AMERICA'S #1 TAX CHEAT

By Bob Schulz

http://givemeliberty.org
February 13, 2004


Do you cheat on your income tax? Just a little bit here and there? If you do, you have lots of company. The IRS Form 1040 probably makes liars out of more Americans than the bathroom scale. Why do otherwise honest people cheat on their taxes? When asked, people will say, "It's just none of the government's business," or "I pay them enough as it is." Such emotional statements are not based upon any knowledge or even worry about what the law may require. People are venting their resentment at an all-powerful government that invades their privacy, raids their paychecks, and keeps them in line with threats of audits, penalties and even prison. Add it up. Most Americans are government slaves two days out of five. Perhaps a little cheating makes that more bearable. 

Who do you suppose is the biggest tax cheat in American history? Al Capone? Leona Helmsley? Willie Nelson? Some big corporation? I'm afraid not. The fact is that no single "taxpayer" can hold a candle to the #1 biggest tax cheat in American history -- the United States government! As you will see, the strongest evidence supporting this shocking allegation is the very behavior of the government itself in response to the questions raised in this article. 

How do Americans acquire their beliefs about the income tax? Virtually all Americans grow up taking other people's word for it. We take the word of others for a great deal in life actually, having neither the time nor the skill to confirm everything society appears to require of us. For example, most parents apply for a Social Security number on behalf of their newborn before ever leaving the hospital. The nurse hands them the form, and they fill it out without question. Everyone assumes that medical professionals would not be insisting on a Social Security application if the law did not require it. It turns out that there is no law requiring Americans to apply for a Social Security number at any time, much less at birth. However, the important question is this: why do nurses at virtually every hospital in America believe there is a law that requires parents to fill out the Social Security application for their child? How and why is this belief being propagated? 

Were you aware that a Federal Court has ruled that no one can be refused a job for failure to have or provide a Social Security number? (See EEOC v. Information Systems Consulting CA3-92-0169-T IN THE UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF TEXAS DALLAS DIVISION) It may actually be unlawful for an employer to terminate or not hire you merely for failure to fill out IRS Form W-4 or W-9. (See DOJ Form I-9; or 8 U.S.C. 1324a(b), 1324a(b)(2); or Privacy Act of 5 USC Annotated 552(a).) Yet virtually every employer in America believes that no one can be hired or work without providing a Social Security number on Form W-4. Who is telling the employers this? 

As it turns out, in response to countless letters from concerned Americans, the government has either been unable or has flatly refused to cite any law that would force Americans to "join Social Security" against their free will. What is going on here? 

In February, 2002, 537 questions of this nature were considered during open hearings near the nation's Capitol. Both the Internal Revenue Service and Department of Justice pledged to attend and participate in these historic hearings at the behest of Congressman Roscoe Bartlett (R-MD). In a last minute display of dishonesty and cowardice, the IRS, DOJ and Rep. Bartlett refused to honor their pledge to participate. However, the hearings proceeded as scheduled, and the questions were answered by a panel of experts that included attorneys, CPA's, former IRS agents and other researchers. Subsequently all 537 questions were presented to the United States government in a formal Petition for a Redress of Grievances. To view the full record of the hearings, as well as news of the ongoing legal battle to compel the government to answer these disturbing questions see www.givemeliberty.org on the Internet. 

Over the last couple of decades a significant, if uncertain number of Americans have discovered that the income tax laws are convoluted, deceptive and, most importantly, misunderstood and misapplied. Some learn these things by chance or curiosity. Many more have learned the hard way -- in a fight for their lives against the most hated and feared agency in America, the Internal Revenue Service. The government itself estimates that tens of millions of Americans fail to file required tax returns. The number who do not file in the sincere belief that no law requires it is probably more like tens of thousands; but, if you pause to consider the risks involved, it becomes all the more significant that tens of thousands of Americans are flatly refusing to file returns as a matter of principle

Most Americans do not read the Tax Code, relying instead upon the professional advice of CPA's and attorneys. Tens of thousands of private citizens, for a variety of reasons, have done their own study of the tax laws and have been so outraged by what they have discovered that they have been willing to risk financial ruin and even prison rather than continue to submit to what they see as fraud and coercion. Many of these people have consulted with CPA's and attorneys only to find that the "professionals" don't have the slightest idea what the Tax Code actually says. Instead, the "professionals" parrot the government line: "No judge will agree with you, and you'll wind up in prison." No answers, just threats. 

Consider, if you will, some highly interesting court cases from the last 15 years in which Americans, who had refused to file, were tried and found not guilty. Defendants are occasionally acquitted due to legal technicalities; we all know that. However, these cases share two astounding similarities. First, each defendant based his defense almost solely on the belief, indeed the argument, that there is no law that requires any American living and working in the 50 states to file an income tax return or pay an income tax. Second, neither the prosecution nor the judge in each of these cases was willing or able to show the jury any such law. Below are the names of the those found not guilty, the cities where the trials took place and the dates: 

  • Thomas Reeves, Paducah, Kentucky, January 1988
  • 17 Defendants including Mr. Franklin Sanders, Memphis, Tennessee, July, 1991 
  • Gabe Scott, Fairbanks, Alaska, July, 1992
    Lloyd Long, Chattanooga, Tennessee, October, 1993
  • Fred Allnut, Sr. and son Christopher, Baltimore, Maryland, March 1996 
  • Gaylon "Whitey" Harrell, Logan County, Illinois, May 26, 2000
  • Don Fecay, Detroit, Michigan, August, 2001 
  • Vernice Kuglin, August 8, 2003, Memphis, Tennessee, August 8, 2003

It should be noted that there have been several hundred convictions for willful failure to file income tax returns in the same time period as the cases noted above. We have seen no proof that the government has ever put into evidence the specific code section that these convicted Americans allegedly violated. 

How desperate is the government to discredit and destroy those who dare to take a stand on the income tax issue? In 1992 in Honolulu, Hawaii, Mr. Lamar Hardy was indicted and prosecuted for allegedly laundering drug money. He was acquitted when an IRS agent on the witness stand admitted to designing a scheme to lure Mr. Hardy into unwittingly committing a serious felony when, in fact, the government had been unable to find any evidence that Mr. Hardy had committed any crime, drug-related or otherwise. Why target Mr. Hardy? Mr. Hardy and his brother had for some years been advising people that there is an important difference between "tax evasion" (failure to pay what is lawfully owed) and "tax avoidance" (not paying a penny more than the law requires). Significant numbers of people have listened to the Hardy Brothers and no longer file tax returns. Why didn't the government simply charge Mr. Hardy with failure to file returns and/or aiding and abetting others in failing to file their returns? Were they afraid to put the knowledgeable and experienced Mr. Hardy in front of a jury? 

In the Spring of 1993, the Ninth Circuit Court of Appeals reversed the convictions of Ray and Dixie Lee Powell of Washington state, who had been convicted of failure to file income tax returns. The convictions were overturned on the grounds that the trial court had failed to properly instruct jurors; the Powell's good-faith belief that they were not violating the law was, indeed, a proper defense, whether or not it was "objectively reasonable". The Powells flatly stated that they did not file returns. What would their belief have to do with it? Is the tax system a matter of faith? 

In mid-1990's, Joseph Banister was a Special Agent for the IRS Criminal Investigation Division. One day he heard these "preposterous" income tax questions being discussed on a radio talk show. Joe's curiosity was aroused by the simple fact that he knew the talk show host to be level-headed and reliable on other topics. Joe began his own investigation, eventually contacting several people who had studied the issue extensively. On his own time Joe studied the questions and allegations about the income tax. He presented this research, along with his own questions, to his bosses at the IRS. It was immediately suggested that he should resign. Here was a golden opportunity for the IRS. It could have simply answered Joe's questions, sent him back to his "contacts" and put to rest the mistaken ideas of countless "tax protesters" once and for all. Instead, for simply asking questions, Mr. Banister was forced out. The government continues to prosecute Mr. Banister, only recently trumping up charges against him in order to revoke his CPA license -- all for asking questions. What does common sense tell you about the government's treatment of Mr. Banister? 

On Tuesday, April 3, 2001, CBS posted to its Web site an article, including a video clip, entitled "Tax Revolt". That same evening CBS treated the same subject in its program 60 Minutes II. The program producer had spoken by telephone for some 90 minutes with a long-time investigator of these income tax questions. This gentleman faxed to the CBS producer approximately 30 pages of documentation related to information in this article. The ensuing TV broadcast contained not one reference to any of the information provided. IRS Commissioner Rossotti, interviewed on the program, ridiculed the Tax Honesty Movement and claimed "100% success" in criminal prosecutions. CBS had much of the information contained in this article, yet failed to ask the IRS Commissioner to comment. 

On November 25, 2003 in Fort Worth, Texas, Richard Simkanin was tried on multiple counts of willful failure to file returns and failure to withhold income tax from employee paychecks. The jury asked to be shown the laws Mr. Simkanin was accused of violating. The prosecution and the court refused, and the hung jury voted 11 to 1 to acquit Mr. Simkanin. The government immediately re-indicted him. This time the judge granted government motions to choose a jury in secret and to prevent Mr. Simkanin from presenting any evidentiary exhibits explaining his beliefs about the tax code. In short, they tampered with the jury selection process and prevented Mr. Simkanin from defending himself. 

On January 7, 2004, Mr. Simkanin was convicted on multiple counts of alleged tax crimes. In the previous 3 years, Mr. Simkanin had joined in our public efforts to compel the government to answer the questions that arise from the several tax cases noted above. I attended Mr. Simkanin's trial. As an American I was shocked and ashamed. Again the government refused to cite the laws Mr. Simkanin was accused of violating; but this time the behavior of the court was far worse. The judge blatantly sabotaged Mr. Simkanin's defense. Key defense witnesses were prevented from testifying. Critical evidence was not allowed in. Mr. Simkanin's attorney and witnesses were cut off each time information damaging to the government's case was about to be introduced. Clearly the word has gone out to Federal judges to railroad and destroy anyone attempting to hold the government accountable to the tax laws as written. For his noble efforts Dick Simkanin, loving husband and father -- a man of the highest principle -- may spend the rest of his life in prison, should his appeal fail. 

In the last five years the We the People organization has respectfully and peacefully petitioned our government for a Redress of Grievances -- for answers to reasonable and highly disturbing questions about the income tax laws. Rather than answer the questions and clear up misunderstandings, the government has responded with threats, intimidation, contrived civil injunctions and corrupt criminal prosecutions. 

Consider the cases cited in this article. What do you think of the behavior of the courts and other government entities? How many times in your life have you correctly sensed someone's guilt, not so much by the facts at hand, but by the party's behavior when confronted? I have met many so-called "tax protesters," and to me they do not behave as if guilty of anything. On the other hand, in several years of pressing these issues with people in government and the Media, the behavior I consistently encounter absolutely reeks of cover-up, fear, guilt and intimidation. 

Indeed, as Americans we must debate the size and role of government in our lives. The concern here, however, is 80 years of government lies about the income tax and a grossly un-American inquisition against those who confront these lies. How long must Americans suffer under tax laws that are notoriously confusing, rules and regulations that a free people should be ashamed of, and tax administration that is scandalously corrupt. Examine your pay stub. Examine your last tax return. How much is the government taking from you? Based upon several years of my own study, and decades of research by others, it is my firm conviction that we all have been victimized by the biggest tax cheat in American history -- the United States government. My fellow Americans, we guarantee a more corrupt government for our posterity when we fail to root out the corruption we find today. Won't you join me in demanding that the government stop its own shameful tax evasion and answer these questions once and for all? 

Please direct comments or questions by E-mail to info@givemeliberty.org, or by mail to We the People, 2458 Ridge Rd.,Queensbury, NY 12804; by phone at 518-656-3578 or FAX at 518-656-9724; or visit us on the Internet at www.givemeliberty.org.