From AbundantHope.net IRS Exposed: IRS is a privately owned Puerto Rican trust. By Dan Meador Jul 6, 2012
Public Notice
by Dan Meador
This
memorandum will be construed to comply with provisions necessary to
establish presumed fact (Rule 301, Federal Rules of Civil Procedure,
and attending State rules) should interested parties fail to rebut any
given allegation or matter of law addressed herein. The position will
be construed as adequate to meet requirements of judicial notice, thus
preserving fundamental law. Matters addressed herein, if not rebutted,
will be construed to have general application. A true and correct
copy of this Public Notice is on file with and available for
inspection at the newspaper responsible for publishing the instrument
as legal notice. The memorandum addresses the character of the
Internal Revenue Service and other agencies of the Department of the
Treasury, and legal application of the Internal Revenue Code.
1. IRS Identity & Principal of Interest
In
1953, the Internal Revenue Service was created by the stroke of a pen
when the Secretary of the Treasury changed the name of the Bureau of
Internal Revenue (T.O. No. 150-29, G.M. Humphrey, Secretary of the
Treasury, July 9, 1953). However, no congressional or presidential
authorization for making this change has been located, so the source of
authority had to originate elsewhere. Research to which IRS officials
have acquiesced suggests that the Secretary exercised his authority as
trustee of Puerto Rico Trust #62 (Internal Revenue) (see
31 USC § 1321), and as will be demonstrated, the Secretary does, in fact, operate as Secretary of the Treasury, Puerto Rico.
The solid link between the Internal Revenue
Service and the Department of the Treasury, Puerto Rico, was first
published in the September 1995 issue of Veritas Magazine, based on
research by William Cooper and Wayne Bentson, both of Arizona. In
October, a criminal complaint was filed in the office of W. A. Drew
Edmondson, attorney general for Oklahoma, against an Enid-based
revenue officer, and in the time since, IRS principals have failed to
refute the allegation that IRS is an agency of the Department of
Treasury, Puerto Rico. In November, criminal complaints were filed
simultaneously with the grand jury for the United States district court
for the District of Northern Oklahoma, Tulsa, and the office of
Attorney General Edmondson, and both the office of the United States
Attorney and IRS principals have yet to rebut the allegations in that
instance (UNITED STATES OF AMERICA vs. Kenney F. Moore, et al, 95 CR-129C).
By consulting the index for Chapter 3, Title
31 of the United States Code, one finds that IRS and the Bureau of
Alcohol, Tobacco and Firearms are not listed as agencies of the United
States Department of the Treasury. The fact that Congress never
created a “Bureau of Internal Revenue” is confirmed by publication in
the Federal Register at 36 F.R. 849-890 [C.B. 1971 - 1,698], 36 F.R.
11946 [C.B. 1971 - 2,577], and 37 F.R. 489-490; and in Internal
Revenue Manual 1100 at 1111.2.
Implications are condemning both to IRS and third parties who knowingly participate in IRS-initiated scams:
No legitimate authority resides in or emanates from an office which
was not legitimately created and/or ordained either by state or
national constitutions or by legislative enactment. See variously,
United States v. Germane, 99 U.S. 508 (1879), Norton v. Shelby County,
118 U.S. 425, 441, 6 S.Ct. 1121 (1866), etc., dating to Pope v.
Commissioner, 138 F.2d 1006, 1009 (6th Cir. 1943); where the state is
concerned, the most recent corresponding decision was State v.
Pinckney, 276 N.W.2d 433, 436 (Iowa 1979).
Another direct evidence of the fraud is found
at 27 CFR § 1, which prescribes basic requirements for securing
permits under the Federal Alcohol Administration Act. The problem here
is that Congress promulgated the Act in 1935, and the same year, the
United States Supreme Court declared the Act unconstitutional.
Administration of the Act was subsequently moved offshore to Puerto
Rico, along with the Federal Alcohol Administration, and operation
eventually merged with the Bureau of Internal Revenue, Puerto Rico,
which until 1938, along with the Bureau of Internal Revenue,
Philippines, created by the Philippines provisional government via
Philippines Trust #2 (internal revenue) (see 31 USC § 1321 for
listing of Philippines Trust #2 (internal revenue)), administered the
China Trade Act (licensing & revenue collection relating to
opium, cocaine & citric wines). This line will be resumed after
examining additional evidences concerning IRS and Commissioner of
Internal Revenue authority.
Further verification that IRS does not have
lawful authority in the several States is found in the Parallel Table
of Authorities and Rules, beginning on page 751 of the 1995 Index
volume to the Code of Federal Regulations. It will be found that there
are no regulations supportive of 26 USC §§ 7621, 7801, 7802 & 7803 (these
statute listings are absent from the table). In other words, no
regulations have been published in the Federal Register, extending
authority to the several States and the population at large, (1) to
establish revenue districts within the several States, (2) extending
authority of the Department of the Treasury [Puerto Rico] to the
several States, (3) giving authority to the Commissioner of Internal
Revenue and assistants within the several States, or (4) extending
authority of any other Department of Treasury personnel to the several
States.
Authority of the Internal Revenue Service,
via the Commissioner of Internal Revenue, is convoluted in
regulations, but makes an amount of sense by citing various
regulations pertaining to the Service and application of the
Commissioner’s authority. General procedural rules at 26 CFR §
601.101(a) provide a beginning-point:
(a) General. The Internal Revenue
Service is a bureau of the Department of the Treasury under the
immediate direction of the Commissioner of Internal Revenue. The
Commissioner has general superintendence of the assessment and
collection of all taxes imposed by any law providing internal revenue.
The Internal Revenue Service is the agency by which these functions
are performed…
The fact that there are no regulations
extending Commissioner of Internal Revenue, or Department of the
Treasury authority to the several States (26 USC § 7802(a)),
has greater clarity in the light of the general merging of functions
between IRS and other agencies presently attached to the Department of
the Treasury. The Commissioner is given responsibility for issuing
rules and regulations for the Code at 26 CFR § 301.7805-1,
with approval of the Secretary, but there are no cites of authority
for this CFR subpart, whether Treasury Order, publication in the
Federal Register, or even statute cite. In other words, there is no
actual or effective delegation which vests the Commissioner with
significant independent authority which might be conveyed to IRS,
BATF, Customs or any other Department of the Treasury agency with
respect to powers extending to or affecting the several States and the
population at large.
The link between IRS and the Bureau of
Alcohol, Tobacco and Firearms is significant as the tie with the
Bureau of Internal Revenue, Department of the Treasury, Puerto Rico,
is through this door. Reorganization Plan No. 3 of 1940, Section 2,
made the following change:
§ 2. Federal Alcohol Administration
The Federal Alcohol Administration, the
offices of the members thereof, and the office of the Administrator
are abolished, and their function shall be administered under the
direction and supervision of the Secretary of the Treasury through the
Bureau of Internal Revenue in the Department of the Treasury.
Again, the Federal Alcohol Administration Act
of 1935 was declared unconstitutional in 1935, and the operation
thereafter transferred off shore to Puerto Rico. The name of the
Bureau of Internal Revenue was changed to the Internal Revenue Service
in 1953 (cite above), then the Bureau of Alcohol, Tobacco and
Firearms, a division of the Internal Revenue Service, was seemingly
separated from IRS (T.O. 120-01, June 6, 1972). In relevant part, the
order reads as follows:
1. The purpose of this order is to transfer,
as specified herein, the functions, powers and duties of the Internal
Revenue Service arising under law relating to Alcohol, Tobacco,
Firearms and Explosives including the Alcohol, Tobacco, and Firearms
division of the Internal Revenue Service, to the Bureau of Alcohol,
Tobacco and Firearms herein after referred to as the Bureau which is
hereby established. The Bureau shall be headed by the Director of the
Alcohol, Tobacco and Firearms herein referred to as the Director…
2. The Director shall perform the functions,
exercise the powers and carry out the duties of the Secretary and the
administration and the enforcement of the following provisions of law:
A. Chapters 51 and 52 and 53 of the Internal
Revenue Code of 1954 and Section 7652 and 7653 of such code insofar as
they relate to the commodity subject to tax under such chapters.
B. Chapter 61 to 80 inclusive to the Internal
Revenue Code of 1954 insofar as they relate to activities
administered and enforced with respect to chapters 51, 52, 53.
(emphasis added)
Transfer of functions and duties of IRS to
BATF relative to Internal Revenue Code Subtitle F (chapters 61 to 80)
is important where the instant matter is concerned as the only
regulations published in the Federal Register applicable to the
several States are under 27 CFR, Part 70 and other parts of this title
relating exclusively to alcohol, tobacco and firearms matters.
However, the charade doesn’t end there. In Reorganization Plan No. 1
of 1965 (5 USC § 903),
the original Bureau of Customs, created by Act of Congress in 1895,
was abolished and merged under the Secretary of the Treasury.
In a Treasury Order published in the Federal
Register of December 15, 1976, the Secretary of the Treasury used
something of a slight of hand to confuse matters more by determining,
“The term Director, Alcohol, Tobacco, and Firearms has been replaced
with the term Internal Revenue Service.”
Obviously, it is impossible to replace a
person with a thing when it comes to administrative responsibility.
However, the order demonstrates that IRS and BATF are one and the
same, merely operating with interchangeable hats. Therefore,
definitions and designations applicable to one are applicable to the
other.
In definitions at 27 CFR § 250.11, the following provisions are found:
Revenue Agent. Any duly authorized Commonwealth Internal Revenue Agent of the Department of the Treasury of Puerto Rico.
Secretary. The Secretary of the Treasury of Puerto Rico.
Secretary or his delegate.
The Secretary or any officer or employee of the Department of the
Treasury of Puerto Rico duly authorized by the Secretary to perform
the function mentioned or described in this part.
In the absence of any other definition
describing revenue officers and agents, the Secretary, or the
Department of the Treasury, definitions above are uniformly applicable
to all IRS and BATF departments, functions and personnel. In fact, it
will be found that even petroleum tax prescribed in Subtitle D of the
Internal Revenue Code applies only to United States territorial
jurisdiction exclusive of the several States and to imported
petroleum. BATF has authority only with respect to firearms,
munitions, etc., produced outside the several States and the first
sale of imports.
The two delegations of authority to the
Commissioner of Internal Revenue thus far located tend to reinforce
conclusions set out above. Treasury Department Order No. 150-42, dated
July 27, 1956, appearing in at 21 Fed. Reg. 5852, specifies the
following:
The Commissioner shall, to the extent of
the authority vested in him, provide for the administration of United
States internal revenue laws in the Panama Canal Zone, Puerto Rico and
the Virgin Islands.
On February 27, 1986 (51 Fed. Reg. 9571), Treasury Department Order No. 150-01 specified the following:
The Commissioner shall, to the extent of
authority otherwise vested in him, provide for the administration of
the United States internal revenue laws in the U.S. Territories and
insular possessions and other authorized areas of the world.
To date only three statutes in the
Internal Revenue Code of 1986, as currently amended, have been
located that specifically reference the several States, exclusive of
the federal States (District of Columbia, Puerto Rico, Guam, the
Virgin Islands, etc.): 26 USC §§ 5272(b), 5362(c) & 7462.
The first two provide certain exemptions to bond and import tax
requirements relating to imported distilled spirits for governments of
the several States and their respective political subdivisions, and
the last provides that reports published by the United States Tax
Court will constitute evidence of the reports in courts of the United
States and the several States. None of the three statutes extend
assessment or collections authority for IRS or BATF within the several
States.
IRS is contracted to provide collection
services for the Agency for International Development, and case law
demonstrates that the true principals of interest are the
International Monetary Fund and the World Bank (Bank of the United
States v. Planters Bank of Georgia, 6 L.Ed (Wheat) 244; U.S. v. Burr,
309 U.S. 242; see 22 USCA § 286,
et seq.). In other words, IRS seemingly provides collection services
for undisclosed foreign principals rather than collecting internal
revenue for the benefit of constitutional United States government
operation. To date, IRS principals have failed to dispute the
published Cooper/Bentson allegation that the agency, via these foreign
principals, funded the enormous tank and military truck factory on
the Kama River, Russia.
The Internal Revenue Service, a foreign
entity with respect to the several States, is not registered to do
business in the several States.
2. Preservation of Due Process Rights
The
Internal Revenue Service has for years been protected by statutory
courts both of the United States and the several States, with the
latter operating in the framework of adopted uniform laws which
ascribe a federal character to the several States. Both operate under
the presumption of Congress’ Article IV jurisdiction within the
geographical United States (the District of Columbia, Puerto Rico,
etc.), both accommodate private international law under exclusively
United States treaties on private international law, and both operate
in the framework of admiralty rules to impose Civil Law (see both
majority & dissenting opinions variously, Bennis v. Michigan, U.S.
Supreme Court No. 94-8729, March 4, 1996) , which is repugnant to
both state and national constitutions (see authority of Department of
Justice as representative of the “Central Authority” established by
U.S. treaties on private international law at
28 CFR § 0.49;
also, “conflict of law” as a subcategory to “statutes” in American
Jurisprudence). However, this house of cards will shortly fall as
Cooperative Federalism, known as Corporatism well into the 1930s, has
been thoroughly documented and is rapidly being exposed via state and
United States appellate courts and in public forum.
In reality, the Internal Revenue Code preserves due process rights, but the statute has been dormant until recently:
[Sec. 7804(b)]
(b) PRESERVATION OF EXISTING RIGHTS AND REMEDIES.–
Nothing in Reorganization Plan Numbered 26 of 1950 or Reorganization
Plan Numbered 1 of 1952 shall be considered to impair any right or
remedy, including trial by jury, to recover any internal revenue tax
alleged to have been erroneously or illegally assessed or collected,
or any penalty claimed to have been collected without authority, or
any sum alleged to have been excessive or in any manner wrongfully
collected under the internal revenue laws. For the purpose of any
action to recover any such tax, penalty, or sum, all statutes, rules,
and regulations referring to the collector of internal revenue, the
principal officer for the internal revenue district, or the Secretary,
shall be deemed to refer to the officer whose act or acts referred to
in the preceding sentence gave rise to such action. The venue of any
such action shall be the same as under existing law.The reorganization
plans of 1950 & 1952 were implemented via the Internal Revenue
Code of 1954, Volume 68A of the Statutes at Large, and codified as
title 26 of the United States Code. Savings statutes have been in
place since the beginning, but generally not understood by the general
population or the legal profession. The statute set out above is
easier to comprehend when references are consolidated. Further, the
dependent clause “including trial by jury” relates to a
constitutionally-assured right, not a remedy, so it should be moved to
the proper location in the sentence. Finally, the matter of venue is
important as “existing law” is constitutional and common law
indigenous to the several States. In the absence of legitimate federal
law which extends to the several States, those who operate under
color of law, engage in oppression, extortion, etc., are subject to
the foundation law of the States. Venue is determined by the law of
legislative jurisdiction.Citing “including trial by jury” preserves
the full slate of due process rights included in Fourth, Fifth, Sixth,
Seventh and Fourteenth Amendments to the Constitution for the united
States of America and corresponding provisions in constitutions of the
several States. The example represents the class.Additionally, note
that, (1) actions may issue against bogus assessments as well as
collections, and (2) § 7804(b), unlike § 7433, does not presume that the complaining party is a “taxpayer”. Finally, there is 26 CFR, Part 1 regulatory support for § 7804 where there are no regulations published in the Federal Register in support of § 7433 (see
Parallel Table of Authorities and Rules, beginning on page 751 of the
Index volume to the Code of Federal Regulations). Therefore, § 7804(b)
preserves rights and determines the nature of civil actions for
remedies in the several States. When straightened out, applicable
portions of § 7804(b) read as follows:Nothing in [the Internal
Revenue Code] shall be considered to impair any right, [including
trial by jury], or remedy, [***], to recover any internal revenue tax
alleged to have been erroneously or illegally assessed or collected …
The venue of any such action shall be the same as under existing law.
The necessity of due process is implicitly preserved by 28 USC § 2463,
which stipulates that any seizure under United States revenue laws
will be deemed in the custody of the law and subject solely to
disposition of courts of the United States with proper jurisdiction. In
other words, even if IRS had legitimate authority in the several
States, the agency would of necessity have to file a civil or criminal
complaint prior to garnishment, seizure or any other action adversely
affecting the life, liberty or property of any given person, whether a
Fourteenth Amendment citizen-subject of the United States or a
Citizen principal of one of the several States. Due process assurances
in the Fifth and Fourteenth Amendments do not equivocate —
administrative seizures without due process can be equated only to
tyranny and barbarian rule. Further, even regulations governing IRS
conduct acknowledge and therefore preserve Fifth Amendment assurances
at 26 CFR § 601.106(f)(1).
(1) Rule I. An exaction by the U.S.
Government, which is not based upon law, statutory or otherwise, is a
taking of property without due process of law, in violation of the
Fifth Amendment to the U.S. Constitution. Accordingly, an Appeals
representative in his or her conclusions of fact or application of the
law, shall hew to the law and the recognized standards of legal
construction. It shall be his or her duty to determine the correct
amount of the tax, with strict impartiality as between the taxpayer
and the Government, and without favoritism or discrimination as
between taxpayers.
Even officers, agents and employees of United States agencies are assured due process where garnishment is concerned (5 USC § 5520a),
so the notion that IRS has authority to execute garnishment and other
seizures via the private sector without due process is clearly
absurd. In the English-American lineage, due process has always been
deemed to mean trial by jury under rules of the common law indigenous
to the several States; the de jure people of America are not subject
to admiralty or administrative tribunals.
Where officers, agents and employees of the
Internal Revenue Service are concerned, there can be no plea of
ignorance concerning the necessity of due process as the Handbook for
Revenue Agents, at paragraph 332: (1), provides the following:
During the course of administratively
collecting a tax, an occasion may arise where service of a levy or a
notice of levy is not adequate to seize the property of a taxpayer. It
cannot be emphasized too strongly that constitutional guarantees and
individual rights must not be violated. Property should not be
forcibly removed from the person of the taxpayer. Such conduct may
expose a revenue officer to an action in trespass, assault and
battery, conversion, etc.
The provision acknowledges the Supreme Court decision in Larson v. Domestic and Foreign Commerce Corp. 337 U.S. 682 (1949).
In sum, the mandate for due process, meaning
initiatives through judicial courts with proper jurisdiction, is
clearly antecedent to imposition of administratively-issued liens,
except where licensing agreements obligate assets, or seizures,
whether by garnishment, attachment of bank accounts, administrative
seizure and sale of real or private property, or any other initiative
that compromises life, liberty or property.
3. Current Internal Revenue Code & Internal Revenue Code of 1939 Are Same
Consult 26 USC §§
7851 & 7852 to
verify that the Internal Revenue Code of 1954, as amended in 1986 and
since, simply reorganized the Internal Revenue Code of 1939. Read § 7852(b) & (c), then read the balance of §§ 7851 & 7852 for best comprehension.
The importance of making this connection
rests on the fact that the Internal Revenue Code of 1939 was merely
codification of the Public Salary Tax Act of 1939. There was no
general income tax levied against the population at large in 1939 or
since. The Public Salary Tax Act of 1939, which in the Internal
Revenue Code of 1939 incorporated the Social Security tax activated
after 1936, was premised on the notion that working for federal
government is a privilege. Income and related taxes prescribed in
Subtitles A & C of the current Internal Revenue Code have never
been mandatory for anyone other than officers, agents and employees of
the United States, as identified at 26 USC § 3401(c), and agencies of the United States, identified at § 3401(d), particularized at 5 USC §§ 102 & 105.
The privilege tax is an excise rather than
direct tax — the Sixteenth Amendment, fraudulently promulgated in
1913, did not alter or repeal constitutional provisions which require
all direct taxes to be apportioned among the several States
(Constitution, Article I §§ 2.3 & 9.4). In Eisner v. Macomber, 252
U.S. 189 (1918), Coppage v. Kansas, 236 U.S. 1, and numerous
decisions since, the United States Supreme Court has repeatedly
affirmed that for purposes of income tax, wages and other returns from
enterprise of common right are property, not income. In fact, returns
from enterprise of common right are fundamental to all property, and
the sanctity is preserved as a fundamental common law principle dating
to signing of the Magna Charta in 1215.
The nature of Subtitles A & C taxes is revealed at 26 CFR § 31.3101-1: “The employee tax is measured by the amount of wages received after 1954 with respect to employment after 1936…”
In other words, the wage is not the object,
but merely the measure of the tax. This verbiage constitutes so much
legalese in an effort to circumvent the duck test, but the fact that
taxes collected by the Internal Revenue Service fall into the excise
category was confirmed by the Comptroller General’s report following
the initial effort to audit IRS (GAO/T-AIMD-93-3). It is further
suggested at 26 CFR § 106.401(a)(2), where the regulation concedes
that, “The descriptive terms used in this section to designate the
various classes of taxes are intended only to indicate their general
character…”
By referencing the Parallel Table of
Authorities and Rules, cited above, it is found that the definition of
“gross income” is still preserved in Section 22 of the Internal
Revenue Code of 1939, thus cementing the link between the Code of 1939
and Subtitles A & C of the Code of 1954, as amended in 1986 and
since. The Internal Revenue Code of 1939 merely codified the Public
Salary Tax Act of 1939. This link is further confirmed in Senate
Committee On Finance and House Committee On Ways and Means reports No.
H.R. 8300 (1954, Internal Revenue Code), in which § 22 of the
Internal Revenue Code of 1939 and § 61 of the Internal Revenue Code of
1954 (current code) were solidly linked. Both reports stipulate that
the current definition of “gross income” is intended to be
constitutional.
This intent is articulated at 26 CFR § 1.61-1(a): “Gross income means all income from whatever source derived, unless excluded by law.”
An “Act of Congress” is policy, not law, and
per definition located in Rule 54, Federal Rules of Criminal
Procedure, has only local application in the District of Columbia and
other United States territories and insular possessions unless general
application is manifestly expressed: Rule 54(c) — “‘Act of congress’
includes any act of Congress locally applicable to and in force in the
District of Columbia, in Puerto Rico, in a territory or in an insular
possession.”
Where the Internal Revenue Code of 1954 is
concerned (Vol. 68A, Statutes at Large, p. 3), the legislation is in
fact styled, “An Act” “To revise the internal revenue laws of the
United States.”
As demonstrated above, wages and other
returns from enterprise of common right are exempt from direct tax by
fundamental law, and the regulation for the current Internal Revenue
Code definition for “gross income” clearly articulates the fundamental
law exemption.
The exemption as it pertains to the several
States is demonstrated by referencing the Parallel Table of Authorities
and Rules (Index volume to the CFR, p. 751 of the 1995 edition):
There are 26 CFR, Part 1 regulations listed for 26 USC §§ 61 & 62,
the latter being the definition for adjusted gross income, but there
is no 26 CFR, Part 1 or 31 regulation for 26 USC § 63, the definition
for taxable income.
While definitions for gross and adjusted
gross income are clearly antecedent to the definition of taxable
income, they have no legal effect if there is no taxing authority —
adjusted gross income which is not taxable within the several States
is of no consequence where the federal tax system is concerned.
Further, on examination of 26 CFR § 1.62-1,
pertaining to “adjusted gross income”, it is found that subsections
(a) & (b) are reserved so the published regulation is incomplete,
with “temporary” regulation § 1.62-1T serving as the current authority defining “adjusted gross income.” Temporary regulations have no legal effect.
Definitions at § 3401, Vol. 68A of the
Statutes at Large (the Internal Revenue Code of 1954), make it clear
that, (§ 3401(a)(A)), “a resident of a contiguous country who enters
and leaves the United States at frequent intervals..,” is a
nonresident alien of the United States (citizens and residents of the
several States included), and the exclusion from “wages” extends even
to citizens of the United States who provide services for employers
“other than the United States or an agency thereof”(§3401(a)(8)(A)).
4. The Employer or Agent is Liable
Volume
68A of the Statutes at Large, the Internal Revenue Code of 1954,
makes it perfectly clear who is “liable” for payment of Subtitles A
& C taxes:
SEC. 3504. ACTS TO BE PERFORMED BY AGENTS.
In case a fiduciary, agent, or other person
has the control, receipt, custody, or disposal of, or pays the wages
of an employee or group of employees, employed by one or more
employers, the Secretary of his delegate, under regulations prescribed
by him, is authorized to designate such fiduciary, agent, or other
person to perform such acts as are required by employers under this
subtitle and as the Secretary or his delegate may specify. Except as
may be otherwise prescribed by the Secretary or his delegate, all
provisions of law (including penalties) applicable in respect to an
employer shall be applicable to a fiduciary, agent, or other person so
designated, but, except as so provided, the employer for whom such
fiduciary, agent, or other person acts shall remain subject to the
provisions of law (including penalties) applicable in respect to
employers.
The liability is further clarified at Vol. 68A, Sec. 3402(d):
(d) TAX PAID BY RECIPIENT. — If the
employer, in violation of the provisions of this chapter, fails to
deduct and withhold the tax under this chapter, and thereafter the tax
against which such tax may be credited is paid, the tax so required
to be deducted and withheld shall not be collected from the employer;
but this subsection shall in no case relieve the employer from
liability for any penalties or additions to the tax otherwise
applicable in respect to such failure to deduct and withhold.
These provisions from Vol. 68A of the
Statutes at Large comply with and verify liability set out at 26 CFR,
Part 601, Subpart D in general. Further, territorial limits of
application are made clear by the absence of regulations supporting 26
USC §§
7621, 7802,
etc., which are the statutes authorizing establishment of internal
revenue districts and delegations of authority to the Commissioner of
Internal Revenue and assistants. The fact that the liability falls to
the “employer” (26 USC § 3401(d))
and/or his agent, with no compensation for serving as “tax
collector,” narrows the field to federal government entities as
“employers” if for no other reason than the population at large is not
subject to the edict of government officials. As a matter of course,
government cannot compel performance where the general population is
concerned. The subject class that has “liability” for Subtitles A
& C taxes is the “employer” or his agent, fiduciary, etc., as
specified above.
The matter is further clarified in Sections 3403 & 3404 of Vol. 68A, Statutes at Large:
SEC. 3403. LIABILITY FOR TAX.
The employer shall be liable for the payment
of the tax required to be deducted and withheld under this chapter,
and shall not be liable to any person for the amount of any such
payment.
SEC. 3404. RETURN AND PAYMENT BY GOVERNMENTAL EMPLOYER.
If the employer is the United States, or a
State, Territory, or political subdivision thereof, or the District of
Columbia, or any agency or instrumentality of any one or more of the
foregoing, the return of the amount deducted and withheld upon any
wages may be made by any officer or employee of the United States, or
of such State, Territory, or political subdivision, or of the District
of Columbia, or of such agency or instrumentality, as the case may
be, having control of the payment of such wages, or appropriately
designated for that purpose.
The territorial application, and limitation,
is made clear by definitions in Title 26 of the Code of Federal
Regulations, as follows:
§ 31.3121(3)-1 State, United States, and citizen.
(a) When used in the regulations in this
subpart, the term “State” includes the District of Columbia, the
Commonwealth of Puerto Rico, the Virgin Islands, the Territories of
Alaska and Hawaii before their admission as States, and (when used
with respect to services performed after 1960) Guam and American
Samoa.
(b) When used in the regulations in this
subpart, the term “United States”, when used in a geographical sense,
means the several states (including the Territories of Alaska and
Hawaii before their admission as States), the District of Columbia,
the Commonwealth of Puerto Rico, and the Virgin Islands. When used in
the regulations in this subpart with respect to services performed
after 1960, the term “United States” also includes Guam and American
Samoa when the term is used in a geographical sense. The term “citizen
of the United States” includes a citizen of the Commonwealth of
Puerto Rico or the Virgin Islands, and, effective January 1, 1961, a
citizen of Guam or American Samoa.
Definition of the terms “includes” and
“including” located at 26 USC § 7701(c) provides the limiting authority
which the above definitions, beyond constructive application, are
subject to:
(c) INCLUDES AND INCLUDING. — The terms
“includes” and “including” when used in a definition contained in this
title shall not be deemed to exclude other things otherwise within the
meaning of the term defined.
Two principles of law clarify definition
intent: (1) The example represents the class, and (2) that which is
not named is intended to be omitted. In the definition of “United
States” and “State” set out above, all examples are of federal States,
and are exclusive of the several States, with the transition of
Alaska and Hawaii from the included to the excluded class proving the
point. This conclusion is reinforced by the absence of regulations
which extend authority to establish revenue districts in the several
States (26 USC § 7621), authority for the Department of the Treasury [Puerto Rico] in the several States (26 USC § 7801),
and no grant of delegated authority for the Commissioner of Internal
Revenue, assistant commissioners, or other Department of the Treasury
personnel (26 USC § 7802 & 7803).
5. Lack of Regulations Supporting General Application of Tax
Here
again, the Parallel Table of Authorities and Rules is useful as it
demonstrates that Subtitles A & C taxes do not have general
application within the several States and to the population at large.
The regulation for 26 USC § 1 refers to 26 CFR § 301, but that amounts
to a dead end — there is no regulation under 26 CFR, Part 1 or 31
which would apply to the several States and the population at large.
Further, there are no supportive regulations at all for 26 USC §§ 2
& 3, and of considerable significance, no regulations supporting
corporate income tax, 26 USC § 11, as applicable to the several
States.
Where the instant matter is concerned, regulations supporting
26 USC § 6321,
liens for taxes, and § 6331, levy and distraint, are under 27 CFR,
Part 70. The importance here is that Title 27 of the Code of Federal
Regulations is exclusively under Bureau of Alcohol, Tobacco and Firearms
administration for Subtitle E and related taxes. There are no
corresponding regulations for the Internal Revenue Service, in 26 CFR,
Part 1 or 31, which extend comparable authority to the several States
and the population at large.
The necessity of regulations being published
in the Federal Register is variously prescribed in the Administrative
Procedures Act, at 5 USC § 552 et seq., and the Federal Register Act, at 44 USC § 1501 et seq. Of particular note, it is specifically set out at 44 USC § 1505(a),
that when regulations are not published in the Federal Register,
application of any given statute is exclusively to agencies of the
United States and officers, agents and employees of the United States,
thus once again confirming application of Subtitles A & C tax
demonstrated above. Further, the need for regulations is detailed in 1
CFR, Chapter 1, and where the Internal Revenue Service is concerned,
26 CFR § 601.702.
The need for regulations has repeatedly been
affirmed by the Supreme Court of the United States, as stated in
California Bankers Ass’n. v. Schultz, 416 U.S. 21, 26, 94 S.Ct. 1494,
1500, 39 L.Ed.2d 812 (1974):
Because it has a bearing on our treatment
of some of the issues raised by the parties, we think it important to
note that the Act’s civil and criminal penalties attach only upon
violation of regulations promulgated by the Secretary; if the
Secretary were to do nothing, the Act itself would impose no penalties
on anyone … The government argues that since only those who violate
regulations may incur civil and criminal penalties it is the
regulations issued by the Secretary of the Treasury and not the broad,
authorizing language of the statute, which is to be tested against
the standards of the 4th Amendment…
Because there is a citation supporting these
statutes applicable under Title 27 of the Code of Federal Regulations,
it is important to point out that, “Each agency shall publish its own
regulations in full text,” (1 CFR § 21.21(c)), with further verification that one agency cannot use regulations promulgated by another at 1 CFR § 21.40.
To date, no corresponding regulation has been found for 26 CFR, Part 1
or 31, so until proven otherwise, IRS does not have authority to
perfect liens or prosecute seizures in the several States as pertaining
to the population at large.
6. Misapplication of Authority
Regulations pertaining to seized property are found at
26 CFR § 601.326:
Part 72 of Title 27 CFR contains the
regulations relative to the personal property seized by officers of the
Internal Revenue Service or the Bureau of Alcohol, Tobacco and
Firearms as subject to forfeiture as being used, or intended to be
used, to violate certain Federal Laws; the remission or mitigation of
such forfeiture; and the administrative sale or other disposition,
pursuant to forfeiture, of such seized property other than firearms
seized under the National Firearms Act and firearms and ammunition
seized under title 1 of the Gun Control Act of 1968. For disposal of
firearms and ammunition under Title 1 of the Gun Control Act of 1968,
see 18 U.S.C. 924(d). For disposal of explosives under Title XI of Organized Crime Control Act of 1970, see 18 U.S.C. 844(c).
The only other comparable authority thus far found pertains to windfall profits tax on petroleum (26 CFR § 601.405), but once again, application is not supported by regulations applicable to the several States and the population at large.
Where the provision for filing 1040 returns is concerned, the key regulatory reference is at 26 CFR § 601.401(d)(4),
and this application appears related to “employees” who work for two
or more “employers”, receiving foreign-earned income effectively
connected to the United States. The option of filing a 1040 return for
refund is mentioned in instructions applicable to United States
citizens and residents of the Virgin Islands, but to date has not been
located elsewhere. Reference OMB numbers for § 601.401,
listed on page 170, 26 CFR, Part 600-End, cross referenced to
Department of Treasury OMB numbers published in the Federal Register,
November 1995, for foreign application.
The fact that 1040 tax return forms are
optional and voluntary, with special application, is further
reinforced by Delegation Order 182 (reference 26 CFR §§ 301.6020- 1(b)
& 301.7701). The Secretary or his delegate is authorized to file a
Substitute for Return for the following: Form 941 (Employer’s Quarterly
Federal Tax Return); Form 720 (Quarterly Federal Excise Tax Return);
Form 2290 (Federal Use Tax Return on Highway Motor Vehicles); Form
CT-1 (Employer’s Annual Railroad Retirement Tax Return); Form 1065
(U.S. Partnership Return of Income); Form 11-B (Special Tax Return –
Gaming Services); Form 942 (Employer’s Quarterly Federal Tax Return
for Household Employees); and Form 943 (Employer’s Annual Tax Return
for Agricultural Employees).
The “notice of levy” instrument forwarded to
various third parties is not a “levy” which warrants surrender of
property. The Internal Revenue Code, at § 6335(a), defines the
“notice” instrument by use — notice is to be served to whomever
seizure has been executed against after the seizure is effected. In
short, the notice merely conveys information, it is not cause for
action. The term “notice” is clarified by definition in Black’s Law
Dictionary, 6th Edition, and other law dictionaries. Use of the
“notice of levy” instrument to effect seizure is fraud by design.
Proper use of the “notice” process,
administrative garnishment, et al, is specifically set out in 5 USC §
5514, as being applicable exclusively to officers, agents and
employees of agencies of the United States (26 USC § 3401(c)). Even
then, however, the process must comply with provisions of 31 USC §
3530(d), and standards set forth in §§ 3711 & 3716-17. In
accordance with provisions of 26 CFR, Part 601, Subpart D, the
employer, meaning the United States agency the employee is employed
by, is responsible for promulgating regulations and carrying out
garnishment.
Even if IRS was the agency responsible for
collecting from an “employee,” due process would be required, as noted
above, so authority to collect would ensue only after securing a court
order from a court of competent jurisdiction, which in the several
States would mean a judicial court of the State. In law, however,
there is no authority for securing or issuing a Notice of Distraint
premised on non-filing, bogus filing, or any other act relating to the
1040 return. See United States v. O’Dell, Case No. 10188, Sixth
Circuit Court of Appeals, March 10, 1947. In G.M. Leasing Corp. v.
United States, 429 U.S. 338 (1977), the United States Supreme Court
held that a judicial warrant for tax levies is necessary to protect
against unjustified intrusions into privacy. The Court further held
that forcible entry by IRS officials onto private premises without prior
judicial authorization was also an invasion of privacy.
7. Liability Depends on a Taxing Statute
General
demands for filing tax returns, production of records, examination of
books, imposition and payment of tax, etc., are of no consequence to
the point a taxing statute (1) defines what tax is being imposed, and
(2) the basis of liability. In other words, even if the Internal
Revenue Service was a legitimate agency of the United States
Department of the Treasury and had authority in the several States, the
Service would have to be specific with respect to what tax was at
issue and would have to demonstrate the tax by citing a taxing statute
with the necessary elements to establish that any given person was
obligated to pay any given tax.
This mandate has been clarified by the courts
numerous times, with the matter definitively stated by the Tenth
Circuit Court of Appeals in United States v. Community TV, Inc., 327
F.2d 797, at p. 800 (1964):
Without question, a taxing statute must
describe with some certainty the transaction, service, or object to be
taxed, and in the typical situation it is construed against the
Government. Hassett v. Welch, 303 U.S. 303, 58 S.Ct. 559, 82 L.Ed.858
In other words, to the point Service
personnel produce the statute which mandates a certain tax and which
specifies, “… the transaction, service, or object to be taxed..,” the
burden of proof lies with the Government, with the consequence being
that no obligation or civil or criminal liability can ensue to the
point a taxing statute that meets the above requirements is in
evidence.
This conclusion is supported by the statute
which provides the underlying requirements for keeping records, making
statements, etc., located at 26 USC § 6001:
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.
Whenever in the judgment of the Secretary it is necessary, he may
require any person, by notice served upon such person, or by
regulations, to make such returns, render such statements, or keep
such records, as the Secretary deems sufficient to show whether or not
such person is liable for tax under this title. The only records
which an employee shall be required to keep under this section in
connection with charged tips shall be charge receipts, records
necessary to comply with section 6053(c), and copies of statements
furnished by employees under section 6053(a).
The control statute for Subtitle F, Chapter
61, Subchapter A, Part I, concerning records, statements, and special
returns, clearly returns the matter to the “employee” defined at §
3401(c), and the “employer” defined at § 3401(d). In general, however,
(1) the Secretary must provide direct notice to whomever is required
to keep books, records, etc., as being the “person liable,” or (2)
specify the person liable by regulation. In the absence of notice by
the Secretary, based on a taxing statute which makes such a person
liable according to provisions stipulated in United States v.
Community TV, Inc., Hassett v. Welch, and other such cases, or
regulations which specifically set establish general liability, there is
no liability.
Sec. 6001 also exempts “employees” from
keeping records except where tips and the like are concerned. This is
consistent with constructive demonstration that “employers” rather
than “employees” are required to file returns, as opposed to paying
deducted amounts as income tax returns, constructively demonstrated in
a previous section of this memorandum and specifically articulated in
26 CFR § 601.104. Clarification via 26 USC § 6053(a) is as follows:
(a) REPORTS BY EMPLOYEES. — Every employee
who, in the course of his employment by an employer, receives in any
calendar month tips which are wages (as defined in section 3121(a) or
section 3401(a)) or which are compensation (as defined in section
3231(e)) shall report all such tips in one or more written statements
furnished to his employer on or before the 10th day following such
month. Such statements shall be furnished by the employee under such
regulations, at such other times before such 10th day, and in such
form and manner, as may be prescribed by the Secretary.
Unraveling § 6001 straightens out the meaning
of § 6011, which requires filing returns, statements, etc., by the
person made liable (§ 3401(d)), as distinguished from the person
required to make returns (payments) at § 6012 (§ 3401(c)). Even though
a person might be a citizen or resident of the United States employed
by an agency of the United States, and thereby be required to return a
prescribed amount of United States-source income, he is not the
person liable under § 6011 and attending regulations.
The “method of assessment” prescribed at 26
USC § 6303 is therefore dependent on the taxing statute and must rest
on authority specifically conveyed by a taxing statute which
prescribes liability where the Secretary (1) has provided specific
notice, including the statute and type of tax being imposed, or (2)
supports assessment by regulatory application. In the absence of one
or the other, an assessment by the Secretary is of no consequence as
it is not legally obligating.
The requirement for the Secretary to provide
notice to whomever is responsible for collecting tax, keeping records,
etc., is clarified at 26 CFR § 301.7512-1, particularly (a)(1)(i),
relating to “employee tax imposed by section 3101 of chapter 21
(Federal Insurance Contributions Act),” and (a)(1)(iii), relating to
“income tax required to be withheld on wages by section 3402 of
chapter 24 (Collection of Income Tax at Source on Wages)…” The person
liable is the employer or the employer’s agent, and of particular
significance, it is this “person” who is subject to civil and
particularly criminal penalties (26 CFR § 301.7513-1(f); 26 CFR §§
301.7207-1 & 301.7214-1, etc.). Officers and employees of the United
States are specifically identified as being liable at 26 USC §
301.7214-1.
The matter of who is required to register,
apply for licenses, or otherwise collect and/or pay taxes imposed by
the Internal Revenue Code is ultimately and finally put to rest under
“Licensing and Registration”, 26 USC §§ 301.7001-1, et seq. Each of
the categories so addressed has liability based on some particular
taxing statute which creates liability.
8. The Necessity of Administrative Process
The
requirement for a specific taxing statute, with 26 USC § 6001 clearly
providing the first leg in necessary administrative procedure to
determine liability, was addressed at length in Rodriguez v. United
States, 629 F. Supp. 333 (N.D. Ill. 1986).
Presuming (1) the Secretary has provided the
necessary notice, or (2) a regulation prescribes general application
which makes any given person liable for a tax and requires tax return
statements to be filed, each step in administrative process prescribed
by 26 USC §§ 6201, 6212, 6213, 6303 and 6331 must be in place for
seizure or any other encumbrance to be legal.
Here again, regulations published in the
Federal Register are significant, with provisions of 5 USC § 552 et
seq., 44 USC § 1501 et seq., 1 CFR, Chapter I, and 26 CFR, Part 601
all supporting the mandate for regulations to be published in the
Federal Register before they have general application. It will be
noted by referencing the Parallel Table of Authorities and Rules,
beginning on page 751 of the 1995 Index volume to the Code of Federal
Regulations, that application by regulation to the several States is
only under Title 27 of the Code of Federal Regulations, or that there
are no regulations published in the Federal Register. The following
entries, or non-entries, are found:
26 USC § 6201 Assessment authority 27 CFR, Part 70
26 USC § 6212 Notice of deficiency No Regulation
26 USC § 6213 Restrictions applicable to deficiencies; petition to Tax Court
No Regulation
26 USC § 6303 Notice and Demand for Tax 27 CFR, Part 53, 70
26 USC § 6331 Levy and distraint 27 CFR, Part 70
The assessment authority under 26 USC § 6201, in relevant part as applicable to Subtitles A & C taxes, are as follows:
(a) AUTHORITY OF SECRETARY. — The
Secretary is authorized and required to make the inquires,
determination, 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 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.
(3) ERRONEOUS INCOME TAX PREPAYMENT CREDITS. —
If on any return or claim for refund of income taxes under subtitle A
there is an overstatement of the credit for income tax withheld at
the source, or of the amount paid as estimated income tax, the amount
so overstated which is allowed against the tax shown on the return or
which is allowed as a credit or refund may be assessed by the
Secretary in the same manner as in the case of a mathematical or
clerical error appearing upon the return, except that the provisions
of section 6213(b)(2) (relating to abatement of mathematical or
clerical error assessments) shall not apply with regard to any
assessment under this paragraph.
(b) AMOUNT NOT TO BE ASSESSED. –
(1) ESTIMATED INCOME TAX. — No unpaid amount
of estimated income tax required to be paid under section 6654 or 6655
shall be assessed.
(2) FEDERAL EMPLOYMENT TAX. — No unpaid
amount of Federal unemployment tax for any calendar quarter or other
period of a calendar year, computed as provided in section 6157, shall
be assessed.
(d) DEFICIENCY PROCEEDINGS. –
For special rules applicable to deficiencies
of income, estate, gift, and certain excise taxes, see subchapter B.
[emphasis added]
The grant of assessment authority with
respect to taxes prescribed in Subtitles A & C is limited to
provisions set out above even where the Service might have authority
relating to those made liable for the tax, meaning the “employer”
specified at 26 USC § 3401(d). Clearly, returns made either by the
agent of the United States agency required to file a return, or the
Secretary, are to be evaluated mathematically, and errors are to be
treated as clerical errors, nothing more. The Secretary has no
authority to assess estimated income tax (individual estimated income
tax at § 6554; corporation estimated income tax at § 6655), or
unemployment tax ( § 6157). For all practical purposes, the trail
effectively ends here.
9. The Impossibility of Effective Contract/Election
In
order for there to be an opportunity for a nonresident alien of the
United States (a Citizen of one of the several States) to elect to be
taxed or treated as a citizen or resident of the United States, one or
the other of a married couple, or the single “individual” making the
election, must be a citizen or resident of the United States (26 USC §
6013(g)(3)). Some party must in some way be connected with a “United
States trade or business” (performance of the functions of a public
office (26 USC § 7701(a)(26)). A nonresident alien never has
self-employment income (26 CFR § 1.1402(b)-1(d)). In the event that a
nonresident alien is an “employee” (26 USC § 3401(c)), the “employer”
(26 USC § 3401(d)) is liable for collection and payment of income tax
(26 CFR § 1.1441-1). And in order for real property to be treated as
effectively connected with a United States trade or business by way of
election, it must be located within the geographical United States
(26 USC § 871(d)).
Provisions cited above preclude any and all
legal authority for Citizens of the several States, or privately owned
enterprise located in the several States, to participate in federal
tax and benefits programs prescribed in Subtitles A & C of the
Internal Revenue Code and companion legislation such as the Social
Security Act which provide benefits from the United States Government,
which is a foreign corporation to the several States.
Summary & Conclusion
This
memorandum is not intended to be exhaustive, but merely sufficient to
support causes set out separately. The most conspicuous conclusions
of law are that Congress never created a Bureau of Internal Revenue,
the predecessor of the Internal Revenue Service; Subtitles A & C
of the Internal Revenue Code prescribe excise taxes, mandatory only
for employees of United States Government agencies; the Internal Revenue
Service, within the geographical United States where the Service
appears to have colorable authority, is required to use judicial
process prior to seizing or encumbering assets; and the law
demonstrates that people of the several States, defined as nonresident
aliens of the self-interested United States in the Internal Revenue
Code, cannot legitimately elect to be taxed or treated as citizens or
residents of the United States. If a Citizen of one of the several
States works for an agency of the United States or receives income
from a United States “trade or business” or otherwise effectively
connected with the United States, the employer or other third party
responsible for payment is made liable for withholding taxes at the rate
of 30% or 14%, depending on classification, and is thus “the person
liable” and may be subject to Internal Revenue Service initiatives,
with administrative initiatives, where seizure and/or encumbrance
actions are concerned, subject to judicial determinations by courts of
competent jurisdiction.
Under penalties of perjury, per 28 USC §
1746(1), I attest that to the best of my knowledge and understanding,
all matters of law and fact presented herein are accurate and true.
__________________________________ ___________________________
Dan Meador
PRODUCED & DISTRIBUTED BY: Dan & Gail Meador, 1108 N. 2nd Street, Ponca City, Oklahoma 74601; Email:
dmeador@poncacity.net
Memorandums by Dan Meador and other researchers can be downloaded from Internet on the Law Research & Registry web site:
www.LawResearch-Registry.orghttp://nesaranews.blogspot.com/2012/07/irs-exposed-irs-is-privately-owned.html
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