Monday, November 9, 2015

The biggest scam and how they did it. Part 6.

Court cases. Taxpayer non taxpayer

The courts have ruled that there are taxpayers and non taxpayers. One must be subject to a tax, to be a taxpayer. It is possible to be liable for one tax, and not another, thus you can be both taxpayer and non taxpayer at the same time.

For the purposes of income tax, we will look at a few cases. 

Eisner v. Macomber 252 US 189, 40 SCt 189, Decided March 8, 1920,
"Brief as it is, it indicates the characteristic and distinguishing attribute of income essential for a correct solution of the present controversy.  The Government, although basing its argument upon the definition as quoted, placed chief emphasis upon the word "gain," which was extended to include a variety of meanings; while the significance of the next three words was either overlooked or misconceived.

"Derived--from--capital";--"the gain--derived -from--capital," etc.  Here we have the essential matter: not a gain accruing to capital, not a growth or increment of value in the investment; but a gain, a profit, something of exchangeable value proceeding from the property, severed from the capital however invested or employed, and coming in, being "derived," that is, received or drawn by the recipient (the taxpayer) for his separate use, benefit and disposal;--that is income derived from property.  Nothing else answers the description.    

Let me show you what they mean.

According to the  United States Supreme Court, (USSC) definition of income, Income is the gain or return of capital, separated from the capital for the use of the individual. Cases that came after, continued to support this definition. 

Column A is the investment, Column B, the return, Column C the tax and D the net return.

There must be a return, a gain, and you must be able to reinvest it, but that choice is yours. You are free to spend it, use it, or reinvest it. In this case the income would be the amount shown in column B. the net return after taxes is shown in column D.   D is the return you get to use as you see fit.

The IRS says your pay is income. It cannot be income by the definitions given to us by the US Courts. Look at the chart. You take 40 hours at 5 an hour and get 200 dollars. You get something different than what you invested (time and labor). The IRS says this is pure profit and is taxed. They say it is profit because they claim it cost you nothing to get the 200 dollars. They are wrong in so many ways it would take me another 5 pages to explain it.

Now, can you take the end result of the net income (as the IRS calls it) or net return of 180 dollars and re invest it into that 40 hours to give you a bigger return in Column B? NO, you cannot. Why? Because time is finite for humans. Once used it cannot be re used, unlike the capital used in blocks A2, A3, and A4.

Simply put: The time invested by a worker for pay, cannot generate a return or profit that can be separated from the capital investment, to be use for reinvesting. Thus it cannot be “income” as defined by the courts.

A workers pay is equal compensation because the time exchanged for the pay, cannot be reinvested and can only be used once because time is finite for humans.

Congress has taxed income, not compensation – US V Conner.  

So how does the IRS covert your equal compensation to an income tax? By word art and trickery.

The biggest scam and how they did it. Part 5

The courts play a very key roll in this scam. They refuse to hear cases, and they ignore evidence given by the people, and show favoritism to the governments agent, the Treasury department.

The courts got so fed up with hearing tax cases, that they created a "tax court", and demand people prove that the tax court lacks jurisdiction before they will hear a case. The tax court is where you go to argue how much is owed, or how much is not owed. The tax court cannot hear liability cases. A citizen is forced to prove a negative in order to get the lower courts to hear a case. A difficult at best, situation, but one that can be accomplished by people with the proper knowledge.

Fact: there is no liability for the income tax for most Americans who work within the boundaries of the USA, who get paid hourly or by salary, unless they work for the Government or have investments which produce a return of the investment.

Fact: There is no liability statute for American Citizens. The ONLY liability statute is found in Subtitle A, Chapter 3, tax on non resident aliens and foreign corporations.  No other income tax liability statute exists.

The IRC contains 5 different definitions of TYPES of income. Ordinary income, unordinary income, Gross income, adjusted gross income and taxable income.

Interesting thing about 2 of these definitions.  Taxable income means all income subject to taxation unless exempt by law, (and the court ruled also by the US Constitution).  This means that there is some income that is not taxable. Income meaning a gain..

The IRS considers Social Security disability payments to be income that is exempt. However the courts ruled differently.  They said that SS Disability is equal compensation, just like any other insurance settlement thus it is not taxable as income.

Gross income means all income, and lists a number of sources of income. The IRS claims wages are income yet wages does not appear in that list. Why? Because a wage tax, is a different tax than that of the income tax.

Income itself is not defined in the IRC as congress cannot define a word used in the US Constitution. Since the word income is used in the 16th amendment, it has specific meaning and congress cannot change that meaning.

The biggest scam and how they did it. Part 4

The US Treasury department is made up of several smaller departments. Amongst those is one called the IRS. No act of congress created it. No one is sure where the name comes from. Pay-me-triots claim its a State of Delaware corporation, but that has been disproved more than once in the courts.

 The nations tax law is the 26th title of the 50 titles that make up the Federal Statutes at large. Title 26 is divided in to several subtitles. Of those Subtitle F "Administration of title" is where we are going to start.

Here we find definitions of words that, unless otherwise specifically changed at a specific statute, are the definitions to be used when reading the title. In other words, a specific word may have a title definition, but when applied to a specific tax, that definition may be altered to be more precise for that chapter or tax.

One of the confusing things about this law, is the definition and the usage of the term "the secretary".

In Title 26, Subtitle F, Administration of Title,  at chapter 79 we find the title definitions at section 7701. Then at  section 7701(a)(11) we find the definitions of  Secretary of the treasury and Secretary. 

(A) Secretary of the Treasury. The term "Secretary of the Treasury" means the Secretary of the Treasury personally, and shall not include any delegate of his.
(B) Secretary. The term "Secretary" means the Secretory of the Treasury or his delegate. 

Do you see the confusion here? Definition (A) means ONE PERSON and one person only. Definition (B) can mean one of 2 possibilities, meaning 2 different people.  So when the congress wrote the law where it says "The Secretary may prescribe", who are they talking about? The Treasury Secretary, aka the head honcho, the boss, or are they talking about his delegate?  

This is a major confusion point when talking about this law.  

Remember what I wrote in the previous post about the office of management and budget? And the IRS pamphlets and booklets lacking a proper OMB number?  If you read through the IRC you will find that it is "the secretary" (which one?) that does the prescribing of them. In other words, they create them, direct what is to be included within them, and what they must do and look like. A secretary created the w-4 form for example, and decided the claim of exemptions had to be accompanied by a sworn statement of truth. Meaning the perjury oath.  Now, was it the Treasury secretary, or a delegate that created it? And how do we know the information on the form is correct, but more to the point, the instruction sheet attached to it, given to companies that call them selves "employers" is correct?
How can you hold that person accountable for accurate information if the law does not distinguish between the two?   Or do we hold the Treasury Secretary responsible for everything his delegates do? If so we won't be able to keep Treasury secretary's around for very long. Nor will the courts (again) hear cases involving this kind of claim.

This shows why the Office of Management and Budget's exemption to the IRS is wrong, and shows why the IRS should have to follow the same law as every other department, or agency of the US government.