17914Re: [tips_and_tricks] Re: Trojan Horse buried in Health Care Bill...New IRS Paperwork for You to fill out
- Oct 4, 2010
; but a tax upon property holders in respect of their estates, whether real or personal, or of the income yielded by such estates, and the payment of which cannot be avoided, are direct taxes ..."Quotations form Bob's post:
"The definitions given below by John Hill are incorrect. It may be inferred that income tax is POSSIBLY a tax on an activity because the Supreme Court ruled that it is an EXCISE. An excise can be applied to an ACTIVITY, an EVENT or to a PRIVILEGE.
About the only thing the 16th Amendment DID do was to allow taxation of income without regard to the source. Therefore income derived from rental of real estate is constitutionally taxable by an income tax. (The reason the 16th Amendment came about in the first place was to keep income from rental of real estate being considered a direct tax. See Pollock v. Farmers' Loan & Trust Co., 157 US 429 (1895))"The Pollock case was considering an "income tax law" written by Congress. This income tax law was to be imposed also upon the common US citizen. Here are excerpts from the decision.
"...Ordinarily, all taxes paid primarily by persons who can shift the burden upon someone else, or who are under no legal compulsion to pay them, are considered indirect taxes
it is apparent (1) that the distinction between direct and indirect taxation was well understood by the framers of the constitution and those who adopted it; (2) that, under the state system of taxation, all taxes on real estate or personal property or the rents or income thereof were regarded as direct taxes; Pollock v. Farmers Loan & Trust Co., 157 U.S. 429, 574 (1895)
... A tax upon one's whole income is a tax upon the annual receipts from his whole property, and as such falls within the same class as a tax upon that property, and is a direct tax, in the meaning of the Constitution....
We are of opinion that the law in question, so far as it levies a tax on the rents or income of real estate, is in violation of the constitution, and is invalid. Pollock v. Farmers Loan & Trust Co., 157U.S. 429, 583 (1895)
...We have unanimously held in this case that, so far as this law operates on the receipts from municipal bonds , it cannot be sustained, because it is a tax on the powers of the States, and on their instrumentalities to borrow money, and consequently repugnant to the Constitution. ...it follows that, if the revenue from municipal bonds cannot be taxed because the source cannot be, the same rule applies to revenue from any other source not subject to the tax; and the lack of power to levy any but an apportioned tax on real and personal property equally exists as to the revenue therefrom. Admitting that this act taxes the income of property irrespective of its source, still we cannot doubt that such a tax is necessarily a direct tax in the meaning of the Constitution. In England, we do not understand that an income tax has ever been regarded as other than a direct tax. In Dowell's History of Taxation and Taxes in England, given, and an income tax is invariably classified as a direct tax. Pollock v. Farmers Loan & Trust Co., 157 U.S. 429, 586 (1895)
and, from the supporting opinion of Justice Fields in this case:
I am of opinion that the whole law of 1894 should be declared void, and without any binding force,-that part which relates to the tax on the rents, profits, or income from real estate, that is, so much as constitutes part of the direct tax, because not imposed by the rule of apportionment according to the representation of the states, as prescribed by the constitution; and that part which imposes a tax upon the bonds and securities of the several states, and upon the bonds and securities of their municipal bodies, and upon on the salaries of judges of the courts of the United States, as being beyond the power of congress; and that part which lays duties, imposts, and excises, as void in not providing for the uniformity required by the constitution in such cases Pollock v. Farmers Loan & Trust Co., 157 U.S. 429, 607 (1895)
It appears to me that the court is clear that a tax on real property, and income derived there from, falls into the category of "direct taxation." If you continue with further research into this case, you should find that the Pollock case is very firm on "considering the source" of the income. The reason for this is simply because the Constitution demands the source to be considered. The Sixteenth Amendment surely does say that Congress has the power to lay and collect taxes on income from whatever source derived, without considering apportionment. In other words, Congress has the power to do such under an "INDIRECT TAX." Keep in mind that the sixteenth amend. does not say WHO or WHAT the recipient of the tax is! Pollock clarified that if the recipient of the tax is a common citizen, then the common citizen cannot be taxed on his income from rental property, under an income tax (indirect tax). That is why the Pollock court struck down only the section of the INCOME tax they were considering. That section being a tax on income from property, upon the common man, which WAS NOT APPORTIONED according to the precepts of the Constitution. The rest of the income tax law of 1895 that was upheld applied only to those that derived special privilege form the state. In other words, the court clarified that the owning of property by the common man is a right granted by the very nature of things and that that income cannot be taxed under an "INCOME TAX." Again in other words, the owning of property by the common man, and income derived there from cannot be taxed as a "privilege" under an "INCOME TAX". IT IS A RIGHT, NOT A PRIVILEGE! AM-N
- << Previous post in topic Next post in topic >>