The laws regarding 'Wage Withholding'The employer must, by law, withhold 'income taxes' from 'wages'... In your determination, have you been receiving 'wages'? |
|
The laws regarding 'Wage Withholding'The employer must, by law, withhold 'income taxes' from 'wages'... In your determination, have you been receiving 'wages'? |
|
Does your employer or their accounting firm know?
Have a look... you will find it helpful to 'demo' this out on paper, as seems to be written in a somewhat convoluted manner.
For U.S. Citizens, the law defines 'remuneration' as 'wages', except in §3401(a)(8)(A)(i), which states that said 'remuneration' is not "wages" if it is reasonable to believe that it will be 'excluded' from gross income under section 911.
Besides the fact that it is not listed under 911 hence leaving it outside of the 'fence' that is outlined by the law, there are a large number of other reasons to believe that your remuneration would be excluded from gross income under section 911...
The employers, CPA's, and attorneys have only ONE 'reason' to believe that it WOULD be listed under section 911, and that is because of their erroneous belief that the word 'WHATEVER' in the Sixteenth Amendment means 'any and all'.
That is a simple 'theory' to destroy... as the word 'whatever' is clearly restricted to 'any and all' of the 'sources' that appear on the list of 'sources' outlined by the Secretary of the Treasury in our gross income article.
Subsequently, such 'excluded' remuneration is 'exempt' under the rules of the Secretary of the Treasury due to the fact that it is not 'included' in 911.
In other words, the statutes express that 'wages' must be 'remuneration' which meets the terms described in § 911 or they are not 'wages', and thus excluded from the withholding requirement in § 3402.
Yet another way, this law reveals that the remuneration must be defined as "Gross income" under the law regarding "Income Taxes" before it can be within the legal term "wages", and can be legally regarded as subject to the withholding of the Income Tax in § 3402.
Our research in the "Gross income" article has shown that the Income Tax is only imposed upon U.S. source income of U.S. Citizens when it is defined as "gross income" under § 911 of the IRC. This requires the claiming of a foreign nation as a tax home, thus the income received from the U.S. source is received in a foreign country and by law is foreign earned income.
The Secretary of the Treasury has plainly stated in 26 CFR § 1.861-8T(d)(2)(iii)(D) the only income for U.S. Citizens not exempt from the income tax is Foreign earned income as defined in § 911 of the IRC. All of the other items of income listed had to do exclusively with foreigners, and at 26 CFR § 1.861-8T(d)(2)(iii)(A) the Secretary specifically stated that the Foreigner was subject to taxation on both U.S. and foreign earned income.
Since the Secretary of the Treasury did not make such a broad sweeping statement regarding the U.S. Citizen, it is plainly apparent that there is no statement made by the Secretary that U.S. source income of U.S. Citizens living and working in the U.S. is subject to the income tax, and would thus be exempt from withholding, since the withholding law is only applicable to amounts included in § 911.
As exposed in the 'Quick Study' article, this position is further supported by 26 CFR § 1.861-8(d)(2)(ii)(A) which plainly states that income which is 'excluded' from the law is "exempt income."
In Black's law Dictionary the term "Excluded" is not found, but the term Exclusion connotes "denial of entry or admittance."
So, if something is excluded from a law, is there any necessity that it be written in the law? Clearly not.
If something is not written in the law is there any necessity that an exemption for the un-written item be entered into the law? No again...
If the Federal standards of Statutory Construction (See LAW 101) and 26 U.S.C. § 7806 are really in operation in 26 U.S.C., and only the words in the law influence the meaning of the law, unless it is rendered ambiguous and thus legislative intent must be conferred with, the remuneration of U.S. Citizens from U.S. sources, and subsequently the only remuneration of U.S. Citizens to constitute "wages" to be withheld from under § 3401(a), is "gross income" as defined under § 911 of the IRC.
Some may say "What about the remuneration paid to U.S. Citizens described in 26 U.S.C. § 3401(a)(8(A)(ii), (B), (C), and (D), are they not gross income"? Of course they are, but that is specifically in relationship to "services... performed in a foreign country" or "within a possession of the U.S." or "within Puerto Rico". We are talking about remuneration paid from U.S. sources, § 3401(a)(8(A)(ii), (B), (C), and (D), do not apply to U.S. sources, so we do not need to look at them. Also, there are no such geographic limitations upon the location of the services provided in the application of the definition of gross income in § 911, as applied in 26 U.S.C. § 3401(a)(8)(A)(i), so it cannot be substantiated that the exception provided for in 26 U.S.C. § 3401(a)(8)(A)(i) can only be applied in situations where the U.S. Citizen or resident is working abroad.
This information furthermore supports, and is supported by, the research exposed in the "Gross Income" article on this site, since, if there were any other sections of law where a U.S. Citizen earned "gross income", why is it not mentioned along with § 911 at § 3401(a)(8)(A), or in 26 CFR § 1.861-8T(d)(2)(iii)?
The research shows that according to the Secretary's Regulations at 26 CFR § 1.861-8(f)(1) and -8T(d)(2)(iii), U.S. Citizens only earn "gross income" from U.S. sources when claiming a foreign tax home. Between these two laws, § 911 is cited in one and alluded to as the foreign tax credit in the other. Now, we have a third witness, § 3401(a)(8)(A) citing § 911, and we can only wonder what the Tax professors and CPA's will say now.
(Presently, we are seeing them ignore this argument and are arguing the word "whatever" in the Sixteenth Amendment. This is a silly situation as the Professionals now look like tax protesters, as they argue the constitution, and we just point out the statutes and regulations giving our position legal and statutory merit. The battle for your money has turned around the front line against the CPA's, Accountants, and Tax Attorneys.)
It is now very plain to see that even if a U.S. Citizen signs a W4 Form and hands it to his employer, the statutory authority to withhold from U.S. Citizens is limited to only 'remuneration' defined as gross income under § 911, thus constituting "wages" for the purposes of Chapter 24. There is nothing within § 911 hinting that it governs U.S. Citizens living in the U.S. earning income from U.S. sources.
It is plainly clear by the words of the law, that no employer paying 'remuneration' to any employee who is a U.S. Citizen living and working in the U.S., has a statutory right or duty to withhold a tax from the 'remuneration' under § 3402 or report the 'remuneration' as "Wages", and subsequently "Gross income" under the income tax, on the W2 pursuant to §6051.
This is the direction that the we are going to take. And we will let America know what resistance we get from the ignorant employers and Executive Rebels of the IRS.
We will work to continue to help you bring to your Congressperson’s attention the fact that the law, defining "wages" to be taxed and collected in § 3402, does not apply to the remuneration paid to U.S. Citizens living in the U.S. If the IRS resists us any further, it will be self-evident that they are Executive Rebels who have rendered the regulations promulgated by the Secretary, and the statutes enacted by the U.S. Congress, to be of no legal effect, by not allowing U.S. Citizens to rightfully claim their remuneration to not be "wages" under the law and thus not be subject to the withholding of the income tax imposed in Subtitle A and Collected in Subtitle C § 3402.
It is very apparent, by every means available at this time, that the taxes under §§ 1 and 3402 are the same tax, and that § 3401(a)(8)(A)(i) does not exempt remuneration paid to government employees from the definition of "wages". There are two questions which arise from this:
1. 'Are employers of America and the government going to obey the law and let the people who earn their money, have their money?'
2. How does the remuneration paid to Federal Government employees become remuneration paid from a taxable source under § 861 and subsequently defined as "wages" under § 3401(a)(8)(A) and then subject to withholdings under § 3402?
The first question is an old question which is answered one employer at a time. The second is a new question which requires further research. We will post findings as soon as we know something statutory, or fail to find anything after exhaustive searching.
Despite the way that employers in America have been carrying on outside of the law, it is plainly apparent that the terms in Chapter 24 of the Code at § 3401 are not the same as the terms in § 3121. It will be interesting to see if employers who are confronted with the letter of the law will be able to discriminate between the two different items and not report the amount of ‘wages’, as defined in § 3401(a), as none are earned to be withheld from, to be the same amount of ‘wages’ as defined in § 3121(a).
Now, a U.S. Citizen does not have to take a stand against the Social Security System in order to take a stand to stop the majority of the withholdings from his or her pay.
Nevertheless, it has been proved, in numerous circumstances, a U.S. Citizen can be, by right, free of all withholdings from his or her pay. There are many cases where fearless employers have heeded the rights of a U.S. Citizen living and working in the U.S., and that Citizen is not having any Income or Employment Taxes withheld from his or her remuneration, under the strict provisions of the law. But from now on, Taxgate will be refining a position handling each of the taxes collected under Subtitle C, independently of one another.
Some U.S. Citizens have sought to stop the withholdings from their 'remuneration' by making application of the provisions of § 3402 at subsection (n), in claiming that they are 'Exempt' from withholding of the tax withheld under § 3402.
In some circumstances this is seen as an even worse strategy, as the W4 only has to do with "wages" as defined under § 3401(a), and if a U.S. Citizens living and working in the U.S. does not appear to be earning "wages", the form is only used by the out of step IRS procedures, by the IRS, to come to the employer and tell them to withhold from your remuneration, which the employer thinks is 'wages', at the maximum rate.
The Exempt W-4 is not a cure-all. It also does not always extricate one's self from the withholding of the tax withheld in § 3402 for the main reason that to make use of this law the U.S. Citizen must still be under the authority of this section of law. This means that the regulations and determinations of the Secretary and his delegate (the IRS) rule this process, set forth under § 3402, as the Citizen claiming the "Wages" (defined in § 3401(a)) they earn (which they may not be earning) are exempt under the IRS's rules or a ruling by the IRS. They will check it out and they will find out if it is a fact or not.
So, it is folly to think that you can claim to not be subject to the Social Security Act and § 3402 withholdings with an Exempt W-4 Form. The W4 has nothing to do with Social Security withholding requirements according to our research. Also, to attempt to make use of the procedure set forth in § 3402 for the Secretary (whom you seek to claim to have no authority over you) to release you from a grip which he does not have over you is especially silly when you do not earn "wages" subject to § 3402. Nonetheless it is appropriate in certain instances.
There is another fact that reveals that making use of § 3402, in accordance with the letter of the law and the information on the form, is folly when you are not a student, and it is very clear. First, when you were a student, the law gave you an exemption and then gave you the opportunity to make a return in April to obtain a refund. This you probably did, and thus told the IRS that you had earned gross income in that prior year. Additionally, your employer submitted a W2 return regarding you, and you used that return to substantiate that you had earned gross income. Therefore, two witnesses stated under penalty of perjury that you had earned ‘Gross income’ for that first year.
You claimed that you had incurred a tax liability that year, but due to exemptions and deductions your liability was so low you obtained a refund. Therefore, you claimed under penalty of perjury that you had a tax liability that year, now you cannot meet the requirement of § 3402(n)(1) to make use of § 3402(n) to claim to be exempt from withholdings. It will not be until after you leave school that you will experience the bewildering full force of the income tax upon your labor. By then your records will be well established that you believed that you were earning ‘Gross income’ under the law, and had a tax liability in the past.
Now, despite the fact of what you might learn from our "Gross Income" article, and despite the fact that you may not be liable for any income tax imposed in subtitle A this year, as you may earn no ‘Gross income", you cannot use § 3402(n), as you cannot fulfill the requirement of paragraph (1). The IRS records are still there saying that you did earn "gross income" under the law.
Even if you choose not to file for the preceding year, there is still the matter of the W2 or 1099 return(s) being sent by your 'payor' to the IRS, claiming that you made ‘Gross income’ last year. Therefore, when you make the claim of being "EXEMPT", the IRS has the return information in the computer to use, to claim that you did incur a liability last year as you did earn ‘Gross income’.
Should the reader ignore this logical explanation surrounding § 3402(n), and attempt to claim to be "EXEMPT" on a W-4 form, the reader will be branded as a "tax protester" by the IRS, and the employer will be ordered (illegally and without statutory authority we might add) (Click to see the W2 article), to withhold from the reader at the rate for a person who is "single" and has no exemptions. This status is known simply as "single 0" and is the maximum rate of withholding. This is done by the IRS Detroit Computing Center, Questionable W4 Program in an effort to assure that the government’s claim against the person’s money is secured, and to create such a financial hardship for the working family that the return for that year will be filed.
The recent revelation of § 3401(a)(8)(A) shows us that this problem of income tax withholdings is solved within the Code, and is greatly dependent upon the income tax itself, which, boiled down to the definition of ‘Gross income", does not apply to most U.S. Citizens living and working in the U.S. The circular trap of the withholdings and the exemption provision of § 3402(n) is solved by first examining the foundation of the law to see if the law is even applicable to a U.S. Citizen, rather than making an assumption.
The fact that § 3401(a)(8)(A) does not include remuneration paid to U.S. Citizens, who are U.S. Residents, to make them subject to withholdings under § 3402, is it not a U.S. Citizen's right to not be subject to these withholdings, just because they are a U.S. Citizen living in America, and that they do not need an "Exempt" W4 as there will be no payment of "wages" due to the geographic location of his receipt of his pay?
Most employers have been led to believe by their attorneys, that we do not have a right to claim and take possession of all of our money/property at the end of the pay period. The hot war for withholdings is beginning. The law is on the side of the U.S. Citizen, as usual.
We have known in the past that the employer claims that the worker has a number, and thus the worker is subject to the Act and the tax withholding in 3402. Now that we have isolated the definition of "wages", and the possession of an SSN has nothing to do with "wages" in § 3401(a), we suppose that the employers will be in court and on their own again.
In our experience, the ones who have been successful with their employers, and the employer standing fast in the face of IRS intimidation and threats, have suffered no losses regarding the assertion of the Citizen’s rights. The Citizen is just outside of their jurisdiction. The law makes this plainly evident. the Citizen will continue to be outside of the scope of the IRS's authority if he can assert and have upheld all of his rights to his money.
Strategies reveals where to locate the methods to end withholding and demand a refund of prior years' withholdings. It doesn't matter if you signed a W-4 or not.
