LibertyTree Tv   

  Death To The New World Order

 

How America was tricked into paying a tax they were not liable for in 1943

THE TRUTH ABOUT INCOME TAX

"If the taxpayers of this country ever discovered that we operate on 98% bluff, the entire system will collapse."


- internal revenue  officer to Sen. Henry E. Bellmon (R. Okla.) on April 15, 1971.

 

The constitution  - Article 1 Section 9 Cluase 4 - "no  capitation or other direct tax shall be laid without apportionment "


The fed applied a tax on the states not the people  ... the 16th amendment  which was a repeal of a previous supream court decision regarding rents on property ( with earnings from federal sources)  its crafty usage of the wordage from article 1 section 9 clause 4 and article 1 section 2 clause 3  were COMBINED to  SOUND AS IF it was repealing these sections ,(  But people seemed to have missed the fact no statement claiming "this amendment repeals  article 1 section 9 clause 4 ...."  (AS THE 21st mentions about the 18th admendment )...however it ADDED the word INCOME,   thus targeting it to the meaning of GAINS FROM PRIVALEGED SOURCES  as in the case decision they reversed regarding rents on property used by the fed.   GET IT ?   as the supream court has repeatedly stated ...

 in a decision written by Chief Justice White, first noted that "the Sixteenth Amendment did not authorize any new type of tax, nor did it repeal or revoke the tax clauses of Article I of the Constitution", quoted above.  Direct taxes were, notwithstanding the advent of the Sixteenth Amendment, still subject to the rule of apportionment…"     

Issues about ratification were a pointless diversion as it doesn't matter if it was or not


To learn about this deception in detail follow THIS LINK

 

UNLEARNIG THEINCOME TAX 

 
 

The truth about the Income Tax  (excise tax) 

 

WE CHALLENGE ANYONE  TO

DISPROVE THESE FACTS ABOUT INCOME TAX LAW

 

FACT 1.  U.S. CITIZENS ARE NOT REQUIRED BY LAW TO FILE FORMS 1040, AND THEY ARE NOT LIABLE FOR THE PAYMENT OF A TAX ON “INCOME” UNLESS THEY ARE WITHHOLDING AGENTS OR FIDUCIARIES FOR CORPORATIONS OR FOREIGN ENTITIES AS SHOWN BELOW.

                There is no provision in the Internal Revenue Code imposing an “income” tax on monies received or earned by citizens or resident aliens residing within the states of the union, regardless of the amount, unless the money is received on behalf of, or payable to, a corporation, a non-resident alien, foreign partnership or foreign corporation.

 

FACT 2.  AMERICANS ARE MISLED AND DECEIVED INTO BELIEVING THAT THE “INCOME” TAX APPLIES TO THE GENERAL PUBLIC.

                For years, the Internal Revenue Service has deceived the American people in a manner not equaled by the Nazi GESTAPO.  Fear and Bluff have been the IRS’ major weapons.  Americans have been falsely led to believe that they owe a tax on their earnings; that it is their “patriotic duty” to pay it and that there is no alternative to the IRS’ abuse.  These beliefs are simply untrue.  Because accountants, tax preparers, tax lawyers and others profit from the fraudulent misapplication of the law, most of them are reluctant to admit the truth about the law when they are confronted with it.

 

FACT 3.  THE IRS ADMITS THAT THE “INCOME” TAX SYSTEM IS DEPENDENT ON THE VOLUNTARY FILING OF TAX RETURNS.

                In the decision of U.S. v. Flora, 362 U.S. 145 (1960), on page 176, the U.S. Supreme Court stated:  Our system of taxation is based on voluntary assessment and payment, not upon distraint.  If a law requires you to do something, your compliance with the law is mandatory, not voluntary.  But if a law requires certain other people (not you) to do something, then your compliance with that law is voluntary.  The IRS has repeatedly stated that:  The mission of the Internal Revenue Service is to encourage and achieve the highest possible degree of voluntary compliance with the tax laws and regulations(I.R. Manual Sec. 1111.1) (emphasis added)

 

                Mr. Dwight E. Avis, the head of the Alcohol, Tobacco and Firearms Division of the Bureau of Internal Revenue Service, testifying before the House Ways and Means Committee of the 83rd Congress in 1953 stated:  Let me point this out now:  our income tax is a 100% voluntary tax, and your liquor tax is a 100% enforced tax.  This situation is as different as night and day.  Consequently your same rules just will not apply.  (emphasis added)

 

FACT #4-THE CONSTITUTIION FORBIDS THE U.S. GOVERNMENT TO IMPOSE ANY DIRECT TAX ON THE PEOPLE IN THE STATES OF THE UNION.

                Two provisions in the U.S. Constitution prohibit the imposition of direct taxes on the people or their property by the U.S. government.  The first is Article 1, Section 2, Clause 3 which requires the amount of any direct tax be billed and divided among the state governments in proportion to the population of each state.  The second provision is in Article 1, Section 9, Clause 4 which prohibits any capitation tax (a tax on people) or other direct tax unless apportioned among the states.  Direct taxes have been imposed only five times in U.S. history.  All were correctly and constitutionally imposed on state governments (not individuals).  The last direct tax was imposed in 1861 by the union government to finance the Civil War.

 

FACT 5.  THE U.S. SUPREME COURT RULED THAT THE “INCOME” TAX IS CONSTITUTIONAL AS AN INDIRECT (EXCISE) TAX, BUT NOT AS A DIRECT TAX (a tax on the general public).

                In the 1916 decisions of Brushaber v. Union Pacific R.R., 240 U.S. 1 and Stanton v. Baltic Mining, 240 U.S. 103, the U.S. Supreme Court ruled that the Sixteenth Amendment (incorrectly called the “income” tax amendment) to the U.S. Constitution created no new power of taxation and that it did not amend or nullify the constitutional prohibition against direct taxation of the people within the states of the union.  The Brushaber Court ruled that the “income” tax is constitutional as an indirect excise tax on corporations or on the receipts of foreigners but unconstitutional as a direct tax on U.S. citizens.  In the decision of Flint v. Stone Tracy Co., 220 U.S. 107 (1911), the U.S. Supreme Court defined an “excise” tax as a tax on activities involving the exercise of a privilege. 

 

FACT 6.  THE IRS ADMITS THAT THE BRUSHABER DECISION RELATES TO “INCOME” ACCRUING TO NON-RESIDENT ALIENS ONLY-NOT TO U.S. CITIZENS.

                Treasury Decision 2313, issued March 21, 1916 by the Commissioner of Internal Revenue to inform collectors of internal revenue of the significance of the Brushaber decision states:  Under the decision of the Supreme Court of the United States in the case of Brushaber v. Union Pacific Railway Co., decided January 21, 1916, it is hereby held that income accruing to non-resident aliens in the form of interest from the bonds and dividends on the stock of domestic corporations is subject to the income tax imposed by the act of October 3, 1913(emphasis added)

 

FACT 7.  FORM 1040 IS AN INCOME TAX RETURN FOR NON-RESIDENT ALIENS.

                As previously stated, IR Code Section 871(a) imposes a tax of 30% on the amounts received by non-resident aliens from sources within the United States.  Section 871(b) states that the non-resident alien shall be taxable under Section 1, thus authorizing the use of the charts in Section 1 to compute and reduce his tax so he can get a tax refund from the 30% which is withheld under the provisions of Section 1441.  Also, under I.R. Code Section 874(a), the non-resident alien is entitled to the benefit of deductions and credits by filing or having his fiduciary agent file a 1040 as stated in TD2313.  Again, these sections relate only to non-resident aliens or their agents-not to U.S. citizens acting for themselves.

 

FACT 8.  “INCOME” IS MONEY RECEIVED ON BEHALF OF, OR PAID TO, A NON-RESIDENT ALIEN.

                I.R. Code Sec. 1441(a) and (b) state that…interest,…dividends, rent, salaries, wages, premium annuities, compensations, remunerations, emoluments, or other fixed or determinable annual or periodic gains, and profitsare “income” when received on behalf of, or paid, to a non-resident alien or other foreign entity.  Also, courts have ruled that profits of corporations are “income”.  But…There is no provision in the IR Code stating that receipts belonging to citizens or residents of the country are “income.  Thus, a citizen’s own receipts are not “income”, “gross income”, or “taxable income” under the IR Code.  Within the states, “income” is property derived from activities involving the exercise of a government-granted privilege.  Working for a living is not a privilege-it is a non-taxable constitutional RIGHT!

               

FACT 9.  IT IS A PRIVILEGE FOR A NON-RESIDENT ALIEN TO DO BUSINESS, TO INVEST OR TO WORK IN THE U.S.A.

                The U.S. government can prohibit foreigners from working, investing or doing business within this country; therefore, allowing such activity is a privilege subject to an excise tax similar to the government-granted privilege to do business as a corporation.  But U.S. citizens have a non-taxable, constitutionally-protected RIGHT to work, invest or do business in this country.  This RIGHT also extends to protect our citizens against state taxation of constitutional rights under the provisions of the Fourteenth Amendment.  The U.S. Supreme Court in Murdoch v. Pennsylvania, 319 U.S. 105 stated:  A state may not impose a tax for the enjoyment of a right granted by the Federal Constitution.  (emphasis added)

 

FACT 10.  THE “INCOME” TAX IS AN INDIRECT EXCISE TAX ON PRIVILEGED ACTIVITIES, NOT ON “INCOME”.  THE “INCOME” IS MERELY THE MEASURE OF THE TAX.

                The CONGRESSIONAL RECORD, Volume 89, Part 2, on page 2580 for March 27, 1943 states:  The income tax is, therefore, not a tax on income as such.  It is an excise tax with respect to certain activities and privileges which is measured by reference to the income which they produce.  The income is not the subject of the tax; it is the basis for determining the amount of the tax.  (emphasis added)  The U.S. Supreme Court in the decision of Flint v. Stone Tracy Co., 220 U.S. 107, in discussing income tax as an excise tax, stated on p. 165:  It is therefore well settled by the decisions of this court that when the sovereign authority has exercised the right to tax a legitimate subject of taxation as an exercise of a franchise or privilege, it is no objection that the measure of taxation is found in the income.  (emphasis added)

 

FACT 11.  WITHHOLDING AGENTS ARE REQUIRED TO WITHHOLD FROM PAYMENTS OF “INCOME” TO FOREIGN PERSONS ONLY.

                IR Code Section 7701(a)(16) states:  The term ‘withholding agent’ means any person required to deduct and withhold any tax under the provisions of Sections 1441, 1442, 1443 or 1461.  These sections apply to money owed to, received on behalf of, or paid to, non-resident aliens, foreign partnerships, foreign corporations and other foreign entities only, not to money received by citizens on their own behalf.  Because the U.S. government has no authority over foreign citizens living in a foreign country, the only individuals who can be required to deduct and withhold the tax on foreigner’s receipts and can be made liable for deduction and payment of the tax are withholding agents for such foreigners.

 

FACT 12.  THE ONLY PERSON MADE LIABLE IN THE INTERNAL REVENUE CODE FOR PAYMENT OF “INCOME” TAX IS A WITHHOLDING AGENT.

                Sub-title A of the I.R. Code contains the provisions of the law imposing “income” tax.  In Sub-title A, Section 1461 is the only section making any person liable for (subject to) payment of “income” tax.  The only individual made liable in Section 1461 is the “withholding agent” who is required to withhold from the “income” of foreign persons ONLY which is identified in I.R. Code section 1441(b).

.

FACT 13.  THE ONLY WAY A PERSON CAN BE “MADE LIABLE” FOR ANY INTERNAL REVENUE TAX IS BY A PROVISION IN THE LAW (a statute or Code Section).

                In the decision of Botta v. Scanlon, 288 F.2d 509 (1961), the United States Court of Appeals explained that there is only one way that a tax liability can be created.  It stated:  Moreover, even the collection of taxes should be exacted only from persons upon whom a tax liability is imposed by some statute.  (emphasis added)  In Sutherland’s Rules of Statutory Construction, an authoritative reference book on interpretation of statutes, Section 66.03 states:  the obligation to pay taxes arises only by force of legislative action…  (emphasis added)  Legislative action is the passage of a statute (a law).  For anyone to be “liable” for income tax, it must be so stated in the IR Code.

 

FACT 14.  PROVISIONS MAKING ANYONE LIABLE FOR PAYMENT OF A TAX MUST BE STATED IN CLEAR, UNDERSTANDABLE LANGUAGE.

                In the decision of Higley v. Commissioner of Internal Revenue, 69 F.2d 160, head note 2 states:  Liability for taxation must clearly appear from statute imposing tax.  (emphasis added)  Sutherland’s Rules of Statutory Construction under Section 66.01 titled Strict Construction of Statutes Creating Tax Liabilities refers to the U.S. Supreme Court decision of Gould v. Gould. 245 U.S. 151 which states:  In the interpretation of statutes levying taxes it is the established rule not to extend their provisions by implication beyond the clear import of the language used, or to enlarge their operation so as to embrace matters most strongly against the government, and in favor of the citizen.  (emphasis added)

 

FACT 15.  I.R. CODE PROVISIONS IMPOSING LIABILITY ARE CLEARLY STATED AND USE THE WORD “LIABLE”.

                The word “liable” is found in I.R. Code Section 4401(c), 5005(a), 5703(a) and 1461 which create liabilities for wagering tax, distilled spirits tax, tobacco tax and “income” tax respectively.  Section 1461 is the ONLY section in the I.R. Code imposing a liability for payment of “income” tax.  That section applies to WITHHOLDING AGENTS ONLY (those required by Section 1441 and 1442 to deduct and withhold from payments of “income” owed to foreign persons).  Section 1461 states:  Every person required to deduct and withhold any tax under this chapter is hereby made liable for such tax.  (emphasis added)

 

FACT 16.  I.R. CODE CHAPTER #24 PROVIDES FOR VOLUNTARY WITHHOLDING FROM “EMPLOYEES”.  IT DOES NOT APPLY TO ANY NON-GOVERNMENT EMPLOYEE OR EMPLOYER.  (See Section 3401(c) & (d)).

                Chapter 24 of the I.R. Code contains provisions that authorize the U.S. Government, the District of Columbia, their agencies and instrumentalities ONLY, to set up and administer a voluntary withholding system for their employees.  Without such statutory authority, no official of the government could legally create a withholding system in government.  Chapter 24 does NOT authorize or require withholding by any non-federal government employers, and this chapter does NOT impose any tax on any government employee or anyone else.

               

FACT 17.  THERE IS NO AUTHORITY TO WITHHOLD MONEY FROM A CITIZEN OR RESIDENT OF THE UNITED STATES UNLESS HE AUTHORIZES IT.

                The Fifth Amendment to the Bill of Rights of the U.S. Constitution states that no individual can be deprived of property without due process of law (a hearing in a court of law).  The ONLY way a United States citizen or resident alien can legally have “income” tax withheld from his pay is if he authorizes it by voluntarily signing an IRS W-4 “Employee’s Withholding Allowance Certificate”, thus indicating that he is in the same status as a non-resident alien.  The Fifth Amendment protection is why the IRS pressures employers to obtain the voluntary execution of IRS Form W-4 by all people being hired.  However, the Fifth Amendment prevents any law or regulation that requires any individual to sign a Form W-4 Withholding Allowance Certificate.  IR Code Section 3402(n) provides statutory reinforcement of this Fifth Amendment right by providing additional authority for citizens to stop voluntary withholding through submission of a signed statement that the employee owed no income tax in the previous year and contemplates not owing any for the coming year.

 

FACT 18.  TO UNDERSTAND THE I.R. CODE, ONE MUST LEARN WHICH WORDS ARE USED IN THE CODE AS LEGAL TERMS.

                In the I.R. Code, many words of common usage are used as legal terms that have meanings more limited in their application than when defined for common usage.  Words such as taxpayer, taxable income, taxable year, employee, employer, wages, United States, State, person, etc. are legal terms that have limited  meanings when used in the Code.  Some legal terms have different meanings when used in different parts of the Code.  As will be shown in detail in Chapters IV and V, to understand the true meaning of the Code, it is necessary to learn the various limited legal definitions of those terms and where in the Code the definitions apply..

 

FACT 19.  THE I.R. CODE APPLIES TO “TAXPAYERS” ONLY (those who are “made liable” for a tax by a statute).

                This fact has been clearly stated through the years in many court decisions, some of which are repeatedly cited in this book, including Long v. Rasmussen, 281 F.2326 (1922), Stuart v. Chinese Chamber of Commerce of Phoenix, 168 F.2d 712 (1948), First National Bank of Emlenton, Pa. v. U.S., 161 F.Supp. 847 (1958), Botta v. Scanlon, 288 F.2d 509 (1961) and Economy Plumbing v. U.S., 470 F.2d 589 (1972).  “Taxpayer” (one word not two) is a legal term defined in IR Code Sec. 7701(a)(14) which states:  The term ‘taxpayer’ means any person subject to any internal revenue tax. (emphasis added)  As the court stated in Botta v. Scanlon, discussed earlier, for a person to be subject to a tax there must be a provision on the law stating clearly that his activity makes him “liable” for the tax.  Paying a tax such as a sales tax, a license tax or real estate tax does not place one in the legal status of “taxpayer” as that term is used in the I.R. Code.

 

FACT 20.  THE TERMS “TAXABLE INCOME” AND “TAXABLE YEAR” APPLY TO “TAXPAYERS” ONLY.

                These terms, defined in I.R. Code Sec. 441(a) (taxable income) and (b) (taxable year) apply to “taxpayers” only and to those who file returns, thus stating (in effect) under penalty of perjury that they are “taxpayers”.  Also, “taxable year” is a key legal term in Section 6012(a)(1) which is a section that the IRS cites when claiming that individuals are required to file income tax returns.  Since a withholding agent is the only person in Sub-Title A of the I.R. Code “made liable” for payment of income tax, he is the only individual in the legal status of “taxpayer” in respect to “income tax”; thus a “withholding agent” is the only one who has a “taxable year” under Section 6012(a)(1).

 

FACT 21.  CERTAIN “PERSON(S)” ONLY ARE SUBJECT TO CRIMINAL PENALTIES.

                Those “person(s)” who are subject to the criminal penalties in the Code are defined and limited by I.R. Code Sec. 7343 to those required to act on behalf of a corporation or partnership.  Section 7343 states:  The term ‘person’ as used in this chapter includes an officer or employee of a corporation, or a member or employee of a partnership, who as such officer, employer, or member is under a duty to perform the act in respect of which the violation occurs.  (emphasis added)  Because the term “includes” is a word of limitation and not expansion, as we will see in Chapter IV, when an individual is  not in a capacity as defined in this Section 7343, his prosecution under the Code is illegal.

 

FACT 22.  A FILED TAX RETURN PROVIDES EVIDENCE FOR THE IRS TO USE AGAINST THE PERSON FILING TO PROVE LEGALLY THAT HE IS A “TAXPAYER” AND THEREBY SUBJECT TO ALL PROVISIONS OF THE I.R. CODE.

                When an individual who is not a “taxpayer”, as that term is defined in the I.R. Code, files an income tax return signed under penalty of perjury, he has shown by his own act of filing that he is a “taxpayer” and thereby subject to all the provisions of the Internal Revenue Code.  Further, under the established legal doctrine of presumption by his own voluntary act of filing, he also subjects himself to the provisions of Title 28, Sec. 1746 of Federal law which states that his signature on the tax return which he signed under penalty of perjury has the same force and effect at law as a sworn oath or notarized affidavit.  The very first thing that every IRS revenue agent learns when dealing with non-taxpayers who have not filed returns is to try to get them to file by deceiving them into believing that the law requires them to do so.

 

FACT 23.  KARL MARX WROTE IN HIS COMMUNIST MANIFESTO TEN PLANKS NEEDED TO CREATE A COMMUNIST STATE.  THE FIRST PLANK WAS THE ABOLITION OF THE RIGHT TO OWN PROPERTY.  THE SECOND PLANK WAS A PROGRESSIVE INCOME TAX.

                If the government could legally tax citizens’ earnings, government would then have first claim on those earnings.  His earnings are compensation for his labor-the most precious of all his property.  His circumstances would be like the slave who is allowed to have only that which is left after the master takes whatever he wants.

Income taxes, The Constitution and The States


Our country or nation was created by the Declaration of Independence which was a unified declaration of freedom by thirteen colonies which united in a single, composite body defined as united (meaning joined together in common interest) states of America.  Therefore, in forming a nation as a composite body of thirteen separate former colonies, now known as states, our founders in our Constitution gave the new federal government very limited and defined powers as set forth in Article 1, Section 8 thereof.  As the following authorities, including the Supreme Court, will show, all law, federal and state, is territorial, meaning geographically-defined, before any legislative authority comes into play.  Otherwise stated, jurisdiction is always territorial as well as legislative; the law simply does not apply until the subject matter in controversy has first been territorially authorized within defined geographical boundaries, and after which our Constitution defines the very limited legislative powers of the federal government in Article 1, Section 8 wherein those specified powers are specifically defined.  President James Madison noted in the Federalist Papers:  “The powers delegated to the proposed Constitution are few and defined.  Those which are to remain in the state governments are numerous and indefinite…Its (the federal government) jurisdiction extends to certain enumerated objects only, and leaves to the several states a residuary and inviolable sovereignty over all other objects.” 

 

The U.S. Supreme Court in Collector v. Day, 78 U.S. 113 (1870) stressed the independent yet paramount sovereignty of the states over the federal government stating:

 

in respect to the reserve powers the state is as sovereign and independent as the general government.  ...the reserved rights of the states, such as the right to pass laws, to give effect to laws through executive action, to administer justice through the courts, and to employ all necessary agencies for legitimate purposes of state government, are not proper subjects of the taxing power of Congress.  (emphasis added)

 

In keeping with that ruling of the Supreme Court, we are instructed that the federal government has jurisdictional authority to tax incomes only from those living within their limited geographical and legislative jurisdiction and control inside federal boundaries.

 

And, in this connection, the U.S. Government Printing Office itself, in 1956 issued Part One of  a Report of the Interdepartmental Committee for the Study of Jurisdiction Over Federal Areas Within the States.  This report cited at great lengths the problems of people who live in federal areas such as the District of Columbia and military reservations within the states and other federal possessions in the islands such as Puerto Rico, Guam, the Virgin Islands and American Samoa where the national government has total control and legislative jurisdiction.  Remembering that this is a U.S. government report, we can readily see that our government is admitting that its legislative power including the imposition of taxes on persons, activities and properties is limited to those living in a defined geographic area that has been authorized by Congress and no others, such as within the states.  Therefore, the Constitution authorizes Congress to impose certain taxes but only within these exclusive federal areas which, again, would include only the District of Columbia, federal enclaves within the states and the territorial island possessions.

 

Interestingly, this same report notes that the Attorney General of the United States in 1940 wrote to the Chairman of the Senate Finance Committee that:  “criminal jurisdiction of the federal courts is restricted to federal reservations over which the federal government has exclusive jurisdiction…” (again meaning D.C., the enclaves and possessions).  So, in the words of the Attorney General of the United States himself, only if a crime is committed in one of those places does a federal court have jurisdiction to try it.  This means that all criminal income tax trials in U.S. District Court are illegal unless the defendant lives within the District of Columbia or some other federal area.  Emphasizing further this limited territorial and legislative jurisdiction, Title 18, Section 7 of the criminal code, which deals with “special maritime and territorial jurisdiction of the United States” shows that such jurisdiction also includes “(1) the high seas; (2) any American ship; (3) any lands reserved or acquired for the use of the United States, and under the exclusive concurrent jurisdiction thereof,…”.  More recently, federal jurisdiction was broadened to include jurisdiction over government aircraft and space vehicles.  So the government has no other territorial and, hence, legislative jurisdiction meaning they have none within the territorial boundaries of the fifty states of the union except the federal enclaves inside state borders which may have been ceded to the federal government!  For those of us who live within the states, the government cannot make laws because they have no geographic, and therefore, no legislative jurisdictional authority inside the states

 

In April of 1873, Supreme Court Justice Miller wrote the ruling in The Slaughterhouse Cases, 83 U.S. 36.  In a discussion about the Fourteenth Amendment to the Constitution which was ratified in 1868, Justice Miller said:  “

 

It has been said by eminent judges that no man was a citizen of the United States

(meaning national citizenship) except as he was (also) a citizen of one of the states

composing the union.  Those, therefore, who had been born and resided always in

the District of Columbia or in the territories, though within the United States, were

 not citizens(emphasis added)

 

 

Remembering that Justice Miller was commenting in this decision in 1873 soon after the War Between the States and following the freedom of the slaves, it is this writer’s opinion that the Fourteenth Amendment created a new and distinct class of citizens (primarily black, former slaves) who were given possible dual citizenship by the wording in the amendment which defined them as:  “…citizens of the United States (federal territory) and of the state wherein they reside.”  Therefore, by reason of the Fourteenth Amendment in1868, all people, including former slaves, whether resident in northern or southern states, were proclaimed citizens of both the state in which they lived as well as being a citizen of the union which we refer to as the united states of America.  I think that this conclusion is made clear by the wording in the amendment which states: 

 

                All persons born or naturalized in the United States, and subject to the jurisdiction

                thereof, are citizens of the United States and of the state wherein they reside.  No

                state shall make or enforce any law which shall abridge the privileges or immunities

                of citizens of the United States nor shall any state deprive any person or life,

                liberty or property without due process of law; …” (emphasis added)

 

So, the wording clearly establishes both national (or so-called federal) as well as state citizenship, and in that sense, those relatively few former slaves or others who might have been born and/or lived always within federal boundaries of D.C., federal enclaves within the states or the federal territories were, by reason of the amendment, as much citizens as citizens born and/or living in the states of the union.  Justice Miller in the Slaughterhouse Cases went on in his ruling to demonstrate and explain this two-citizenship reality when he stated: 

 

The distinction between citizenship of the United States (being federal citizenship) and citizenship of a state is clearly recognized and established.  Not only may a man be a citizen of the United States (meaning within federal territory) without being a citizen of a state, but an important element is necessary to convert the former into the latter.  He must reside within the state to make him a citizen of it, but it is only necessary that he should be born or naturalized in the United States to be a citizen of the union.  It is quite clear, then, that there is a citizenship of the United States, and a citizenship of a state, which are distinct from each other and which depend upon different characteristics or circumstances in the individual.  (emphasis added) 

 

Remember-this is our Supreme Court speaking-and their word is law!  Residence determines a citizen’s state or federal citizenship. 

 

We must remember that our Founding Fathers were all leading citizens of the colonies and, as such, were extremely possessive of what we today would call states rights and were very hesitant in writing the Constitution to grant any unnecessary powers to the federal government, which is the reason why such powers are restricted in Article 1, Section 8 of the Constitution with all other powers being retained by either the states in the Ninth Amendment or the people themselves in the Tenth Amendment.  Such retention of state and people power is reflected precisely in the territorial or geographic jurisdictional restriction noted herein.  So the Founding Fathers restricted the national government’s legislative authority in a geographic sense to those federal areas previously mentioned.  Even then, as many of the cession grants by states to the federal government of defined territory within state borders will show states were very possessive in ceding limited rights and territory within their boundaries for the purpose of authorized federal enclaves. 

 

So the Supreme Court Slaughterhouse ruling has succinctly identified two types of citizenship that exists in our nation today.  We can all be either a citizen of a particular one of the fifty states of the union or we can be a “United States (meaning only federal territory) citizen” subject to the jurisdiction of the federal government if we live in the District of Columbia, the federal enclaves or the federal territorial island possessions, and the tax laws are applicable only to United States citizens residing on federal ground-not to state citizens!

 

Our Constitution was both written by and was enacted for the protection and enjoyment of the citizens of the states of the union who founded our nation.  Since the Fourteenth Amendment created a new class of federal citizens, the question arises are these “citizens” also protected, like state citizens, by the Constitution and its taxation apportionment requirement?  Has our Supreme Court addressed this question of whether these federal “citizens” are protected by our Constitution like state citizens?   

 

Given the foregoing question, it is now time to look at the statutory law as embodied in the Internal Revenue Code.  In this writer’s opinion, the governing regulation 1.1-1 which supposedly implements Code Section 1 of the I.R. Code is clearly unconstitutional as it is overly broad by including in its wording the word “citizen” which appears nowhere in the parent Code Section.  Consequently, although I remain convinced that regulation 1.1-1 is unlawful for that reason, even if it were an acceptable regulation at law, as one that correctly implements its parent Code Section, is the wording “citizen or resident of the United States” (note capital “U” for “United” and capital “S” for “States” as used therein describing those upon whom the Code imposes s tax a reference only to residents of the District of Columbia, the enclaves and the island possessions, but not to those persons who are residents of one of the fifty states?  If so, the newly-freed former slaves who live in one of the states gained the protection of our Constitution by the amendment, but those few who live within federal territory, although gaining national citizenship by the amendment, did not gain that same protection of the Constitution by the amendment against direct taxation as state citizens.  Therefore, even if this implementing regulation were not unconstitutional for the overly broad wording it contains, for the reason stated, its provisions would not apply to state citizens anyway because it is limited to those federal citizens residing inside federal territory.  In summary, since the national government has territorial and, therefore, legislative jurisdiction over citizens of the “United States”, meaning those living in defined federal territories only, does this newly-acquired citizenship give them the taxing limitations of our Constitution?  I think it does, but some others think not. 

 

It might be noteworthy that a judicially-recognized lawyer/authority on taxation by the name of Roger Foster wrote a piece entitled A Treatise on the Federal Income Tax Under the Act of 1913.  Soon after that act became law, in this treatise Foster stated that:  “The tax applies to all citizens in the United States (meaning those living in federal areas), wherever resident, to all residents (meaning aliens) of the United States irrespective of their citizenship, to the income of all property owned and every business, trade and profession carried on (meaning conducted) in the United States (meaning federal lands) by persons residing elsewhere (meaning those doing business in federal territories).  It is levied in Alaska, the District of Columbia, Puerto Rico and the Philippine Islands, when such construction is necessary to carry out its provisions…”.  Clearly, here is more authoritarian support that application of the term “United States”, as used in the 1913 law, was restricted to federal territories as Mr. Foster specifically notes at the end of the previous quotation.  It still is in the law today, but it doesn’t answer the constitutional question posed in the preceding paragraph as to whether “citizenship” gives those living in federal areas the protection of our Constitution.  Again, I think it does, but I recognize there are differences of opinion among many scholars. 

 

Taking advantage of the uninformed layman’s misunderstanding of the correct statutory meaning of the term “United States”, millions of American state citizens, failing to recognize the lack of territorial (meaning geographic) jurisdiction and, hence, legislative jurisdiction as well, have been voluntarily filing tax returns and paying a tax that they have never owed for over 100 years since passage of the Sixteenth Amendment in 1913.  This territorial prohibition alone against taxation of state citizens by the IRS is simply another prohibition over and above the many Supreme Court cases that prohibit taxation of every state citizens’ God-given, constitutional right to earn a living by his own brawn or brain power!

 

As devout Christians whose primary loyalty was to their Creator God Almighty, our nation’s Founding Fathers who were state (colony) citizens were intensely committed to acquisition of the freedoms from the oppressive government that they had long endured from the British Crown.  This impassioned concern gave rise to the American Revolution and was perhaps best illustrated by their abhorrence embodied in their demand for an end to British “taxation without representation”.  Such conviction against the greed of totalitarian government is, perhaps, best embodied in the last paragraph of the Declaration of Independence as follows:

 

                We, therefore, the Representatives of the united States of America, in General

                Congress, Assembled, appealing to the Supreme judge of the world for the

                Rectitude of our intentions, do, in the Name, and by Authority of the good

                People of these Colonies, solemnly publish and declare, That these United

                Colonies are, and of Right ought to be Free and Independent States; that they

                Are Absolved from all Allegiance to the British Crown, and that all political

                Connection between them and the State of Great Britain, is and ought to be

                Totally dissolved; and that as Free and Independent States, they have full

                Power to levy War, conclude Peace, contract Alliance, establish Commerce,

                And to do all other Acts and Things which Independent States may of right

                Do.  And for the support of this Declaration, with a firm reliance on the

                Protection of Divine Providence, we mutually pledge to each other our

                Lives, our Fortunes, and our Sacred Honor.  (emphasis added)

 

A wise and frugal government which shall restrain men from injuring one another…shall not take from the mouth of labor the bread it has earned.  This is the sum of good government.

 

Thomas Jefferson (1743-1826)

 

Know the truth and the truth shall make you free.  John 8:32 (KJV)

 


Not that I've ever seen...

OVER THE YEARS I'VE WRITTEN QUITE A BIT about the statutory requirement for the government's production of it's own return when it actually believes a submitted return is "frivolous". The reason for that requirement, which is codified at 26 U.S.C. § 6020(b), is to allow a proper amount of tax to be collected, something not possible from an actually frivolous return (which will be one not soundly based on the law, and therefore not capable of conveying or creating a valid legal claim to an amount of tax).

Section 6020(b) exists to provide for authority to create a valid basis for the government's claims in any case in which the person who will be liable for the tax fails to do so by self-assessment on his or her own, whether by not filing at all, or by filing, willfully or otherwise, a false or fraudulent return-- which language extends coverage to any return which does not contain an accurate assessment:

26 U.S.C. § 6020 Returns prepared for or executed by Secretary

(b) Execution of return by Secretary

(1) Authority of Secretary to execute return

If any person fails to make any return required by any internal revenue law or regulation made thereunder at the time prescribed therefor, or makes, willfully or otherwise, a false or fraudulent return, the Secretary shall make such return from his own knowledge and from such information as he can obtain through testimony or otherwise.

The regulations associated with the section explicitly add "frivolous" to the mix, recognizing that a return for which no basis in law exists falls within the ambit of a return which is, willfully or otherwise, false or fraudulent (and in any event is within the manifest intent of Congress in enacting this statute, since it creates the same need for a valid instrument by which a government claim can be supported):

26 C.F.R. § 301.6020-1(b) Execution of returns-

(1) In general.

If any person required by the Internal Revenue Code or by the regulations to make a return ... fails to make such return at the time prescribed therefore, or makes, willfully or otherwise, a false, fraudulent or frivolous return, the Commissioner or other authorized Internal Revenue Officer employee shall make such return from his own knowledge and from such information as he can obtain through testimony or otherwise.

Proper CtC-educated returns are not frivolous, of course (nor false or fraudulent-- and certainly are not unfiled). Thus not a single 6020(b) return has ever been shown to have been created in response to educated returns.

Though normally it's hard to prove a negative like that statement above, here it's easy. No such returns have been produced even in the case of my and my wife's own returns, which as everyone knows, have been the subject of intense attention by the government for more than a decade.

This fact was admitted by a DOJ attorney on the stand as a government witness in my wife Doreen's second trial, just after the judge and prosecutor in the case each lied to the jury about the content of § 6020(b), perhaps in hope of confusing the jury about the significance of such returns having not been made. It is also shown (by lack of any relevant entries) in the Treasury Dept. Certificates and IRS transcripts concerning our filings for 2002 and 2003, filings which the government has spent hundreds of thousands of dollars trying to compel Doreen and me to change to what it wishes said but can't honestly say for itself.

All told, then, when what the government believes are actually "frivolous" returns, are filed, the government must create its own alternatives, in order to collect what it believes is the proper tax due. CtC-educated returns simply do not qualify and do not prompt the creation of such returns.

BUT TODAY I'M NOT FOCUSING on the mandate to create returns for the collection of a proper tax on "income". Today I'm focused on the fiction asserted by trolls across the internet and shameless scoundrels within the IRS that CtC-educated returns prompt "frivolous return penalties".

This fiction is promoted in order to frighten educated Americans from acting on what they know, imagining them to be children who would give up their rights and the rule of law just out of fear that preserving them might come at a cost. It is also promoted to dissuade Americans who don't already know the truth from going to the trouble to learn it.

Happily, the first of these purposes is routinely frustrated. Americans are NOT children, and this is especially true of those who have learned the truth about the tax.

On the other hand, the second purpose has unfortunately had some success, where the fiction about "penalties" has gone unrebutted. This is a real shame, because all that is needed to rebut this false and harmful nonsense is a little clear thinking and observation.

Again, the fact that my own returns have never prompted such penalties stands as sufficient evidence by itself that CtC-educated filings do not qualify. (Indeed, in 2006 the head of the IRS Ogden Frivolous Return Program wrote a declaration-- as part of the CtC-suppression campaign discussed here-- regarding mine and Doreen's 2002 and 2003 returns. This official dances around the subject a great deal but carefully avoids ever declaring our returns to be "frivolous". See the relevant portions of this declaration here, and an analysis filed in response here.)

HOWEVER, DESPITE THE FACT that CtC-educated returns do not qualify for the penalty, some educated filers have been harassed by rogue agents in the IRS with threats of such penalties. Some folks have even had acknowledged overpayments kept from them by the diversion of their money to what will be shown below to be completely fraudulent assertions of "frivolous return penalty" liabilities.

It is these threats (which are sometimes made to look as though the penalties have actually been assessed) and this harassment that fuels the troll-droppings that turn some folks away from the path to learning the truth. It is the misunderstanding about the true nature of these threats and this harassment that keep many folks from becoming part of the solution to the corrupt, systematic misapplication of the tax by which so much harm has been wreaked on America for the last 75 years.

These rumors and the misunderstanding that fuels them must end. Showing what the law requires in regard to these penalties will equip anyone subjected to this harassment to respond to it properly, and will equip everyone else to send the trolls back into the dank darkness under the bridge (or the rock) from beneath which they have crawled.

So, let's parse this out:

IT'S THIS SIMPLE, FOLKS: A sworn and signed 6020(b) return declaring liability for the penalty is a core requirement for the assessment of the penalty. Period. The law is perfectly clear on this requirement.

The "frivolous return" penalty provided for at 26 U.S.C. § 6702 is to be assessed in the same manner as the income tax generally:

26 U.S.C. § 6671. Rules for application of assessable penalties

(a) Penalty assessed as tax

The penalties and liabilities provided by this subchapter [which includes section 6702 -PH] shall be paid upon notice and demand by the Secretary, and shall be assessed and collected in the same manner as taxes. Except as otherwise provided, any reference in this title to “tax” imposed by this title shall be deemed also to refer to the penalties and liabilities provided by this subchapter.

Taxes (other than a couple of exceptions concerning stamp taxes and criminal restitution) can only be assessed per a return or list:

26 U.S.C. § 6201 - Assessment authority

(a) Authority of Secretary

The Secretary is authorized and required to make the inquiries, determinations, and assessments of all taxes (including interest, additional amounts, additions to the tax, and assessable penalties) imposed by this title, or accruing under any former internal revenue law, which have not been duly paid by stamp at the time and in the manner provided by law. Such authority shall extend to and include the following:

(1) Taxes shown on return

The Secretary shall assess all taxes determined by the taxpayer or by the Secretary as to which returns or lists are made under this title.

"List" doesn't mean "recording a liability on a list with a bunch of others", or anything like that. For purposes of this statutory specification, it means what is described in Revised Statute 3176, as amended by Section 1103 of the Revenue Act of 1926. That constitutes the actual statutory authority from which 26 U.S.C. § 6201 is derived-- that is, the actual authority under which the United States is permitted to collect taxes:

Sec. 3176. The collector or any deputy collector in every district shall enter into and upon the premises, if it be necessary, of every person therein who has taxable property and who refuses or neglects to render any return or list required by law, or who renders a false or fraudulent return or list, and make, according to the best information which he can obtain, including that derived from the evidence elicited by the examination of the collector, and on his own view and information, such list or return, according to the form prescribed, of the objects liable to tax, owned or possessed or under the care or management of such person, and the Commissioner of Internal Revenue shall assess the tax thereon, including the amount, if any, due for special tax, and in case of any return of a false or fraudulent list or valuation, he shall add one hundred per centum to such tax; and in case of a refusal or neglect, except in case of sickness or absence, to make a list or return, or to verify the same as aforesaid, he shall add fifty per centum to such tax. In case of neglect occasioned by sickness or absence as aforesaid, the collector may allow such further time for making and delivering such list or return as he may deem necessary, not exceeding thirty days. The amount so added to the tax shall, in all cases, be collected at the same time and in the same manner as the tax; and the list or return so made and subscribed by such collector or deputy collector shall be held good and sufficient for all legal purposes.

Here is the amending language to Sec. 3176 enacted in the 1926 Revenue Act:

SEC. 1103. Section 3176 of the Revised Statutes, as amended, is amended to read as follows:

     "SEC. 3176. If any person, corporation, company, or association fails to make and file a return or list at the time prescribed by law or by regulation made under authority of law, or makes, willfully or otherwise, a false or fraudulent return or list, the collector or deputy collector shall make the return or list from his own knowl- edge and from such information as he can obtain through testi- mony or otherwise. In any such case the Commissioner of Internal Revenue may, from his own knowledge and from such information as he can obtain through testimony or otherwise, make a return or amend any return made by a collector or deputy collector. Any return or list so made and subscribed by the Commissioner, or by a collector or deputy collector and approved by the Commissioner, shall be prima facie good and sufficient for all legal purposes.

     "If the failure to file a return (other than a return under Title II of the Revenue Act of 1924 or Title II of the Revenue Act of 3926) or a list is due to sickness or absence, the collector may allow such further time, not exceeding 30 days, for making and filing the return or list as he deems proper.

     "The Commissioner of Internal Revenue shall determine and assess all taxes, other than stamp taxes, as to which returns or lists are so made under the provisions of this section. In case of any failure to make and file a return or list within the time prescribed by law, or prescribed by the Commissioner of Internal Revenue or the collector in pursuance of law, the Commissioner shall add to the tax 25 per centum of its amount, except that when a return is filed after such time and it is shown that the failure to file it was due to a reasonable cause and not to willful neglect, no such addition shall be made to the tax. In case a false or fraudulent return or list is willfully made, the Commissioner shall add to the tax 50 per centum of its amount.

     "The amount so added to any tax shall be collected at the same time and in the same manner and as a part of the tax unless the tax has been paid before the discovery of the neglect, falsity, or fraud, in which case the amount so added shall be collected in the same manner as the tax."

OK, so we have seen that:

  • The "frivolous" penalty must be assessed as a tax like any other under 26 USC.

  • The assessment of such taxes can only be per a return or list.

As will have been noted in the enacting language of R.S. 3176-- both in the original and as amended, such a return or list must be subscribed in order to be legally effective:

...the list or return so made and subscribed by such collector or deputy collector shall be held good and sufficient for all legal purposes. [Original]

Any return or list so made and subscribed by the Commissioner, or by a collector or deputy collector and approved by the Commissioner, shall be prima facie good and sufficient for all legal purposes. [As amended]

So, really what we've got so far is:

  • The "frivolous" penalty must be assessed as a tax like any other under 26 USC.

  • The assessment of such taxes can only be per a return or list.

  • A return or list on which a penalty can be assessed must be subscribed (and since we're not talking about "objects liable to tax" about which lists are made, we'll just stick with "returns" from now on...).

Now, "subscribed" by itself only means "signed" in everyday useage. But in the case of returns required for assessment of a penalty, "signed" means "signed under oath":

26 U.S.C. § 6065 Verification of returns

Except as otherwise provided by the Secretary, any return, declaration, statement, or other document required to be made under any provision of the internal revenue laws or regulations shall contain or be verified by a written declaration that it is made under the penalties of perjury.

There is no "otherwise provided" exception for the creation of returns concerning "frivolous penalties"-- in fact, the regulations specifying such returns in particular are comprehensive, and carefully make no such exception:

26 C.F.R. § 301.6020-1(b) Execution of returns-

(1) In general.

If any person required by the Internal Revenue Code or by the regulations to make a return ... fails to make such return at the time prescribed therefore, or makes, willfully or otherwise, a false, fraudulent or frivolous return, the Commissioner or other authorized Internal Revenue Officer employee shall make such return from his own knowledge and from such information as he can obtain through testimony or otherwise. ...

(2) Form of the return.

A document (or set of documents) signed by the Commissioner or other authorized Internal Revenue Officer or employee shall be a return for a person described in paragraph (b)(1) of this section if the document (or set of documents) identifies the taxpayer by name and taxpayer identification number, contains sufficient information from which to compute the taxpayer's tax liability, and purports to be a return.

So now we have a critical additional element which must be present and accounted for before a "frivolous return penalty" can actually be assessed: a sworn signature, putting a government official at risk of the penalties of perjury if he or she is falsely (or negligently) asserting that the government has a valid claim to seize property from someone else.

It is only with the acceptance of such a risk that claims against someone else's property of this kind can be made legally valid.* This is the whole point and purpose of 26 U.S.C. § 6020(b): authorizing and requiring government officials to properly assert government ownership-interests and claims against those of other people, which the states must do in the same way any citizen would assert interests and claims.

Let's do another recap, then:

  • The "frivolous" penalty must be assessed as a tax like any other under 26 USC.

  • The assessment of such taxes can only be per a return.

  • A return on which a penalty can be assessed must be sworn under penalties of perjury.

What this all means, of course, is that if no sworn return asserting the "frivolous return penalty" exists, no such penalty can be, or has been, lawfully assessed.

SO, WHAT DOES THIS MEAN IN PRACTICAL TERMS? First of all, it means that where no actual sworn 6020(b) return exists no filed return has been actually even alleged-- much less "determined"-- to be "frivolous". The making of a sworn 6020(b) return is the legal and legally-required means by which such an allegation is made, according to the law; there is no other mechanism provided by which this allegation can be made.

 Second, this means if you or anyone you know has been a victim of "penalty" threats or harassments, this bad behavior can and should be challenged on the basis of fundamental invalidity unless sworn returns asserting the government's claims can be proven to have preceded them. If there are no sworn 6020(b) returns, there can be no legally-applicable penalties and none have actually been assessed, whatever the scary notices from the tax agency might be designed to suggest.

It also means that where those sworn returns can't be shown to exist, any rumor about educated returns drawing actual penalties should be denounced as the false troll-spew it is.

More importantly than all the foregoing, perhaps, the facts and law concerning "frivolous" status and the requirements of 6020(b) mean that any threats or harassment by tax agency actors involving "frivolous return penalties" (or the treatment of any filing as "frivolous" in any other way) are almost certainly crimes of some kind, and/or actionable civilly.

SO, IF YOU'VE BEEN THREATENED OR HARASSED or had a claimed refund delayed or denied on the declared basis that the related filing was "frivolous", get your FOIA requests in seeking any evidence of 6020(b) returns. This will equip you with proof that there are none, with all the implications and legal utility of that fact.

And whether you have a direct, personal matter to attend to this way or not, raise your voice about all this. Denounce the trolleries about CtC-educated returns and "frivolous return penalties", and encourage your friends and neighbors to get educated and stand up for the law.

"If the taxpayers of this country ever discovered that we operate on 98% bluff, the entire system will collapse."

-Reported remark by an internal revenue service officer to Sen. Henry E. Bellmon (R. Okla.) on April 15, 1971.

 

"The Tax Code represents the genius of legal fiction...  The IRS has never really known why people pay the income tax... The IRS encourages voluntary compliance, through FEAR."

-Jack Warren Wade Jr., former IRS officer in charge of the IRS Nationwide Revenue Officer Training Program, in his book ‘When You Owe The IRS’

*This doesn't mean that such claims automatically are valid, once made according to the prescribed form, of course. But they cannot be legally valid if not made according to these requirements.

P.S. To read a detailed analysis of what really qualifies for "frivolous return" penalties, see the material here. To see a very telling hoax (or fraud, as some would see it) deployed by the IRS in its sporadic efforts to frighten some folks with threats of these penalties, see the write-up here.

A Bit More About 6020(b) and FRPs.

 


LAST WEEK I POSTED A DRILL-DOWN on the legal relationship between the mandate at 26 U.S.C. § 6020(b) and the imposition of the so-called "frivolous return penalty". Among other things, this analysis points out that a 6020(b) return is the exclusive mechanism provided in the law for initiating an effort to assess a "frivolous return" penalty pursuant to the provisions at 26 U.S.C. § 6702.

Today I want to talk a little further about this relationship. I'm going to focus particularly on the harmony between the "required" element of 6020(b) and the "duty" element of 26 U.S.C. § 6671(b), the section of law identifying the "person" to whom the "frivolous return" penalty (FRP) can apply.

This examination will help illustrate and emphasize the limits of the sub-class of persons able to be properly subjected to an FRP. As a side benefit, the exercise will also help debunk nonsense by the tax-scam beneficiaries and their hired legal guns about the legal meaning of "includes", a term which is deployed in the definition of that "person" sub-class.

THE MANDATE IMPOSED UPON THE UNITED STATES AT 26 U.S.C. 6020(b) provides for the production of a sworn return signed by a government official whenever a required return is either unmade, or is false or fraudulent, willfully or otherwise-- a prescription that is deemed by the Secretary of the Treasury to extend also to cases in which a required, filed return is "frivolous".

Here is the language of the statute:

26 U.S.C. § 6020 Returns prepared for or executed by Secretary

(b) Execution of return by Secretary

(1) Authority of Secretary to execute return

If any person fails to make any return required by any internal revenue law or regulation made thereunder at the time prescribed therefor, or makes, willfully or otherwise, a false or fraudulent return, the Secretary shall make such return from his own knowledge and from such information as he can obtain through testimony or otherwise.

and the regulatory extension:

26 C.F.R. § 301.6020-1(b) Execution of returns-

(1) In general.

If any person required by the Internal Revenue Code or by the regulations to make a return (other than a declaration of estimated tax required under section 6654 or 6655)  fails to make such return at the time prescribed therefore, or makes, willfully or otherwise, a false, fraudulent or frivolous return, the Commissioner or other authorized Internal Revenue Officer employee shall make such return from his own knowledge and from such information as he can obtain through testimony or otherwise.

As seen, it is "required" returns that potentially invoke the 6020(b) mandate. Because FRPs can only be assessed through the mechanism of a 6020(b) return (due to the necessity of a return for the assessment of the penalty, per 26 U.S.C. 6671(a) and 6201(a)(1) and because 6020(b) is the sole authority for the production of such a return), this means that per the terms of 6020(b) only "required" returns are capable of drawing the "frivolous return" penalty.

Now let's look at the statutory specifications for the application of the FRP:

26 USC § 6702 - Frivolous tax submissions

(a) Civil penalty for frivolous tax returns

A person shall pay a penalty of $5,000 if—

...

and,

26 USC § 6671 - Rule for application of assessable penalties

(b) Person defined

The term “person”, as used in this subchapter, includes an officer or employee of a corporation, or a member or employee of a partnership, who as such officer, employee, or member is under a duty to perform the act in respect of which the violation occurs.

Here we find, harmoniously, that the definition establishing the class of persons to whom the FRP can apply confines that class to those creating "required" returns (that is, those who are duty-bound to create the returns in question). The specifications of 6020(b) and 6671(b) are thus fully in synch-- the authority for the government-produced returns needed to assess the penalty only allows for them in regard to required returns, and only those who have produced required returns are capable of being subjected to the penalty.

But there's more to be had from this than just admiration for the synchronicity. Because of this harmony between 6020(b) and 6671(b), we are also treated to a nice demonstration of the proper construction of "includes", something of which there can never be too much.

It is self-evident that the definition at 6671(b) of those capable of being subject to the penalty is limited, simply by the fact that a subject class is defined at all. Under no circumstances are statutory definitions provided for things which are all-inclusive, or which retain their common meaning.

Usually that logic of statutory construction practices, and canons of interpretation, and the terms of 26 U.S.C. 7701(c) are all that is available to establish the limited scope of what is defined, and the meaning and effect of the "includes" which appears in their expression. But here we are given a bit more.

Here, we have in 6020(b) a specification located outside those written particularly for the application of the FRP which itself imposes a limitation on the "persons" capable of being subject to the penalty. This limitation is precisely the same as that of 6671(b)-- when we read it as defining the entire class of those subject to the penalty.

The reciprocal proves the same point. To read the class of subject persons identified at 6671(b) as being greater than only those acting under a duty would put 6671 out of harmony with 6020(b).

In short, only if we read 6671(b)'s "...includes an officer, etc., under a duty..." as defining the entirety of the class of those subject to the penalty does the section harmonize with the 6020(b) element of "required". Thus, we see the actual limits of the subject class specified independently by virtue of the provisions of 6020(b).

More plainly than usual, then, we are here treated to a demonstration of the fact that the use of "includes" in the definition at 6671(b) is not an addition of the listed exemplars to some external or more expansive class of person (as the tax scamsters really wish everyone would believe). Instead "includes" is revealed by this interplay as a confining mechanism, allowing only for the application of the penalty to those under a duty to produce a given return-- just as is the function and proper construction of that term wherever it appears in tax law.

At the same time, we are also shown more plainly than usual that the class of those to whom a statutory provision can apply (here the FRP provision) is limited in cases in which the definition makes use of the term "includes". And of course all of this together underscores the fact that without a sworn 6020(b) return having been produced, no return has been found to be "frivolous"* and no "frivolous return penalty" has been, or even can be, assessed.

 NOTE: An in-depth discussion in which several federal circuit court rulings concerning the meaning and limits of 26 U.S.C. 6671(b) are presented can be found here.

NOTE II: For what might be seen as a little icing on the cake, look at the highlighted text of 26 U.S.C. § 6020(b) and 26 C.F.R. § 301.6020-1(b) in the article above. While 6020(b) orients itself to the return required ("...any return required..."), the regulatory supplement by which the 6020(b) mandate is expressly extended to "frivolous" returns changes the orientation to the person required ("...any person required..."). This unusual and highly-nuanced departure from statutory language puts the regulation in direct harmony with the definition at 6671(b). It's not likely to have been mere coincidence.

*Return requirements are varied, but among them is that anyone receiving more than the exemption amount of "income" within any given year is required to make and submit a return. It is thus seen any 1040 or 1040X which does not prompt a 6020(b) return is being thereby agreed to have either not reached these "income" thresholds, or to not qualify as false, fraudulent or frivolous.