Admin,

As always, great post! Thank you on behalf of myself and others who have read it. I took a couple of days to digest it and think it through.

Consider the following alternative perspective:

There are different “persons” identified in the code: An I.R.C. 7701(c ) “person,” a 7343 “person,” a 6671(a) “person,” and a “U.S. person” in 7701(a)(30). Now, in light of 1461, we must be absolutely sure which person they are referring to. Your input about both sides needing to be a “person” in order for a taxable transaction to occur was a great, additional light bulb moment for me. I submit the “person” they are referring to in 1461 below is a 7343/6671 “person.”

Now the “U.S. person” in I.R.C. 7701(a)(30) we know will be liable every time . . . and since this includes the statutory citizen, there is no need to even bring him up in 1.1441-1(c )(3), because this statutory citizen has been “bagged and tagged” by the “U.S. person” definition, so he is a non-issue. And frankly, he is a small fish compared to all the aliens they want to bring into the fold. Never mind the fact that most aliens (resident and nonresident) will incorrectly but voluntarily adopt the status of the “U.S. person.”

Now Admin, here is what you have not answered or reconciled:

If the nonresident alien defined in 7701(b)(1)(:cool: is a “safe entity” or moniker (for lack of a better term), and it is given as one of the allowable descriptions for a nonresident alien individual in 1.1441-1(c )(3) . . . how then can this term be bad 100% of the time? So, as long as we are talking about a 7701 “person,” then we can expand that to an “individual.” And if we are talking about an individual, then by the definitions of 1.1441-1(c )(3) you COULD be an alien individual or a nonresident alien individual AS LONG AS that description is qualified as the nonresident alien defined in 7701(b)(1)(:cool:. The other nonresident alien individuals in the latter part of 1.1441-1(c )(3) do NOT describe me. So my conclusion is, is that I can be a 7701(c ) person, because I can be an individual, because I am a nonresident alien defined in 7701(b)(1)(:cool:. All of that is harmonious and provides no conflict. I am NOT the “person” described in 26 U.S.C 6671(a) or 7343, because they are identified as someone with a duty, whom I believe is the “person” addressed in 1461.

Now, I'm going to make a bold assertion here, because I think I know where you are going next — Title 8.

We know there are 3 definitions in Hooven & Allison Co v. Evatt:

IS IT POSSIBLE that the definition of United States given in Title 8 is definition 1) given above? I submit that it is. The definition given throughout Title 8 seems to support a definition that describes the nation, not just the federal zone. The reason being, is because within the definition, the Union states of Alaska and Hawaii are prominently addressed. This is not reconciled anywhere within the FG/SEDM other than to say that the writers of the code failed to correct it because it was politically expedient, and that it should be removed (not a quote but a generality of how it was addressed).

All I know, is that every single American is going to need a passport to come and go from this country. I know the “United States” has plenary jurisdiction over Americans when they are outside of the country, that is to say, abroad, although we can't define that term, but let's suffice it to say they are referring to when Americans are outside of the Nation as that term is meant in Hooven & Allison Co. v. Evatt, definition 1).

This is what I meant by my assertion of “curve-fitting” in my previous post. If we move forward with an assumption, and it is incorrect, it can skew conclusions to that of something damaging. I submit the “United States” defined in Title 8 is definition 1) of Hooven & Allison Co. v. Evatt, while the definition of “United States” in Title 26 is most certainly definition 2).

Here are some quotes from IRS Publication 519 that seems to reinforce this view:

Now, it's not as if I hang my hat on IRS publications. I know they are NOT to be used to promote a position or for legal standing. But to date, I can't seem to find where IRS publications are flat-out wrong . . . what they do is obfuscate by stating half of the truth, or camouflaging the context. So I think the truth is there, but one has to know how to identify it. That being said, the quotes above indicate that “tax purposes” is something exclusive of what the layman may presume these things mean in the context of immigration, naturalization, or citizenship.

Now the arguments made with regard to Title 8 are valid. But I think the curve-fitting is going on with regard to the analysis in the context of “United States” as defined in Title 8, when the definitions and concepts should be applied to the definition of “United States” as defined in Title 26. The result is the same, but the conclusive “reaches” or curve-fitting are not necessary, and permit my conclusion that most Americans are aliens vis a vis the Federal Legal Venue . . . the question is, are they resident or nonresident.

One last thing. It appears in the FG/SEDM approach to the government, an effort is being made to interface with them AS IF they were a de jure government . . . when we know they are not. I on the other hand recognize their efforts to achieve extra-territorial jurisdiction through franchise agreements. So, it is my opinion, that an American can act precisely like a McDonald's by entering into a contract with the “United States.” Now we can quote The Declaration of Independence all we want, but the fact of the matter is, if an American contracts with the “United States,” then the courts and the rest of the legal community are going to view this as a voluntary “alienation” of the rights by the American who contracted freely. The government exercises their jurisdiction all of the time against Americans not domiciled on Federal Territory, so to say that one MUST be domiciled on Federal Territory to truly have an income tax liability is a recipe for disaster, as this has been knocked down time and time again.

Getting back to the original issue then, the use of the term “individual” I believe is there only to serve as a discriminator between an artificial entity such as a trust or corporation. I believe a nonresident alien is an alien . . . because an alien is defined as someone who is NOT a citizen or national of the United States. This describes me. The substantive question is, is the alien resident or nonresident? I believe I am a citizen of the United States as that term is defined in Title 8, because I believe they are referring to the nation, and not the federal zone. All Americans must have a passport when they come and go, and there is NO WAY around that. Being able to confuse the two definitions only serves to protect the goose which lays the golden egg — namely, the Federal Income Tax code. I believe I am a 7701 person, because I am an individual which is THE individual described in 1.1441-1(c )(3) as a nonresident alien defined in 7701(b)(1)(:cool: ONLY.

I don't see any way around this conclusion! This is what the definitions say! I have to go by the clear import of the language! It's my opinion that it is an error to view the Title 8 “United States” in same way as the Title 26 “United States.” The relationships of Title 8 can be properly applied to the Title 26 definitions for “income tax purposes.”

I had more to address, but it looks like your original post was edited from the first time I read it. So just to recap your statements:

People volunteer for the franchise every day, they are ensnared in it, yet they still are domiciled in states of the Union and find themselves under subject matter jurisdiction.

Yes, but can't someone voluntarily enter into one? Of course they can! They don't have to physically be domiciled there so long as they agree to the terms and elect to be treated AS IF they were there by adopting the term of “U.S. person” or resident alien.

To me, when a nonresident alien agrees to serve his country by becoming a “United States” military member, that is the point in which the nonresident alien becomes resident, and agrees to enter into the contract. If said alien serves for a number of years and secures a pension, that pension is and will always be “United States” sourced. If the servicemember resumes his/her status as a nonresident alien, the pension he/she receives is received by virtue of a voluntary contract agreement, albeit earlier, but I believe the recipient is still bound by the requirement to pay a tax on those “United States” payments. the question is, are they ECI or not ECI. I'm sorry, I don't see a way around this!

Because we are not talking about the SAME entity. I submit the definitions are different. Thus, a Union state citizen is an alien with regard to the Federal Government, but is a national and a citizen under Title 8. I feel more comfortable with this stance as Alaska and Hawaii are addressed in the definition of the nation, and there is no answer for this other than to say . . . “The writers of the code forgot to pull that out!” That's never going to fly!!!

Unfortunately they don't have to. The franchisees come running to them and their legal venue, as both you and I agree on, by virtue of their unknowing adoption of the term “U.S. person” and 6671/7343 person, “United States” and others.

This is true, but we DO NOT have a de jure government . . . we have a de facto, private and corporate government as is often addressed in FG/SEDM, thus Admiralty law, and private commercial law is the flavor of the day . . . not the Constitution! This is why the contracts are permitted and enforced.

Admin, a problem I often identify in my FG/SEDM studies is one of going back and forth between the Law of the Land, and dealing with a government we know to be de facto and amenable only to commercial law and private contracts. It's one or the other . . . it's not both! If the government was de jure, then we could be taking the “purist” legal positions of the Constitution, but since they are not, we are dealing with “contracts” both in venue and extraterritorially through voluntary agreements and surrender of “rights.” We know they are NOT de jure, so this is what permits them to enforce the franchise agreements — namely, a tax on a “United States” payment made to a nonresident alien who at one time was a resident alien through his voluntary contract with the “United States.”

Thanks for taking the time to read! My analysis takes me to a slightly different place, and I can't see a way around it!

stija,

As I understand it, SS “benefits” fall under the category of US sourced income which is not ECI. That being said, 85% of the amount received would be taxed at a rate of 30%.

Now, I was under the impression that any and all payments received by the government, or the “United States” would be taxable . . . and this passes the common sense test. But after scouring Subchapter N, the only way US sourced income can be treated as ECI is when the NRA is him/her/itself in fact engaged in a trade or business (aka public office). This is impossible, for all public offices are seated in the District of Columbia per 4 USC 72. There is no such thing as a NRA in the federal legal venue. There is either a citizen, or a resident alien, thus ECI for a nonresident alien is a logical impossibility . . . as far as I can tell.

SS “benefits” are characterized as US sourced income which is NOT ECI, thus a 30% tax is levied against 85% of the benefits received.

This is consistent I believe with what is taught in the SEDM “Non-Resident Non-Person Position, Form #05.020” pamphlet.

Bing,

That's precisely the type of reply I was looking for . . . and it confirms my hunch on how a particular case that was overruled would still offer some foundations of legal principle . . . as opposed of being wiped completely from the books and declared null-and-void in totality!

This makes complete sense . . . and it passes the common sense test. But as we all know, the government is running a lot-a-bit short on common sense these days.

Thanks for the support and the backup!

Neo

Wow!! Thank you!!! Happy Memorial Day!