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Title: Westminster man told to stop running tax scheme
Source:
Baltimore Sun
URL Source: http://www.baltimoresun.com/news/lo ... story?coll=bal-local-headlines
Published: Dec 4, 2006
Author: AP
Post Date: 2006-12-04 18:32:27 by Starwind
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Keywords: Kotmair, Save-A-Patriot Fellowship
Views: 3071
Comments: 200
A Westminster man has been barred by a federal judge from running a scheme in which he promised to help members avoid paying federal taxes, the U.S. Department of Justice announced today. The "Save-A-Patriot Fellowship" run by John Baptist Kotmair Jr. falsely advised that clients didn't have to pay taxes and could legally withdraw from the Social Security system, U.S. District Judge William Nickerson said in his ruling. Despite legal action by the U.S. Justice Department, Kotmair's organization continued to file frivolous protest letters with the Internal Revenue Service on behalf of more than 800 clients and showed "no inclination ... to cease their activities," Nickerson noted. Nickerson's order, issued last week, permanently bars Kotmair and his organization from representing or assisting anyone in corresponding with the IRS, or preparing court filings relating to income taxes. Kotmair and his organization must also notify all individuals involved in the scheme of the injunction and provide the Justice Department with the names of the customers, their e-mail addresses and telephone and Social Security numbers. The injunction also must be posted prominently on the organization's Web sites for a year, and fraudulent promotional materials must be removed from the sites.
Poster Comment: Kotmair's defense and taxation arguments were inane to put it charitably. His website (where he's to post the injunction) is at http://save-a-patriot.org/ Stupid tax-protestors and their schemes just muddy the water for legitimate tax-protest arguments. Kotmair, Schiff, Schultz, Rose all will become boilerplate examples of tax schemes which will be used unfairly to broad-brush and defeat otherwise legitimate arguments, rasing the cost and complexity to properly take on the IRS. I cite Joe Banister as an example of how to do it right, intelligently, and the above tax schemes just make it difficult if not impossible for people like Banister to prevail honestly on the merits.
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#125. To: noone222 (#119)
One can argue the finer points of the law until they're blue in the face, and come to any number of conclusions when the law in incomprehensible and legal precedent is artfully worded to confuse not inform, but in the end a free people cannot tolerate a system designed with the intent upon enslaving them, their children and their posterity, to an international criminal cartel of private bankers that use governments to provide cover and enforce collections. outstanding - bump
Thank you ... I appreciate the feedback !
"Guard with jealous attention the public liberty. Suspect every one who approaches that jewel. Unfortunately, nothing will preserve it but downright force. When you give up that force, you are ruined." Patrick Henry
I was merely referring to the LEGAL question of the voluntary nature of the SS system. It would appear that in fact SS IS a voluntary system as opposed to mandatory, as the administration itself has a form for withdrawal of application. If it were a MANDATORY system, WHY would they have such a form? So this would indeed seem to suggest that the LAW says "SS is VOLUNTARY"!!! Of course, there is clever wording in the form which would at least give the appearance of a "mandatory" nature of the system, however the smallest bit of common sense clearly dictates EXACTLY what this form is for. The bottom line is: ALL of the "people" involved in all of the courts in which you are quoting "case law" HAVE a SS#(otherwise known as a Taxpayer Identification Number); and it is this that BINDS them to the income tax system, and subjects them to the "tax code"!! A TIN is MANDATORY to pay income taxes!!! As I stated earlier, Hale vs. Henkel is STILL in effect, and establishes a RIGHT to carry on as an individual. The CATCH is that the only "individuals" are the ones that are NOT IN the SS system.... Being and "individual" does have it's "drawbacks". For example, it can be very difficult to secure work - as the large majority of employers are CORPORATE employers, and they have every legal right to have in their corporate charter that all employees have a SS or TIN number. If this is indeed in their corporate charter, an individual simply can't work for them... Another is that you will not be able to get on Medicare or Medicaid, so if you're likely to need a quadruple bypass in your latter years because you couldn't push away from those pork chops or that fat on your steak was just too tasty to trim it away (both of which are in violation of The CREATOR'S LAWS, and HIS Laws were intended for OUR benefit - NOT for HIS or the corporation's - unlike most of government's laws), then perhaps you'd better not opt out - as those medical expenses could bankrupt a person in a hurry.... It's a decision you have to make. Like the old saying goes "You can't have your cake and eat it too".
No matter how noble the objectives of a government; if it blurs decency and kindness, cheapens human life, and breeds ill will and suspicion - it is an EVIL government. Eric Hoffer
One can argue the finer points of the law until they're blue in the face, and come to any number of conclusions when the law in incomprehensible and legal precedent is artfully worded to confuse not inform, but in the end a free people cannot tolerate a system designed with the intent upon enslaving them, their children and their posterity, to an international criminal cartel of private bankers that use governments to provide cover and enforce collections. It really is as simple as that. Bill and I met with attorney, John Green, of the Andrew Jackson Society (he's a friend and associate of Edwin Vieira,Jr), yesterday, and one of the things he told us is that John Snow, former Secretary of the Treasury, made the statement that the tax code is incomprehensible (I'd like to see that if anyone can find it). Think of the implications. If he or any of them can't understand it, how then can any of us be expected to? And, that being the case, that means every person now imprisoned for tax evasion etc etc should be freed.
I do have Otto Skinner's "The biggest tax loophole of them all" and found it to explain principles of the income tax in light of 16th and SC decisions very well. It came recommended years ago from many sources so I bought it then.
I've not researched the ratification of the 16th myself, and do base my comments on "hearsay". I know it was heavily researched by Benson and that it was his conclusion it was not ratified. I recall the claim being based on various criteria -- some states passed a version of the amendment that wasn't worded correctly, if only misplaced punctuation. another passed a version modified outright. In one ironic twist, one state supposedly passed it in spite of it's constitution prohibiting it from voting to approve any new federal taxing power which the 16th would not/did not do if it conferred no new taxing power. I understand it was taken to court but the court ruled it was a political matter out of their jurisdiction. So far as I know, the allegation has not been contested by pro-tax sympathizers, never been declared wrong by any court. In fact, Aaron Russo in FtF quotes a judge saying the evidence supports the notion that the 16th wasn't properly ratified, though I've not verified his claim. But yes, for me I readily admit it's hearsay. My researched position, however is that it doesn't matter since it conferred no new tax power as per Brushaber/Stanton. It remains an important matter only for the conventional income tax theory advocates.
If there was ever a candidate for a law that was ripe for being declared void for vagueness, it would have to be the Internal Revenue Code.
The wording in the "I hereby request..." says in part: That suggests that it would not cancel the number. I mentioned before this might be just to cancel an application for SS payout benefits, not one's number. So if you've used this, the million FRN question is: have you been able to verify that the SS has purged the SSN they issued you?
Under normal circumstances a person has to have knowledge or awareness of the crime and the intent to commit it before they can be convicted of it ... so I would certainly agree.
"Guard with jealous attention the public liberty. Suspect every one who approaches that jewel. Unfortunately, nothing will preserve it but downright force. When you give up that force, you are ruined." Patrick Henry
You are correct, once a number has ever been issued and so much as one red cent paid in to that "account", that number is NEVER rescinded. However, the application can be - thereby disassociating you from that that number. The number is "theirs", always was, and never was YOURS. In effect, you are withdrawn from the system. Afterwards, whenever the number is accessed, they draw up the record, but no it longer has a name associated with it. It is as if you are dead to the Social Security and tax system. My very best friend and "mentor" has indeed gone to the local SS office and had them do a search of his "number". It came back that there was no record (at least not one that associated him with that number). He IS out... He had them verify and "stamp" this confirmation for him. I take that as being good enough. TO TOMMY: I noticed you had asked very early in the thread about "can you withdraw from SS". PING back to comment #127
No matter how noble the objectives of a government; if it blurs decency and kindness, cheapens human life, and breeds ill will and suspicion - it is an EVIL government. Eric Hoffer
I'll have to try that out.
[Starwind #124] I may just go dig that case out and see what the rulings were. In the case, Save-a-Patriot Fellowship v. United States, the US had seized, for payment of taxes owed by Kotmair personally, $44,115 in U.S. currency from one location in a safe and $377 in currency from another location of the same safe. Also seized were "Various numismatic coins and items found in the safe and elsewhere in the Residence." It was also alleged that a vial of Holy Qettoret was seized. Holy Qettorett was said to be "The sacred substance used in the Temple prior to its destruction and, some believe, necessary to sanctify the Temple upon its reconstruction so that the Messiah can perform prophesied miracles upon his/her return." The Court decided that Plaintiff "had not established that the substance had been taken by the I.R.S." Court found that $384 cash, the $210 of money orders and $ 40 of Susan B. Anthony Dollars found at the Office were, when found, property of the SAP Fellowship which had not yet been mingled with Kotmair's personal assets. The Court entered a judgment in favor of Plaintiff SAPF for $634 plus interest. The Court wrote that the $44,115 was considered lost to SAPF when it was commingled with funds of Kotmair for his personal use, and that the action for recovery for these funds had been filed after the time allowed by statute had tolled. As the seizure was against Mr. Kotmair personally, and $634 was shown not to have been commingled with the personal funds of Kotmair, that $634 was returned to SAPF. SAPF did not recover the $44,115. [EXCERPT] Kotmair: That is a hard question to answer. THE COURT: That is why we ask it. Kotmair: If the energy from it goes to the Fellowship, and it does, I would say it is to the benefit of the fellowship. The Court declines to follow the "logic" of Kotmair's position or to dwell upon the point in the digestive process at which Kotmair would agree that the I.R.S. could effect collection. Rather, the Court must conclude that once Kotmair takes Fellowship funds for personal use, those funds can no longer be found to be Fellowship property immune from levy for Kotmair's tax liabilities. The Court finds from the evidence that the SAP Fellowship obtained, and had ownership of, the cash and money orders it received for memberships and the sales of goods, and, possibly services. If the Fellowship had established that Kotmair's possession of particular assets was solely as Fiduciary for the SAP Fellowship the ownership could remain in the Fellowship. However, at such point as Kotmair took the assets and did not place them in a location [n23] that was exclusively used for the maintenance of Fellowship assets, the ability of the SAP Fellowship to establish ownership in this case was lost. In the context of this case, once the cash and money orders were taken from the office and placed in something other than a Fellowship depository, the funds were available for the immediate personal use of Kotmair, mingled with his own assets, and no longer had the character of Fellowship assets sufficient to avoid levy. In this case, the cash and money orders that had been removed from the office prior to the raid were found in the Residence in various locations, none of which have been established to be exclusive association depositories. However, the Court finds that the $ 384 of cash, the $ 210 of money orders and $ 40 of Susan B. Anthony Dollars found at the Office were, when found, property of the SAP Fellowship which had not yet been mingled with Kotmair's personal assets. Accordingly, the Court concludes that the SAP Fellowship has carried its burden of proof and proven ownership with regard to these assets found in the Office, but not as to the cash and money orders found in the Residence. MEMORANDUM OF DECISION IN THE CASE COUNSEL: For SAVE-A-PATRIOT FELLOWSHIP, an unicorporated association, plaintiff: George E. Harp, Law Office, Shreveport, LA. For UNITED STATES OF AMERICA, defendant: Lynne A. Battaglia. Beverly Moses Katz, U.S. Department of Justice, Washington, Dc. JUDGES: Marvin J. Garbis, United States District Judge OPINIONBY: Marvin J. Garbis OPINION: MEMORANDUM OF DECISION This case was tried before the Court without a jury. The Court has heard the evidence, reviewed the exhibits, considered the materials submitted by the parties and had the benefit of the arguments of counsel. The Court now issues this Memorandum of Decision as its findings of fact and conclusions of law in compliance with Rule 52(a) of the Federal Rules of Civil Procedure. I. BACKGROUND At all times relevant to this case, the Save-A-Patriot Fellowship ("the SAP Fellowship") has been based in a rented facility at 12 Carroll Street ("the Office") in Westminster, Maryland. Mr. John B. Kotmair, Jr. ("Kotmair"), was the founder and is the leader (called the "Fiduciary"), of the SAP Fellowship, Kotmair resides at 2911 Groves Mill Road ("the Residence") in Westminster, Maryland. On December 10, 1993, the Internal Revenue Service ("I.R.S.") executed search warrants at the Office and the Residence in connection with an investigation of Kotmair. The execution of the search warrants resulted in litigation by Kotmair seeking the return of a vial of Holy Qettorett [n1] allegedly seized by the I.R.S. in the raid. Kotmair v. United States, MJG-94-447. The Court decided, in the Kotmair case, that the Plaintiff had not established that the substance had been taken by the I.R.S. [n2] The instant case, which involves subject matter more mundane than Holy Qettorett, is brought by the SAP Fellowship. In the December 10, 1993 raid, the I.R.S. seized at the Office various documents, computer disks, files, papers, and other materials relating to the operations of the SAP Fellowship. There was also seized at the Office $ 384 of currency, 40 Susan B. Anthony dollars, and 5 money orders valued at $ 210. [n3] At the Residence the I.R.S. seized various papers and the following items: 1. The sum of $ 44,115 of U.S. currency found in one location in the safe. 2. The sum of $ 377 of U.S. currency found in another location in the safe. 3. Various numismatic coins and items found in the safe and elsewhere in the Residence. The items seized in the raid were taken by the Criminal Investigation Division of the I.R.S. for use in a criminal investigation. On December 22, 1993, the I.R.S. Collection Division served a Notice Of Levy on the Criminal Investigation Division so as to take the $ 44,115 in currency for application to the outstanding tax liabilities of Kotmair. On September 2, 1994, the Collection Division levied upon the remainder of the above-mentioned seized property for application to the tax liabilities of Kotmair. The SAP Fellowship filed this law suit on March 29, 1995, a date beyond the nine month limitation period [n4] following the December 22, 1993, levy but within nine months of the September 2, 1994, levy. By Memorandum and Order of May 10, 1996, this Court dismissed the Plaintiff's claim as to the $ 44,115 in currency due to the expiration of limitations. There remained for trial the SAP Fellowship's claim to the assets levied upon on September 2, 1994. II. NATURE OF THE CASE As stated in Saltzman, "IRS Practice and Procedure," P 15.07[2][a] (2nd ed. 1991): HN1 In general, if a levy has been made on property . . . any person other than the taxpayer [against whose tax liability the levy was made] who claims (1) an interest in or lien on the property and (2) that the property was wrongfully levied upon by the Service may bring a civil action directly against the United States in federal district court." HN2 The statutory authority for a wrongful levy action is provided by Section 7426 of the Internal Revenue Code. See 26 U.S.C. § 7426. In a wrongful levy action the underlying assessment against the taxpayer (here Kotmair) is "conclusively presumed to be valid." § 7426(c) Hence, the only issue in the case is whether or not the subject property is the property of the wrongful levy claimant (here the SAP Fellowship). III. DISCUSSION A. The SAP Fellowship Activities The SAP Fellowship has been proven to exist, have members, and to function. The organization has assets, leases property, has a defined membership, publishes a newsletter, and has produced at least one video tape program, twelve hours of "Just The Facts." [n5] There is no doubt that Kotmair is the major figure in the SAP Fellowship. As far as the Fellowship is concerned, he is, as Theodore Roosevelt aspired to be [n6], the corpse at every funeral, the bride at every wedding and the baby at every christening." The SAP Fellowship operates without any written governance structure or financial records. Operating assets, such as files, equipment etc. are located at the Office. Money, money orders, and other valuables are received at the Office, but not kept there. Kotmair is free to, and does, take funds from the SAP Fellowship for personal use. However, the evidence does not disclose that Kotmair maintained a high standard of living or that such funds as were accumulated were necessarily his personal hoard. [n7] The SAP Fellowship describes itself [n8] in the following terms: The evidence, including testimony and a recent (Fall of 1996) membership newsletter, "Reasonable Action," establishes that the SAP Fellowship has organizational activities, including the providing of "information" regarding tax procedures [n9], views on the U.S. Constitution, and similar matters. The Fellowship offers for sale, or in its lingo "exchange for FRNs" [n10], various publications as well as video tape programs and audio recordings. The material includes its own publications, an 1828 dictionary [n11], a deposition of an F.B.I. Agent and a tape of the motion picture "Harry's War" [n12] in which a citizen victimized by unscrupulous I.R.S. employees obtains an armored vehicle and takes on, and wins over to his viewpoint, the U.S. Army. The Fellowship also offers the written works of Irwin A. Schiff who calls himself "America's leading untax expert." [n13] Schiff can be viewed as a "prophet" of the tax protester movement and a "guru" for Kotmair. Although convicted of tax felonies [n14] and out of step with legal reality (as seen by federal judges), Schiff presents a most entertaining view of the tax law. He has been described by Judge Guerfein of the Second Circuit [n15] in the following terms: [Schiff] was in the insurance business. He also fancied himself a "constitutionalist", an extremist who reserved the right to interpret the decisions of the supreme court as he read them from his layman's point of view regardless of and oblivious to interpretations of the judiciary. One can describe his attitude either as contumacious of governmental authority for the purpose of advancing the common weal, or as that of a clever faker who used his own distortions of the Constitution as a flimsy excuse for failing to pay his income taxes. In addition to affording its membership access to the philosophy of Irwin Schiff and his disciples, the Fellowship offers a program by which, supposedly [n16]: Fellowship members pledge to reimburse other members for losses of cash or property incurred from illegal confiscation by the IRS and/or their nasty little brothers in state governments. This is done by spreading the reimbursement costs to all members. Essentially, when a member suffers a "qualified" loss of property or freedom, he/she submits a claim to the SAP Fellowship which, after validation, supposedly results in reimbursement for civil losses (to a $ 150,000 maximum) and a stipend of $ 25,000 per year of incarceration. The payments are to be made by the membership directly to the validated claimant or the claimant's family. A civil claim is validated: A criminal claim is validated: The Fellowship also conducts activities for its "Independent Representatives." [n17] For example, in October of 1996, the Fellowship offered a series of seminars for members, a Saturday night meeting open to the public, a Sunday social and, as a highlight of the function, the wedding of two of the Independent Representatives. [n18] B. The SAP Fellowship Is An Unincorporated Association The Government contends, at the threshold, that the SAP Fellowship is not an organization at all, but is solely a name used by Kotmair for his own "sole proprietorship" operation. The Court does not agree, even though it is readily apparent that Kotmair is the major figure in the Fellowship. As noted above, the evidence established that there is an organization and not simply an operation by Kotmair personally. The SAP Fellowship, and not Kotmair personally, leased the Office. There are members, other than Kotmair, who engage in Fellowship activities. This Court observes, also, that the I.R.S. itself, quite appropriately, returned to the Office the operating assets seized from the Office (other than cash and numismatic items). These assets, at least some of which had more than nominal value, were simply (and correctly) assumed to be Fellowship property, as distinct from Kotmair's personal property. The Government's arguments regarding the absence of a written instrument of governance is noted but, in the context of this case, is not determinative. Moreover, the absence of records and record keeping, while significant in terms of the ability of the SAP Fellowship to carry its burden of proof does not overcome the evidence establishing that there is an actual unincorporated association distinct from its members. In sum, the Court finds as a fact that the SAP Fellowship is an unincorporated association (not just an alter ego or sole proprietorship of Kotmair), has members, and does things through persons in addition to Kotmair. C. An Unincorporated Association In Maryland Can Own Property The Government's second line of defense is that even if the evidence established that the SAP Fellowship is recognized as an unincorporated association, such an entity cannot own property as a matter of law. There is little precedent -- in Maryland law or elsewhere -- regarding property ownership by unincorporated associations. Presumably, those organizations that have significant assets find it beneficial to formalize their status, as a corporation, trust or other entity. However, the Court can take judicial notice of the fact that there are a multitude of unincorporated associations that function in spite of their informality. For example, there are many PTA's and other affiliations of persons with common interests that have not formalized their existence. Who would, sensibly, argue that a PTA treasury cannot be the property of the PTA? While the situation may be different in some other jurisdictions [n19] HN3 in Maryland the legislature has recognized that an unincorporated association can own property in its own right. [n20] The Maryland Code, HN4 Md. Cts. & Jud. Proc. Code Ann. § 6-406 provides: Moreover, HN5 Md. Cts. & Jud. Proc. Code Ann. § 11-105 provides: This Court concludes that, as a matter of law, an unincorporated association in Maryland can own property. The Government's reliance upon Bourexis v. Carroll County, 96 Md. App. 459, 625 A.2d 391 (Md. App. 1993), is misplaced. The Maryland Court of Appeals did not hold that an unincorporated association cannot own property. Rather, it held that in Bourexis, in which there was no evidence offered as to the "governance, powers, financing, or property" of the organization, there was "nothing to show it [was] an entity that may be sued. Id. At 395. For reasons stated herein, this Court concludes that the SAP Fellowship is an unincorporated association and, as such, is legally capable of owning property. It is, therefore, necessary to determine the extent to which the SAP Fellowship has carried its burden of proving that it owned the property at issue. D. What Did The Fellowship Prove It Owned? The SAP Fellowship chose not to maintain any bank accounts or even maintain records of its finances. That decision may well be consistent with the group's philosophy. [n21] The absence of bank accounts or records may also, whether as a deliberately sought "benefit" or not, make it more difficult for law enforcement to investigate its activities. Whatever the reasons for an absence of records -- be they philosophical or otherwise -- the decision has a price which goes beyond the inability to earn interest on bank deposited funds. That price certainly includes the inconvenience that results when the Fellowship finds itself involved in a legal proceeding in which it has the burden of proof. In this case, had the SAP Fellowship had its own bank account in which it maintained its funds it might have little problem in prevailing as to those funds. [n22] Similarly, although perhaps less conclusively, had the SAP Fellowship maintained records of its funds and had Kotmair as Fiduciary keep the association funds completely separate from his own, the Fellowship would have at least a possibility of carrying its burden of proof. However, the Fellowship presents no records whatsoever. Nor does the evidence establish that its funds were maintained separately from those of Kotmair. And, most significantly, there is no evidence from which the Court can determine at what point after Fellowship funds leave the Office in the possession of Kotmair that they cease to be held exclusively as the property of the SAP Fellowship. The record establishes that Kotmair was entitled to, felt free to, and did, take funds from the Fellowship and use them for his personal sustenance. Kotmair espouses a doctrine that would have funds that he takes to spend for personal use remain the property of the SAP Fellowship. Indeed, in the world according to Kotmair, if he uses Foundation funds for his food, the Foundation ownership extends to the food even as it proceeds through his digestive system. For example: THE COURT: We are trying to get an understanding of when something belongs to you and when it doesn't. When it belongs to [the SAP Fellowship], so I just want you to try and help me understand that. If you go to the grocery store and you buy Wheaties [with fellowship funds], when is it yours, after you eat it or . . . Kotmair: That is a hard question to answer. THE COURT: That is why we ask it. Kotmair: If the energy from it goes to the Fellowship, and it does, I would say it is to the benefit of the fellowship. The Court declines to follow the "logic" of Kotmair's position or to dwell upon the point in the digestive process at which Kotmair would agree that the I.R.S. could effect collection. Rather, the Court must conclude that once Kotmair takes Fellowship funds for personal use, those funds can no longer be found to be Fellowship property immune from levy for Kotmair's tax liabilities. The Court finds from the evidence that the SAP Fellowship obtained, and had ownership of, the cash and money orders it received for memberships and the sales of goods, and, possibly services. If the Fellowship had established that Kotmair's possession of particular assets was solely as Fiduciary for the SAP Fellowship the ownership could remain in the Fellowship. However, at such point as Kotmair took the assets and did not place them in a location [n23] that was exclusively used for the maintenance of Fellowship assets, the ability of the SAP Fellowship to establish ownership in this case was lost. In the context of this case, once the cash and money orders were taken from the office and placed in something other than a Fellowship depository, the funds were available for the immediate personal use of Kotmair, mingled with his own assets, and no longer had the character of Fellowship assets sufficient to avoid levy. In this case, the cash and money orders that had been removed from the office prior to the raid were found in the Residence in various locations, none of which have been established to be exclusive association depositories. However, the Court finds that the $ 384 of cash, the $ 210 of money orders and $ 40 of Susan B. Anthony Dollars found at the Office were, when found, property of the SAP Fellowship which had not yet been mingled with Kotmair's personal assets. Accordingly, the Court concludes that the SAP Fellowship has carried its burden of proof and proven ownership with regard to these assets found in the Office, but not as to the cash and money orders found in the Residence. The evidence regarding the numismatic items is not sufficient to permit any finding for the SAP Fellowship. There are references in the evidence to some association receipts of numismatic items. But, there is an absence of specific evidence relating to any particular item sufficient to carry the burden of proof. Moreover, the evidence is not adequate to establish that any of the numismatic items were maintained in a location that can be found to be a Fellowship depository. There was no record of which items belonged to the association. And, there was nothing, not even a sign, a label, a wrapping, or anything else that would indicate that the ownership of the items was other than that of Kotmair in whose home the items were found. Accordingly, the Court cannot find for the plaintiff with regard to the numismatic coins and items. IV. COSTS AND LEGAL FEES The history of this case, and the related litigation, leads the Court to address the matter of costs and legal fees at this point to avoid further proceedings. The Court has found for the plaintiff in part and the Defendant in part. Therefore, the parties shall bear their own respective costs. To the extent that the plaintiff has prevailed, the Government had a reasonably justified position. Accordingly, there shall be no award of legal fees. V. CONCLUSION For the foregoing reasons: 1. The Court determines that the Plaintiff, the SAP Fellowship, is entitled to recover the $ 384 in currency, $ 40 in Susan B. Anthony Dollars, and $ 210 in money orders seized from the Office and levied upon to satisfy the tax liabilities of Kotmair on September 2, 1994. 2. Judgment shall be entered by separate Order [**22] awarding the Plaintiff a recovery of $ 634, plus interest thereon as provided by law, the parties to bear their own respective costs. SO DECIDED this 18th day of December, 1996. Marvin J. Garbis United States District Judge JUDGMENT This action came on for trial before the Court on September 20, 1996, Honorable Marvin J. Garbis, United States District Judge presiding. On this date, the Court has issued its Memorandum of Decision in this case. In view of the foregoing, Judgment is hereby entered in favor of Plaintiff SAVE-A-PATRIOT FELLOWSHIP against Defendant United States of America in the total amount of $ 634.00 plus interest as provided by law, the parties to bear their own costs. SO ORDERED this 18th day of December, 1996. Marvin J. Garbis United States District Judge - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n1 The sacred substance used in the Temple prior to its destruction and, some believe, necessary to sanctify the Temple upon its reconstruction so that the Messiah can perform prophesied miracles upon his/her return. n2 In the Kotmair case, the Plaintiff presented the testimony of Professor Vandyl Jones who claimed to be the original for "Indiana Jones." Professor Jones, was, in fact, searching for the Ark of the Covenant and actually found the ancient "factory" at which the Israelites manufactured and stored Holy Qettorett for Temple use. He found stored there a large quantity of "Holy Qettorett mix" needing only the addition of Sodom Salt and other ingredients. Dr. Jones entrusted a small vial of the substance to a "follower" of Kotmair, Scott Hucklebee, who brought it to America. However, the Court did not find that the vial was in the Residence at the time of the raid. Also, there was a sufficient supply left in Israel for use if, and when, needed so that the loss of the Hucklebee vial would not cause irreparable harm. n3 In the search warrant return this is described as "APPLICATION & 4 MO - $ 175." The $ 210 value is found because it is used in the parties' Joint Statement of Facts. n4 26 U.S.C. § 6532(c)(1). n5 That is the "facts" according to the Fellowship as led by Kotmair. n6 As stated by Alice Roosevelt Longworth, Theodore Roosevelt's daughter. n7 The SAP Fellowship claims that the $ 44,115 "hoard" was set aside for Fellowship use, noting that it has engaged in expensive activities, such as the production of the "Just The Facts" video tape. The Court makes no finding as to this contention in view of the denial of the claim for these funds on limitations grounds. n8 See the SAP Fellowship Program Agreement. n9 For example, a "press release" stating that a Washington State attorney had concluded that the I.R.S. has no authority to seize property in that state for income tax liabilities of "most citizens." This conclusion, it is said, was presented to, and not refuted by, the Washington State Bar Association and Attorney General. n10 Presumably Federal Reserve Notes since the Fellowship has an unorthodox view of "dollars." n11 Useful, presumably, in supporting arguments as to the original meaning of words in the Constitution and related documents. n12 The Court notes that the actor Edward Herrman played the role of a grass roots tax protestor in "Harry's War" and, more recently, the role of the President of the United States in "Pandora's Clock." n13 See the dust jacket to Irwin A. Schiff How Anyone Can Stop Paying Income Taxes (Freedom Books 1982). n14 United States v. Schiff, 801 F.2d 108 (2nd Cir. 1986), cert denied. 480 U.S. 945, 94 L. Ed. 2d 789, 107 S. Ct. 1603 (1987) n15 Schiff in United States v. Schiff, 612 F.2d 73, 75 (2nd Cir. 1979) (reversing conviction of tax crimes and remanding for new trial). n16 The Court is not finding that the program operates as asserted, but only that such a program is presented to members. n17 Presumably, its membership or a class of members. n18 Kotmair's role in the nuptials is not specified. n19 For decisions holding that an unincorporated association cannot own property, see Krumbine v. Lebanon County Tax Claim Bureau, 541 Pa. 384, 663 A.2d 158, 160 (Pa. 1995) (real property); Rock Creek Gardens Tenants Assoc. v. A.M. & L.A. Ferguson, 404 A.2d 972 (D.C. App. 1970) (per curium) (real property); United States v. Thevis, 474 F. Supp. 134, 138 (N.D. Ga. 1979); Libby v. Perry, 311 A.2d 527, 531-32 (Me. 1973). But See Loving Saviour Church v. United States, 556 F. Supp. 688, 690 (D.S.D. 1983) (holding that an unincorporated association is a legal entity and therefore can own property). n20 Compare, Motta v. Samuel Weiser, Inc., 768 F.2d 481, 485-86 (1st Cir. 1985) (stating that "courts may determine that ownership vests in the individuals who comprise the organizations.") n21 The Fellowship appears to have a distrust of banks. n22 Compare Arth v. United States 735 F.2d 1190, 1193 (9th Cir. 1984), in which the claimant's funds were deposited into the taxpayer's account and were held to have properly been levied upon. n23 Be it an office, a safe, a designated part of a safe, or other container plainly labeled to show Fellowship ownership and rigorously kept as Fellowship property. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
I believe the word income was defined in the 1939 Income Tax Act (going from memory) and it was defined as a profit or gain from a capital investment. The term income has never been otherwise defined in law. It is not necessary for a statute to define every word it uses. The term "income" was defined in the 1856 edition of Bouvier's "A LAW DICTIONARY" 6th ed. Philadelphia : Childs & Peterson, 1856. 2 vols. 2. It has been holden that a devise of the income of land, is in effect the same as a devise of the land itself. 9 Mass. 372; 1 Ashm. 136. Moreover, the Supreme Court has recognized an applicable definition. U.S. Supreme Court GOODRICH v. EDWARDS, 255 U.S. 527 (1921) And the definition of 'income' approved by this Court is:
[Neil McIver #103] As I said, some are charged with violating penalty statutes, one of which you posted. It is not possible to violate a law that prescribes a penalty. ... In order to be properly penalized with 7201, the state must show the citation of the tax referred to in "tax imposed by this title or the payment thereof", but they do not. I would surmise that it is not possible to demonstrate to a court that your argument has any legal merit. The tax imposed by Title 26 is the Federal Income Tax. The reference to "tax imposed by this title" clearly identifies the tax in question. Criminal statutes routinely prescribe a penalty. How would one be sentenced for an alleged crime that FAILS to prescribe a penalty? United States Code U.S. Code as of: 01/19/04 (a) Murder is the unlawful killing of a human being with malice aforethought. Every murder perpetrated by poison, lying in wait, or any other kind of willful, deliberate, malicious, and premeditated killing; or committed in the perpetration of, or attempt to perpetrate, any arson, escape, murder, kidnapping, treason, espionage, sabotage, aggravated sexual abuse or sexual abuse, child abuse, burglary, or robbery; or perpetrated as part of a pattern or practice of assault or torture against a child or children; or perpetrated from a premeditated design unlawfully and maliciously to effect the death of any human being other than him who is killed, is murder in the first degree. Any other murder is murder in the second degree. (b) Within the special maritime and territorial jurisdiction of the United States, Whoever is guilty of murder in the second degree, shall be imprisoned for any term of years or for life. (c) For purposes of this section - (2) the term "child" means a person who has not attained the age of 18 years and is - (B) at least six years younger than the perpetrator; (3) the term "child abuse" means intentionally or knowingly causing death or serious bodily injury to a child; (4) the term "pattern or practice of assault or torture" means assault or torture engaged in on at least two occasions; (5) the term "serious bodily injury" has the meaning set forth in section 1365; and (6) the term "torture" means conduct, whether or not committed under the color of law, that otherwise satisfies the definition set forth in section 2340(1). United States Code U.S. Code as of: 01/19/04 Any person who willfully attempts in any manner to evade or defeat any tax imposed by this title or the payment thereof shall, in addition to other penalties provided by law, be guilty of a felony and, upon conviction thereof, shall be fined not more than $100,000 ($500,000 in the case of a corporation), or imprisoned not more than 5 years, or both, together with the costs of prosecution. From Idiot Legal Arguments: Disagreement with tax law is not a defense to willfulness Disagreement with tax law is not a defense to willfulness: US v. Ferguson (SD Ind 1985) 615 F.Supp 8 aff’d 793 F2d 828 cert. denied 479 US 933 (in fact, the disagreement with the tax laws or the notion that the Internal Revenue Code is invalid shows an awareness of the contents of the tax laws and helps prove the element of willfulness); US v. Kraeger (2d Cir 1983) 711 F2d 6; US v. Weninger (10th Cir 1980) 624 F2d 163 cert.den 449 US 1012; US v. Benson (5th Cir 1979) 592 F2d 257; Koar v. US (SDNY unpub 8/14/98) 82 AFTR2d 6329, 98 USTC para 50748; knowledge that these arguments have already been rejected by courts or that the people advocating these arguments have already lost in court undermines a good faith defense: Roth v. CIR (9/23/92) TC Memo 1992-563; Gajewski v. CIR (11/10/76) 67 Tax Ct 181 aff'd (8th Cir 1978) 578 F2d 1383; US v. Condo (9th Cir 1984) 741 F2d 238 cert.den 469 US 1164; (similarly when the same perp persists in putting up losing arguments) Walker alias Theonaleth v. CIR (3/12/96) TC Memo 1996-124; ditto Harrell v. CIR (6/15/98) TC Memo 1998-207; (ignoring professional advice from lawyer or accountant) Ware v. CIR (6/5/84) TC Memo 1984-295; ("It should be pointed out, however, that neither a defendant's disagreement with the law, nor his own belief that such law is unconstitutional, no matter how earnestly held, constitute a defense of good faith misunderstanding or mistake. It is clearly the duty of all citizens to obey the law whether they agree with it or not. ... The defendant contends that his personal belief in what the law is or should be supersedes the federal Constitution and statutes as construed and applied by the Supreme Court. If each citizen is a law unto himself, government will exist in name only.") US v. O.W. Ware (10th Cir 1979) 608 F2d 400; (confusion or misunderstanding of the details of tax laws or of one's obligations under them is distinct from an opinion that the tax law is unconstitutional) US v. House (WD Mich 1985) 617 F.Supp 232 aff'd 787 F2d 593(t); (it is possible that the perp's naive reliance on a taxevasion guru could be used to defend against a charge of fraudulent intent but it cannot possibly defend against the fact that the perp failed to file his tax return, which does not depend upon intent) Nilson v. CIR (10/21/85) TC Memo 1985-535; (perp cannot offer as mitigation that he relied on the advice of certain lawyers, although it appears that he had some slight contact with each of them there is no evidence of the sort of intensive relationship, including full disclosure, that would make a good faith defense) US v. Masat (5th Cir 1991) 948 F2d 923 cert.den 506 US 835; (the facts that the perp had attended tax protester gatherings and had tried to use worthless funny money to pay her debts negated a good faith defense) US v. Grosshans (6th Cir 1987) 821 F2d 1247 cert.den 484 US 987; (altho some provisions of the tax law are sufficiently murky to justify litigation, the basic requirement that everyone receiving income above a certain minimum from any source must file returns and pay taxes is clear beyond dispute) US v. Melton (4th Cir unpub 3/8/96) 86 F3d 1153(t), 77 AFTR2d 2361 cert.den 519 US 820; (filing a false W-4 and failing to file a tax return evidences not a different interpretation but a willful breach of the tax law) Rowlee v. CIR (6/15/83) 80 TC 1111; (mere omission to file, without any sign of dishonesty or concealment, is insufficient to sustain a charge of tax fraud) Kotmair v. CIR (6/19/86) 86 TC 1253; ("However, a pattern of consistent failures to file for several years is strong evidence of fraud.") Harrell v. CIR (6/15/98) TC Memo 1998-207; similarly (mere failure to file a return, without more, does not show fraud but the addition of any other hanky-panky such as offering long-discredited protester arguments or furtive financial practices will indicate fraudulent intent) Sherrer v. CIR (4/14/99) TC Memo 1999-122; (having filed returns and paid taxes in previous years, perp could not pretend that he was ignorant of the general duty of filing such returns, etc.) US v. Bowers (4th Cir 1990) 920 F2d 220; similarly US v. Ferguson (7th Cir 1985) 793 F2d 828 cert.den 479 US 933; similarly US v. Trowbridge (9th Cir unpub 3/26/97) 110 F3d 71(t) cert.den 520 US 1235; similarly US v. Hart (ND Ind 1987) 673 F.Supp 932; similarly US v. Shields (8th Cir 1981) 642 F2d 230 cert.den 454 US 848; Wilber v. CIR (8/31/87) TC Memo 1987-439 aff'd (8th Cir unpub 11/10/88) 871 F2d 1092(t); US v. Rifen (1978) 577 F2d 1111; Cavanaugh v. CIR (8/19/91) TC Memo 1991-407 aff'd (10th Cir unpub 2/9/93) 986 F2d 1426(t); Jenny v. CIR (1/3/83) TC Memo 1983-1; "We believe an ordinary person would know that attempting to avoid payment of taxes is unlawful." US v. R. Bailey (10th Cir unpub 11/22/95) 72 F3d 138(t), 79 AFTR2d 1045. Filing W-4 forms falsely claiming many imaginary dependents is sufficient evidence of fraud. Wiggins-El v. CIR (9/10/81) TC Memo 1981- 495; ditto Coulter v. CIR (4/15/92) TC Memo 1992-224; similarly supposedly divesting self of all seizable properties by fraudulent conveyance (deeding to near relative "for $1 and other considerations" after the IRS began its investigations) is a sign of fraudulent intent. Cavanaugh v. CIR (8/19/91) TC Memo 1991- 407 aff'd (10th Cir unpub 2/9/93) 986 F2d 1426(t); similarly going to considerable lengths to conceal transactions and assets. Harrell v. CIR (6/15/98) TC Memo 1998-207; Wilber v. CIR (8/31/87) TC Memo 1987-439 aff'd (8th Cir unpub 11/10/88) 871 F2d 1092(t); Cupp v. CIR (10/14/75) 65 Tax Ct 68 aff'd (3d Cir 1977) 559 F2d 1207; having received a letter from the IRS assuring the perp that the tax is valid and constitutional and a letter from his employer that the weight of authority requires withholding taxes from his paycheck negates the defense of honestly not believing that the tax applied to him. Coulter v. CIR (4/15/92) TC Memo 1992-224; ditto US v. Rifen (1978) 577 F2d 1111; similarly having been notified by letter from the IRS that he is liable for taxes negates "good faith" defense that he thought maybe he wasn't. US v. Willie (10th Cir 1991) 941 F2d 1384 cert.den 502 US 1106; having previously lost a tax case on similar arguments negates good faith defense. Graber v. US (SD Iowa 1997) 993 F.Supp 685; being aware that his anti-tax gurus had been convicted of tax evasion negates good faith defense. US v. Crosson (ED Penn unpub 12/20/95); "The fact that the plaintiffs proceeded in this action without the assistance of an attorney does not insulate them from the [good faith] requirements of [FRCP] Rule 11. Any research on the part of the plaintiffs would have clearly shown that it has no chance of success in arguing that they were not subject to the federal income tax laws." Pottorf v. Bryan (D Kan unpub 5/18/87); perp’s failure to keep appointments for IRS interviews negates good faith defense. US v. Crosson (ED Penn unpub 12/20/95); similarly perp's refusal to allow IRS to examine his business ledgers on the pretext that because he refused to regard paper money as real money his ledgers did not show any dollar amounts. Wilber v. CIR (8/31/87) TC Memo 1987-439 aff'd (8th Cir unpub 11/10/88) 871 F2d 1092(t); perp’s refusal to file tax returns or pay taxes for several years, which persists because of his harebrained arguments, is a sufficient reason for the bankruptcy court to dismiss his petition and refuse him the protection of the bankruptcy law, since his available assets to pay his creditors cannot possibly be evaluated until his tax liability can be known. In re Shugrue (Bankr., ND Tex 1998) 221 Bankr.Rptr 394; ditto In re Cobb (Bankr. MD Fla 1998) 216 Bankr.Rptr 676; claim of innocent ignorance of the law is negated by the fact that the mountebank had been ordered by courts and by govt agencies to cease his scam, and that he even boasted that he was ignoring these orders. US v. Hildebrand (8th Cir 1998) 152 F3d 756; similarly such pretense is negated by the mountebank's own claim to have done legal research and his obvious usage of Black's Law Dictionary. US v. Fulbright (9th Cir 1997) 105 F3d 443 cert.den 520 US 1236; similarly when the tax evader "purports to be familiar with the tax laws". Blaty v. CIR (10/1/84) TC Memo 1984-518; [in one instance of imposing a fine under Rule 11, the court said, "An example of the frivolity of these filings is illustrated by the frequent bald citations to the Constutition of the US, the UCC, and any nearby Legal Dictionary." Stoecklin v. US (MD Fla unpub 11/7/97) 80 AFTR2d 8207]; even though perp is pro se, the court cases he misapplies clearly show that his position is wrong. Tornichio v. US (ND Ohio unpub 3/12/98) 81 AFTR2d 1377, 98 USTC para 50299; similarly tax evader's very convoluted research into ancient coinage laws evidenced his wrongful intent. US v. Shields (8th Cir 1981) 642 F2d 230 cert.den 454 US 848; fact that tax evader had advanced degrees with Phi Beta Kappa honors negated his good faith defense that he didn't understand simple IRS instructions and words like dollars. Stout v. CIR (3/3/86) TC Memo 1986-80; similarly tax evader's own testimony that he had first "conducted a very careful study" of reading several tax protester manuals (but evidently not a single conventional lawbook on taxation) effectively established that his tax evasion was willful and deliberate. US v. O.W. Ware (10th Cir 1979) 608 F2d 400; the courts have noticed when a litigant was using canned pleadings. US v. Schiefen (D SoDak 1995) 926 F.Supp 877 aff'd (8th Cir 1996) 81 F3d 166 mand.denied 522 US 1074; (and using canned pleadings so mindlessly that the defendant has not altered papers that speak of him as the plaintiff and ask for summary judgment against the defendant) Langseth v. CIR (9/19/83) TC Memo 1983-576; ("The Court suspects that the debtor has been overly active in searching the Internet for the latest batch of crazy and absurd pleadings created by the latest inventive tax protester group.... His pleadings look like they came off the latest web page for tax protesters and, as the Court has stated more than once, they make No Sense.") In re Shugrue (Bankr., ND Tex 1998) 221 Bankr.Rptr 394; "It is apparent that these cases are not mere isolated incidents with a peculiar coincidental similarity .... These tax protesters with their mass-produced attachments, complaints, motions and memoranda, all march to a common drummer." Vaughn v. US (WD La 1984) 589 F.Supp 1528; ditto In re Busby (MD Fla unpub 10/2/98) 82 AFTR2d 6924; ditto US v. Schiefen (D SD 1995) 926 F.Supp 877 aff’d 81 F3d 166 mand.denied 522 US 1074; "The language used by Plaintiff in this case is very similar to the language used by other persons ... not only in this district but throughout the US. It is not difficult, based upon this widespread use of the terms and the similarity of the pleadings, to conclude that there is ongoing communications among persons espousing these theories." R. Jones v. T.G. Watson (ND Ohio unpub 9/29/97); "The filing of frivolous lawsuits merely to protest the assessment of federal income tax has become a new and unpleasant indoor sport, particularly at a time when court dockets are crowded with cases of merit. The issues raised by the plaintiff in this action have been raised and adversely decided many times before. While consideration is given to the fact that the plaintiff is representing himself, the filing of a suit pro se does not give the plaintiff the right to proceed frivolously. Parties may be assessed reasonable expenses and attorney's fees under FRCP rule 11 and 28 USC sec. 2412 and the court finds that such an award is appropriate in this case. ... Would that law, common or otherwise, also authorize assessment of a penalty upon plaintiff for the time and trouble to which his frivolous action has subjected the court." McKinney v. Regan (MD La 1994) 599 F.Supp 126, 55 AFTR2d 1509, 85 USTC para 9479. Where tax protester's pleadings, submitted by their lawyer, claimed that their arguments had never been addressed by any federal court, the court quoted at length from an opinion of a circuit court of another circuit in a case involving the same arguments and the same lawyer. Charczuk v. CIR (10th Cir 1985) 771 F2d 471; Some of this argument arises from a serious misunderstanding of the Cheek decision, which misunderstanding has been widely repeated throughout tax scofflaw propaganda: In 1980, John L. Cheek, an airline pilot who had previously paid his income taxes, abruptly stopped filing tax returns and even filed a very unsuccessful challenge to the entire notion of income tax; Cheek v. Doe (ND IL 1986) 110 FRD 420 aff'd in part (7th Cir 1987) 828 F2d 395 cert.den 484 US 955; therafter he was convicted for numerous tax violations, and appealed on the grounds that the trial court should have not have instructed the jury to disregard his opinion that the income tax law was invalid as might relate to the willfulness of violating the tax law. The Circuit Court rejected that argument, US v. Cheek (7th Cir 1989) 882 F2d 1263, but the US Supreme Court held that the jury could at least hear the defendant explain how he thought the tax laws were invalid and then decide for themselves the issue of willfulness (and it ordered a new trial), Cheek v. US (1991) 498 US 192, 112 L.Ed.2d 617, 111 S.Ct 604. However, the Circuit Court, in transmitting the case back to the trial court for a new trial, emphasized some points made by the Supreme Court: "Tax evaders who persist in their frivolous beliefs, such as that wages are not income or that FRNs do not constitute cash or income, should not be encouraged by the [Supreme] Court's decision in Cheek or our decision today. While a defendant is now permitted to argue that his failure to file tax returns and to pay his income taxes was the result of his incredible misunderstanding of the tax law's applicability, the govt remains free to present evidence demonstrating that he knew what the law required but simply chose to disregard those duties.." US v. Cheek (7th Cir 1991) 931 F2d 1206; in the new trial the jury was not as gullible as Cheek had hoped and he was sentenced to a year and a day in prison and a fine of $62G, and his attempt to appeal this new conviction was very unsuccessful. US v. Cheek (7th Cir 1993) 3 F3d 1057 cert.den 510 US 1112; as a result of his imprisonment his career as an airline pilot was terminated. Cheek v. American Airlines Inc. (7th Cir unpub 6/25/96) 89 F3d 838(t) cert.denied 519 US 993. A court was permitted to tell the jury that the perp's opinion that tax laws are unconstitutional cannot constitute a good faith defense, and the resulting conviction for multiple counts of tax evasion upheld. US v. M.L. Lindsay (10th Cir 7/1/99) _F3d_, 99 USTC para 50648, 84 AFTR2d 5102 ; court can instruct jury that they can consider whether the defendant's notions about tax laws are reasonable as a factor in evaluating whether he held those opinions in good faith. US v. D.D. Murphy (7th Cir unpub 6/10/99); but there is a difference between a plausible misunderstanding of the meaning of the tax law and the willful failure to comply with it as a challenge to its validity, as the defendant's previous filing of tax returns demonstrates that he was aware that the law required the filing of tax returns then his subsequent deliberate non-filing demonstrated the willfulness and his theories about the law's constitutionality were immaterial. US v. Masat (5th Cir 1991) 948 F2d 923 cert.den 506 US 835;
[Neil McIver #107 to Starwind] I think all three of my statements are adequetly supported by the Brushaber and Stanton cases which Nolu already posted in #77 above which I'm copying here. In Stanton, the Supreme Court termed the "theory" underlying Pollack "a mistaken theory." U.S. Supreme Court * * * Without attempting minutely to state every possible ground of attack which might be deduced from the averments of the bill, but in substance embracing every material grievance therein asserted and pressed in argument upon our attention in the elaborate briefs which have been submitted, we come to separately dispose of the legal propositions advanced in the bill and arguments concerning the two classes. Class A. Under this the bill charged that the provisions of the statute 'are unconstitutional and void under the 5th Amendment, in that they deny to mining companies and their stockholders equal protection of the laws and deprive them of their property without due process of law,' for the following reasons: (1) Because all other individuals or corporations were given a right to deduct a fair and reasonable percentage for losses and depreciation of their capital, and they were [240 U.S. 103, 111] therefore not confined to the arbitrary 5 per cent fixed as the basis for deductions by mining corporations. (2) Because by reason of the differences in the allowances which the statute permitted, the tax levied was virtually a net income tax on other corporations and individuals, and a gross income tax on mining corporations. (3) Because the statute established a discriminating rule as to individuals and other corporations as against mining corporations on the subject of the method of the allowance for depreciations. (4) Because the law permitted all individuals to deduct from their net income dividends received from corporations which had paid the tax on their incomes, and did not give the right to corporations to make such deductions from their income of dividends received from other corporations which had paid their income tax. This was illustrated by the averment that 99 per cent of the stock of the defendant company was owned by a holding company, and that under the statute not only was the corporation obliged to pay the tax on its income, but so also was the holding company obliged to pay on the dividends paid it by the defendant company. (5) Because of the discrimination resulting from the provision of the statute providing for a progressive increase of taxation or surtax as to individuals, and not as to corporations. (6) Because of the exemptions which the statute made of individual incomes below $4,000, and of incomes of labor organizations and various other exemptions which were set forth. But it is apparent from the mere statement of these contentions that each and all of them were adversely disposed of by the decision in the Brushaber Case, and they all therefore may be put out of view. Class B. Under this class these propositions are relied upon: (1) That as the 16th Amendment authorizes only an exceptional direct income tax without apportionment, to which the tax in question does not conform, it is therefore not within the authority of that Amendment. (2) Not being within the authority of the 16th Amendment, the tax is therefore, within the ruling of Pollock v. Farmers' Loan & T. Co. 157 U.S. 429 , 39 L. ed. 759, 15 Sup. Ct. Rep. 673; 158 U.S. 601 , 39 L. ed. 1108, 15 Sup. Ct. Rep. 912, a direct tax and void for want of compliance with the regulation of apportionment. As the first proposition is plainly in conflict with the meaning of the 16th Amendment as interpreted in the Brushaber Case, it may also be put out of view. As to the second, while indeed it is distinct from the subjects considered in the Brushaber Case to the extent that the particular tax which the statute levies on mining corporations here under consideration is distinct from the tax on corporations other than mining and on individuals, which was disposed of in the Brushaber Case, a brief analysis will serve to demonstrate that the distinction is one without a difference, and therefore that the proposition is also foreclosed by the previous ruling. The contention is that as the tax here imposed is not on the net product, but in a sense somewhat equivalent to a tax on the gross product of the working of the mine by the corporation, therefore the tax is not within the purview of the 16th Amendment, and consequently it must be treated as a direct tax on property because of its ownership, and as such void for want of apportionment. But, aside from the obvious error of the proposition, intrinsically considered, it manifestly disregards the fact that by the previous ruling it was settled that the provisions of the 16th Amendment conferred no new power of taxation, but simply prohibited the previous complete and plenary power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged, and being placed in the category of direct taxation subject to apportionment by a consideration of the sources from which the income was derived, - that is, by testing the tax not by what it was, a tax on income, but by a mistaken theory deduced from the origin or source of the income taxed. Mark, of course, in saying this we are not here considering a tax not within the provisions of the 16th Amendment, that is, one in which the regulation of apportionment or the rule of uniformity is wholly negligible because the tax is one entirely beyond the scope of the taxing power of Congress, and where consequently no authority to impose a burden, either direct or indirect, exists. In other words, we are here dealing solely with the restriction imposed by the 16th Amendment on the right to resort to the source whence an income is derived in a case where there is power to tax for the purpose of taking the income tax out of the class of indirect, to which it generically belongs, and putting it in the class of direct, to which it would not otherwise belong, in order to subject it to the regulation of apportionment. But it is said that although this be undoubtedly true as a general rule, the peculiarity of mining property and the exhaustion of the ore body which must result from working the mine cause the tax in a case like this, where an inadequate allowance by way of deduction is made for the exhaustion of the ore body, to be in the nature of things a tax on property because of its ownership, and therefore subject to apportionment. Not to so hold, it is urged, is as to mining property but to say that mere form controls, thus rendering in substance the command of the Constitution that taxation directly on property because of its ownership be apportioned, wholly illusory or futile. But this merely asserts a right to take the taxation of mining corporations out of the rule established by the 16th Amendment when there is no authority for so doing. It moreover rests upon the wholly fallacious assumption that, looked at from the point of view of substance, a tax on the product of a mine is necessarily in its essence and nature in every case a direct tax on property because of its ownership, unless adequate allowance be made for the exhaustion of the ore body to result from working the mine. We say wholly fallacious assumption because, independently of the effect of the operation of the 16th Amendment, it was settled in Stratton's Independence v. Howbert, 231 U.S. 399 , 58 L. ed. 285, 34 Sup. Ct. Rep. 136, that such tax is not a tax upon property as such because of its ownership, but a true excise levied on the results of the business of carrying on mining operations. (pp. 413 et seq.) As it follows from what we have said that the contentions are in substance and effect controlled by the Brushaber Case, and, in so for as this may not be the case, are without merit, it results that, for the reasons stated in the opinion in that case and those expressed in this, the judgment must be and it is affirmed. http://laws.findlaw.com/us/231/399.html U.S. Supreme Court * * * It is not correct, from either the theoretical or the practical standpoint, to say that a mining corporation is not engaged in business, but is merely occupied in converting its capital assets from one form into another. The sale outright of a mining property might be fairly described as a mere conversion of the capital from land into money. But when a company is digging pits, sinking shafts, tunneling, drifting, stoping, drilling, blasting, and hoisting ores, it is employing capital and labor in transmuting a part of the realty into personalty, and putting it into marketable form. The very process of mining is, in a sense, equivalent in its results to a manufacturing process. And, however the operation shall be described, the transaction is indubitably 'business' within the fair meaning of the act of 1909; and the gains derived from it are properly and strictly the income from that business; for 'income' may be defined as the gain derived from capital, from labor, or from both combined, and here we have combined operations of capital and labor. As to the alleged inequality of operation between mining corporations and others, it is of course true that the revenues derived from the working of mines result to some extent in the exhaustion of the capital. But the same is true of the earnings of the human brain and hand when unaided by capital, yet such earnings are commonly dealt with in legislation as income. So it may be said of many manufacturing corporations that are clearly subject to the act of 1909, especially of those that have to do with the production of patented articles; although it may be foretold from the beginning that the manufacture will be profitable only for a limited time, at the end of which the capital value of the plant must be subject to material depletion, the annual gains of such corporations are certainly to be taken as income for the purpose of measuring the amount of the tax. * * * As to what should be deemed "income" within the meaning of § 38, it of course need not be such an income as would have been taxable as such, for at that time (the Sixteenth Amendment not having been as yet ratified), income was not taxable as such by Congress without apportionment according to population, and this tax was not so apportioned. Evidently Congress adopted the income as the measure of the tax to be imposed with respect to the doing of business in corporate form because it desired that the excise should be imposed, approximately at least, with regard to the amount of benefit presumably derived by such corporations from the current operations of the Government. In Flint v. Stone-Tracy Co., 220 U.S. 107, 165, it was held that Congress in exercising the right to tax a legitimate subject of taxation as a franchise or privilege, was not debarred by the Constitution from measuring the taxation by the total income, although derived in part from property which, considered by itself, was not taxable. It was reasonable that Congress should fix upon gross income, without distinction as to source, as a convenient and sufficiently accurate index of the importance of the business transacted. And from this point of view, it makes little difference that the income may arise from a business that theoretically or practically involves a wasting of capital.
Shiff's defense did not argue that the tax return was not required, therefore the judge could decline to digress into matters not relevant to the defense. Schiff proffered an unsuccessful defense to have his acts found not to be "willful" due to his alleged mental disorder. One filing on behalf of Mr. Schiff, excerpted below, related that "Mr. Schiffs behavior is not rational. It is the product of a Delusional Personality Disorder that is not amenable to treatment and is unlikely to remit." FOR IMMEDIATE RELEASE Professional Tax Resister Sentenced to More Than 12 Years in Prison for Tax Fraud WASHINGTON, D.C. - Longtime tax protestor Irwin Schiff was sentenced in federal district court in Las Vegas to total of 163 months in prison-151 months for tax fraud and an additional 12 months for contempt of court - the Department of Justice and the Internal Revenue Service (IRS) announced today. In addition, Schiff was ordered to pay more than $4.2 million in restitution and to serve three years of supervised release.. In October 2005, Schiff was convicted of conspiring to defraud the United States, aiding and assisting in the preparation of false income tax returns, filing his own false tax returns, and evading the payment of millions of dollars in back taxes owed. This marks the third time Schiff has been convicted for committing federal tax offenses. Schiff previously has spent more than four years in jail for his tax crimes. Two associates of Schiff, Cynthia Neun and Lawrence Cohen, were also convicted of aiding and assisting other taxpayers in the filing of false tax returns. On February 3, 2006, Cohen was sentenced to 33 months in prison. Neun was sentenced yesterday to 68 months in prison and ordered to pay $1.1 million in restitution.. “Last October, a jury of his peers found Mr. Schiff guilty of serious tax crimes related not only to his own tax evasion, but also to his encouraging and enabling others to file false returns. The prison sentence handed down today reflects the seriousness of those crimes,” said Eileen J. O’Connor, Assistant Attorney General for the Justice Department’s Tax Division. “The Department of Justice is working vigorously to vindicate the interests of law- abiding Americans who file returns and pay the taxes the law requires.” . “Mr. Schiff earned this sentence,” said IRS Commissioner Mark Everson. “For years he has preyed on others by holding out false hope that they need not pay their taxes.”. According to the indictment and the evidence introduced at trial, beginning in 1995, Schiff aided thousands of taxpayers in the filing of false federal income tax returns with the IRS that reported zero taxable income in spite of the taxpayers earning reportable income. Schiff owned and operated Freedom Books, a business that sold books, tapes, and informational packages encouraging customers not to pay income tax. According to a government witness who testified at trial, between 1997 and 2002, Freedom Books sold more than $4.2 million of these products.. The evidence presented at trial also proved that Schiff evaded the payment of more than $2 million in taxes he owed the IRS from 1979 through 1985. Schiff concealed income he earned from Freedom Books, in part, by using offshore bank accounts and conducting financial transactions through secret “warehouse” banking services. The evidence also showed that Schiff used debit cards issued by offshore banks to obtain funds he transferred offshore, that he opened bank accounts using multiple tax identification numbers and that he concealed his wealth by hiding his assets through the use of nominees.. Assistant Attorney General O’Connor thanked Tax Division Trial Attorneys Jeffrey A. Neiman, David J. Ignall, and Melissa Schraibman, who prosecuted the case. She also thanked Criminal Investigation Special Agents David Holland, Adam Steiner, and Autumn Woodard of the IRS, and the U.S. Attorney’s Office for the District of Nevada, whose assistance was essential to the successful investigation and prosecution of the case.. Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax. The following is part of a filing made on behalf of Schiff. [From Page 3] The government concedes that the following three-prong test is essential to establish that collateral estoppel applies: In Montana v. United States, 440 U.S. 147, 155 (1979), the Supreme Court established a three-prong test for determining whether collateral estoppel applies: first, whether the issues presented in the subsequent litigation are in substance thesame as those presented in the first case, second, whether controlling facts or legal principles have changed significantly since the first judgment; and third, whether other special circumstances warrant an exception to the normal rules of preclusion ... [Id, U.S. Memo, at 8 (emphasis added)] It is undisputed that Mr, Schiff was found guilty of tax evasion (26 U.S.C. §7201) for the tax 20 years 1980-1982 in 1985. At that time, neither defense counsel, the government nor the court sought a psychological evaluation of Mr. Schiff to determine whether he suffered from a mental disease or defect relevant to the issue of "willfulness," although the district court imposed the following special condition of probation on Mr. Schiff: Consequently, the jury never considered evidence of Mr. SchifFs mental state relevant to the issue of willfulness. Cf. Rule 12.2, F.R.Crim.P., which provides in relevant part: The court may, for good cause, allow the defendant to file the notice late, grant the parties additional trial-preparation time, or make other appropriate orders. [From page 6] Mr. Schiff has been diagnosed as suffering from a long history of chronic and acute bipolar disorder and depression. See WAC Del. at lff[24 and 25, and Exhibit 3 attached thereto. Dr. Luis Carlos Ortega, M.D at Valley Hospital and Medical Center, 620 Shadow Lane, Las Vegas, Nevada 89106, recently treated Mr. Schiff for his bipolar disorder and severe depression; Mr. Schiff was admitted for an extended stay in Valley Hospital in October, 2003. See WAC Del. at ffl[24 and 25, and Exhibit 3 attached thereto Dr. Ortega further opined that Mr. Schiff suffered from a delusional disorder. See WAC Del. at 1J25, and Exhibit 3 attached thereto. After reviewing Dr. Ortega's Discharge Summary, Attorney Cohan obtained Mr. Schiffs agreement to submit to a psychological evaluation to determine whether, to what extent and the likely length of time Mr. Schiff suffers and/or has suffered from a delusional disorder impacting the issue of willfulness See WAC Del. at |26. Thus, on January 6, 2004, Mr. Schiff submitted to a psychological evaluation by Licensed Psychologist Cynthia Barry, Ph.D., 1066 Saratoga Avenue, Suite 100, San Jose, California. Following the evaluation, Dr. Barry prepared a Report dated January 9, 2004, and rendered the following diagnosis: This despite the fact, that he recently experienced a suicidal depression serious enough to require hospitalization (related in part to recognition of a probable prison sentence if he is found guilty of the current charges). In short, Mr. Schiffs behavior is not rational. It is the product of a Delusional Personality Disorder that is not amenable to treatment and is unlikely to remit. Below is a filing by T. Louis Palazzo, attorney for Irwin A. Schiff. Some portions of paragraphs 11-14 denoted by me in blue font. ALL other emphasis, (boldface, underline, italics) as in original. Note on page 11 ["(emphasis added)"] appears in original. http://evans-legal.com/dan/tpfaq/schiff_opp_sj.pdf T. LOUIS PALAZZO Attorney for Defendant IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEVADA UNITED STATES OF AMERICA, vs. IRWIN A SCHIFF, Civil No. CV-S-01-0895-PMP (LRL) DECLARATION OF WILLIAM A. COHAN IN SUPPORT OF OPPOSITION TO UNITED STATES' MOTION FOR SUMMARY JUDGMENT I, WILLIAM A. COHAN, hereby declare under penalty of perjury: * * * 10. Following his discharge from the hospital on October 17, 2003, I have expended considerable time reviewing missives from and discussing with Mr. Schiff his positions on federal income tax law, the Internal Revenue Code, case law and the Constitution. As he did in his deposition, rather than reasonably considering the numerous problems created by the voluminous contrary authority we must confront and overcome, Mr. Schiff repeatedly launched into recitations of excerpts from his rigidly held preconceptions of "what the Court really meant" and/or exclaimed he is the only person in the world who understands the Supreme Court's decisions and/or knows that "income in the constitutional sense means a corporate profit." Cf Schiff's Deposition (1/ 29/ 03): MR. SCHIFF: Okay. ...In the general terms economic income was income, in a legal sense, before the Brushaber. The Brushaber decision gave a different definition to income. What they did is they used income when they really meant profit. So they talk income separated from its source and only corporate profit is income separated from the source. So every time the Brushaber -- that's why it's such a difficult decision to read because they use the word "income" when they really mean "profit." * * * 54 Code, if you look at the committee reports, they said we're using income in the constitutional sense, and income in the constitutional sense means a corporate profit. Nobody knows this except me, apparently, but I'm educating the public. * * * So to answer your question ... I've had sources of income, but I never had income as used in the 16th Amendment or as used in [IR Code §] 61. 61 says gross income means all income, from whatever source derived, but, of course, it doesn't define gross income because you can't define a word using the same word in the definition Gross income means -- well, the Brushaber decision and a lot of -- the Merchants Loan & Trust Company decision define income as a corporate profit. So now, if you substitute the definition of income -- because income isn't defined in the Code. You know that, okay. So now let's substitute profit, so this is what gross income means, all profit from services, including fees, commissions, fringe benefits. I received no profit from these sources. [Id., 79:11-81:21] *** MR DARMSTADTER: Just so I can understand a little bit more of your theory, and I think I do, the IRS -- based on your theory, the IRS is incorrectly including for at least for individuals * * * is incorrectly determining, at least for individuals, that all economic income is actually taxable income where you believe that taxable income is really only a concept that applies to profits from corporations. MR SCHIFF: It's income separated from the source. That's what the Supreme Court says. The whole purpose of the amendment is income separated from the source. And the only place where income is separated from the sources is in a corporation P&L statement. If the corporation has a million dollars of profit and you tax the profit, you don't know what portion of their dividends or capital gains generated. You're taxing income separated from its source. It's a difficult concept to get, I know. I doubt if anybody who read the Brushaber decision in law school ever understood it because it's difficult to understand. It took me a month using different highlighters to figure out what they were talking about. [Id., 96:13-97:13 (emphasis added)]. - 4 - meaning of income, taxable income, the court's applying the wrong standard, banking and/or money. Cf. Schiff Deposition Vol 1, 99:1-17 ("There's two chapters of [my] book that says why nobody can have taxable income."); 104:17-105:21 ("You better be in gold and silver because the music is going to [stop]. * * * It's going to go down the tubes. I wrote a book on that. Read my book...."); Vol II, 4:2-8:14 ("[I]t's clear that there's a constitutional meaning to the word 'income.' In many of the court decisions they apply the wrong standard. They talk about income in its ordinary sense."), 40 4-41 4, 45:12-19 ("I'll refute it in a different manner. ... They cannot claim I had taxable income."), 67:5-68:22 ("And, of course, I'm an expert in money and banking."), 79:7-25 ("I teach people what the law is. In those days I didn't have as good understanding of the law.") 12. As the Tax Court held: "Petitioner has quoted language out of context and has illogically misinterpreted holdings of cases." Schiff v. C.I.R., T.C. Memo 1984-223 (emphasis added). 13. Schiff's belief system appears to be completely circular: within that system Schiff is right, the government and the courts are wrong and he remains impervious to rational discussion. See also, Schiff v. U.S., 919 F.2d 830, 834 (2nd Cir. 1990), cert, denied, 501 U.S. 1238 (1991), wherein the Second Circuit described Schiff as "an extremist who reserves the right to interpret the decisions of the Supreme Court as he read[s] them from his layman's point of view regardless of and oblivious to the interpretations of the judiciary." 14. Mr. Schiff has ignored my repeated refusals to assert his theories and remains convinced that if I assert them he will prevail because the courts will not take a pro se litigant's arguments seriously. Cf. U.S. v. Schiff, 269 F.Supp.2d 1262, 1269 n. 3 (D. Nev 2003): A: I did that, but I always failed. It was always a futility because the judges the - government always got a summary judgment. I mean, I'm 0 for about 17 civil cases. Q: How many cases? A: Jeez, I think I have more cases - if you put a Schiff versus United States, I think a whole stream of stuff comes up I litigated in the two cases in the U.S. Court of Claims. That's all I have been doing all my life is litigating. One of these days I hope to get it right. [Emphasis added] 17. On December 10,1985, the Honorable Peter C. Dorsey, United States District Judge ------- [1] "Solipsism: the theory that only the self exists or can be proven to exist ..." Webster's Encyclopedic Unabridged dictionary of the English Language (1989 ed.) at p. 1355. - 6 - for the District of Connecticut, imposed the following special conditions of probation on Mr Schiff: "defendant shall undertake counseling, at his own expense, which may include psychiatric counseling as deemed necessary under the guidelines and supervisions of the Probation Department." See Exhibit 10 attached to Declaration of Henry C. Darmstadter and Exhibits in Support of Motion for Summary Judgment. [2] 18. However, none of Mr. Schiff s prior counsel, the courts nor the government have sought a psychological evaluation of Mr Schiff to determine whether he suffers from a mental disease or defect relevant to the issue of "willfulness" and/or guilt and/or his liability vel non for civil fraud penalties and/or which might impact whether a "reasonable-person-and/or-knew-or-had-to-know" analysis applies. 19. Your undersigned has on several occasions encountered clients whom I suspected to be suffering from a delusional disorder or other mental disease or defect For example, I represented the lead defendant, Phillip Marsh, in U.S. v. Marsh, et al., Case No. CR-93-0592-VRW (N D CA), for whom I filed a notice under Rule 12.2(b), F.R.Crim.P., informing the government that Defendant Marsh intended to introduce testimony relating to a mental disease or other mental condition relevant 19 to guilt Forensic Psychiatrist, Jay M. Jackman, M.D, examined and evaluated Mr. Marsh for the defense and concluded that Mr. Marsh suffered from a major delusional disorder In preparation for their Presentence Report, the Probation Department retained Psychologist Cynthia Barry, Ph.D., to assess Mr. Marsh Based on her tests and assessment Dr. Barry likewise concluded that Mr. Marsh suffered from a delusional belief system. See U.S. v. Marsh, 144 F.3d 1229, 1242 (9th Cir. 1998) ------- [2] When asked at his deposition if he had undergone counseling as required under his 27 conditions of probation, Mr. Schiff responded: "I refuse to answer on the grounds I'm not required to be a witness against myself in this proceeding." See Schiff Deposition Vol. I, 55, 19-23. - 7 - My attempts at rational discussions with Mr. Schiff have been more difficult than any I experienced with Mr Marsh. Just a portion of the colloquy between Judge Dorsey and Mr. Schiff at the probation violation hearing held on May 31,1991, illustrates the ignoratio elenchi confronting every attempt to confine Mr. Schiff's discourse to orderly discussion of one topic at a time without repeated digression: MR. SCHIFF: No, no Well first of all - first of all - THE COURT: The question is whether you understand - MR SCHIFF: The returns I filed are not in the package, your Honor. The returns I filed - let me explain something, your Honor. First of all the returns- THE COURT: Please, please. MR SCHIFF: The returns - THE COURT: Please. This is not going to be a forum in which you are going to set the pace. You're going to operate under my rules and under my procedures. You'll have an adequate opportunity to be heard. What the contention of the government is, is that the returns that you filed whatever they may have been, all of them, whatever they may have been, do not qualify as valid tax returns. Now I know you claim to the contrary. MR SCHIFF: You Honor - THE COURT: Whether they are valid or not, at the moment is not the issue. The issue at the moment is whether there is some reasonable basis to believe that the government's position is sound. Now you understand that? MR SCHIFF: No. THE COURT: All right. Then I'm telling you that and I'm not going to conduct an educational course for you. MR SCHIFF: May I just put a word in here edgewise, your Honor? THE COURT: You're going to get a word in - THE COURT: Mr Schiff, you know - MR SCHIFF: Your Honor - THE COURT: I have -I have - I attempted to say put up with you, I won't say that. I have observed the way you conduct yourself. You contort, you misconstrue, you twist and you dodge, you bob and you weave. You don't deal with the issues in the legal context, you deal with them in the way that you would like to see them dealt with. Now let me just tell you what I'm going to do. I'm going to permit the government to make a presentation on - which will probably consist simply of all of the returns that you have filed. I will then take into consideration what you have submitted, that is the memorandum and the motion to dismiss that you filed this morning, and whatever the government wants to file in response, and I presume that all the government is going to do is offer the returns that are on file with the IRS. Is that true, Mr. Jongbloed? MR. JONGBLOED: Yes, that's correct, your Honor... THE COURT: All right. What you show - MR SCHIFF: Well I assume I have a right to cross examine the government's witness? THE COURT: No, you're not going to have a witness, Mr Schiff, because the fact of the matter is that what the government is relying on is not a witness, but on the documents themselves. Show him the documents that you're going to rely on, Mr. Jongbloed. MR SCHIFF: But someone's got to testify that - THE COURT: Now just a minute. Don't tell me what somebody's got to do or somebody does not have to do. MR. SCHIFF: I'm reading from the law your Honor. This - THE COURT: You don't have to read from the law because the fact of the matter is the law as you see it is frequently the law as you make it up in your own head to suit your own convenience. THE COURT: Mr. Schiff if there is no witness, then you're going to have no opportunity to cross examine - MR SCHIFF: WELL THEN THERE'S NO ADVERSE WITNESS. Then there has to be - who are my - who are my adversary witnesses? Who's going to say that the returns I filed - THE COURT: - Please - MR SCHIFF: - are not - THE COURT: You know I've told you before that I'm thoroughly aware of the - and I don't mean this in a theological or Semitic fashion -I am aware of the rabbinical procedure by which you answer a question with a question and you never get anywhere. The fact of the matter is, you're not going to ask me questions because I'm not going to answer your questions. That tactic may work in some forum, it's not going to work here. MR SCHIFF: Your Honor - THE COURT: All I'm telling you is, that the - what I expect the government is going to do. The government will show you the documents and the question of whether there's probable cause is not going to be dependent upon what some witness says, it's going to be dependent upon whether, under the law as I understand it and will apply it, the documents that you have filed comply with the requirements. If they do as you claim, that's the end of the probation violation contention. MR SCHIFF: But your Honor - THE COURT: If they do not comply with the law as you claim, that's the end of the matter . If they do not comply, then I will find probable cause - MR SCHIFF My- THE COURT: - and then you will have the opportunity to have a full hearing on the matter. Do we understand one another? MR. SCHIFF: No, I don't, because my terms of my probation - THE COURT: Then you're not listening. MR. SCHIFF: I am not charged with filing lawful returns. I am charged with not following the direction of my probation - MR. SCHIFF: - officer. THE COURT: No, no, no, no, no. You're charged with violating the conditions that I imposed upon your probation - MR. SCHIFF: Here was the condition. THE COURT: - that says specifically that you are to file all lawfully required returns. That means file valid returns. The government claims that you have not filed valid returns. MR SCHIFF: My probation officer- THE COURT: I don't care what your - MR SCHIFF: said - THE COURT: I don't care what your probation officer said because the fact is that I did not give the probation officer the authority to tell you what you could and could not do. I told you what you were required to do. If you've done it then you're not re- MR SCHIFF: I sent you copies of those returns myself. THE COURT: I don't care what you did, Mr. Schiff. MR. SCHIFF: You never told me that they were -1 filed those returns a year and a half ago. Your Honor, I have a - conditions of probation supervised release, and according to the conditions of my probation - these are the conditions - the conditions say that I am to follow the instructions of the probation officer Now following the instructions of the - my conditions do not say that I have to follow the instructions of every government employee - THE COURT: You see Mr. Schiff, you read those portions - and it's a nice, clever, cute trick- that you read those portions that suits your convenience and you don't read the basic requirement which was that you were required to file all the tax returns which were required by the law. Isn't that what it says? MR SCHIFF: Well first of all - first of all the instructions did not say file income tax returns. It says all returns - THE COURT: You see - you see there's your nice little attempt to distort something. What have I got to do? I've got to tell you exactly what to do? THE COURT: Don't ask me a question Mr. Schiff. MR. SCHIFF: Well it didn't. THE COURT: All right. MR. SCHIFF But more important, your Honor, I have to look to my probation officer for supervisory advice * * * * See RT (5/31/91) 10:1-16:21 (emphasis added), attached hereto as Exhibit 1. 8 Based on all the foregoing and Occam's razor, I was forced to conclude that Mr. Schiff probably suffers from a severe delusional disorder or other mental disease or defect See, e.g., excerpts from the DSM-IV, 297.1 Delusional Disorder, attached hereto as Exhibit 2, which state in pertinent part: Delusions are deemed bizarre if they are clearly implausible, not understandable, and not derived from ordinary life experiences (e.g., an individual's belief that a stranger has removed his or her internal organs and replaced them with someone else's organs without leaving any wounds or scars). In contrast, nonbizarre delusions involve situations that can conceivably occur in real life (e.g., being followed, poisoned, infected, loved at a distance, or deceived by one's spouse or lover) [A] common characteristic of individuals with Delusional Disorder is the apparent normality of their behavior and appearance when their delusional ideas are not being discussed or acted on. In general, social and marital functioning are more likely to be impaired than intellectual and occupational functioning. * * *
Your postings really push the envelope spamwise. In no particular order: Yes, funds taken from Kotmair's home were deemed to belong to Kotmair, not SAPF. All funds, materials and property takes from SAPF and deemed the property of SAPF by the IRS were returned. To this day visiters to SAPF's office can see the IRS labels and tape marks on the furniture and filing cabinent that were taken and returned by the IRS. The dialog regarding whether Wheaties purchased & consumed by Kotmair ended up benefiting the fellowship is regarded with a bit of levity and admiration by SAPF members, myself included. In truth, however, if one expends half the calories he consumes to perform work for pay, how can the expense for that food be considered as costing nothing to the worker as mainstream thinking currently does? There certainly is an expense to the worker to perform the work, and compensation is not gain. Though there's levity in Kotmair's Wheaties dialog, He's nonetheless stated a truism. Regarding the practice of charging people for violating a penalty statute: There are many, many taxes in title 26. Not just the income tax. Any corporate tax accountant can probably tell you there are a great number of tax returns, one for each kind of tax. All (federal) covered under title 26. Title 26 Table of contents (partial): Under Miscellaneous (partial): There are many, many taxes covered in title 26. Nearly all of them not only impose a tax but state liability. Apart from withholding agents listed in 1463, who withhold payments to foreign entites. Can you show me the liability statute for the income tax? Most prosecutors can't seem to find it. I fail to see the comparison you attempt to make between being charged with murder and charged with violating a penalty statute, particularly when the former has historically been a common law offense and the latter is clearly statutory and revenue related. Certainly it's reasonable to expect that people intuitively know that murder is wrong. I suppose your comparison is based on the idea that it should similarly be intuitive that people must pay taxes on income even without a statutory requirement. Is that correct? If so, it does appear you are in good company as it would explain why almost no judge is interested in pointing to the income tax liability statute. Among some case "law" postings you posted: Correct me if I'm wrong, but it seems you highlighed in blue the incorrect phrase to associate with Kotmair, as the conclusion prior to the case cite applies to him and not the one following. In any event, these appear to be merely "tax court" decisions, and you should know that tax court is not an article III judicial court, but purely an administrative dispute board little different from a 3rd party arbitration panel. I wouldn't be surprised if those "judges" that preside in tax court are just IRS employees. As for the exceptionally enlarged text "being aware that his anti-tax gurus had been convicted of tax evasion negates good faith defense", one might similarly conclude that being aware of acquital cases like Long & Kuglin's enhances a good faith defense. Re: Schiff, he was of the zero return school which I consider flawed. But I have one book by Schiff which is excellent. Just a short thing called "How an Economy Grows and Why it Doesn't". More of a comic book which is perfect for illustrating basic economics. It is a shame that, barring a miracle, the man will be in jail for the rest of his life. I'd call him a victim of a bureaucratic government.
It would seem there was no such charge, nor would it seem SAPF won. Loosing some $44K in a siezure due to co-mingling of assets resulting from deliberate election to not keep records or funds separate (leaving SAPF defenseless against protection of its membership's assets) can hardly be declared a victory. If you're certain a charge of failure to withhold taxes was made, could you please post some documentation (a copy of an indictment for instance)? Something other than Kotmair's assertions.
(The Gospel of Jesus Christ is the only true good news)
I will look into the actual charges more formally and let you know. It is/was my impression that that was one of the charges. As for SAPF winning, we do consider the ruling a victory. Yes, 44k was lost but that was solely because it was deemed to be Kotmair's money and not SAPF's. It must be remembered that the IRS went into the office with guns and took just about everything that wasn't nailed down, and that they wanted to shut the operation down, and they failed to do so. They were forced to bring it all back. Remember also that the IRS first appealed the matter and then moved to have their own appeal dismissed with prejudice, which it was. If the IRS won, why would they have appealed? The gist of it was that Garbis ruled SAPF had a right to exist, and everything that was deemed to have been taken from SAPF was returned. In light of what could have happened, we consider that a victory. Obviously the monetary loss is unfortunate, but that notwithstanding.
Regarding the practice of charging people for violating a penalty statute: There are many, many taxes in title 26. Not just the income tax. Any corporate tax accountant can probably tell you there are a great number of tax returns, one for each kind of tax. All (federal) covered under title 26. They smack you between the eyes with the specific element of the IRC when they proceed to court. For example, in the PERMANENT INJUNCTION AGAINST SAPF, the Court wrote, Here is another example. UNITED STATES of America, Plaintiff-Appellee, No. 90-3154. Argued June 14, 1991. Rehearing and Rehearing En Banc Andrew B. Baker, Jr. (argued), Asst. U.S. Atty., Dyer, Ind., for plaintiff-appellee. Before POSNER, MANION and KANNE, Circuit Judges. KANNE, Circuit Judge. Like moths to a flame, some people find themselves irresistibly drawn to the tax protestor movement's illusory claim that there is no legal requirement to pay federal income tax. And, like the moths, these people sometimes get burned. Lorin G. Sloan believed these claims and because he acted upon them now faces four months in a federal prison; there can be little doubt that he has been burned. * * * Mr. Sloan ostensibly pursues this matter on his own behalf--or perhaps more correctly without trained legal counsel. In any event, he appeared before us personally to argue his appeal. The primary position taken by Mr. Sloan is that he has been unable to learn from any authoritative source--the tax code, the Internal Revenue Service, or the federal courts--the exact statutory provision which imposes upon him a legal duty to file a federal tax return. This position is, no doubt, formulated to show that he did not willfully violate a "known legal duty." Moreover, in demonstrating to him the existence of this duty, Mr. Sloan insists that our analysis of his obligation to pay the federal income tax be consistent with certain fundamental principles or "standards" which he says he has learned through his studies. Unfortunately, for Mr. Sloan, his "standards" are inapplicable because they have previously been rejected by the federal courts. One such fundamental and immutable principle, he maintains, is that the revenue laws of the United States do not impose a tax on income. But we have squarely rejected this tax protestor argument before, holding that the Internal Revenue Code imposes a tax on all income, Coleman v. Commissioner, 791 F.2d 68, 70 (7th Cir.1986); Lovell v. United States, 755 F.2d 517, 519 (7th Cir.1984), and that wages are income, United States v. Koliboski, 732 F.2d 1328, 1329 & n. 1 (7th Cir.1984). * * * We will treat Mr. Sloan's question as a challenge to the legal sufficiency of the indictment which charged him with tax evasion. To meet the standards imposed by the fifth and sixth amendments to the Constitution, an indictment must "[1] state[ ] all of the elements of the offense charged, [2] inform[ ] him of the nature of the charges so that a defense can be prepared, and [3] enable[ ] the defendant to evaluate any possible double jeopardy problems presented by the charge." United States v. Glecier, 923 F.2d 496, 499 (7th Cir.1991) (quoting United States v. Neapolitan, 791 F.2d 489, 500- 01 (7th Cir.), cert. denied, 479 U.S. 939, 107 S.Ct. 421, 93 L.Ed.2d 371 (1986)); United States v. Foster, 789 F.2d 457, 459 (7th Cir.), cert. denied, 479 U.S. 883, 107 S.Ct. 273, 93 L.Ed.2d 249 (1986). All the requirements were readily met in this case. First, the three-count indictment stated all the essential elements required to be proved by the government to convict the defendant of federal tax evasion. Glecier, 923 F.2d at 499. "To establish a violation of s 7201, the government must prove willfulness, the existence of a tax deficiency and an affirmative act constituting an evasion or attempted evasion of [the] tax." United States v. Copeland, 786 F.2d 768, 770 (7th Cir.1985) (citing Sansone v. United States, 380 U.S. 343, 351, 85 S.Ct. 1004, 13 L.Ed.2d 882 (1965)); see also United States v. Davenport, 824 F.2d 1511, 1516 (7th Cir.1987). Here, all three counts of the indictment established the first required element by alleging that Mr. Sloan "did willfully and knowingly attempt to evade and defeat said income tax due and owing to the United States." The indictment's first count further stated that he "owed approximately $4,142.30 to the United States of America in income tax," providing him notice of the existence of a tax deficiency. [FN1] Finally, the act of filing a false Form W-4 constitutes an affirmative act of evasion or attempting to evade. See Copeland, 786 F.2d at 770. And, once again, all three counts of the indictment indicated that Mr. Sloan had committed this affirmative act. Second, the indictment was sufficient to inform Mr. Sloan of the charges against him. Glecier, 923 F.2d at 499. The indictment cited the statute he was accused of violating (26 U.S.C. s 7201) and identified the specific tax (the income tax) he was obligated to pay. It also provided other information--including the tax year, his taxable income, the amount of tax due, his failure to file an income tax return, his filing of a false Form W-4, and his failure to pay the tax--pertinent to the charges against him. [FN2] Thus, the second requirement was satisfied in the present case. Third, the indictment sufficiently designated the tax, the tax year, and the specific false W-4 forms (those Sloan filed with his employer, Fisher Body Division of General Motors) to eliminate any possibility of objection on the grounds of double jeopardy. Mr. Sloan's indictment was therefore legally sufficient in all respects to support his convictions for tax evasion for the years 1981, 1982 and 1983. * * * The real tragedy of this case is the unconscionable waste of Mr. Sloan's time, resources, and emotion in continuing to pursue these wholly defective and unsuccessful arguments about the validity of the income tax laws of the United States. Despite our rejection of Mr. Sloan's legal analysis of the tax laws, we are not unmindful of the sincerity of his beliefs. On the other hand, we are less sure of the sincerity of the professional tax protestors who promote their views in literature and meetings to persons like Mr. Sloan, yet are unlikely ever to face the type of penalties incurred by him. It may be that our decision will not alter Mr. Sloan's views regarding the tax laws of this country, for he has stated that if we affirm his conviction without applying the law as he understands it, our decision will be "a sham to which I WILL NOT SUBMIT." It may also be that serving his sentence in prison will not alter Mr. Sloan's view. We hope this pessimistic assessment is incorrect. We AFFIRM the conviction of Lorin G. Sloan on all counts.
Can you show me the liability statute for the income tax? Most prosecutors can't seem to find it. I fail to see the comparison you attempt to make between being charged with murder and charged with violating a penalty statute, particularly when the former has historically been a common law offense and the latter is clearly statutory and revenue related. Certainly it's reasonable to expect that people intuitively know that murder is wrong. I suppose your comparison is based on the idea that it should similarly be intuitive that people must pay taxes on income even without a statutory requirement. Is that correct? You stated at Neil McIver #103 that, "It is not possible to violate a law that prescribes a penalty." The murder statute prescribes a penalty. It is possible to violate the murder statute. It is not a comparison. It is a specific example demonstrating that your argument lacks merit. The UK has common law courts. The US does not. There is no general Federal common law. There was no Federal crime of murder until a statute was passed creating such as a Federal crime. Your supposition is incorrect and based on your delusion that there is no requirement to pay taxes on income, and your meritless denial that there is a statutory requirement to do so. The SAPF officials who acted upon that meritless argument have records from the Bureau of Prisons to document their notable lack of success in persuading anyone who mattered. United States Code U.S. Code as of: 01/22/02 Section 7203. Willful failure to file return, supply information, or pay tax Any person required under this title to pay any estimated tax or tax, or required by this title or by regulations made under authority thereof to make a return, keep any records, or supply any information, who willfully fails to pay such estimated tax or tax, make such return, keep such records, or supply such information, at the time or times required by law or regulations, shall, in addition to other penalties provided by law, be guilty of a misdemeanor and, upon conviction thereof, shall be fined not more than $25,000 ($100,000 in the case of a corporation), or imprisoned not more than 1 year, or both, together with the costs of prosecution. In the case of any person with respect to whom there is a failure to pay any estimated tax, this section shall not apply to such person with respect to such failure if there is no addition to tax under section 6654 or 6655 with respect to such failure. In the case of a willful violation of any provision of section 6050I, the first sentence of this section shall be applied by substituting ''felony'' for ''misdemeanor'' and ''5 years'' for ''1 year''.
Among some case "law" postings you posted: Correct me if I'm wrong, but it seems you highlighed in blue the incorrect phrase to associate with Kotmair, as the conclusion prior to the case cite applies to him and not the one following. A pattern of consistent failures to file for several years is strong evidence that Kotmair would not succeed in court. If you are to invoke these arguments as having merit, in your opinion, you at least have an obligation to warn the readers that those who have acted on such beliefs and gone to court have then gone to prison. TAX PROTESTERS STATUS PER THE BUREAU OF PRISONS Name/Bureau of Prisons Number/Age/Sex/Date of Release/Status JOHN B KOTMAIR EDWARD L KOTMAIR IRWIN A SCHIFF "being aware that his anti-tax gurus had been convicted of tax evasion negates good faith defense.": US v. Crosson (ED Penn unpub 12/20/95 http://laws.findlaw.com/us/498/192.html U.S. Supreme Court In this case, if Cheek asserted that he truly believed that the Internal Revenue Code did not purport to treat wages as income, and the jury believed him, the Government would not have carried its burden to prove willfulness, however unreasonable a court might deem such a belief. Of course, in deciding whether to credit Cheek's good-faith belief claim, the jury would be free to consider any admissible evidence from any source showing that Cheek was aware of his duty to file a return and to treat wages as income, including evidence showing his awareness of the relevant provisions of the Code or regulations, of court decisions rejecting his interpretation of the tax law, of authoritative rulings of the Internal Revenue Service, or of any contents of the personal income tax return forms and accompanying instructions that made it plain that wages should be returned as income. 8 We thus disagree with the Court of Appeals' requirement that a claimed good-faith belief must be objectively reasonable if it is to be considered as possibly negating the Government's evidence purporting to show a defendant's awareness of the legal duty at issue. Knowledge and belief are characteristically questions for the factfinder, in this case the jury. Characterizing a particular belief as not objectively reasonable transforms the inquiry into a legal one, and would prevent the jury from considering it. It would of course be proper to exclude evidence having no relevance or probative value with respect to willfulness, but it is not contrary to common sense, let alone impossible, for a defendant to be ignorant of his duty based on an irrational belief that he has no duty, and forbidding the jury to consider evidence that might negate willfulness would raise a serious question under the Sixth Amendment's jury trial provision. Cf. Francis v. Franklin, 471 U.S. 307 (1985); Sandstrom v. Montana, 442 U.S. 510 (1979); Morissette v. United States, 342 U.S. 246 (1952). It is common ground that this Court, where possible, interprets congressional enactments so as to avoid raising serious constitutional questions. See, e.g., Edward J. DeBartolo Corp. v. Florida Gulf Coast Building and Construction Trades Council, 485 U.S. 568, 575 (1988); Crowell v. Benson, 285 U.S. 22, 62 , and n. 30 (1932); Public Citizen v. United States Dept. of Justice, 491 U.S. 440, 465 -466 (1989). It was therefore error to instruct the jury to disregard evidence of Cheek's understanding that, within the meaning of the tax laws, he was not a person required to file a return or to pay income taxes and that wages are not taxable income, as incredible as such misunderstandings of and beliefs about the law might be. Of course, the more unreasonable the asserted beliefs or misunderstandings are, the more likely the jury will consider them to be nothing more than simple disagreement with known legal duties imposed by the tax laws, and will find that the Government has carried its burden of proving knowledge. B Cheek asserted in the trial court that he should be acquitted because he believed in good faith that the income tax law is unconstitutional as applied to him, and thus could not legally impose any duty upon him of which he should have been aware. 9 Such a submission is unsound, not because Cheek's constitutional arguments are not objectively reasonable or frivolous, which they surely are, but because the Murdock-Pomponio line of cases does not support such a position. Those cases construed the willfulness requirement in the criminal provisions of the Internal Revenue Code to require proof of knowledge of the law. This was because in "our complex tax system, uncertainty often arises even among taxpayers who earnestly wish to follow the law" and "`[i]t is not the purpose of the law to penalize frank difference of opinion or innocent errors made despite the exercise of reasonable care.'" United States v. Bishop, 412 U.S. 346, 360 -361 (1973) (quoting Spies v. United States, 317 U.S. 492, 496 (1943)). Claims that some of the provisions of the tax code are unconstitutional are submissions of a different order. 10 They do not arise from innocent mistakes caused by the complexity of the Internal Revenue Code. Rather, they reveal full knowledge of the provisions at issue and a studied conclusion, however wrong, that those provisions are invalid and unenforceable. Thus, in this case, Cheek paid his taxes for years, but after attending various seminars and based on his own study, he concluded that the income tax laws could not constitutionally require him to pay a tax. We do not believe that Congress contemplated that such a taxpayer, without risking criminal prosecution, could ignore the duties imposed upon him by the Internal Revenue Code and refuse to utilize the mechanisms provided by Congress to present his claims of invalidity to the courts and to abide by their decisions. There is no doubt that Cheek, from year to year, was free to pay the tax that the law purported to require, file for a refund and, if denied, present his claims of invalidity, constitutional or otherwise, to the courts. See 26 U.S.C. 7422. Also, without paying the tax, he could have challenged claims of tax deficiencies in the Tax Court, 6213, with the right to appeal to a higher court if unsuccessful. 7482(a)(1). Cheek took neither course in some years, and, when he did, was unwilling to accept the outcome. As we see it, he is in no position to claim that his good-faith belief about the validity of the Internal Revenue Code negates willfulness or provides a defense to criminal prosecution under 7201 and 7203. Of course, Cheek was free in this very case to present his claims of invalidity and have them adjudicated, but, like defendants in criminal cases in other contexts who "willfully" refuse to comply with the duties placed upon them by the law, he must take the risk of being wrong. We thus hold that, in a case like this, a defendant's views about the validity of the tax statutes are irrelevant to the issue of willfulness, need not be heard by the jury, and if they are, an instruction to disregard them would be proper. For this purpose, it makes no difference whether the claims of invalidity are frivolous or have substance. It was therefore not error in this case for the District Judge to instruct the jury not to consider Cheek's claims that the tax laws were unconstitutional. However, it was error for the court to instruct the jury that petitioner's asserted beliefs that wages are not income and that he was not a taxpayer within the meaning of the Internal Revenue Code should not be considered by the jury in determining whether Cheek had acted willfully. 11 IV For the reasons set forth in the opinion above, the judgment of the Court of Appeals is vacated, and the case is remanded for further proceedings consistent with this opinion. It is so ordered. JUSTICE BLACKMUN (joined by JUSTICE MARSHALL) wrote: The Court acknowledges that the conclusively established standard for willfulness under the applicable statutes is the "voluntary, intentional violation of a known legal duty." Ante, at 201. See United States v. Bishop, 412 U.S. 346, 360 (1963), and United States v. Pomponio, 429 U.S. 10, 12 (1976). That being so, it is incomprehensible to me how, in this day, more than 70 years after the institution of our present federal income tax system with the passage of the Revenue Act of 1913, 38 Stat. 166, any taxpayer of competent mentality can assert as his defense to charges of statutory willfulness the proposition that the wage he receives for his labor is not income, irrespective of a cult that says otherwise and advises the gullible to resist income tax collections. One might note in passing that this particular taxpayer, after all, was a licensed pilot for one of our major commercial airlines; he presumably was a person of at least minimum intellectual competence. In oral argument to the Supreme Court, Cheek's lawyer stated: All we are asking is that Mr. Cheek be permitted to present that to a jury. If the jury thinks he is a phoney they will convict him. If they think he is sincere they should acquit him. And the Government can get its penalties and fines -- On retrial, Cheek was convicted and sentenced to a year and a day in jail. Note that on remand, Cheek was convicted of a tax law violation: United States Court of Appeals, Defendant was convicted in the United States District Court for the Northern District of Illinois, Paul E. Plunkett, J., of willfully attempting to evade payment of income taxes and willfully failing to file income tax returns. The Court of Appeals, 882 F.2d 1263, affirmed, and certiorari was granted. The United States Supreme Court, 498 U.S. 192, 111 S.Ct. 604, 112 L.Ed.2d 617, reversed and remanded. The Court of Appeals, Kanne, Circuit Judge, 931 F.2d 1206, reversed and remanded. Defendant was convicted again in the District Court, James B. Zagel, J., and appealed. The Court of Appeals, Aldisert, Senior Circuit Judge, sitting by designation, held that: (1) defendant was not entitled to jury instruction on advice of counsel defense; (2) imposition of fine after second trial did not violate defendant's due process rights; and (3) defendant's speedy trial rights were not violated. Affirmed.
I know this will come as somewhat of a shock to your system, but NON-Article III Courts (no, not the Tax Court) can and do administer the death penalty. Just because a Court is not an Article III Court is not cause to dismiss what it can do. As for your assertion that the citations "appear to be merely 'tax court' decisions," I am sure you will not object to my repeating the following citations extracted from the material I quoted. These appear to be some of the exceptions to your observation that the citations I provided "appear to be merely 'tax court' decisions." US v. Ferguson (SD Ind 1985) 615 F.Supp 8 aff’d 793 F2d 828 cert. denied 479 US 933 US v. Kraeger (2d Cir 1983) 711 F2d 6 US v. Weninger (10th Cir 1980) 624 F2d 163 cert.den 449 US 1012 US v. Benson (5th Cir 1979) 592 F2d 257 US v. Condo (9th Cir 1984) 741 F2d 238 cert.den 469 US 1164 US v. O.W. Ware (10th Cir 1979) 608 F2d 400 US v. Masat (5th Cir 1991) 948 F2d 923 cert.den 506 US 835 US v. Bowers (4th Cir 1990) 920 F2d 220 US v. Ferguson (7th Cir 1985) 793 F2d 828 cert.den 479 US 933 US v. Trowbridge (9th Cir unpub 3/26/97) 110 F3d 71(t) cert.den 520 US 1235 US v. Hart (ND Ind 1987) 673 F.Supp 932 US v. Shields (8th Cir 1981) 642 F2d 230 cert.den 454 US 848 US v. Rifen (1978) 577 F2d 1111 US v. Willie (10th Cir 1991) 941 F2d 1384 cert.den 502 US 1106 US v. Hildebrand (8th Cir 1998) 152 F3d 756 US v. Fulbright (9th Cir 1997) 105 F3d 443 cert.den 520 US 1236 US v. Shields (8th Cir 1981) 642 F2d 230 cert.den 454 US 848 US v. O.W. Ware (10th Cir 1979) 608 F2d 400 US v. Schiefen (D SoDak 1995) 926 F.Supp 877 aff'd (8th Cir 1996) 81 F3d 166 mand.denied 522 US 1074 Vaughn v. US (WD La 1984) 589 F.Supp 1528 Charczuk v. CIR (10th Cir 1985) 771 F2d 471 US v. Cheek (7th Cir 1989) 882 F2d 1263 Cheek v. US (1991) 498 US 192, 112 L.Ed.2d 617, 111 S.Ct 604 US v. Cheek (7th Cir 1993) 3 F3d 1057 cert.den 510 US 1112 US v. Masat (5th Cir 1991) 948 F2d 923 cert.den 506 US 835
A truly free society enjoys (or should enjoy) the benefit of rational dispute without the threat of incarceration and should be able to redress grievances without hiring a lawyer or becoming one their self. When an issue is as pervasive as taxation is, having some potential application to every citizen regardless of their financial status or level of education, it would appear reasonable that these mandates should be written in plain enough language, in simple terms understandable to all affected by them. The necessity to draft regulatory instructions in incomprehensible legal terms, that are defined in law dictionaries, buried within countless volumes of "code", is more likely the result of high tech pettifoggers representing corporate evaders of taxes than the outgrowth of common citizens expecting fair treatment and an honest government, both of which most would admit is a far cry from the situation in America's tax system. The (legally created) fiction that people and corporations should be treated equally under the law is simply an outrageous fraud. This fraud allows the continuance of an admittedly incomprehensible tax system that defies common sense, especially when combined with a debt based economic system flooded with fiat currency, and dependent on credit. This unholy marriage (consumated in 1913 under questionable circumstances) is only beneficial to powerful bankers, corporate marauders and government thieves ultimately resulting in the ruination of the family unit and the nation by forcing two people to work in order to earn one living after taxes. The end result is that 20 years after the 1913 Federal Reserve Act and the Income Tax Act were implemented, America was bankrupt. This bankruptcy has been kept quiet while the looters pilfered America's natural resources and abused its populace's labor. Many would argue that we are the greatest nation on earth, we are technologically superior and even that we have a higher standard of living than most of the entire world. I would remind those delusional people that we are the greatest debtor nation on earth today, and many of our counterparts are coming out from under the effects of this assumed grandeur and demanding a return on their investment in American debt instruments that are increasingly devalued. Anyone refusing to look at the wholesale gutting of America's assets such as ports, national parks, roads, and other critical infra-structure, along with the imposition of the NAU, NAFTA, GATT, WTO, Agenda 21, etc., etc. is in denial or willingly delusional. These activities are not simply the natural progression of a nation state into an international federation, this is imposition of bankruptcy proceedings through international agencies such as the IMF and World Bank that represent the interests of international banking cartels that pit one nation's debt against another's in order to maintain discipline and control of them all. What I'm attempting to point out is that we can cling to the illusion of greatness and prosperity until it collapses. Our problem in this nation is far more problematic than represented by the antics of Irwin Schiff, Bob Schultz and Joe Banister. But it all starts and ends with the acceptance of fraud. Whether or not we as a nation have the ability to return to simple honesty in our lives devoid of legalese, pettifogging miscreants, crooked judges that fear the IRS, senile thieving perverts in Congress, and an ignorant apathetic population is up for debate, but there can hardly be any question we are headed in the wrong direction like a runaway freight train without an engineer. When the only way to actually be heard by the government is to hire lobbyists and load them down with bribes for the politicians sometimes the court system looks like the only other alternative. People like Schiff, Kotmair, Schultz, Russo and Banister approach this unseemly venue as a last resort in a vain attempt to salvage whatever unfounded notions of liberty remain ingrained in their pea brains in spite of the obvious. Hoping against hope that there's still one reasonable judge that will sacrifice his career in the interest of liberty and freedom ... when that is not the purpose of the court system ... it's about control, period. The world has always had laws. The laws have always been used to exploit and control the masses for an elitist class ... nothing new here, it's easier to control slaves that are conditioned to believe they are free. Anyone willing to support the mumbo-jumbo that oozes out of D.C. whether it's a legislative measure, a judicial opinion or an executive imperative does so out of ignorance, fear or for their own gain, not for righteousness sake. The same courts you and others are so proud to quote have authorized numerous frauds such as slavery in the past, so cut the high minded horseshit and face the facts. The only proper response to an IRS Summons is ... Fuck you and the horse you rode in on, any attempt by you or any of your bloodthirsty agents to interfere with my life will be considered an act of war and treated as such, I support the 2nd Amendment.
"Guard with jealous attention the public liberty. Suspect every one who approaches that jewel. Unfortunately, nothing will preserve it but downright force. When you give up that force, you are ruined." Patrick Henry
Another round of spaming, I see. Question: What is your personal view based of income taxes? (based on your understanding of them, of course). Do you consider it a good, proper and moral means of raising revenue? I ask because it seems both myself and Starwind have volunteered our personal views on the subject, but I don't recall you doing so. I must say that based on your postings, you favor them passionately. In fact, you come off like an IRS agent. If not an actual employee, at least someone who has some vested reason to promote its practices. Regarding your comment #144, you've completely lost site of the discussion. The topic was the practice of people being charged with violating a penalty statute. You did later post and citation of someone being charged with "violating" section 7203, along with the text of that section (presumably accurately). Anyone can see that it merely describes the penalties to be imposed upon someone who does not file. It is clearly not possible to violate this statute, as 7203 does not place any requirement or duty upon anyone except for the judge who is in a position to sentence someone. Re: Comparisons with murder: Murder is almost always a state crime, not a fed crime. Feds only have jurisdiction on murder cases that occur within federal jurisdictional areas that are outside of the jurisdiction of any of the union states. Now you can make up whatever nonsense you want in comparing the intuitive nature in our knowing that murder is wrong with some mystical fiction that a particular tax is owed even absent any statute so stating, but it won't change the fact that A) 7203 ONLY prescribes the punishment for someone who is convicted of willful failure et al and B) it is impossible for any person outside of a judge to "violate" this section. Quote some case law on the subject if you wish. I'd be curious on how a judge can say that isn't so while still sounding intelligent. If you want to concede that that's just what happens, fine. I'll accept that as it's apparently true. Now this is a blatant misconstruing of my statement. My clear meaning, in context was that it is not possible to violate a law that itself only prescribes a penalty. You cannot violate a murder law that, itself, only prescribes a penalty to be imposed for committing murder either. Section 1461 establishes liability for the income tax. Such liability must be fulfilled. Of course this applies to payments made to foreigners and the person liable is the withholding agent who made the payment to them. Given that, your sentence above shows you don't understand my suppositions. (BTW, if you can find a second liability statute in subtitle A, title 26, do let me know). SAPF "officials"??? Where did that designation come from? If you're referring to John and Edward Kotmair, and Schiff, then I'll mention that John was convicted based on activities from the early 70's, before SAPF was created. Edward, to my knowledge, is not active in the fellowship, and Irwin, if he ever was a member, and I don't know that he was, advocated arguments not shared by SAPF. What's with the "officials"? Re Cheek case, the SC (according to your citation) declared that an honest belief that one had no duty to file was sufficient to negate the element of willfulness "no matter how unreasonable a court might deem such a belief". It's right in there above one of the portions of code you bolded, but which, it seems, didn't suit you to highlight for a reason I could speculate on. I must say it seems almost your mission to stuff as much of this case sites in my face as you possibly can. In case there's any question on sincerity, you should keep in mind that the vast majority of those who become members of SAPF do so out of principle, not greed. Anyone coming to SAPF with the idea that they'll get in on this fight of applying the law as written to get rich is sadly mistaken. That's where the "Patriot" comes from in "Save-A-Patriot". I'm sure it's hard for some to comprehend that people would do things just because it's right even if it means being much worse off, but there are some of us still around. I recall reading one of the IRS arguments against SAPF that no one would fight the IRS if there wasn't some monetary reward. I guess the idea that people might just have principles is just such a foreign concept among IRS agents and employees. Judge Garbis already has found that Kotmair is also sincere in his beliefs. The 44K aside, SAPF won it's case agains the IRS in 96. Sorry, but I'm not licensed to give legal advice, and I wouldn't want to say anything that might be construed as such. That goes for any suggestion that people are not required to file, and it goes for any suggestion that people are required to file. I can not, will not, do not, and have not advised either. Each and every person will have to make up their own mind on what to do and consider, to whatever lengths they themselves deem proper, the hazards of whatever course they entertain.
kudos, outstanding post.
nolu, have you watched Russo's Freedom To Fascism? if not, why not? if you have, i'd very much like to get your opinion about the several former IRS agents, including Banister, who learned the truth and who have challenged the almighty IRS to "show me the law." to date, there has been no answer. any enforcement of their statutes/codes is because they have the power to do so, not because it's lawful or legal. judges go along with the program because they themselves are scared to death of the IRS. see noone's #148.
that's grotesquely farcical....it sounds like that idiot IRS commissioner (Rossotti?) Russo interviewed in FtF. btw, what about that voluntary compliance????
When an issue is as pervasive as taxation is, having some potential application to every citizen regardless of their financial status or level of education, it would appear reasonable that these mandates should be written in plain enough language, in simple terms understandable to all affected by them. While I sympathize with your desire for simplicity and clarity, taxation as applied to everyone is a complex subject and some degree of experience is required to comprehend it. But that is no different than medicine, construction, aviation, navigation, even farming. You have no expectation of being able to diagnose or operate on your own pancreatic cancer. You have no expectation of being able to design and build a bridge, etc. Every discipline has its specialized terminology that has meaning to those experienced in that discipline and the meanings aren't "common". Were I to decide I ought to be able to repair my own roof simply because everybody has a roof, roofs are important, and they're just angled or flat, shingled, tarred, or steel, over some supports - I'd set myself up for a nightmare "home project". I lack the tools. I lack the knowledge of how my particular roof is made. I lack the experience of knowing what materials to buy. I have no practice with either tools or materials. And the "obvious" is seldom so. A "2 by 4" isn't really 2 inches by 4 inches. Shingles can not be butted together, an expansion gap must be allowed. You might try home-remedies for a cold, but you wouldn't try to diagnose or remedy coughing up blood. Complying with or practicing tax law likewise has specialized experience, tools, and terminology. There are simple tax forms for simple circumstances, but if you're going to argue "tax law" or the invalidity thereof, you'll need more specialized knowledge of courts and code. The necessity to draft regulatory instructions in incomprehensible legal terms, that are defined in law dictionaries, buried within countless volumes of "code", is more likely the result of high tech pettifoggers representing corporate evaders of taxes than the outgrowth of common citizens expecting fair treatment and an honest government, both of which most would admit is a far cry from the situation in America's tax system No, it is the result of centuries of layering law upon law (fairly or unfairly) to address new circumstances and ever increasingly complex society, and political tinkering with the tax laws to implement social policy. A flat tax, for example, is unfair to the poor, a sales tax is unfair to the consumer, a property tax is unfair to the homeowner, graduated taxes are unfair to the wealthy, corporate taxes are "just passed on", etc. etc. Society wants roads, schools, hospitals, fire departments and armies to be publicly funded. The poor pay no taxes. Businesses make money and lose money. Families make money and lose money. Workers make money and lose money. Balancing out those simple concepts becomes quite complex in the tax laws. And that doesn't even begin to cover everyone's pet "tax loopholes". Absolutely it is an overly complex and unfair system. But everyone is to blame. Corporations for their lobbying, reporters and teachers for dumbing-down the public, politicians for lying and corruption, the public for tolerance and acquiescence, and also the tax protesters, schemers, and defrauders who spread false legal advice (mistakenly and deliberately). There are honest people as well in all walks of life, but until you learn to recognize the facts of tax law, you'll not recognize honest tax advice either. The (legally created) fiction that people and corporations should be treated equally under the law is simply an outrageous fraud. That belief itself is a fiction. Corporations and people are *not* treated equally under the law. That inequality is the source of much of the unfairness. If a worker were recognized to have a cost-basis in their labor, as does a corporation, their taxable "gain" in their wages would be far smaller. OTOH, the tax law would get even more complex. But if you want to make an omelet, you're going to have to break some eggs. When the only way to actually be heard by the government is to hire lobbyists and load them down with bribes for the politicians sometimes the court system looks like the only other alternative. People like Schiff, Kotmair, Schultz, Russo and Banister approach this unseemly venue as a last resort in a vain attempt to salvage whatever unfounded notions of liberty remain ingrained in their pea brains in spite of the obvious. It is not the only alternative, but worse, the alternative presented by Schiff, Kotmair, Schultz, etc., is a *false* alternative. It is no alternative. It is based on a false understanding of the tax law, the courts, and the rule of law, and on that basis most people reject it out of hand as something akin to anarchy, not surprisingly. But in the process Schiff, Kotmair, Schultz, et. al., have made the discussion exceedingly more difficult because they foment the very ignorance they claim to battle, and they exhaust the open-mindedness and receptivity to IRS abuses and unconstitutional arguments that once existed. Schiff, Kotmair, Schultz, et. al. inept arguments and advice put the broad brush in the hands of the courts and IRS with which we all get tarred. A study of court history shows it used to be fairly easy to bring constitutional challenges on tax issues. That has become almost impossible, no thanks in part to Schiff, Kotmair, Schultz, et. al. Yes their attempts were in vain, but because of their own deliberate ineptitude. There was nothing noble or useful about it. To paraphrase General George S. Patton, taxation wars are not won by filing lost arguments. Taxation wars are won by making the other side file losing arguments. The same courts you and others are so proud to quote have authorized numerous frauds such as slavery in the past, so cut the high minded horseshit and face the facts. And when Patton would tally his fuel and equipment requirements, when Patton would study Rommel's tank tactics, when Patton pointed out Montgomery's failed strategy, was that pride or realistic analysis of how to defeat his enemy in battle? The only difference between battlefields and courtrooms is the ammunition. The only proper response to an IRS Summons is ... Fuck you and the horse you rode in on, any attempt by you or any of your bloodthirsty agents to interfere with my life will be considered an act of war and treated as such, I support the 2nd Amendment. And that, not surprisingly, is why most people stop listening. You opt for the wrong ammunition. We are a nation of laws, of the rule of law, and shooting someone as the "only proper response" and declaring armed warfare on the government's agents is what gets people killed. You may think you're making a noble defense of your liberty, but you'll just get others killed in your crossfire. And for what? To defend the low minded tax arguments of Schiff, Kotmair, Schultz, etc?
(The Gospel of Jesus Christ is the only true good news)
are we? only for us little people. not for our elite rulers. bush said it all when he said the constitution is just a goddamned piece of paper. i realize that's simplistic, but in my mind, it really is just as simple as that.
If you really believe we aren't then just stop obeying them and don't expect others to obey them either. Might will make right, and you know who'll win that argument. Violating that piece of paper just got his party voted out of office, and may yet get him impeached, as Clinton was. For all the faults of the tax code, pretending it doesn't say what it says, doesn't help clear it up any, does it.
(The Gospel of Jesus Christ is the only true good news)
that's been my point all along. they have all the might. that doesn't make them right. as for bush being voted out because of that statement and possibly being impeached, i don't believe that will happen. in fact, pelosi et al already said it won't. i'm not a believer in the democrat/republican antipode. nor am i a believer that we vote anyone in or out. it's all about advancing the agenda of the corporate elites and no longer about the welfare of we the people. what to do about it? i have no idea. we're about to lose our country because of [our] treasonous government as the NAU is in the process of being implemented as we type. sigh.
what to do about it? i have no idea. we're about to lose our country because of [our] treasonous government as the NAU is in the process of being implemented as we type. sigh. It damned sure ain't about the welfare of we the people. What to do about it??? We have 2 choices. The founding fathers thought it was worth dying for.... So all I can say is all you "males" out there need to get off the tofu and become MEN!!! Like Noone222 said, the appropriate response is to tell them that "aggressions" on their part will be considered an act of war and treated as such.
No matter how noble the objectives of a government; if it blurs decency and kindness, cheapens human life, and breeds ill will and suspicion - it is an EVIL government. Eric Hoffer
i was thinking just that, innieway! there are only two choices, either resist or submit. it is the resistors, afterall, who are responsible for any freedom we've had and will have in the future. it certainly isn't the capitulators. from the Declaration of Independence We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.
That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. The U.S. Government has definitely become destructive of those ends. And there are many people that decide to submit to them since they feel helpless to resist them ... if our ancestors had taken this approach we'd still be British subjects.
"Guard with jealous attention the public liberty. Suspect every one who approaches that jewel. Unfortunately, nothing will preserve it but downright force. When you give up that force, you are ruined." Patrick Henry
http://sendnomoney.com/Sound/July_2006_Gary_This_is_Keven.mp3
"It is the old practice of despots to use a part of the people to keep the rest in order; and those who have once got an ascendency and possessed themselves of all the resources of the nation, their revenues and offices, have immense means for retaining their advantages." Thomas Jefferson to John Taylor, 1798
I lean towards trying to call a Constitutional Convention. 23 states allow voter initiatives that might be usable to force those state legislatures to call for a convention (2/3 states needed to call for a convention), and in other states perhaps voter organizations can pressure candidates to "pledge" to call a convention. Amendments would be: Balanced Budget: Monetary reform: Phaseout Entitlements: Eliminate international obligations: Term Limits: Even if the convention never gets off the ground, or never even out of the planning stage, just the idea might be enough to stimulate a more open discussion of what is wrong and how to improve it (if not fix it), and maybe jar congress into some action before it looses control. Adoption of just one of the above amendments would improve things considerably, IMO, one way or another. Candidates up for election are the most susceptible to giving a voice to the ideas even if they shy away from advocating a constitutional convention. The internet can be a powerful grass-roots tool to spread an idea and organize like-minded people, if there is focus and a concrete goal: Hold a Constitutional Convention, debate the amendments (revised no doubt), vote up or down.
(The Gospel of Jesus Christ is the only true good news)
FORGET IT! The PTB has been pushing for that for many years. If it were to happen there would be no limitations on what the convention could do. You know what happened the last time we had one of those. In 1789, the convention was called ostensibly to reform the Articles of Confederation. In the sweltering heat of summer the building in Philadelphia was sealed up so as to keep the proceedings a secret, lest word leak out that the Articles were to be scrapped and a new government formed. If we were to have a convention, you could kiss the constitution GOOD-BYE forever. As long as it remains, we have the chance to redeem the country. Once it is gone, however, it will be a different story. Anyone who would suggest such folly is a TRAITOR in my book and deserve a traitor's fate. BTW, The problem is and always has been the banksters combined with the mischief of Congress. Get rid of the banksters and the mischief of Congress will cease. Until that time, they are all hogs feeding at the trough on Wall Street.
"It is the old practice of despots to use a part of the people to keep the rest in order; and those who have once got an ascendency and possessed themselves of all the resources of the nation, their revenues and offices, have immense means for retaining their advantages." Thomas Jefferson to John Taylor, 1798
lol - puts me in cahoots with those other constitutional convention traitors like Washington, Hamilton, Franklin... surely you remember them, those scurrilous constitution-framer types.
(The Gospel of Jesus Christ is the only true good news)
That is a specious reply. If we had men of half the caliber of them here today, we would not be in the shape we are in now. Even Hamilton, the bankers man, was more a man of character and morals than any of these who aspire to lead this nation in any capacity today. Still, I like the anti-federalist positions on many things. They have proved quite prophetic.
"It is the old practice of despots to use a part of the people to keep the rest in order; and those who have once got an ascendency and possessed themselves of all the resources of the nation, their revenues and offices, have immense means for retaining their advantages." Thomas Jefferson to John Taylor, 1798
Sympathy is appreciated but doesn't solve any problems. The U.S. Tax System provides deductions that bankers benefit from, at the expense of those unable to afford the purchase of a home. And guys like Ross Perot can grease the palms of politicians to get a 10 Million Dollar Tax waiver while the local waitress at the greasy spoon can't afford shoes for her kids. This nonsense offends my sensibilities. People that rely upon the tax system to earn a living should get a real job. The only difference between battlefields and courtrooms is the ammunition. The difference in my opinion is that on a battlefield everyone expects injustice to prevail, and in modern courtrooms that is a surety. We are a nation of laws, of the rule of law, .... What country do you live in ????????????? [Ever hear of the Patriot Act ?]
"Guard with jealous attention the public liberty. Suspect every one who approaches that jewel. Unfortunately, nothing will preserve it but downright force. When you give up that force, you are ruined." Patrick Henry
Comments (166 - 200) not displayed.
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-Thomas Paine
#126. To: lodwick (#125)
#127. To: Starwind, Neil McIver (#121)
This is, after all, about what the law does or does not say, and which specific parts are or are not constitutionally enacted and enforced.
#128. To: noone222, Neil McIver, Starwind, innieway, nolu_chan (#119)
(Edited)
The truth is that there isn't any way to pay for something with a debt (note). Legal tender and money are certainly not equals, especially when legal tender fails to extinguish the debt, and perpetual debt requires perpetual service of the interest on that debt. It's a criminal slave system operated against the people of the world by a criminal banking cabal (Central Banks internationally are the same) ... it's that simple. The cabal has conspired with criminals and morons within the government to establish a currency monopoly that is bankrupting the richest nation to have ever operated on planet earth.
#129. To: noone222 (#123)
#130. To: Starwind (#124)
Somewhere along the way I got the impression that you were persuaded/convinced the 16th Amendment was not ratified. Not having read what is purported to be the best research on that theory, on what research do you base your belief, or do I misunderstand your belief as to 16th Amendment ratification?
#131. To: lodwick (#125)
One can argue the finer points of the law until they're blue in the face, and come to any number of conclusions when the law in incomprehensible and legal precedent is artfully worded to confuse not inform,
#132. To: innieway (#127)
"I futher understand that the application withdrawn and all related material will remain part of the records of the Social Security Administration and that this withdrawal will not affect the proper crediting of wages..."
#133. To: christine (#128)
It really is as simple as that. Bill and I met with attorney, John Green, of the Andrew Jackson Society (he's a friend and associate of Edwin Vieira,Jr), yesterday, and one of the things he told us is that John Snow, former Secretary of the Treasury, made the statement that the tax code is incomprehensible (I'd like to see that if anyone can find it). Think of the implications. If he or any of them can't understand it, how then can any of us be expected to? And, that being the case, that means every person now imprisoned for tax evasion etc etc should be freed.
#134. To: Neil McIver, Starwind, TommyTheMadArtist (#132)
(Edited)
That suggests that it would not cancel the number. I mentioned before this might be just to cancel an application for SS payout benefits, not one's number.
So if you've used this, the million FRN question is: have you been able to verify that the SS has purged the SSN they issued you?
#135. To: innieway (#134)
#136. To: Starwind, Neil McIver (#124)
[Neil McIver #122 to Starwind] One of the charges against SAPF in 93 was failure to withhold. SAPF won while admitting that no withholding was being done for the staff.
THE COURT: We are trying to get an understanding of when something belongs to you and when it doesn't. When it belongs to [the SAP Fellowship], so I just want you to try and help me understand that. If you go to the grocery store and you buy Wheaties [with fellowship funds], when is it yours, after you eat it or . . .
The SAP Fellowship is a national organization of American patriots who have joined together to resist the illegal actions of the IRS and other government agencies who would attempt to deceive the public.
. . . only after S.A.P. has determined that a judgment [**11] does exist and that the claimant, to the best of his ability, dragged the plunderers through every agency and court proceedings feasibly possible, using delaying tactics in each and everyone.
. . . only after S.A.P. has determined that the claimant member is actually incarcerated and is given physical proof that said member, to the best of his/her ability, resisted and delayed the tyrants at every step through the criminal investigation and all other agency and court proceedings feasibly possible.
An unincorporated association . . . or other group which has a group name may sue or be sued in the group name on any cause of action affecting the common property, rights and liabilities of the group.
In any cause of action affecting the common property, rights and liabilities of an unincorporated association, or other group which has a recognized group name, a money judgment against the group is enforceable against the assets of the group as an entity, but not against the assets of any member.
#137. To: noone222 (#97)
Nolu ... it's impossible to define the word income with the word income. This phraseology doesn't define income.
INCOME. The gain which proceeds from property, labor, or business; it is applied particularly to individuals; the income of the government is usually called revenue.
http://laws.findlaw.com/us/255/527.html
"The gain derived from capital, from labor, or from both combined,' provided it be understood to include profits gained through sale or conversion of capital assets.' Eisner v. Macomber, 252 U.S. 189, 207 , 40 S. Sup. Ct. 189, 193 (64 L. Ed. 521, 9 A. L. R. 1570).
#138. To: Neil McIver (#103)
http://caselaw.lp.findlaw.com/casecode/uscodes/18/parts/i/chapters/51/sections/section%5F1111.html
TITLE 18 - CRIMES AND CRIMINAL PROCEDURE
PART I - CRIMES
CHAPTER 51 - HOMICIDE
Section 1111. Murder Whoever is guilty of murder in the first degree shall be punished by death or by imprisonment for life;
(1) the term "assault" has the same meaning as given that term in section 113;
(A) under the perpetrator's care or control; or
http://caselaw.lp.findlaw.com/scripts/ts_search.pl?title=26&sec=7201
TITLE 26 - INTERNAL REVENUE CODE
SUBTITLE F - PROCEDURE AND ADMINISTRATION
CHAPTER 75 - CRIMES, OTHER OFFENSES, AND FORFEITURES
SUBCHAPTER A - CRIMES
PART I - GENERAL PROVISIONS
Section 7201. Attempt to evade or defeat tax Link
#139. To: Neil McIver, Starwind (#107)
http://laws.findlaw.com/us/240/103.html
STANTON v. BALTIC MINING CO, 240 U.S. 103 (1916)
STRATTON'S INDEPENDENCE, LTD. v. HOWBERT, 231 U.S. 399 (1913)
#140. To: Neil McIver, Starwind (#116)
[Neil McIver #116 to Starwind] The things that take place in the courtroom are dubious as well. I think in Irwin Schiff's trial the jury asked the judge for a copy of the law which required him to file and the judge told them he wouldn't give it to them. For some reason they convicted him anyway.
Friday, February 24, 2006
WWW.USDOJ.GOV TAX
(202) 514-2007
TDD (202) 514-1888
Link
[Defendant shall undertake counseling, at his own expense, which may include psychiatric counseling as deemed necessary under the guidelines and supervisions of
[From Page 4]
* * * the Probation Department [See Declaration of William A. Cohan at § l7 (hereinafter "WAC Del."].
(b) Notice of Expert Evidence of a Mental Condition, If a defendant intends to introduce expert evidence relating to a mental disease or defect or any other mental condition of the defendant bearing on either (1) the issue of guilt or (2) the issue of punishment in a capital case, the defendant must ... notify an attorney for the government in writing of this intention and file a copy of the notice with the clerk.
From the historical record, Mr. Schiff's own descriptions of his behavior and Dr Ortega's recent emergency psychiatric hospitalization report, it appears that the diagnosis of Bipolar Disorder is well established and warranted. Mr. Schiff had a recent episode of depression with suicidal ideation, which required hospitalization, but has been remediated with medication. I also believe there is a concurrent Delusional Personality Disorder. The first condition is an Axis I disorder that generally responds to treatment with psychiatric medication and cognitive behavioral counseling. The second diagnosis is an Axis II personality disorder. For the most part, personality disorders do not respond to treatment and are believed to be characterological in nature. In my opinion, and in the history detailed above, Mr. Schiff's distorted beliefs appear to have grown out of the stress of his business failures and his first, undiagnosed manic episode. However, once developed,
[From page 7] these delusional beliefs have carried forward quite separate from the state of his bipolar mood swings and the impact of psychiatric medication. With very high probability they will continue unabated in the future. There is a significant element of Paranoia in his MMPI protocol; however, he is extremely constricted emotionally so that underlying anger does not surface. His pseudo-rational belief system is confined to one area and there is no disorganization of thought. Further, it does not appear to originate from anti-social tendencies. However, this belief system is not under voluntary control. Individuals suffering from Delusional Disorder have little or no ability to alter their beliefs. Mr. Schiff acknowledges that even his two sons have advised him to pay his taxes and avoid the negative consequences. However, he states that he cannot do so because "I cannot pay what I do not owe."
See WAC Del at § 26 and Dr. Barry's Report attached thereto as Exhibit 4 and incorporated herein as though set forth in full.
PALAZZO LAW FIRM
Nev. Bar No 4128
520 South 4th Street
Las Vegas, NV 89101
(702) 385-3855, 385-3856 (FAX)
IRWIN A. SCHIFF
Plaintiff,
Defendant MR. DARMSTADTER: So for purposes of definition so that we're not misunderstanding each other, could you define what you mean by "economic income?"
11. When confronted with contradictions in his conclusions, Schiff either ignores the challenge or moves on to new exhortations of what the law is and his omniscient "expertise" on the Indeed, Schiff s own counsel's refusal to assert Schiff's tax theories in the hearing on the motion for preliminary injunction should itself have sent a message to Schiff
- 5 -that his tax ideology is legally frivolous. After Schiff s counsel refused to assert Schiff s theories in court, Schiff dismissed her, and represented himself during the remainder of the hearing.
15. In U.S. v. Schiff, 269 F Supp.2d 1262, 1270 (D. Nev. 2003), this Court held: ... Schiff is on notice of the law, notwithstanding his remonstrations that he is the one who is right, and that every single legal authority to the contrary is either bogus or unsound. Schiff s attempt to distinguish the adverse cases on the grounds that they do not specifically involve application of his zero-income tax scheme is totally unavailing All of Schiff s schemes suffer from the same conceptual infirmities rejected time and again by the courts: that income taxes are voluntary Schiff cannot avoid the "know or had reason to know" standard by holding up a differently wrapped package. Schiff knows what's in the box, and therefore knows better. See Estate Preservation, 202 F 3d at 1103 ("The 'knew or had reason to know' standard therefore includes 'what a reasonable person in the [defendant's] ... subjective position would have discovered.'")(citations omitted).
16. Stints of incarceration for years, IRS levies for hundreds of thousands of dollars, substantial sanctions and fines imposed by (1) the Second Circuit for bringing frivolous appeals and (2) the United States Tax Court for presenting groundless and frivolous arguments demonstrate that Schiff s belief system is impervious to negative feed back. [1] Schiff s expectation seems to be that someday the federal courts will experience an epiphany and acknowledge that he has been right all along . Cf., Schiff Deposition Vol. II, 84:8-19: THE COURT: All right. Do you understand that, Mr Schiff? It's not whether it's valid or not, not whether it's
- 8 - MR SCHIFF: This is whether or not I violated the terms of my probation. The terms of my probation state I am to follow the instructions of my probation supervisor. Now my probation supervisor never told me to file returns other than the ones I filed. The basis of the government's claim is that I didn't follow the instructions of Mr Necki... and Mr. Warren .... But, there's nothing in my conditions of probation that say I have to follow the instructions of government employees. Now -
- 9 - MR SCHIFF: 32(1 )(c) says I will have the opportunity to question the witnesses.
- 10 - THE COURT: No, no, no, no.
- 11 - MR. SCHIFF: Did your instructions - did your instructions require to file -
#141. To: nolu_chan (#136)
The tax imposed by Title 26 is the Federal Income Tax. The reference to "tax imposed by this title" clearly identifies the tax in question.
Subtitle A—Income Taxes
Subtitle B—Estate and Gift Taxes
Subtitle C—Employment Taxes
Subtitle D—Miscellaneous Excise Taxes
Subtitle E—Alcohol, Tobacco, and Certain Other Excise Taxes
CHAPTER 31—RETAIL EXCISE TAXES
CHAPTER 32—MANUFACTURERS EXCISE TAXES
CHAPTER 33—FACILITIES AND SERVICES
CHAPTER 34—POLICIES ISSUED BY FOREIGN INSURERS
CHAPTER 35—TAXES ON WAGERING
CHAPTER 36—CERTAIN OTHER EXCISE TAXES
[CHAPTER 37—REPEALED]
[CHAPTER 38—REPEALED]
CHAPTER 38—ENVIRONMENTAL TAXES
CHAPTER 39—REGISTRATION-REQUIRED OBLIGATIONS
CHAPTER 40—GENERAL PROVISIONS RELATING TO OCCUPATIONAL TAXES
(mere omission to file, without any sign of dishonesty or concealment, is insufficient to sustain a charge of tax fraud) Kotmair v. CIR (6/19/86) 86 TC 1253; ("However, a pattern of consistent failures to file for several years is strong evidence of fraud.") Harrell v. CIR (6/15/98) TC Memo 1998-207;
#142. To: Neil McIver, nolu_chan (#136)
One of the charges against SAPF in 93 was failure to withhold. SAPF won while admitting that no withholding was being done for the staff.
#143. To: Starwind (#142)
If you're certain a charge of failure to withhold taxes was made, could you please post some documentation (a copy of an indictment for instance)? Something other than Kotmair's assertions.
#144. To: Neil McIver (#141)
[Neil McIver #141]
The tax imposed by Title 26 is the Federal Income Tax. The reference to "tax imposed by this title" clearly identifies the tax in question.
This Court has found that Defendants John Baptist Kotmair and Save-A-Patriot Fellowship have engaged in conduct subject to penalty under IRC §§ 6700 and 6701 in connection with their fraudulent promotion of the “U.S.-Sources” or “Section 861" argument. This argument has no basis in law and has been consistently rejected by the courts.
939 F.2d 499
v.
Lorin G. SLOAN, Defendant-Appellant.
United States Court of Appeals,
Seventh Circuit.
Decided Aug. 9, 1991.
Denied Sept. 10, 1991.
Lorin G. Sloan (argued), pro se. FN1. The tax deficiencies differed for each of the three years. Count 2 indicated that Sloan owed $3,618.00 to the United States government for 1982, while count 3 covering 1983 revealed that Sloan was obligated to pay $653.53 to the government.
FN2. We also note that this information satisfies the requirements imposed by the Federal Rules of Criminal Procedure. See FED.R.CRIM.P. 7(c)(1) ( "the indictment or information shall be a plain, concise, and definite written statement of the essential facts constituting the offense charged.... The indictment or information shall state for each count the official or customary citation of the statute, regulation or other provision of law which the defendant is alleged therein to have violated.").
#145. To: Neil McIver (#141)
[Neil McIver #141]
"Except in matters governed by the Federal Constitution or by acts of Congress, the law to be applied in any case is the law of the state. And whether the law of the state shall be declared by its Legislature in a statute or by its highest court in a decision is not a matter of federal concern. There is no federal general common law."
-- ERIE R. CO. v. TOMPKINS, 304 U.S. 64 (1938) http://caselaw.lp.findlaw.com/scripts/ts_search.pl?title=26&sec=7203
TITLE 26 - INTERNAL REVENUE CODE
SUBTITLE F - PROCEDURE AND ADMINISTRATION
CHAPTER 75 - CRIMES, OTHER OFFENSES, AND FORFEITURES
SUBCHAPTER A - CRIMES
PART I - GENERAL PROVISIONS
#146. To: Neil McIver (#141)
[Neil McIver #141]
(mere omission to file, without any sign of dishonesty or concealment, is insufficient to sustain a charge of tax fraud) Kotmair v. CIR (6/19/86) 86 TC 1253; ("However, a pattern of consistent failures to file for several years is strong evidence of fraud.") Harrell v. CIR (6/15/98) TC Memo 1998-207;
18066-037
72
White
M
01-24-1984
RELEASED
33337-037
48
White
M
12-27-2000
RELEASED
08537-014
78
White
M
10-07-2016
FORT DIX FCI
CHEEK v. UNITED STATES, 498 U.S. 192 (1991)
498 U.S. 192 * * *
It seems to me that we are concerned in this case not with "the complexity of the tax laws," ante, at 200, but with the income tax law in its most elementary and basic aspect: Is a wage earner a taxpayer and are wages income?
He had all these crazy beliefs, wages are not income, the income tax is voluntary. To be sure, wrong beliefs. I am not here to defend those beliefs on the merits, but those are statutory beliefs. And he was told that that was the state of the law by attorneys at seminars, and he obviously is not a sophisticated man. And note, this Court and the Government cannot say that a person in Mr. Cheek's position as a matter of law could not have been mistaken. Yet that's the position the Government is urging.
http://www.libertylounge.net/forums/5095-good-case-libertarians-who-dont-believe.html
Seventh Circuit.
UNITED STATES of America, Plaintiff-Appellee,
v.
John L. CHEEK, Defendant-Appellant.
No. 92-1668.
Argued June 7, 1993.
Decided Aug. 23, 1993.
#147. To: Neil McIver (#141)
[Neil McIver #141] In any event, these appear to be merely "tax court" decisions, and you should know that tax court is not an article III judicial court, but purely an administrative dispute board little different from a 3rd party arbitration panel. I wouldn't be surprised if those "judges" that preside in tax court are just IRS employees.
#148. To: Starwind, all, thread (#11)
(Edited)
Reading a law dictionary and arguing specious definitions of legal terms
#149. To: nolu_chan (#147)
You stated at Neil McIver #103 that, "It is not possible to violate a law that prescribes a penalty." The murder statute prescribes a penalty. It is possible to violate the murder statute. It is not a comparison. It is a specific example demonstrating that your argument lacks merit.
Your supposition is incorrect and based on your delusion that there is no requirement to pay taxes on income, and your meritless denial that there is a statutory requirement to do so.
The SAPF officials who acted upon that meritless argument have records from the Bureau of Prisons to document their notable lack of success in persuading anyone who mattered.
A pattern of consistent failures to file for several years is strong evidence that Kotmair would not succeed in court.
If you are to invoke these arguments as having merit, in your opinion, you at least have an obligation to warn the readers that those who have acted on such beliefs and gone to court have then gone to prison.
#150. To: noone222 (#148)
#151. To: nolu_chan, noone222 (#147)
#152. To: Neil McIver (#149)
I recall reading one of the IRS arguments against SAPF that no one would fight the IRS if there wasn't some monetary reward.
#153. To: noone222 (#148)
#154. To: Starwind (#153)
We are a nation of laws, of the rule of law,
#155. To: christine (#154)
(Edited)
are we? [a nation of laws, of the rule of law,]
bush said it all when he said the constitution is just a goddamned piece of paper.
#156. To: Starwind (#155)
(Edited)
Might will make right, and you know who'll win that argument.
#157. To: christine (#156)
it's all about advancing the agenda of the corporate elites and no longer about the welfare of we the people.
(1)Kiss the ring of the master and allow him to continue to rape our children. OR
(2)Grow some balls as our founding fathers did, and FIGHT!!!! Learn to say HELL NO!! NO MORE!!! Take our nation back, and eliminate (not merely incarcerate) ALL traitors who don't give a damn what our children and grandchildren will have to endure - and that includes traitors like Starwind(bag) and Nolu_Chan.... They are either with us or against us, and we ain't takin prisoners!!!
#158. To: innieway (#157)
We have 2 choices. (1)Kiss the ring of the master and allow him to continue to rape our children. OR (2)Grow some balls as our founding fathers did, and FIGHT!!!! Learn to say HELL NO!! NO MORE!!!
#159. To: christine (#158)
Life, Liberty and the pursuit of Happiness.
#160. To: noone222, innieway, Artisan, christine, Neil McIver, All (#159)
(Edited)
Check this out.
#161. To: christine (#156)
what to do about it?
Tax Uniformity:
The internet would be ideal to push/organize the agenda. I don't know about the logistics of holding a convention, but every party that wants to have a voice would be required to advocate, support calling the convention, and assist with its organization, even if that party wanted to advance a different agenda at the convention.
All taxpayers are subject to the same laws. No distinctions anymore among corporate vs indivdiual vs organization. No gradations - every payer pays the same percentage on their gain, not on their income and the rules for determining "gain" must be uniform for everyone - no distinctions. Outlaw property taxes, estate taxes, and gift taxes. All local revenue can be generated only by uniform gain tax or local use or sales taxes.
The government can not spend nor enact entitlements for future expenditures of more than 10% over revenues, and that 10% overage can only be approved by 3/4ths of the congress, and that 10% is computed on revenue and never on overage and must be reauthorized every year. (ie 10% overage doesn't carry over and doesn't include any prior overage). In event of revenue shortfalls or extraordinary expenses, other expenditures must be cut until the budget balances. The government can borrow, but only short-term and all borrowing must be paid off by the end of every presidential term. No administration can run up debts to be paid off by future administrations.
Zero-inflation targeting: The government can not, in any given year, print more currency than the nominal GDP requires. GDP metrics are based solely on actual prices charged for goods and services - no imputations or adjustments and all weightings are based on actual census figures.
All existing commitments in Social Security and Medicare will be met, but no new entrants will be accepted and existing contributions and obligations will be frozen and never increased. The government is henceforth restricted from any and all entitlement or loan programs. Expenditures only for goods, services, and operations.
No more loans or forgiveness of past loans to other countries, with the sole exception being disaster recovery assistance within 180 days of natural disasters and not conflict related, and provided the budget remains balanced. No more contributions to the UN or other treaty organizations disproportionate to what other countries contribute. No funding of IMF or World Bank disproportionate to what other countries contribute.
Mandatory limits on all national/federal offices. 6 2-year terms for Representative, 2 6-year terms for Senator. Either leave Presidential terms as- is or increase to not more than 3 4-year terms.
#162. To: Starwind, christine, innieway, noone222, lodwick, IndieTX (#161)
(Edited)
I lean towards trying to call a Constitutional Convention.
#163. To: BTP Holdings (#162)
(Edited)
Anyone who would suggest such folly is a TRAITOR in my book and deserve a traitor's fate.
#164. To: Starwind (#163)
lol - puts me in cahoots with those other constitutional convention traitors like Washington, Hamilton, Franklin... surely you remember them, those scurrilous constitution-framer types.
#165. To: Starwind (#153)
While I sympathize with your desire for simplicity and clarity, taxation as applied to everyone is a complex subject and some degree of experience is required to comprehend it.
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