re: Authority of Secretary
Earlier Bob Gregory stated:
Here are a couple of thoughts on this subject. 26 USC 6020 states, in part:
Authority of Secretary to execute returnIf any person fails to make any return required by any internal revenue law or regulation made thereunder at the time prescribed therefor, or makes, willfully or otherwise, a false or fraudulent return, the Secretary shall make such return from his own knowledge and from such information as he can obtain through testimony or otherwise.
I think the underlined part may be the key.Another important part which I have underlined and italicized above is the fact that even though the Secretary can obtain third party information in order to make such a return, or a "substitute return," that third party information is only prima facie evidence. A Form 1099 or a W-2 has merely been sworn to by that third party as being "proceeds," "earnings," "wages," etc. with the definition of those terms being the common everyday definition that we may find in Websters. The definitions for such terms within the Internal Revenue Code are "special" definitions for the purpose of an "income tax" which the third party "payor" named on the 1099, W-2, etc. are unaware of at best or may even choose to ignore. The court has said:
Since the right to receive income or earnings is a right belonging to every person, this right cannot be taxed as a privilege. Jack Cole v. MacFarland, 337 S.W.2d 453, 456 (1960)
It is the presumption of "taxable" income that must be rebutted when challenging the IRS in regards to your status of being a non-taxpayer.
Bob Gregory also wrote:
Any information returns, such as 1099's, W2's, etc. are assumed to represent "income." Pete Hendrickson has shown how to correct such erroneous information returns so that pay received that is not actually "income" is not counted by the IRS as "income."
Congress nor the IRS has the authority to define the term "income" because the Constitutution itself already defines the term "income" as being "gains or profits." NO MATTER WHERE OR HOW THE PROFIT OR GAIN WAS ACHIEVED!
In Eisner v. Macomber, 252 U.S. 189, at 206-207 the court "after examining dictionaries in common use" provided this definition. "Income may be defined as the gain derived from capital, from labor, or from both combined..."
The IRS defines "income" as being "gains, profit, or income made in the course of a trade or business." The key words here are "trade or business." The term "trade or business" as defined in the Internal Revenue Code:
(a) When used in this title, where not otherwise distinctly expressed or manifestly incompatible with the intent thereof
(26) Trade or business "The term trade or business includes the performance of the functions of a public office."
Although 26 USC Sec. 7701(c) specifies that "includes" shall not be deemed to exclude other things otherwise within the meaning of the term defined." Common sense tells us though that those "other things" must be specifically mentioned somewhere else in the code! Alcohol, Tobacco, Firearms, are all mentioned in the code. They would apply to the term "trade or business." If your means to earning an income is not mentioned in the code, then it is not taxable as a "trade or business."
"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." [Gould v. Gould, 245 U.S. 151 (1917)]
Keeping in mind the well-settled rule that the citizen is exempt from taxation unless the same is imposed by clear and unequivocal language, and that where the construction of a tax law is doubtful, the doubt is to be resolved in favor of those upon whom the tax is sought to be laid.. Spreckels Sugar Refining Co. v. McClain,192 U.S. 397, 24 S.Ct. 376, 418, U.S. 1904
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 powers to the state, but the individuals rights to live and own property are natural rights for the enjoyment of which an excise cannot be imposed. Redfield, v. Fisher, 292 P. 813, at 819 (1930)
The right to labor and to its protection from unlawful interference is a constitutional as well as a common-law right. Every man has a natural right to the fruits of his own industry. 48 Am Jur 2d, Section 2, page 80
A state may not impose a charge for the enjoyment of a right granted by the Federal Constitution. Murdock v. Pennsylvania, 319 U.S. 105, 113 (1943)
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