No Liability

Post 8 of 11

The IRS has done you a service by issuing a brochure that appears to refute some of my arguments. First of all you can assume that if you use the arguments as they are presented in the IRS brochure you are assured of losing. Secondly you have to evaluate the following point by point rebuttal to the brochure and decide if the rebuttal raises substantial enough issues to act in accordance with the position outlined in this book.

The brochure is entitled, “Why do I have to pay taxes?” It is Publication 2105 (Rev. 10-97), Catalog Number 23871N, order your copy today!

The first panel inside entitled “Just the Facts” is straightforward and does not say anything I disagree with. I will point out that #4 is only true as long as the implied phrase, “when required” is included as it is in items 5 and 6.

#4

The courts have historically held there are no Constitutional or legal grounds for failure to file tax returns and failure to pay taxes.

#5

The term voluntary compliance means that each of us is responsible for filing a tax return when required and for determining and paying the correct amount of tax.

#6

Failure to file required tax returns and failure to pay taxes may result in criminal and/or civil penalties.

IRS Publication #2105 (Rev. 10-97)

None of the facts they present has any bearing on the consequences of structuring your affairs so that you are not required to file tax returns. And I will reiterate the Supreme Court’s statement about structuring your affairs to avoid (as distinguished from evade) taxes:

"By means which the law permits, a taxpayer has the right to decrease the amount of what otherwise would be his taxes, or altogether to avoid them."

Gregory V. Helvering, 293 US 465 (1934)

The second panel, which starts off , “Taxes are what we pay for a civilized society” does not present anything substantially worth arguing.

The question they raise in the first paragraph is reasonable enough, “Is the strategy legal?” And, the answer lies in your definition of the law. There is not one tax alternative that does not address the legality of their arguments. For the moral arguments they usually argue that God’s law or moral law is the highest law and therefore supersedes the laws of man. Some of the “patriots” argue that the Constitution as they interpret it is the highest law and therefore they are right and any court that disagrees must be in a conspiracy to pervert or enslave the people. (The IRS’s own statement about legality is based on the converse assumption that the IRS proclamations of what’s legal is the highest form of law and that anyone who disagrees is an illegal tax protester or a tax evader.) In practical reality you have to look to how the laws are applied to individual cases and what is successful. Unfortunately there is almost no widely disseminated information that is reasonably objective, therefore you gamble no matter what choice you make.

The irony of their second paragraph is that most of it can also be said of tax preparers and investment advisers as well as illegal tax protesters. Their final statement, “Believe it or not – a number of individuals who market these packages actually pay taxes” is true regardless of whether or not they file income tax returns as I argued earlier. The statement that the only things that you can’t get away from are death and taxes is still true regardless of whether you file a return or not.

The substance of their brochure is inside under the heading, “Arguments.” The format of the arguments section is that they state their version of the argument (usually distorted) and then present their version of the truth.

Introduction

Illegal Tax Protester Groups have used a variety of false or misleading arguments for not paying taxes. They build their complicated arguments that the income tax system is illegal by stringing together unrelated ideas plucked from widely conflicting court rulings, dictionary definitions, government regulations and other sources. Here are some of the most popular arguments.

IRS Publication #2105 (Rev. 10-97)

I am condoning the payment of taxes which have been assessed or for which liability is clearly established. I also condone non-filing of returns where liability is in question, thus forcing the government to act as assessor and collector once liability is clearly established. I also do not argue that the system is illegal. I fully acknowledge that the system is legal and where liability is clear taxes can and should be assessed and collected by agents of the government when voluntary compliance fails.

Constitutional Argument

Filing a Form 1040 violates the Fifth Amendment right against self-incrimination or the Fourth Amendment right to privacy

The Truth

The courts have consistently held that disclosure of the type of routine financial information required on a tax return does not incriminate an individual or violate the right to privacy

IRS Publication #2105 (Rev. 10-97)

It is the mandate of the court system to uphold the constitution and the cases that have tested the principle of constitutionality have been clear on this issue as the IRS is proud to point out. (The corruption of the court system and arguing the court system has failed to uphold the constitution is a popular argument with the “patriots” and neither me nor the IRS are interested in arguing about the court system.) I do not argue that the filing of a return is inherently incriminating, it is irrelevant to my argument whether or not the information on the return could be used to incriminate the individual. The courts have never to my knowledge addressed the constitutionality of forcing returns of citizens who are not liable to any taxes.

I ask whether or not a return can be required of one for whom liability to taxation is not clearly and unequivocally established. By the lack of a liability statement in the income tax statutes Congress has left some doubt about who is liable to pay the tax. (Unless someone volunteers to assess themselves, thereby clarifying the issue. It is unthinkable in the logic of the legal system that someone would voluntarily assess themselves for a tax for which they are not liable, and even if they did, their liability for making the assessment is a fitting consequence for such a mistake. ) I also do not argue that the filing of a form violates the right to privacy guaranteed by the Fourth Amendment. The filing of tax forms is clearly and constitutionally required of those who are made liable for taxes imposed by law. The requirement to file a tax form by those who are not made liable is the question.

Internal Revenue Code Arguments

(1) There is no Internal Revenue Code that imposes taxes; (2) only “individuals” are required to pay taxes; or (3) IRS can only assess taxes against people who file returns.

The Truth

The tax law is found in Title 26 of the United States Code. Section 6012 of the Code makes clear that only people whose income falls below a certain level do not have to file returns. Section 6201 of the Code states that the Secretary of the Treasury is required to make assessments “of all taxes imposed by the title [Title 26].”

IRS Publication #2105 (Rev. 10-97)

This is the most interesting piece of creative writing in the whole brochure. The first statement of the argument has never, to my knowledge, ever been claimed by anyone anywhere (there is a big difference between arguing that the tax was not imposed and arguing that liability to the tax has not been imposed.) I would like to challenge them to show me that argument in publicly distributed materials, but my meager attempt at anonymity has it’s price.

Why would they put in an argument that has never been made? They claimed in the introduction that these “are some of the most popular arguments” and I have heard every one except this one in my process of investigating the tax laws and seeking radical tax information. I would have loved for them to address the liability issue, but they have disappointed me, despite the fact that it is an existing and even quite popular argument among many groups.

The second statement of the argument appears to be a variation on the theme that the legal definitions of the words are crucial to applying them. However, this is another example stating the argument in a way that is obviously false on its face. An obvious question to which their statement could be an answer is “who is required to pay taxes?” The statement as an answer to this obvious question is inadequate and therefore false since the answer is actually anyone who is legally assessed for taxes. The funny thing is that they did not address who is required to pay taxes in their version of the truth.

They, instead, make a questionable interpretation of an unrelated Section of the code that addresses filing of returns. This is suspiciously like the “stringing together unrelated ideas” technique they attribute to the Illegal Tax Protester Groups in the Introduction to this section. The section of the Code they actually refer to is only clear about what they claim when it is applied as a mandatory statement, which is not always a clear issue.

Their statement is true under some circumstances, but may be false under others. If, for instance, an individual is under the impression that he is required to file a return then it is clear that he will dutifully self-assess. If he then finds that his income was below the level required for filing then he is no longer required to file a return despite his belief.

On the other hand, if an individual is under the belief that he is only required to file a tax return when his liability to taxation is clearly stated in the law, then he will dutifully study the law to determine his liability (self-assessment). If he does not find that he is liable for taxes then he will not file a tax return based on his self-assessment of his legal obligations, just like everybody else.

If the Secretary of the Treasury (or her duly appointed minions) disagrees with the findings of the individual then she is accusing them of neglecting a legal obligation for which the law provides penalties for failure to meet that obligation. It is the same as if a doctor were to neglect to help someone in a medical emergency. By choosing to structure her life to be a medical professional she accepted the legal obligations attendant with the choice she made. Specifically a doctor is legally obligated to help in medical emergencies and they can receive civil and criminal penalties for not meeting that obligation. I am not a doctor and if I am involved in a medical emergency then I have a choice about how I respond. Let’s say I choose not to help in a car accident, then later on the police come to me and say that I had an obligation to help in that situation. They are clearly agents of the government and are clearly involved in an investigation. I am, at that point, under suspicion of illegal activity and have the right to remain silent. This is the same situation that occurs when an individual first, investigates the tax laws, finds no liability, and chooses not to file a return, and then second, the IRS issues a notice disagreeing with the individual’s determinations.

If the police find evidence that I am a medical professional, like a doctorate degree from a medical school or even Professional level Red Cross Certification, then they will have proven their case. Then, I would be rightfully found guilty of negligence in the medical emergency in which I failed to help.

Therefore, in the case of the non-filer, if the Secretary of the Treasury and her minions can clearly prove that the an individual is made liable for income taxes then they can prove that the “shall” in section 6012 must be given a mandatory interpretation and the individual will be guilty of failure to file a required tax return.

The Third statement of the argument is blatantly unrealistic. It is obvious that in order to collect taxes that are evaded illegally, without having to resort to costly legal battles and criminal charges in every case, the assessment process must be imposed by the appropriate authorities when liability is clearly established by law. Our entire tax system is based on self-assessment but we have two different kinds of compliance, voluntary and mandatory. Mandatory compliance is the rule where liability is clearly and unequivocally stated in the law. As the IRS says in their version of the truth “Section 6201 of the Code states that the Secretary of the Treasury is required to make assessments 'of all taxes imposed by the title [Title 26].’” And remember:

"The term voluntary compliance means that each of us is responsible for filing a tax return when required and for determining and paying the correct amount of tax."

IRS Publication #2105 (Rev. 10-97)

I don’t know about you, but, the use of the terms voluntary and required in this sentence seems like an oxymoron. If the Secretary of the Treasury is required to make the assessment and then has the power to enforce the collection of that assessment by the use of force, in the form of criminal and civil penalties, then it is a far cry from voluntary in my mind. Their sloppy use of language is irrelevant because the truth is that if you are not required to file a return, then your compliance with their requirements are truly voluntary and you are then liable for the manner in which you meet those requirements. Which also means that if you are not required to file a return and you choose not to file a tax return then the Secretary of the Treasury is not empowered to make an assessment and is not empowered to collect anything. If the Secretary of the Treasury does act to assess or collect taxes against one who is not liable then she runs the risk of possibly violating Title 18 of the United States Code Sections 241 “Conspiracy against rights,” and/or 242 “Deprivation of rights under color of law.”

• 1) Introduction


• 2) Evaluating Your Personal Attitude


• 3) Food for Thought


• 4) The IRS Agrees With Me! (On some issues)


• 5) Investigating Tax Laws


• 6) Understanding tax laws, in general.


• 7) Understanding the income tax laws.


• 8) IRS Propaganda


• 9) Choosing Your Strategy


• 10) How is this possible?


• 11) Corresponding With The IRS

Labels: income tax

# posted by No Liability @ 5:45 PM