among the several States according to population.” (Emphasis added)

On June 28, 1909, Senator Aldrich proposed what we now have today as the 16th Amendment. The word “direct” is missing. For a very good reason, therefore, the following from Brushaber defines “income” under the class of indirect and as an excise: (House rules means present "income tax" levied as direct although legally an excise so it seems)

“[...} as a result of the Amendment, in express terms excludes the criterion of source of income, that criterion yet remains for the purpose of destroying the classifications of the Constitution by taking an excise out of the class to which it belongs and transferring it to a class in which it cannot be placed consistently with the requirements of the Constitution. Indeed, from another point of view, the Amendment demonstrates that no such purpose was intended, and on the contrary shows that it was drawn with the object of maintaining the limitations of the Constitution and harmonizing their operation. We say this because [...]

the Amendment contains nothing repudiation or challenging the ruling in the Pollock Case that the word 'direct' had a broader significance,

[...] -a condition which clearly demonstrates that the purpose was not to change the existing interpretation except to the extent necessary to accomplish the result intended; that is, the prevention of the resort to the sources from which a taxed income was derived in order to cause a direct tax on the income to be a direct tax on the source itself, and thereby to take an income tax out of the class of excises, duties, and imposts, and place it in the class of direct taxes.” (emphasis added)

Side issue. Doesn’t it seem to say that you can't tax the source? It appears that the word "on" and "from" have a different meaning unless it's Section 61 where "from" means "on" according to the gubermint. Pre Clinton double-talk. How can you be "on" the bed and "from" the bed at the same time?

Eisner vs. Macomber
"Income may be defined as the gain derived from capital, from labor, or from both combined", provided it be understood to include profit gained through a sale or conversion of capital assets, [...]

What does that mean "profit gained through a sale or conversion of capital assets? Is that saying that "labor" is a "capitol asset" (source)?

Merchants' Loan & Trust Co. v. Smietanka 255 U.S. 509 (1921) [...] if the word "income" has the same meaning in the Income Tax Act of 1913 that it had in the Corporation Excise Tax Act of 1909[...]

"profit gained through sale or conversion of capital assets," there would seem to be no room to doubt that the word must be given the same meaning in all the Income Tax Acts of Congress that was given to it in the Corporation Excise Tax Act, (Still sounds like profits tax)

and that what that meaning is has now become definitely settled by decisions of this Court. (However, very unsettled in practice and in recent lower court decisions.)

So in conclusion (for now because there is lots more) the 16th amendment gives congress the power to make income tax as an indirect tax (sale tax, etc uniform in application) and not levied as a direct tax and not on the source itself only on the profit.

Now let’s take a look at who belongs to a cult. Me in how I just presented my case. Or those who sign a prepared 1040 and can’t tell you what a direct of indirect tax is.

Isn’t funny how you make claims about following the law and the judge in the Lloyd Long case quoted earlier can’t even tell you if the income tax is direct or indirect. Then again neither could my Congressman Pat Tiberi he thought it was a direct tax.

If in breaking or following a law wouldn't it be important to know if it the laws are about direct taxes (apportioned) or indirect (uniform). The laws wouldn't be the same would they? So for which laws do we follow? Direct or indirect?
____________________________________________________________

‘IRS management does what it wants, to whom it wants, when it wants, how it wants with almost complete immunity,’ retired Internal Revenue Service official Tommy Henderson told the U.S. Senate Finance Committee.”

[ifreemantoo]

Mac,

I do want to follow the law perhaps you can help me in this. I received a code section 6651 failure to file perhaps at the end of this you can tell me what I should do and how it applies to following the law.

“Sec. 6651. - Failure to file tax return or to pay tax
(a) Addition to the tax

In case of failure -
(1) to file any return required under authority of subchapter A of chapter 61 (other than
part III thereof), subchapter A of chapter 51 (relating to distilled spirits, wines, and beer),
or of subchapter A of chapter 52 (relating to tobacco, cigars, cigarettes, and cigarette
papers and tubes), or of subchapter A of chapter 53 (relating to machine guns and certain
other firearms), on the date prescribed therefor (determined with regard to any extension
of time for filing), unless it is shown that such failure is due to reasonable cause and not
due to willful neglect, there shall be added to the amount required to be shown as tax on
such return 5 percent of the amount of such tax if the failure is for not more than 1 month,
with an additional 5 percent for each additional month or fraction thereof during which
such failure continues, not exceeding 25 percent in the aggregate…”

Parallel authorities for 26 USC 6651 (from CFR):
27 CFR (Alcohol, Tobacco Products and Firearm) part 24 (Wine)
27 CFR (Alcohol, Tobacco Products and Firearm) part 25 (Beer)
27 CFR (Alcohol, Tobacco Products and Firearm) part 70 (Procedure and administration)
27 CFR (Alcohol, Tobacco Products and Firearm) part 194 (Liquor dealers)

The parallel authorities for Section 6651 as applied to 27 USC Alcohol, Tobacco Products and Firearm are boldly apparent.

Q14) I have never been involved as a business owner in the sale of Alcohol, Tobacco Products and Firearms for any year including tax year 2000. If I am liable for any “income tax” (I have not been persuaded that I am) for tax year 2000, was the “Delq – IRC Section 6651(a) (1)” on Page 2 of 2, line 17 (a) (Penalties) of Form 4549 for $964.75 misapplied?

Answer: YES NO Circle your answer.

Q15) If NO is your answer, what is the implementing regulation for IRC Section 6651(a) (1) that makes anyone liable for this penalty other than for Alcohol, Tobacco Products and Firearms?

Answer: Implementing regulation - Code Section_____________ Page # IRC ___________

Q16) If answer to question 14) is N/A, N/F or None, what is the statute or Code Section that should have been applied by someone authorized to do so if I am liable for this penalty?

Answer: Code Section_____________ Page # IRC ___________
Parallel authorities for answer: ____CFR part______
Implementing regulation - Code Section_____________ Page # IRC ___________

Your input appreciated. However, it seems to me an administration and application problem the law seems to clearly tell who should receive this penalty.

Is this what happens when a "direct tax" is treated an "indirect tax" or the other way around? (It gets confusing doesn't it)
____________________________________________________________
‘IRS management does what it wants, to whom it wants, when it wants, how it wants with almost complete immunity,’ retired Internal Revenue Service official Tommy Henderson told the U.S. Senate Finance Committee.”

[MACVSOG68]

Hi freeman. I will respond to your two notes, but have some chores to do tomorrow. I really hope you don't dig too deep a hole for yourself. Later. Take care.