Tax Expert Says Employers Withholding Federal Income Tax is Illegal. Here’s Why.

[Zippyjuan]

What the Grace Report actually said: https://en.wikipedia.org/wiki/The_Grace_Commission

The report said that one-third of all income taxes are consumed by waste and inefficiency in the federal government, and another one-third escapes collection owing to the underground economy. “With two thirds of everyone’s personal income taxes wasted or not collected, 100 percent of what is collected is absorbed solely by interest on the federal debt and by federal government contributions to transfer payments. In other words, all individual income tax revenues are gone before one nickel is spent on the services [that] taxpayers expect from their government

1984 budget breakdown: http://federal-budget.insidegov.com/l/87/1984

Revenues:

Individual Income Taxes: $541 billion (45% of revenues)
Payroll Taxes (things like Social Security): $434 billion (36%)

Spending:

Interest on the Debt: $201 billion (13%)
Medicare and Health: $159 billion (10%)
Social Security: $528 billion (34%)

If you separate Social Security on both sides, then we had $541 billion in income taxes and $360 in interest and medical expenses. So the statement was untrue then as well.

[Danke]

FICA is an income tax.

[Zippyjuan]

True but it is usually counted separately.

[angelatc]

Nope, I have not problems with it at all, I simply went back and got the correct revision to show you, as you WRONGLY stated that is not what the IRM provides, you failed to notice the dates of the revision being referenced.

Concerns establish the relevance of facts in-review, e.g., oranges are sweet, this is a fact, but has no relevance to the concerns as presented here.

Again, you are singularly focusing upon a very specific aspect as justification for all else being wrong—an oversight that leaves you wanting.

The very specific aspect, the fact that I am focusing on, is the fact that the form referenced does not pertain to income tax withholding. It pertains to debt repayment. It has nothing to do with mandatory payroll income tax withholding.

[angelatc]

Oh wow, look somebody quoted to Subtitle C, well guess the matter is all solved now. Gee, why didn't someone think of doing this earlier, could have saved us all tons of wasted effort.

Or someone could explain why they believe it doesn't mean what it says, and provide some case law or legal cites to reinforce their position.

[angelatc]

" 100 percent of what is collected is absorbed solely by interest on the federal debt and by federal government contributions to transfer payments"

1984 budget breakdown: http://federal-budget.insidegov.com/l/87/1984

Revenues:

Individual Income Taxes: $541 billion (45% of revenues)
Payroll Taxes (things like Social Security): $434 billion (36%)

Spending:

Interest on the Debt: $201 billion (13%)
Medicare and Health: $159 billion (10%)
Social Security: $528 billion (34%)

If you separate Social Security on both sides, then we had $541 billion in income taxes and $360 in interest and medical expenses. So the statement was untrue then as well.

Transfer payments are defined as income redistribution. So I don't understand how you can take out SS on both sides. You can take it out on the income side, but SS had $434 billion in and $528 billion out, a deficit of $94 billion.

But even that doesn't seem to make the statement, "100 percent of what is collected is absorbed solely by interest on the federal debt and by federal government contributions to transfer payments," true.

$541 b Income tax collected
$201 b Interest on debt
$ 94 b SS deficit

Maybe they're counting some healthcare spending in there somewhere? I don't see how that would qualify as a transfer payment, since there is an exchange of goods and services.

[Weston White]

Source?

http://www.usdebtclock.org/

https://www.treasurydirect.gov/govt/...ebt_histo5.htm

http://www.cbsnews.com/news/the-war-on-waste/

$2.3 trillion — that's $8,000 for every man, woman and child in America. To understand how the Pentagon can lose track of trillions, consider the case of one military accountant who tried to find out what happened to a mere $300 million.

[Weston White]

You have three key issues for which to content:

1. The growing accrual of interest on existing and new debt.
2. The annually increasing debt and Congress's raising of governmental debt limits.
3. The desire for the Federal Reserve System to ensconce its books and policies from the public--and Congress's supporting of this.

[Weston White]

The very specific aspect, the fact that I am focusing on, is the fact that the form referenced does not pertain to income tax withholding. It pertains to debt repayment. It has nothing to do with mandatory payroll income tax withholding.

Great, so you agree with the rest of the article then. Excellente!

[Weston White]

Or someone could explain why they believe it doesn't mean what it says, and provide some case law or legal cites to reinforce their position.

Certainly, notice the context and very specific subject-matter of this--notice what is missing:

(a). 26 CFR § 601.101(a) – ‘Introduction’: “General. The Internal Revenue Service is a
bureau of the Department of the Treasury under the immediate direction of the
Commissioner of Internal Revenue. The Commissioner has general superintendence of
the assessment and collection of all taxes imposed by any law providing internal
revenue. The Internal Revenue Service is the agency by which these functions are
performed. Within an internal revenue district the internal revenue laws are
administered by a district director of internal revenue.

The Director, Foreign Operations District, administers the internal revenue laws
applicable to taxpayers residing or doing business abroad, foreign taxpayers deriving
income from sources within the United States, and taxpayers who are required to
withhold tax on certain payments to nonresident aliens and foreign corporations,
provided the books and records of those taxpayers are located outside the United States.
For purposes of these procedural rules any reference to a district director or a district
office includes the Director, Foreign Operations District, or the District Office, Foreign
Operations District, if appropriate. …”

(b). Ibidem, § 601.104(2) – ‘Collection functions’: “… In no case does withholding of
the tax relieve an individual from the duty of filing a return otherwise required by law.
The chief means of collecting the income tax due from nonresident alien individuals and
foreign corporations having United States source gross income which is not effectively
connected with the conduct of a trade or business in the United States is the withholding
of the tax by the persons paying or remitting the income to the recipients. The tax
withheld is allowed as a credit in payment of the tax imposed on such nonresident alien
individuals and foreign corporations.”

The context provided to the above regulatory general procedures is especially disconcerting in that both nonresident aliens and foreign corporations (including withholding provisions) is already thoroughly addressed in 26 CFR §§ 1.871-1, 1.1441-0, et seq. See also 26 USC § 7701(a)(16), therein providing only a very narrow definition of what is termed a withholding agent that is in context to the above regulation: “The term “withholding agent” means any person required to deduct and withhold any tax under the provisions of section 1441, 1442, 1443, or 1461.” Neither is there any such statutory provision for guiding those not meeting this limited scope, as show below.

i. Ibid, § 1441 – ‘Withholding of tax on nonresident aliens’
ii. Ibid, § 1442 – ‘Withholding of tax on foreign corporations’
iii. Ibid, § 1443 – ‘Foreign tax-exempt organizations’
iv. Ibid, § 1461 – ‘Liability for withheld tax’


And in Carmichael v. Southern Coal and Coke Co., 301 U.S. 495, 513-514 (1937) that:

“The taxation of employees is not prerequisite to enjoyment of the benefits of the Social Security Act. The collection and expenditure of the tax on employers do not depend upon taxing the employees, and we find nothing in the language of the statute or its application to suggest that the tax on employees is so essential to the operation of the statute as to restrict the effect of the separability clause [Section 19]. Distinct taxes imposed by a single statute are not to be deemed inseparable unless that conclusion is unavoidable. See Field v. Clark, 143 U. S. 649, 143 U. S. 697; Sonzinsky v. United States, 300 U. S. 506.

* Further, that the four national regions and thirty-three ‘Internal Revenue Districts’ delegated under ‘Executive Order 10289’ (E.O.) that are respective to 26 USC § 7621(a), have been terminated as of March 9, 2001 through ‘Treasury Order 150-02(18)’ (T.O.), which thereby cancelled Treasury Order 150-01 in its entirety. See also: 4 USC § 72 – ‘Public offices; at seat of Government’; 26 USC § 7601(a) – ‘Canvass of districts for taxable persons and objects’.

Concluding that the rulemaking powers vested to E.O. 10289 within the ‘Parallel Table of Authorities and Rules’ (PTOA) pertain solely to 19 CFR, Part 101 – ‘General provisions’; which in-part sets forth the authority for Customs Officers and their locations of prescribed operation which are (i.e., 19 CFR § 101.0 – ‘Scope’): (1) “Customs ports of entry”, (2) “service ports”, and (3) “Customs stations”. Therefore, all employees, agents, or officers of the IRS when traversing exterior to the District of Columbia—or otherwise its designated “National Headquarters”—may only carry out the lawful course of their prescribed administrative duties or functions while either in the presence of a Customs Officer who are themselves as well engaged in carrying out the lawful course of their own prescribed duties or functions, or from within a designated: “Customs port of entry”, “service port”, or “Customs station”.


** Also noting that IRS foreign status certificate, Form W-8BEN, stipulates for those who are either a “U.S. citizen or other U.S. person” to instead use IRS Form W-9, which is a request for a TIN—Taxpayer Identification Number.

*** Mr. Dave Champion argued a point of the above in the case against him with the IRS and he is still a free man selling his overpriced tax book.

[erowe1]

http://www.usdebtclock.org/

https://www.treasurydirect.gov/govt/...ebt_histo5.htm

http://www.cbsnews.com/news/the-war-on-waste/

So, like I said, less than half a Trillion. Did you see something in there that said it was more?

[Sonny Tufts]

None of Mr. White's gibberish explains why Sections 3102(a) and 3402(a), previously cited by TheUglyTruth, don't apply to people working in the 50 States. The plain fact is, they do.

[Weston White]

So, like I said, less than half a Trillion. Did you see something in there that said it was more?

Geez dude, go enroll in a math 101 course please. Further, this does not take into account the U.S. international debt holdings, notice the missing $2.3 trillion is not depicted between 2000-2002, and shenanigans such as this:

http://cnsnews.com/news/article/tere...18112975000000


2016-2001 = 16-years.


Debt counter:

From 9/15: $18.2
As of 4/16: $19.3


2001: $5.8
2016: $19.3

Total: $13.5~ The grows larger and larger with each passing year, this is emphasized by reviewing 2007 to the present--in excess of ONE-TRILLION.

[angelatc]

Great, so you agree with the rest of the article then. Excellente!

If that's how you took my statement, then it's no wonder you believe so much absolute bull$#@!.

[Weston White]

None of Mr. White's gibberish explains why Sections 3102(a) and 3402(a), previously cited by TheUglyTruth, don't apply to people working in the 50 States. The plain fact is, they do.

Certainly they do, as those laws were written for Americans, as the United States government has zero authority to command the people of any other nation; however, those 26 USC Sections are only applicable to very specific classes of wages and incomes or business activities.

[Weston White]

If that's how you took my statement, then it's no wonder you believe so much absolute bull$#@!.

Qui tacet consentire videtur. Love it or leave it hot-cakes.

[angelatc]

None of Mr. White's gibberish explains why Sections 3102(a) and 3402(a), previously cited by TheUglyTruth, don't apply to people working in the 50 States.

There's a reason for that.

The plain fact is, they do.

Yep.

[angelatc]

Qui tacet consentire videtur. Love it or leave it hot-cakes.

It was a logical fallacy, so.....

[Weston White]

There's a reason for that.

Yep.

...Yep, and the article addresses that. ...As does my "gibberish."

[Weston White]

It was a logical fallacy, so.....

If only because you decree it as so. laff.

[erowe1]

Geez dude, go enroll in a math 101 course please. Further, this does not take into account the U.S. international debt holdings, notice the missing $2.3 trillion is not depicted between 2000-2002, and shenanigans such as this:

http://cnsnews.com/news/article/tere...18112975000000


2016-2001 = 16-years.


Debt counter:

From 9/15: $18.2
As of 4/16: $19.3


2001: $5.8
2016: $19.3

Total: $13.5~ The grows larger and larger with each passing year, this is emphasized by reviewing 2007 to the present--in excess of ONE-TRILLION.

Your claim was:

Nope, it is $1-trillion or more each and every year, as it has been exponentially increasing since 9/11.

You also singled out the budget year of 2015 in post #50 as one where the debt grew by more than $1 Trillion.

So now I guess you're retracting those claims?

I'm not sure why you would have made this post, complete with telling yourself to enroll in math 101, unless that's your reason.

You also never answered my question about the relevance of the debt increase. I asked that because I don't see what it has to do with your original claim that 100% of income tax revenue goes to paying interest on the debt. Was your point that you really meant to say that 100% of income tax revenue minus the annual increase of the debt is less than the interest on the debt?

[Weston White]

Your claim was:

You also singled out the budget year of 2015 in post #50 as one where the debt grew by more than $1 Trillion.

So now I guess you're retracting those claims?

I'm not sure why you would have made this post, complete with telling yourself to enroll in math 101, unless that's your reason.

You also never answered my question about the relevance of the debt increase. I asked that because I don't see what it has to do with your original claim that 100% of income tax revenue goes to paying interest on the debt. Was your point that you really meant to say that 100% of income tax revenue minus the annual increase of the debt is less than the interest on the debt?

Remember in 2015 the debt clock was frozen for many weeks, and also covertly rolled back. It is fact, the national debt averages over $1-trillion in new debt each year that is over more than a decade now--sure there are years were it is claimed just under a trillion dollars in new debt, while other years new debt breaks that trillion threshold.

I don't think I made the claim that your asserting; however, that claim is depicted within the findings of the ‘Private Sector Survey on Cost Control’ (PSSCC)—The Grace Commission Report, viz., nearly each dollar taxed is owed to interest on the accruing national debt—and that was in 1982!

My point is that this debt CANNOT ever be repaid, it is an anchor around the necks of the entire populace and their progeny. The point can be observed in this:

It is a wise rule and should be fundamental in a government disposed to cherish its credit, and at the same time to restrain the use of it within the limits of its faculties, "never to borrow a dollar without laying a tax in the same instant for paying the interest annually, and the principal within a given term; and to consider that tax as pledged to the creditors on the public faith." On such a pledge as this, sacredly observed, a government may always command, on a reasonable interest, all the lendable money of their citizens, while the necessity of an equivalent tax is a salutary warning to them and their constituents against oppressions, bankruptcy, and its inevitable consequence, revolution. But the term of redemption must be moderate, and at any rate within the limits of their rightful powers. But what limits, it will be asked, does this prescribe to their powers? What is to hinder them from creating a perpetual debt? The laws of nature, I answer. The earth belongs to the living, not to the dead. ... The generations of men may be considered as bodies or corporations. Each generation has the usufruct of the earth during the period of its continuance. When it ceases to exist, the usufruct passes on to the succeeding generation, free and unincumbered, and so on, successively, from one generation to another forever. We may consider each generation as a distinct nation, with a right, by the will of its majority, to bind themselves, but none to bind the succeeding generation, more than the inhabitants of another country. Or the case may be likened to the ordinary one of a tenant for life, who may hypothecate the land for his debts, during the continuance of his usufruct; but at his death, the reversioner (who is also for life only) receives it exonerated from all burthen.

http://www.let.rug.nl/usa/presidents...on/jefl219.php

This is the future of our currency, nonconvertible, fiat money that nobody wants:

[Working Poor]

I want to point out that the IRS does not care what the laws says. If you try this with your business it will very likely be shut down so just be careful. Note also that the person who wrote this is living in Paris. I worked for someone who tried this one morning while customers were sitting getting read to eat a bunch of heavily armed men came in pointing their weapons it was scary as hell we thought we were being robbed. Turns out it was the IRS so actually we were being robbed. They shut us down and took every stick of furniture and equipment, locked the doors and put almost 50 people out of work. Below is a comment from the article:

I did this in the 90's with a tax attorney and all the legal paperwork. IRS came & shut my business down, confiscated all my equipment, emptied my bank accounts, & fined me $80,000.00. Tax attorney was thrown in prison (I think he's still there) and I was forced out of business. It's true it's all legal, but the IRS has the ability to break you in legal fees and come and close your business, confiscate your personal property and make you prove your innocence. You're guilty till proven innocent. Word to the wise, don't do it unless you're ready for a living hell!

[erowe1]

I don't think I made the claim that your asserting

I quoted your exact words.

[angelatc]

If only because you decree it as so. laff.

Uh, no. Not because I decreed it so. Because it is what it is. I said a specific point was incorrect. You said that meant therefore I agreed that that the rest of the article was correct. That's an error in reasoning, aka a logical fallacy.

[ZENemy]

T.i.T

[Jamesiv1]

@Weston White

You seem to think these guys are going to follow the rules, or you're going to catch these guys on some kind of legal technicality.

THEY WANT YOUR MONEY!! THEY ARE GOING TO TAKE YOUR MONEY!! or make your life hell (and the lives of people you love).

These people are crooks, thugs, thieves, out-laws. They make the laws, and they will break the laws whenever it suits their whole reason for being which is TAKING YOUR MONEY!!!

It's not complicated.

[erowe1]

@Weston White

You seem to think these guys are going to follow the rules, or you're going to catch these guys on some kind of legal technicality.

THEY WANT YOUR MONEY!! THEY ARE GOING TO TAKE YOUR MONEY!! or make your life hell (and the lives of people you love).

These people are crooks, thugs, thieves, out-laws. They make the laws, and they will break the laws whenever it suits their whole reason for being which is TAKING YOUR MONEY!!!

It's not complicated.

Seriously.

These tax law loophole gurus always ignore the most relevant question: Will following their interpretation of the law keep me out of prison? If the answer is no, then what's the point? They're just charlatans trying to sell you a useless product.

[devil21]

Seriously.

These tax law loophole gurus always ignore the most relevant question: Will following their interpretation of the law keep me out of prison? If the answer is no, then what's the point? They're just charlatans trying to sell you a useless product.

So, in other words, give in to the fear of force and stop talking about it entirely? You don't think we got into this situation in the first place by the use of fear?



dun dun dun

[erowe1]

So, in other words, give in to the fear of force and stop talking about it entirely? You don't think we got into this situation in the first place by the use of fear?

You can be a tax resister. I admire that if you are.

You can recruit others to join you.

Just don't do that by way of lies. When these gurus trick people into thinking the state's laws are on their side, when they know full well that their tricks won't keep them out of prison, they're lying.