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Enclosure(s):

  (1)  IRS Form W-8

  (2)  IRS Form 6450

  (3)  California Franchise Tax Board form 590

Reference(s):

  (1)  The Great IRS Hoax: Why We Don’t Owe Income Tax; A free book available for downloading from http://familyguardian.tzo.com/

Subject:  Request to Stop Tax Withholding Affidavit and Presentment

Dear _______________:

SECTION 1:  REQUEST OF EMPLOYER

This form is submitted as a replacement for a W-4E, Exemption from Income Tax withholding, but is NOT to be referred to as such nor treated as such within the confines of Treasury/IRS regulations.  Henceforth, I am making the following respectful request and demand relative to withholding of both federal and California income taxes, Social Security, and Medicare from my paycheck:

1.        Henceforth, my correct filing status for income tax purposes is “nonresident alien”.

2.        As a nonresident alien, the correct form(s) to complete in attesting to a nonresident alien status is IRS forms W-8 and 6450, and California FTB form 590,  all of which I have included with this Affidavit.

3.        You are instructed to immediately terminate all withholding of federal and California state income taxes, as well as Social Security and Medicare deductions.

4.        You are requested to forward and/or submit this letter and all attachments to the IRS and the California Franchise Tax Board (FTB) to provide proof to them of my proper filing status and to offer them an opportunity to refute any claims or statements made in this correspondence.

5.        A similar copy of this letter will be submitted by me at the beginning of February of every year to remind you of my “nonresident alien” status.

6.        I am to be referred to NOT as a taxpayer or a “citizen of the United States” or as a “citizen of the State of California”, but a “Natural Born Sovereign Citizen of the United States of America and of California”.  In my status as a “Natural Born Sovereign Citizen of the United States of America and of California”, I am no less a Citizen of the United States than George Washington or Thomas Jefferson or Abraham Lincoln ever were, who also never had federal (14^th Amendment) citizenship nor did they ever need it to be treated as Natural Born Sovereign Citizens of the United States.

7.        My wages are NOT to be treated by you as “taxable income” or as “gross income” within the meaning of the Internal Revenue Code (26 U.S.C.) section 61, and are therefore NOT to be reported by you to the IRS.  With zero taxable/gross income, there is no legal requirement, nor are you authorized or allowed by me to submit annually, an IRS form W-2 to the IRS reporting anything other than zero ($0) earnings subject to federal or state income taxes.

8.        You are requested to change your administrative procedures, withholding policies, employee training programs and materials, and regulations to reflect the legal conclusions reflected herein in the event you are unable to completely refute them, and to promptly notify ALL of your employees of the fact that most of them ARE NOT liable for paying federal income tax.

9.        If you do not honor my wishes expressed in this correspondence, then legal action will likely result and you could be held personally liable for noncompliance.

11.     Should you wish to further investigate the claims contained in this letter or the research to back it up, you are encouraged to read Section 3 of this letter.  You are also encouraged to visit the website at http://familyguardian.tzo.com and download the free book called The Great IRS Hoax: Why We Don’t Owe Income Tax.  The book is free and very completely reveals and exposes the fraud of the income tax that most sovereign Citizens of the United States of America have been repeatedly and maliciously victimized by through ignorance and illegal activities of employees at the IRS.

12.  I’d like to emphasize that I understand how hard it might be to admit the possibility that you might have been handling payroll withholding wrong for your entire career based on the content of this letter.  I respectfully ask, however, that you try to keep an open mind long enough to read, understand, and investigate this letter and the claims made in it for yourself to establish the objective truth rather than relying on bombast, character assassination of the messenger, or retaliatory measures, all of which would be an entirely inappropriate use of your authority and job functions.  I assure you that I have spent the last six months researching all of the issues in this letter and although the content may seem hard to believe, I assure you and testify to you that everything contained herein is absolutely factual and consistent with current laws on the subject.

Thank you so much for your time and attention and cooperation.  I apologize for the rather detailed nature of this correspondence, but given the circumstances, there is no other way that it can be accomplished without incurring additional legal risk with the IRS.

SECTION 2:  REQUESTS OF THE IRS

The following request is made of the IRS pursuant to this affidavit.

1.        Update my IMF and my administrative records to properly reflect my status as a “nonresident alien” with respect only to the Internal Revenue Code, 26 U.S.C.

2.        This correspondence shall constitute a certified demand for proof of jurisdiction of the Internal Revenue Service to assess, collect, lein, levy, garnish, or otherwise hold Citizen liable for payment of any income tax mentioned under 26 U.S.C.  IRS jurisdiction is hereby challenged and you must provide proof of jurisdiction to tax Citizen or jurisdiction is assumed to be nonexistent.

Federal Procedure §2.455 states, as follows:  “If a party’s allegations of jurisdictional facts are challenged by an adversary in any appropriate manner, he or she must support them by competent proof.”

Also, please take Notice of the following:

McNutt v. G.M., 56 S.Ct. 789, 80 L.Ed. 1135

Griffin v. Matthews, 310 Supp. 341, 423, F.2d 272

Basso v. U.P.L., 495 F.2d 906

Thomson v. Gaskiel, 62 S.Ct. 673, 83 L.Ed. 111

3.        You are requested to cease an desist in any activities or planned activities relating to withholding, lien, levy, garnishment, or seizure of any wages, income, or assets of Citizen because this correspondence clearly establishes complete lack of jurisdiction of the IRS or the U.S. Government to assess or enforce or hold Citizen liable for the payment of any income tax identified in  the 26 U.S.C.

4.        If you have any questions or issues about the reasons for or legal foundations of any of the requests made in this letter, you are instructed to refer to, read, and completely understand Section 3 of this correspondence PRIOR to contacting me about any of the issues raised in this correspondence.

5.        Any assertions or claims you make in opposing anything in this letter must be backed up with specific cites of 26 U.S.C sections, 26 C.F.R. implementing regulations, and supreme and appellate court cases.  Refutations not containing these cites or correspondence provided to me relating to this correspondence that is not signed by a specific, named employee of the Internal Revenue Service accompanied by email address, phone number, mailing address, Title, and Delegation of Authority orders will be disregarded and considered null and void.  Furthermore, you are requested to maintain in my official administrative record the complete identity of all IRS employees who have been contacted, consulted, or otherwise exposed to the specifics of this case and to provide to me a list of these individuals in every future correspondence you send to me.  This will ensure that I know who to contact about specific details of my case and it will also maintain personal accountability and discourage anonymous harassment via U.S. mail by your organization.

6.        You are requested to refer to none other than 26 U.S.C. and 26 CFR, along with any appellate and supreme Court cases you wish in your response to this letter.  Referring to IRS publications or to the Internal Revenue Manual (IRM) shall be regarded as frivolous, since your own Internal Revenue Manual States that these should not be relied upon to sustain a position:

"IRS Publications, issued by the National Office, explain the law in plain language for taxpayers and their advisors... While a good source of general information, publications should not be cited to sustain a position." [IRM, 4.10.7.2.8 (05-14-1999)]

See the following cites for additional clarification on this issue:

• Lurhing v. Glotzbach, 304 F.2d 360 (4th Cir. 1962).

• Einhorn v. DeWitt, 618 F.2d 347 (5th Cir. 1980).

• United States v. Goldstein, 342 F.Supp. 661 (E.D.N.Y. 1972).

• Boulez v. C.I.R., 810 F.2d 209 (D.C. Cir. 1987).

• United States v. Will, 671 F.2d 963, 967 (6^th Cir. 1982).

7.        I do not wish to have my First Amendment right to NOT communicate with my government infringed or my right to privacy and the security of my personal papers guaranteed under the Fourth Amendment infringed by being forced to submit more information about myself than what is revealed on this correspondence in order to accomplish the purposes intended..  In all future correspondence, please write my name and address with other than all upper case letters, as I do not wish for our interactions to fall within the ambit of the Uniform Commercial Code.

8.        Should you wish to further investigate the claims contained in this letter of the research to back it up, you are encouraged to visit the website at http://familyguardian.tzo.com and download the free book called The Great IRS Hoax: Why We Don’t Owe Income Tax.  The book is free and very completely reveals and exposes the fraud of the income tax that most sovereign Citizens of the United States of America have been repeatedly and maliciously victimized by through ignorance and illegal activities of employees at your agency.

9.     You are requested to read and heed Section 5: Constructive Notice, appearing at the end of this correspondence.

10       If you do not comply with the clearly explained requirements of this correspondence, then you will be held criminally liable under 26 U.S.C. §7214 for taking more money than is allowed or required by law and legal action will certainly result against you and/or your employer.

SECTION 3:  LEGAL FOUNDATIONS TO BE TREATED AS FACT UNLESS COMPLETELY REFUTED BY BOTH THE INTERNAL REVENUE SERVICE AND EMPLOYER

I, _____________________, herein referred to as Citizen, hereby attest and affirm, under the laws of the union State in which this Affidavit is executed, that to the best of my knowledge and belief, the information contained herein is true, correct, and complete to the best of my knowledge and ability and can be relied upon for all determinations of fact relating to my liability for federal or state income taxes, Social Security Taxes, or Medicare Taxes:

1.        Citizen is of lawful age.

2.        Citizen has personal knowledge of the facts stated herein.

3.        Citizen is not under the lawful guardianship or disability of another.  Affidavit is made Citizen’s own right, sui juris, propria persona.

4.        Citizen is a human being of natural birth, born in _____________________(state), one of the 50 union states of America under the Constitution and law.  As such, Claimant is one of the sovereign American people.  4 Wheat 402, Wong Kim Ark, p. 914, quoting Dred Scott v. Sanford, 60 U.S. 393, Yick Wo v. Hopkins and Woo Lee Hopkins, 118 U.S. 356, United States v. Lee, 106 U.S. 196 at 208, Lansing v. Smith, 4 Wend., 9, 20, Glass v. Sloop Betsy, 3 Dall 6, Afroyim v. Rusk, 387 U.S. 253 (1967), People v. Herkimer, 4 Cowen (N.Y. 345, 348).

5.        Citizen is domiciled in ____________________county, _________________________(state) where he/she has occupied such status for ________ years and ______ months.

6.        According to the U.S. Supreme Court  in Hooven & Allison Co. v. Evatt, 324 U.S. 652, (1945), there are three definitions of the term “United States”:

1. “...either as the name of a sovereign occupying the position analogous to that of other sovereigns in the family of nations, or

2. “...as designating the territory over which the sovereignty of the United States (Federal government) extends” or

3. “...as the collective name for the states which are united by and under the Constitution.”

In other words, the term United States may mean:

1. “'These united States,” when traveling abroad, you come under the jurisdiction of the President through his agents in the U.S. State Department, where “U.S.” refers to the sovereign nation. You are a “Citizen of the United States” like someone is a Citizen of France, or England. We refer to this definition symbolically hereafter as “U.S.*” or 

2. “The United States (the District of Columbia, possessions and territories)”. Here Congress has exclusive legislative jurisdiction. In this sense, the term “United States” is a singular noun. You are a person residing in the District of Columbia, one of its Territories or Federal areas (enclaves). Hence, even a person living in the one of the sovereign States could still be a member of the Federal area and a “citizen of the United States.”  We refer to this definition symbolically hereafter as “U.S.**”

3. “The several States which is the united States of America.” Referring to the 50 sovereign States, which are united under the Constitution of the United States of America. The federal area is not included in this definition because the Congress does not have exclusive legislative authority over any of the 50 sovereign States within the Union of States. Rights are retained by the States in the 9th and 10th Amendments, and you are a “Citizen of these united States.” We refer to this definition symbolically hereafter as “U.S.***”

7.        Pursuant to the three definitions of the term “United States” given above, in the context of any document I may have ever signed in which I might have claimed that I am a “citizen of the United States” (e.g. voter registration, security clearances, etc), what I meant was the first and third definitions (U.S.* and U.S.***, but NOT U.S.**).  Furthermore, this will also be the case on any similar documents I might file in the future absent any further notice from me to the contrary.

8.        Citizen was not born or naturalized in a territory over which the United States is sovereign, pursuant to Article I, §8, Clause 17 for the Constitution of the United States.

9.        Citizen is engaged in an occupation of common right in one of the 50 union States of America.

10.     Citizen is a “nonresident to” the jurisdiction of Art. I, §8, Cl. 17 or Art. IV, §3, Cl. 2 of the Constitution of the United States in which:

“Congress shall have the power to…exercise exclusive legislation in all Cases whatsoever over such District not exceeding ten Miles square, as…[has become] the seat of Government, and…placed purchased by the Consent of the Legislature of the State…for the Erection of Forts..Arsenals, and other needed buildings”, Art. I §8, Cl. 17, or

“Congress shall have the power to dispose of and make all needed Rules and Regulations respecting the territory or other property belonging to the United States..” Art. IV, §3, Cl. 2

11.     Citizen is not within the Territorial jurisdiction of the United States.  Citizen does not now live in, and hasn’t lived in at least the last ten years in, any federal territory or enclave within the United States (federal zone), to include the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, or any other federal enclave or territory within the United States, having its origin and jurisdiction from Art. I, §8, Cl. 17 or Art. IV, §3, Cl. 2 of the Constitution of the United States.

12.     The Internal Revenue Code is not positive law, it is special law.  It applies to specific persons in the United States who chose to make themselves subject to the requirements of the Internal Revenue Code by entering into agreements with the U.S. Government.

13.     Citizen has not entered into employment agreements with the U.S. Government that would abrogate or nullify any of the claims in this affidavit.  Citizen is none of the specific persons who chose to subject themselves to the requirements of the Internal Revenue Code or to the jurisdiction of the United States relating to the imposition of Title 26 Internal Revenue Code.

14.     Income from sources not effectively connected with the conduct of a trade or business within the U.S. Government is not subject to Subtitle A Internal Revenue Code taxes.

15.     Citizen has derived no income from any source effectively connected with the conduct of a “trade or business”, within the United States (federal zone) or the U.S. Government.

26 U.S.C. §871(b)(2)-GRADUATED RATE OF TAX…

“(2) DETERMINATION OF TAXABLE INCOME.—In determining taxable income…gross income includes ONLY gross income which is effectively connected with the conduct of a TRADE OR BUSINESS within the United States.”

16.     26 U.S.C §7701(a)(26) makes it clear that only elected or appointed Government officials holding “public office” are engaged in a “trade or business”.  Citizen is an American Citizen who is NOT performing any of the functions of a public office* and, therefore, is not engaged in, and has earned no income effectively connected to a “trade or business” within the United States (federal zone) or the U.S. Government.

26 U.S.C. §7701(a)(26) Definitions.  Trade or Business.  The term “trade or business” includes [only] the performance of the functions of a public office.”

Following is a definition of “public office”:

*Public Office, pursuant to Black’s Law Dictionary, Abridged 6^th Edition, means:

“Essential characteristics of a ‘public office’ are:

(1) Authority conferred by law,

(2) Fixed tenure of office, and

(3) Power to exercise some of the sovereign functions of government.

(4) Key element of such test is that “officer is carrying out a sovereign function’.

(5) Essential elements to establish public position as ‘public office’ are:

(a)    Position must be created by Constitution, legislature, or through authority conferred by legislature.

(b)    Portion of sovereign power of government must be delegated to position,

(c)    Duties and powers must be defined, directly or implied, by legislature or through legislative authority.

(d)    Duties must be performed independently without control of superior power other than law, and

(e)    Position must have some permanency.”

17.     For the purposes of the income tax, “Trade or Business”  26 U.S.C. §7701(a)(26), is a “term”* or “word of art” defined by Congress.  Pursuant to Congressional rules of statutory construction a “term” may have a limited definition which is different than the common understanding or the dictionary definition of the same word(s).  Such term must be clearly and specifically defined by Congress within the Code utilizing it.

*Term: “An expression or word especially one that has a particular meaning in a particular profession.”  i.e.- term of art. –Ballentine’s Law Dictionary.

“Words of Art”—These are “words that have a particular meaning in a particular area of study and have either no meaning or a different meaning outside of that field”.-Barron’s Dictionary.

18.     In statutes levying taxes, the word “includes” is a word of limitation.  It limits the definition of the term to include only the specific elements or words following the word “includes”.  However, granting a Congressional intent to make “includes”, a word of enlargement, pursuant to 26 U.S.C. §7701(c ), it could only be enlarged to introduce other words, which are synonymous to, or in the precise same category or genus of, the other words used in the meaning.

19.     “The term ‘trade or business’ includes the performance of the functions of a ‘public office’, cannot, therefore, be expanded by implication, to also include the functions of private, independent, non-governmental occupations of common right, or occupations of common right within the government:

Treasury Decision 3980, Vol. 29, January-December, 1927, pgs. 64 and 65 defines the words includes and including as: “(1) To comprise, comprehend, or embrace…(2) To enclose within; contain; confine…But granting that the word ‘including’ is a term of enlargement, it is clear that it only performs that office by introducing the specific elements constituting the enlargement.  It thus, and thus only, enlarges the otherwise more limited, preceding general language…The word ‘including’ is obviously used in the sense of its synonyms, comprising; comprehending; embracing.”

“Includes is a word of limitation.  Where a general term in Statute is followed by the word, ‘including’ the primary import of the specific words following the quoted words is to indicate restriction rather than enlargement.  Powers ex re. Covon v. Charron R.I., 135 A. 2^nd 829, 832 Definitions-Words and Phrases pages 156-156, Words and Phrases under ‘limitations’.”

“In the interpretation of statutes levying taxes, it is the established rule not to extend their provisions by implication beyond the clear import of the language used, or to enlarge their operations so as to embrace matters not specifically pointed out.  In case of doubt they are construed most strongly against the government and in favor of the citizen.”  Gould v. Gould, 245 U.S. 151, at 153.

20.     Because Citizen is not engaged in a “trade or business” within the United States, pursuant to 26 C.F.R. §1.871-1(b)(1)(i), for the purposes of the income tax, he/she is in a class of “non-resident alien individuals”, defined as follows:

26 C.F.R. §1.871-1

“…(b) Classes of non-resident aliens-

In general. For purposes of the income tax, nonresident alien individuals are divided into the following classes:

Nonresident alien individuals who at no time during the taxable year engaged in a trade or business in the United States…”

21.     Pursuant to 26 C.F.R. §1.871-7, Citizen is not subject to the graduated income tax imposed by 26 U.S.C. Section 1.

26 C.F.R. §1.871-7

Taxation of nonresident alien individuals not engaged in trade or U.S. business.—

Imposition of tax. (1) “…a nonresident alien individual…is NOT subject to the tax imposed by Section 1” [Subtitle A, Chapter 1]

22.     Citizen has earned no income derived from any “sources within the United States”, pursuant to 26 U.S.C. §861-863 and their implementing regulations.  Citizen is, thereby, not subject to the 30 percent uniform tax imposed by 26 U.S.C. §871(a).  26 C.F.R. §1.871-7(a)(1) (last sentence) states, “To determine the source of such amounts, see section 861 through 863 and regulations thereunder.”  Claimant performed no “Personal Services”, pursuant to 26 U.S.C. §861(a)(3)(C)(i):

(a)(3) “…Compensation for labor or services performed in the United States shall not be deemed to be income from sources within the United States if-

…(C ) compensation is for labor or services performed as an employee of or under contract with-

    (i) a nonresident alien… not engaged in a trade or business in the United States…”

23.     Pursuant to the previous assertions, Citizen has earned no gross income for the purpose of the income tax pursuant to 26 U.S.C §872(a).

§872(a) GENERAL RULE.—“In the case of a nonresident alien individual…gross income includes only –

(a)    gross income which is derived form sources within the United States,

(b)    gross income which is effectively connected with the conduct of a trade or business within the United States.”

24.     Further, Citizen has no gross income because he/she is not subject to the Public Salary Act of 1939 (76^th Congress, 1^st Session, Chap. 59, pgs 574-575), as follows:

Public Salary Act of 1939, TITLE I—“Section 1.§22(a) of the Internal Revenue Code relating to the definition of ‘gross income’, is amended after the words ‘compensation for personal service’ the following: “including personal service as an officer or employee of a State, or any political subdivision thereof, or any agency or instrumentality of any one or more of the foregoing.”

25.     Citizen is not subject to withholding, and is not within the general class of citizens subject to, 8 F.R. Pg. 12264 §404.102 “…salaries paid officials by the government, or government agency or instrumentality are subject to withholding.”

26.     Citizen is a nonresident alien individual pursuant to 8 Federal Register, September 7, 1943, Pg. 12266 §404.104(g) Cl. 1.

27.     Citizen is none of the persons upon whom the Act of July 1, 1862, 37^th Congress, 2^nd Session (12 Stat. 432, Chap 119, §86, pg. 472), the basis of the income tax laws and subsequent Internal Revenue Laws, are applicable to.  Citizen is not “in the civil, military, naval, or other employment or service of the United States, including senators and representatives and delegates in Congress…”

28.     Claimant is not an officer or employee of the United States, the District of Columbia, a State or municipality, or of any agency or instrumentality of any of the proceeding, or a member of the U.S. military subject to taxation.

29.     Claimant is not an “employee” for federal income tax purposes as such term is defined in 26 U.S.C. or 8 Federal Register, Tuesday, September 7, 1943, §404.104, pg. 12267, as follows:

Employee:  “The term employee specifically includes officers and employees whether elected or appointed, of the United States, a state, territory, or political subdivision thereof or the District of Columbia or any agency or instrumentality of any one or more of the foregoing.”

26 C.F.R. §31.3401(C )-1. Employee

“(a) The term ‘employee’, …includes officers and employees, whether elected or appointed of the United States, a State, Territory, Puerto Rico, or any political subdivision thereof,…

(c ) Generally, physicians, lawyers, dentists, veterinarians, contractors, public stenographers, auctioneers, and others who follow an independent trade, business, or profession, in which they offer their services to the public, are not employees.”

30.     Pursuant to 26 U.S.C. §3401(a), “…[T]he term ‘wages’ means all remuneration for services performed by an ‘employee’.” As Citizen is not an “employee”, he/she does not earn “wages”, for Federal or State income tax purposes.  Claimant is none of the persons in 20 Fed. Proc. L.Ed. 48.548, 26 U.S.C. §6331(a), 26 C.F.R. §301.6331-1(a)(4), 27 C.F.R. §70.51, 27 C.F.R. §70.161 and §70.162 or corresponding STATE INCOME TAX Regulations, under the federal conformity clause.  Respondents have no authority conferred by law to impose a levy/lien on property belonging to Citizen.

20 Fed. Proc. L Ed §48.548. WHAT MAY BE LEVIED UPON.  “…[W]ith regard to a levy on salary or wages [26 U.S.C.S. §6331(e)(1); 26 C.F.R. §301.6331-2(c )] a levy extends only to property possessed and obligations existing at the time of the levy [26 U.S.C.S. §6331(b); 26 C.F.R. §301.6331-1(a)(1)].  Levy may be made upon the salaries of federal, [26 U.S.C.S. §6331(a)] state, and municipal, [26 C.F.R. §301.6331(a)(4)(ii)] employees and a pension payable to a former state employee may be levied upon [Revenue Ruling 55-226, 1955-1 CB551].”

26 U.S.C. §6331(a) AUTHORITY OF SECRETARY. “…Levy may be made upon the accrued salary or wages of any officer, employee or elected official of the United States, the District of Columbia or any agency or instrumentality of the United States or District of Columbia…”

26 C.F.R. §301.6331-1 Levy and Distraint

(i)        Federal Employees.  Levy may be made upon the salary or wages of any officer or employee (including members of the Armed Forces) or elected or appointed official of the of the United States, the District of Columbia or any agency or instrumentality of the United States or the District of Columbia, who has control of payment or wages…

(ii)      State and Municipal employees.  Salaries, wages or other compensation of any officer, employee, or elected or appointed official of a State or Territory, or of any agency, instrumentality, or political subdivision thereof, are also subject to levy to enforce collection of any Federal tax.

(iii)    Seamen..wages of seamen, apprentice seamen, or fishermen employed on fishing vessels are subject to levy.”

31.     Congress has never been conferred authority, by law, to tax an American Citizen’s private compensation by a graduated income tax.  This is because the Constitutional taxation limitations provided by Art. 1, Sec. 2, Cl. 3 and At. I, Sec. 9, Cla. 4, prohibit Congress from imposing a non-apportioned tax on any form of property.  The apportionment clauses in the Constitution have never been repealed.

Article 1,, Section 2, Clause 3:  “Representatives and direct taxes shall be apportioned* among the several states which may be included within this Union, according to their respective numbers…”

Article 1, Section 9, Clause 4:  “No Capitation, or other direct tax, shall be laid, unless in proportion to the census or enumeration herein direct to be taken.”

*Apportion:  To distribute or allocate in equal proportions.

“Direct taxes bear immediately upon persons, upon possessions and enjoyment of rights.”  Knowlton v. Moore, 178 U.S. 41.

“…We are of the opinion that taxes on personal property, being a direct tax…the income [gains and profits] of personal property, are likewise direct taxes.  The tax …so far as it falls on the income of real estate or personal property, being a direct tax within the meaning of the Constitution, and therefore, unconstitutional and void because not apportioned according to representation…”  Pollock v. Farmers Loan & Trust Co., 157 U.S. 420

“The Sixteenth Amendment must be construed in connection with the taxing clauses [i.e. apportionment clauses regarding Direct Taxes, uniformity clauses regarding Indirect Taxes] of the original Constitution and the effect attributed to them before the Amendment was adopted.”  Eisner v. Macomber, 252 U.S. 189, at 205 (1920)

U.S.C.A. Amend. 16 note 62 “The word ‘income’ as used in this [16^th] amendment does not include a stock dividend, since such a dividend is capital and not income and can be taxed only if the tax is apportioned among the several states in accordance with Art. I, Sec. 2, Cl. 3 and Art. 1, Sec. 9, Cl 4 of the Constitution.”  Eisner v. Macomber, 252 U.S. 189, Wash v. Brewster, 255 U.S. 536.

32.     Citizen has earned no income, under the Corporate Excise Act of 1909, or “income” as properly defined at law by the Supreme Court of the United States.  In creating the Income Tax, the intent of Congress was never to tax a Citizen’s substance (compensation for labor), but to tax only the gains generated when compensation (capital) was invested.  The true meaning of the word income is “gain or profit severed (separated) from capital”.  Compensation, capital, and principal, are substance and property, subject to the Constitutional rules of apportionment.  Such forms of substance may be a source of income when invested and a gain results.  However, it is only the gain that is income.  The actual compensation, itself, is never income and is never subject to an income tax.

“…It is to be noted that by the language of the Act, it is not ‘salaries, wages or compensation for personal services that are to be included in gross income’.  That which is to be included is ‘gains, profits, and income derived from salaries, wages or compensation for personal service’.” Lucas v. Earl, 281 U.S. 111 (1930)

U.S.C.A. Amend 16, Note 64. “The meaning of ‘income’ in this Amendment [16^th] is the gain derived from or through the sale or conversion of capital assets; from labor or from both combined; not a gain accruing to capital, or 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 employed, and coming in or being ‘derived,’ that is, received or drawn by the recipient for his separate use.”  Taft v. Bowers, N.Y. 1929, 49 S.Ct. 199, 278 U.S. 470, 73 L.Ed. 460

Merchant’s Loan and Trust Company v. Smietanka, 255 U.S. 518, 519 (1921): “there would seem to be no room to doubt that the word (income) must be given the same meaning in all income tax acts of Congress that was given to it in the Corporate Excise Tax Act and what that meaning is has now become definitely settled by decision of the Court.”

“Whatever difficulty there may be about a precise and scientific definition of ‘income’, it imports..the idea of gain or increase arising from corporate activities… We must reject…the broad contention submitted on behalf of the Government that all receipts, everything that comes in is income within the proper definition of gross income…”  Doyle v. Mitchell, 247 U.S. 179 (1921)

Earnings:  “That which is earned; money earned; the price of services performed; the reward of labor; money or the fruits of proper skill, experience, industry; …derived without the aid of capital, merited by labor, services, or performances.  Earnings are not income.”  Saltzman v. City of Council Bluffs, 214 Iowa, 1033, 243 N.W. 161, 162

“Income within the meaning of the Sixteenth Amendment and Revenue Act, means ‘gains’…and in such connection ‘gain’ means profit…proceeding from property, severed from capital, however invested or employed and coming in, received or drawn by the taxpayer, for his separate use, benefit and disposal…”  Stapler v. U.S., 21 F. Supp. 737, 739

Bouvier’s Law Dictionary, Baldwin’s Student Edition (1946). Income:  “Income employed in natural sense, as importing something distinct from principal or capital, and conveying idea of gain or increase from corporate activities.”

“…[I]t become essential to distinguish between what is and what is not ‘income,’ according to truth and substance, without regard to form.  Congress cannot, by any definition it may adopt, conclude the matter, since it cannot by legislation, alter the Constitution, from which it derives its power, and within whose limitations alone, that power can be lawfully exercised…[Income] Derived—from—capital—the—gain—derived—from—capital, etc.  Here we have the essential matter—not gain accruing to capital, not a growth or increment of the value in the investment; but a gain, a profit, something of exchangeable value.. severed form the capital however invested or employed and coming in, being ‘derived’, that is received or drawn by recipient for his separate use.”  Eisner v. Macomber, 252 U.S. 189, 40 S.Ct. 189, 252 U.S. 189, L.Ed. 521, 9 A.L.R. 1570

“There is a clear distinction between ‘profit’ and ‘wages’ or ‘compensation for labor’.  Compensation for labor cannot be regarded as profit within the meaning of the Law…The word profit is a different thing altogether from mere compensation for labor…The claim that salaries, wages and compensation for personal services are to be taxes as an entirety and therefore must be returned by the individual who performed the services which produced the gain is without support either in the language of the Act or in the decisions of the courts construing it and is directly opposed to provisions of the Act and to regulations of the Treasury Department…”  U.S. v. Balard, 575 F.2d 400 (1976), Oliver v. Halstead, 196 VA 992; 86 S.E. Rep. 2d 858

Black’s 3^rd Law Dictionary, Income:  “Income is the gain which proceeds from labor, business or property;…”  Trefry v. Putnam, 116 N.E. “Income is the gain derived from capital, from labor or from both combined.; something of exchangeable value, proceeding from the property, severed from the capital…and drawn by the recipient for his separate use…”  Eisner v. Macomber, 252 U.S. 189, 40 S.Ct 189, L.Ed. 521, 9 A.L.R. 1570.  Goodrich v. Edwards, 41 S.Ct. 390, 255 U.S. 527, 65 L. Ed. 758.  “Income is something that has grown out of capital, leaving the capital unimpaired and intact.”  Gavit v. Irwin (D.C.) 275 F. 643, 645.  “Income is used…in law in contradistinction [contrast, opposition] to capital.”  21 C.J. 397.  “Income, [gains and profits]…is something produced by capital without impairing such capital, the property being left intact, and nothing can be called income which takes away from the property itself.”  Sargent Land Co. v. Von Baumback, (D.C.), 207 F. 423, 430

“One does not derive income by rendering services and charging for them.”  Edwards v. Keith, 231 Fed. Rep. 1

“Under the Internal Revenue Act of 1954 [and all other Internal Revenue Acts] if there is no gain, there is no income.”  265 U.S.C.A. 1954, Sec, 61(a)

The following rulings are quoted from Conner v. United States, 303 F.Supp. 1187 (1969), pg. 1191:

“[1] …It [Income] is not synonymous with receipts. 47 C.J.S. Internal Revenue §98, p. 226.

[2]  Whatever may constitute income, therefore, must have the essential feature of gain to the recipient.  This was true when the 16^th amendment became effective, it was true at the time of the decision in Eisner v. MacComber (supra), it was true under section 22(a) of the Internal Revenue Code of 1939, and it is true under section 61(a) of the Internal Revenue Code of 1954.  If there is no gain, there is no income…Congress taxed income [gains] not compensation.”

“An unapportioned direct tax on anything which is not income would be unconstitutional.”  C.I.R. v. Obear-Nester Glass Co., C.A. 7, 1954, 217 F.2d., 75 S.Ct. 570, 348 U.S. 982, 99L.Ed. 764, 75 S.Ct. 870, 349 U.S. 948, 99 L.Ed. 127

33.     It is not within the power of the government to impose a mandatory tax on the exercise of an occupation of common right, or natural right, or on the receipt and/or realization of the earnings received from the exercise of such a right.  The Income Tax is an excise tax.  To be legally required to pay an excise tax, an individual must be involved in the exercise of a taxable privilege*.  Citizen is exercising no privileges upon which an excise tax could be imposed by law within the context of his occupation.

*Privilege:  “A particular benefit or advantage enjoyed by a person, company, or class beyond the common advantages of their citizens…”  (Black’s Law Dictionary–6^th Edition) “…An advantage possessed by an individual or a class of persons, which is not possessed by others which exists by operation of law or by virtue of a license, franchise, grant or other permission…”  (Ballentine’s Law Dictionary).

“That the right to…accept employment as a laborer for hire is a fundamental right, is inherent in every free citizen, and is indisputable…”  United States v. Morris, 125 F.Rept. 325, 331.

“The conclusion reached in the Pollock case…recognized the fact that taxation on income was, in its nature, an excise…”  Brushaber v. Union Pacific Railroad Co., 240 U.S. 1, 15-17

EXCISES:  “Excises are taxes laid upon…licenses to pursue certain [regulated] occupations and upon corporate privileges; the requirement to pay such taxes involves the exercise of privilege…Conceding the power of Congress to tax the business activities of private corporations.. the tax must be measured by some standard…It is, therefore, well settled by the decisions of this court that when the sovereign authority has exercised the right to tax a legitimate subject of taxation as an exercise of a franchise or privilege, it is no objection that the measure of taxation is income…”  Flint v. Stone Tracy Co., 220 U.S. 107, at pg 154, 165

“The obligation to pay an excise is based upon the voluntary action of the person taxed in performing the act, enjoying the privilege, or engaging in the occupation which is the subject of the excise, and the element of absolute and unavoidable demand is lacking.”  People ex rel. Atty Gen. V. Naglee, 1 Cal. 232, Bank of Commerce & T. Co. v. Senter, 149 Tenn. 441, 381 SW 144

“The individual, unlike the corporation, cannot be taxed for the mere privilege of existing.  The corporation is an artificial entity which owes its existence and charter power to the State, but the individual’s right to live and own property are natural rights for the enjoyment of which an excise cannot be imposed.”  Redfield v. Fisher, 292 Oregon 814, 817

“Legislature…cannot name something to be a taxable privilege unless it is first a privilege.”  [Taxation West Key 43]…”The Right to receive income or earnings is a right belonging to every person and realization and receipt of income is therefore not a ‘privilege’, that can be taxed.”  [Taxation West Key 933]-Jack Cole Co. v. MacFarland, 337 S.E. 2d 453, Tenn.

“The term ‘excise tax’ is synonymous with ‘privilege tax’, and the two have been used interchangeably.”  Foster & C. Co. v. Graham, 154 Tenn. 412, 285 S.W. 570, 47 ALR 971.  “Whether a tax is characterized in the statute imposing it, as a privilege tax or an excise tax is merely a choice of synonymous words.  An excise tax is a privilege tax.”  Bank of Commerce & T. Co. v. Senter, 149 Tenn. 569, 260 SW 144, American Airways v. Wallace, 57 F.2d, 877, 8880.

“An excise is…a duty levied upon licenses to pursue certain trades or deal in certain commodities, upon official privileges, [i.e. a government job as an elected or appointed political official but NOT an occupation of common right] etc.”  Black v. State, 113 Wis. 205, 89 NW 522

New Neighborhoods v. W. VA. Workers Comp. Fund, 886 F.2d 714 (4^th Cir. 1989): “Excise tax is one not directly imposed upon persons or property.”

Also:  Sims v. Ahrens, 167 Ark. 557, 271 SW 720; Diefendorf v. Gallet, 51 Idaho 619, 10 P2d 307; Miles v. Department of Treasury, 209 Ind 172, 199 NE 372, 97 ALR 1474, 101 ALR 1359, app. Dismd 298 U.S. 640, 80 Led 1372,56 S.Ct. 750

34.     Citizen is not exercising any Revenue Taxable Activities and is none of the subjects of 27 C.F.R. Part 70, which are the implementing regulations for the enforcement and collection provisions of Chapters 51-53 and Chapters 61-89 of Title 26.  Citizen is not liable for any type of income tax enforceable by the Bureau of Alcohol, Tobacco, or Firearms.

56 Federal Register 55079, No. 206, Thursday, October 24, 1991: List of Subjects in 27 C.F.R. Part 70:

“Alcohol and alcoholic beverages, excise taxes, firearms and ammunition, tobacco, Government Employees, Law Enforcement officers, Administrative practice and procedure, authority delegations, claims, penalties, seizures and forfeitures, surety bonds.”

35.     Citizen is not an officer of a Corporation under a duty to withhold.

36.     Citizen was not born in a territory* over which the United States is Sovereign, is not a U.S. naturalized citizen, an alien lawfully admitted for permanent residence, or a “citizen of the United States subject to its jurisdiction”, or the citizen as defined in 26 C.F.R. §1.1-1(c ), who is subject to the Subtitle A, §1 graduated income tax.

26 C.F.R. §1.1-1(c ) “Who is a citizen: Every person born or naturalized in the United States and subject to its jurisdiction is a citizen.

3C Am Jur 2d §2689, Who is born in United States and subject to United States jurisdiction  "A person is born subject to the jurisdiction of the United States, for purposes of acquiring citizenship at birth, if his or her birth occurs in territory over which the United States is sovereign, even though another country provides all governmental services within the territory, and the territory is subsequently ceded to the other country."

“The persons declared to be citizens are ‘All persons born or naturalized in the United States and subject to the jurisdiction thereof.’.  The evident meaning of these last words is, not merely subject in some respect or degree to the jurisdiction of the United States, but completely subject…”  [i.e. the citizens of the territories belonging to’, and under the exclusive sovereignty of the United States, pursuant to Art. 1, §8, Cl. 17 and Art. 4, §3, cla. 2 of the Constitution.] Elk v. Wilkins, 112 U.S. 94, 101, 102 (1884)

*Territory:  “A part of the country separated from the rest and subject to a particular jurisdiction.  A potion of the country subject to and belonging to the United States which is not within the boundary of any state or the District of Columbia.”  262 U.S. 122; 3 Wheat 336, 390…The United States has supreme sovereignty over a territory, [i.e. Puerto Rico, Guam, Virgin Islands] and congress has full and complete legislative authority over its people and government.  136 U.S. 1.  They are not organized under the Constitution, nor subject to its complex distribution of powers of government as the organic law, but are a creation, exclusively of the legislative department, and subject to its [Congress’] supervision and control…” 96 Fed. Rep. 456, citing 16 How. 164; 101 U.S. 129; 114 U.S. 15; 136 U.S. 1; 141 U.S. 174; 152 U.S. 1 (Bouvier’s Law Dictionary)

District of Columbia: (Black’s 6^th Law Dictionary) “Legally it is neither a state nor a territory, but is made subject, by the Constitution, to the exclusive jurisdiction of the United States.”

Territory:  (Black’s 6^th Law Dictionary) “1.  A geographical region over which a nation exercises sovereignty, but whose inhabitants do not enjoy political, social or legal parity with the inhabitants of other regions which are constitutional components of the nation.  With respect for the United States, for example, Guam or the Virgin Islands as opposed to New York, California, or Texas.”