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Code of Silence: Time for the IRS to Answer The Question!
World Magazine ^ | August 30, 2003 | Joel Belz

Posted on 09/01/2003 4:10:28 PM PDT by 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.


TOPICS: Business/Economy; Constitution/Conservatism; Crime/Corruption; Government; News/Current Events
KEYWORDS: genechapman; incometax; irs; irwinschiff; larkenrose; taxhonesty; taxhonestyy; vernicekuglin
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To: VRWC_minion
Big win.
61 posted on 09/02/2003 4:41:06 PM PDT by VRWC_minion (Opinions posted on Free Republic are those of the individual posters and most are right)
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To: UbIwerks
As copied directly from the super secret IRS website
The requirement to file an income tax return is not voluntary and is clearly set forth in Internal Revenue Code §§ 6011(a) , 6012(a) , et seq., and 6072(a). See also Treas. Reg. § 1.6011-1(a).
62 posted on 09/02/2003 4:44:09 PM PDT by VRWC_minion (Opinions posted on Free Republic are those of the individual posters and most are right)
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To: VRWC_minion
As copied directly from the super secret IRS website

A website? That's not good enough, Bolshevik. Everyone knows that one doesn't have to tell the truth on the internet. It's like talking over the telephone lines.

63 posted on 09/02/2003 4:46:38 PM PDT by UbIwerks
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To: MACVSOG68
Although I am not as hopeful as you, I've enjoyed our dialogue. I hope you're right about the possibilities.
64 posted on 09/02/2003 4:47:33 PM PDT by Wolfstar (And an angel rides in the whirlwind and directs this storm.)
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To: Wolfstar
Take care, and keep the faith.
65 posted on 09/02/2003 4:54:14 PM PDT by MACVSOG68
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To: UbIwerks
It was said the IRS refused to answer these questions. Apparently they do answer them with references. That therefore negates the claims made by the author of the article.

Assuming he gets such simple things wrong, how much faith can we have in their interpretations ?

66 posted on 09/02/2003 5:00:26 PM PDT by VRWC_minion (Opinions posted on Free Republic are those of the individual posters and most are right)
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To: MACVSOG68
"I just gave you the cite...CFR 26 1.61-2..."

Ahhh, not so fast. Here it is from the Code of Federal Regulations:

"PART 1--INCOME TAXES--Table of Contents

Sec. 1.61-2 Compensation for services, including fees, commissions, and similar items.

(a) In general. (1) Wages, salaries, commissions paid salesmen, compensation for services on the basis of a percentage of profits, commissions on insurance premiums, tips, bonuses (including Christmas bonuses), termination or severance pay, rewards, jury fees, marriage fees and other contributions received by a clergyman for services, pay of persons in the military or naval forces of the United States, retired pay of employees, pensions, and retirement allowances are income to the recipients unless excluded by law. Several special rules apply to members of the Armed Forces, National Oceanic and Atmospheric Administration, and Public Health Service of the United States; see paragraph (b) of this section."

All references to wages, salaries, tips and compensation for personal services were purged from the Code starting in 1954. What entity fits all the above categories? A corporation, of course. Since income has been ruled by the Supreme Court to be a corporate profit, this section deftly encompasses corporations but not individuals.

Also, most people don't know to look to the "Definitions" paragraphs under each title or subtitle. That is where Congress defines the terms it uses in the statute.

As we all know, lawyers employ what are called "words of art". They can say "All individuals must pay the tax" without revealing what their definition of an "individual" is in that context. An "individual" or "person" could be a corporation, trust, partnership, many things besides a flesh-and-blood human being exercising his right to work for the provision of himself and his family and to keep a roof over their heads.

67 posted on 09/02/2003 5:07:27 PM PDT by Middle Man
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To: VRWC_minion
It was said the IRS refused to answer these questions. Apparently they do answer them with references. That therefore negates the claims made by the author of the article.

You have the answers they gave to Mrs. Kuglin? What did the correspondence look like?

68 posted on 09/02/2003 5:07:28 PM PDT by UbIwerks
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To: UbIwerks
Have you read the article posted ?

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?


Why is it so hard for some people (especially tax protestor dupes) to read simple english ? Are they really this dense in real life ?
69 posted on 09/02/2003 5:12:22 PM PDT by VRWC_minion (Opinions posted on Free Republic are those of the individual posters and most are right)
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To: VRWC_minion
Why is it so hard for some people (especially tax protestor dupes) to read simple english ? Are they really this dense in real life ?

It's been a real bad time for you IRS sycophants. Those defeats you keep on getting. There was Lloyd Long a couple of years ago, but, recently, there was Whitey Harrel, Donald Fecay, and, now, Mrs. Kuglin.

No wonder you people are foaming at the mouth and illegally banning Irwin Schiff's book and trying to throw him in jail.

Irwin Schiff has won and you guys are panicking (sneer).

70 posted on 09/02/2003 5:17:41 PM PDT by UbIwerks
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To: UbIwerks
So much for your garbage about wages and salaries being in the Internal Revenue Code and applying to Mrs. Kuglin. And even if some regulation mentions wages and salaries (not mentioned by USC 26 itself), it obviously is a benign regulation. That's part of the reason the IRS would not answer Mrs. Kuglin's simple request(s).

Given your extensive knowledge of collectivists and Bolsheviks, I'm surprised at your lack of knowledge of the tax system. While the basic law is contained in Title 26 of the US Code, the IRS has ample regulatory authority which for tax payers has the effect of law. Such are the Internal Revenue Code, 26CFR, Treasury Regulations, Treasury rulings, IRS rulings and decisions, and thousands of court decisions. If you had a half way open mind, the many posts you have read on this thread would have at least prompted you to try civility rather than crass name calling. I assume that's your way of telling those of us you disagree with that you really don't have an argument....but you want one.

But hey! Talk is cheap. Put your money where your mouth is and refuse to pay any taxes. I really don't give a $hit. As for your hero Kuglin, I put her in the same category as that other famous tax evader...Big Al. To believe is that "Income from whatever source derived" doesn't include salaries and wages is akin to that other famous saying....Well, that depends on what the meaning of sex is..."

71 posted on 09/02/2003 5:21:06 PM PDT by MACVSOG68
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To: Middle Man
All references to wages, salaries, tips and compensation for personal services were purged from the Code starting in 1954. What entity fits all the above categories? A corporation, of course. Since income has been ruled by the Supreme Court to be a corporate profit, this section deftly encompasses corporations but not individuals.

From: http://evans-legal.com/dan/tpfaq.html#wagesincome

"Every court which has ever considered the issue has unequivocally rejected the argument that wages are not income." United States v. Connor, 898 F.2d 942, 943-944 (3rd Cir. 1990).

"In our view, petitioner's wages are taxable as gross income..." Beard v. Commissioner, 793 F.2d 139, 140 (6th Cir. 1986), aff'g 82 T.C. 766 (1984);

"Wages are taxable income." Perkins v. Commissioner of Internal Revenue, 746 F. 2d 1187, 1188 (6th Cir. 1984); Beerbower v. Commissioner of Internal Revenue, 787 F.2d 588 (6th Cir. 1986).

"Wages are income, and the tax on wages is constitutional." Coleman v. Commissioner, 791 F.2d 68 (7th Cir. 1986), citing United States v. Thomas, 788 F.2d 1250 (7th Cir. 1986); Lovell v. United States, 755 F.2d 517 (7th Cir. 1984); Granzow v. Commissioner, 739 F.2d 265, 267 (7th Cir. 1984);

"Although not raised in his brief on appeal, the defendant's entire case at trial rested on his claim that he in good faith believed that wages are not income for taxation purposes. Whatever his mental state, he, of course, was wrong, as all of us are already aware. Nontheless, the defendant still insists that no case holds that wages are income. Let us now put that to rest: WAGES ARE INCOME. Any reading of tax cases by would-be tax protesters now should preclude a claim of good-faith belief that wages--or salaries--are not taxable." United States v. Koliboski, 732 F.2d 1328, 1329 n.1 (7th Cir. 1984), (emphasis in original; convictions for criminal failures to file affirmed).

"[W]e have [repeatedly] held that wages are within the definition of income under the Internal Revenue Code and the Sixteenth Amendment, and are subject to taxation. Denison v. Commissioner, 751 F.2d 241, 242 (8th Cir.1984) (per curiam), cert. denied, 471 U.S. 1069, 105 S.Ct. 2149, 85 L.Ed.2d 505 (1985)." United States v. Gerads, 999 F.2d 1255 (8th Cir. 1993).

"Section 61 of the Internal Revenue Code imposes a tax on income, and under the Tax Code, wages are income." Grimes v. Commissioner, 806 F.2d 1451, 1453 (9th Cir. 1986).

"Compensation for labor or services, paid in the form of wages or salary, has been universally held by the courts of this republic to be income, subject to the income tax laws currently applicable." United States v. Romero, 640 F.2d 1014, 1016 (9th Cir. 1981).

"Irrefutably, wages earned in compensation for services are "income" pursuant to the federal tax laws." Boubel v. United States, 86 AFTR2d ¸2000-5123, No. 1:99-cv-380 (U.S.D.C. E.D.Tenn. 6/22/2000).

"[I]f anything in our tax law is clear, it is that: 'WAGES ARE INCOME.' ... [A]ny contention to the contrary is patently frivolous...."" Hill v. United States, 599 F. Supp. 118, 120-22 (M.D. Tenn. 1984), (emphasis in original), (quoting United States v. Koliboski, 732 F.2d 1328, 1329 n.1 (7th Cir. 1984)).

"As the cited cases, as well as many others, have made abundantly clear, the following arguments alluded to by the Lonsdales are completely lacking in legal merit and patently frivolous: ... (5) wages are not income...." Lonsdale v. United States, 919 F.2d 1440, 1448 (10th Cir. 1990).

See also, Wilson v. United States, 412 F.2d 694, 695 (1st Cir. 1969); Schiff v. Commissioner, 751 F.2d 116, 117 (2d Cir. 1984); Commissioner v. Mendel, 351 F.2d 580, 582 (4th Cir. 1965); Simmons v. United States, 308 F.2d (4th Cir. 1962); Lonsdale v. Commissioner, 661 F.2d 71, 72 (5th Cir. 1981); United States v. Burton, 737 F.2d 439 (5th Cir. 1984); Capps v. Eggers, 782 F.2d 1341 (5th Cir. 1986); Funk v. Commissioner, 687 F.2d 264, 265 (8th Cir. 1982); United States v. Ware, 608 F.2d 400 (10th Cir. 1979); United States v. Woodall, 255 F.2d 370, 372 (10th Cir. 1958), cert. den. 358 U.S. 824 (1958); Simanonok v. Commissioner, 731 F.2d 743, 744 (11th Cir. 1984); Ledford v. United States, 2002 TNT 153-6, NO. 02-5027 (Fed. Cir. 8/6/2002).

There are a few courts that would respectfully disagree with you.

72 posted on 09/02/2003 5:37:16 PM PDT by MACVSOG68
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To: Middle Man
All references to wages, salaries, tips and compensation for personal services were purged from the Code starting in 1954. What entity fits all the above categories? A corporation, of course. Since income has been ruled by the Supreme Court to be a corporate profit, this section deftly encompasses corporations but not individuals.

Someone around 1954 realized that the income tax before that was not collected pursuant to the Supreme Court decisions on the matter, so the code was re written then removing the mandatory language.

And as for Mac's cases, why is there not a Supreme Court case among them?

The complexity of the income tax is protection for the scam. Or, actually, was protection for the scam since freedom fighters such as Mrs. Kuglin, Donald Fecay, and Whitey Harrel are scoring victories.

73 posted on 09/02/2003 5:46:21 PM PDT by UbIwerks
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To: TIElniff
I wonder what would happen if a vast majority of Americans just decided to stop paying taxes all at once.
74 posted on 09/02/2003 5:52:57 PM PDT by Sir Gawain (Hey where da white women at?)
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To: Sir Gawain
No need to do that.

Just make life unliveable for IRS agents and all species of JBTs in the communities where they live. Drive them out through subtle harassment and ostracism. They are the standing army the Founders warned against. They deserve to be treated as occupiers.
75 posted on 09/02/2003 7:35:14 PM PDT by eno_ (Freedom Lite - it's almost worth defending)
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To: UbIwerks
Irwin Schiff has won and you guys are panicking (sneer).

I'm not panicking. I could care less about your ignorance. Its the affect of your ignorance on others that is the reason I respond.

I have a a good friend of many years who is currently serving a 4 year sentence because he bought into a similar scheme. People that lead folks astray regarding the tax laws are the lowest of the lowest pond scum around.

76 posted on 09/03/2003 6:21:15 AM PDT by VRWC_minion (Opinions posted on Free Republic are those of the individual posters and most are right)
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To: MACVSOG68; UbIwerks
"There are a few courts that would respectfully disagree with you."

The only thing we can conclude with any certainty is that the various circuits are in hopeless disagreement about what the "income" tax is. The Supreme Court is compounding the problem by refusing to rule one way or the other and settle this confusion and chaos. If the court system refuses to clarify the "income" tax, it's up to juries to nullify the law like they did in the Kuglin case.

Also, MACVSOG68, you do exactly what the IRS does when the statutues don't back them up in their lawless actions, you rush to the case law for backup. I attended an appeals hearing recently where an attorney presented all this case law to buttress the government's position. The plaintiff had done his homework and had volumes of case law where his position had been vindicated by one or another of the federal courts. What U.S. attorneys do in these instances is simply ignore any case law that refutes their position. They just pretend that you never raised the objection.

If you do enough digging, you can find some case somewhere where the courts have ruled against the government. Another reason why quoting case law keeps these discussion threads so lively...and pointless.

77 posted on 09/03/2003 7:37:26 AM PDT by Middle Man
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To: Middle Man
The only thing we can conclude with any certainty is that the various circuits are in hopeless disagreement about what the "income" tax is. The Supreme Court is compounding the problem by refusing to rule one way or the other and settle this confusion and chaos. If the court system refuses to clarify the "income" tax, it's up to juries to nullify the law like they did in the Kuglin case. Also, MACVSOG68, you do exactly what the IRS does when the statutues don't back them up in their lawless actions, you rush to the case law for backup.

A couple of points:

First, I saw no confusion over whether wages is considered income in the cases I noted. I saw a lot of discussion that would appear to most reasonable people to shut the door on that part of the income issue. True, the Supreme Court did not rule on it, but then, did any of those who lost file an appeal? Not sure. But would you put good money on the Supreme Court overrulling almost every circuit court? And do you think the SC would somehow find logic in the thesis that the largest single pool of income (salaries and wages) was not intended by Congress to be a part of "Income from whatever source"?

You tell me that I run to case law when need backup. Read the thread. I only went to case law as a backup to support what I had been saying throughout the thread relying on my read of the law not court decisions. Funny though, the first thing you point to is the Kuglin decision....case law!

As for the Kuglin decision. You are wrong. I believe the jury ruled she was not guilty of tax evasion. It did not (nor could it) "nullify" the law which places her wages in the category of income. Personally, I put the Kuglin jury in the same pool as the O.J. jury, both ignoring the evidence and the law to make a political point. And, as I have pointed out earlier, Kuglin will pay those back taxes, plus interest and penalties.

You are correct in saying that case law is not consistent. But that applies in every facet of American life, not just the tax code. I pay no attention to district court rulings, because until they are ratified by Circuit or Supreme Court rulings, they are simply ignored by most. But don't ignore the place of court decisions as an overall part of the law, and certainly the income tax. The IRS considers most of them to be a part of the tax law.

I do not like the income tax for many reasons, and for these reasons fully support the sales tax as the basic revenue generator for the federal government. That being said, I will not resort to non-payment protests, economic terrorism or frivolous attempts to bog down the courts.

But from some of the posts I have seen on just this thread, there are many who would fight a sales tax, a tarriff or a user fee just a much as they fight the income tax.

78 posted on 09/03/2003 8:39:01 AM PDT by MACVSOG68
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To: Middle Man
If you do enough digging, you can find some case somewhere where the courts have ruled against the government. Another reason why quoting case law keeps these discussion threads so lively...and pointless

I didn't recognize you at first but it's good to see you again middleman.

About that much quoted regulation referring to IRC Sec. 61.... I finally had a chance to look at that regulation (I own the Internal Revenue Code where statute Sec. 61 is) and it is just as I said, it is a benign regulation so even if the regulation CFR mentions wages (IRC code sec 61 does not), it has no effect of law. It does not even refer to the Sec. 61 statute, but, instead, to a series of treasury decisions.

79 posted on 09/03/2003 10:32:25 AM PDT by UbIwerks
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To: VRWC_minion
People that lead folks astray regarding the tax laws are the lowest of the lowest pond scum around.

Yep.... Those that try to lead people astray by making the voluntary income tax seem mandatory are the lowest pond scum around. And it's especially egregious to do it on a Conservative website dedicated to upholding constitutional rights and a limited government.

80 posted on 09/03/2003 10:36:09 AM PDT by UbIwerks
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