IN THE UNITED STATES DISTRICT COURT,
NORTHERN DISTRICT OF OKLAHOMA
UNITED STATES OF AMERICA, )
)
Plaintiff, )
)
v. ) Case # 96-CR-113-C
)
DAN MEADOR, )
)
Defendant. )
______________________________)
Brief in Support of Motion for
Summary Judgment to Arrest Judgment
Introduction
Now comes Dan Meador, a native of Kansas and current Citizen
and qualified Elector of Oklahoma, one of several States party to
the Constitution of the United States, per Immigration and
Nationality Act definition, a "national of the United States" (8
U.S.C. 1101(a)(21) & (22)), and by Internal Revenue Code
definition, a "nonresident alien of the United States" (IRC
7701(b)).
Per order of Senior Judge Dale H. Cook, the Government, by
way of Neal B. Kirkpatrick, responded to defendant motions
submitted on the sixth business day following trial. The three
motions were, (1) a motion to arrest judgment, (2) a motion to
acquit, and (3) a motion for new trial. This brief specifically
supports the motion to arrest judgement, premised on Rule 34,
F.R.Cr.P.:
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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Rule 34. Arrest of Judgment
The court on motion of a defendant shall arrest judgment if
the indictment or information does not charge an offense or
if the court was without jurisdiction of the offense ....
More accurately, Mr. Kirkpatrick allegedly responded to the
motions. He did not address matters concerning jurisdiction,
character of the party where the defendant is concerned, the
character and capacity of the Internal Revenue Service, the fact
that the "United States of America" is not authorized as
plaintiff or defendant in Titles 18, 26 or 28 of the United
States Code, the fact that the "United States District Court" is
an Article IV territorial court of the United States which has
absolutely no Article III authority, the fact that the United
States District Court is a legislative admiralty court that is
incompetent at law as contemplated in the "arising under" clause
at Article III, Sec. 2.1 and the Fourth, Fifth, Sixth, and
Seventh Amendments to the Constitution of the United States, etc.
Accordingly, the U.S. attorney and the Plaintiff, "United
States of America", are subject to the doctrine of estoppel by
acquiescence, pursuant to Carmine v. Bowen, 64 A. 932 (1906), and
by way of silence has effected fraud, pursuant to U.S. v. Tweel,
550 F.2d 297, 299 (1977). In particular, the fraud is against the
Constitutional Oath of Office, required at Article VI, Sec. 3 of
the Constitution of the United States, which is prescribed as
necessary for holding public office for United States Government
or governments of the several States party to the Constitution.
This case, the Moore-Gunwall case, and a multitude of
others, emerge from what amounts to institutionalized tyranny.
The scheme is effected by encroachment of interests operating
under the guise of territorial United States authority spread
inland to the several States party to the Constitution. However,
the scheme has been unraveled sufficiently to demonstrate how it
works and to detail proper limits of authority. Thus, this
lengthy brief that consolidates relevant elements of fact and law
in a single instrument.
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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The United States Supreme Court addressed the matter at hand
in New York v. United States, et al. (1992): The Separation of
Powers Doctrine, framed in Article II of the Articles of
Confederation and the Tenth Amendment to the Constitution of the
United States, prevents Federal government from exercising powers
in the several States party to the Constitution which are not
specifically enumerated in the Constitution. The question is not
what powers Government should have, the high court said, but what
powers are delegated. Those who exceed delegated authority
invariably do so for self-serving ends.
In our unique system, State and Federal governments serve as
the antipodes of power, both deriving what authority they have
from the sovereign American people by way of applicable
constitutions. The Tenth Amendment draws a clear line between the
two -- each of the several States has original and exclusive
jurisdiction within territorial bounds save where the United
States has acquired land for constitutionally authorized use, the
State legislature has ceded jurisdiction, and Congress has
formally accepted jurisdiction. (Art. I, Sec. 8.17, Constitution
of the United States). Congress has plenary power, serving more
or less in the capacity of State and general government, only
where the United States owns land and has secured exclusive
territorial jurisdiction (Article IV, Sec. 3.2, Constitution of
the United States). Where the several States party to the
Constitution are concerned, the United States has delegated and
limited power; where land owned by the United States is
concerned, Congress has plenary or permissive power and can
allegedly do anything not expressly prohibited by the
Constitution.
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The scheme currently known as Cooperative Federalism --
previously known as Corporatism, sometimes referred to simply as
Federalism, with the school of thought identified as Fabian
Communism contributing significantly to the fraud -- relies on
governments of the Union of several States accommodating Federal
authority which is not delegated by the Constitution.
Enough hard evidence in law and the historical record has
been unearthed to avoid constructive pleadings. For example, the
Internal Revenue Service is an agency of the Department of the
Treasury, Puerto Rico, which has authority exclusively in United
States territorial and maritime jurisdiction. So far as the
Continental United States is concerned, IRS has no legislatively
or administratively-delegated authority -- the agency merely
operates on contract to develop and maintain systems and provide
record-keeping services for the Treasury Department.
The United States, under emergency proclamation endorsed by
Congress in special session March 9, 1933, operates under a
system of "positive law" which is premised on the lineage of
Roman Civil Law. Since Erie Railroad v. Tompkins (1938), this
system of statutory law has been exclusive of common law
indigenous to forty-nine of the States party to the Constitution.
Yet common law remains in full force and effect in the several
States, as evidenced by several recent decisions by the Supreme
Court of Oklahoma:
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Common law remains in full force unless constitutional
clause or statute explicitly provides to contrary; common
law's legislative abrogation may not be effected by mere
implication, but rather must be clearly and plainly
expressed. Greenberg v. Wolfberg, Okla., 890 P.2d 895
(1994), answer to certified question conformed to 54 F.3d
787, certiorari denied 116 S.Ct. 1847, 134 L.Ed.2d 948.
Presumption favors preservation of common-law rights. Tate
v. Browning-Ferris, Inc., Okla. 833 P.2d 1218 (1992).
Mr. Kirkpatrick and peers in both the office of the United
States Attorney and the Department of Justice would deny the
force and effect of common law -- the United States does not
acknowledge common law, Mr. Kirkpatrick alleges -- and treat the
nation as a seamless garment rather than a patchwork of fifty
semi-sovereign republics subject only to Congress'
constitutionally delegated authority. Yet in United States of
America v. Lopez (1995), the Supreme Court effectively served
notice: The United States does not have plenary power in the
several States party to the Constitution of the United States.
The Constitution does not grant the United States police powers
in the several States party to the Constitution -- this matter
was addressed at length in United States v. Constantine, 296 U.S.
233 (December 1935) relating to repeal of the Eighteenth
Amendment by ratification of the Twenty-First in December 1933.
In addition to territorial jurisdiction (venue
jurisdiction), Mr. Kirkpatrick continues to equivocate concerning
character of the party: I am not a "citizen of the United
States" in the sense of the colorable citizenship created by
Section 1 of the Fourteenth Amendment. I am a native of Kansas
and currently am a Citizen of Oklahoma -- my lineage is that of
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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sovereignty articulated by American founders in the Declaration
of Independence and the Preamble to the "Constitution for the
united States of America". I do not rely on State or Federal
government to grant "civil rights", but as the Founders
articulated in the Declaration of Independence, was endowed by my
Creator with certain unalienable rights which cannot be abridged
or infringed on by Government save as authority is specifically
delegated by applicable constitutions or I expressly grant
permission.
Unfortunately, the Fourteenth Amendment citizen-subject
enjoys only civil rights and benefits created by and granted from
Government. This fraud has been addressed time and again, with
one of the more important decisions as follows:
In common usage, term "persons" does not include the
sovereign, and statutes employing it will ordinarily not be
construed to do so. United States v. United Mine Workers
(1947) 330 U.S. 258, 91 L.Ed. 884, 67 S.Ct. 677.
In order to evade the fact of my sovereignty, Mr.
Kirkpatrick has employed the common device of utilizing a nomme
de guerre, the fictitious DAN MEADOR, DAN LESLIE MEADOR, MEADOR,
etc./1 These fictional names/2 constitute fraud of the first
order -- I am Dan Leslie, Meador, with only the first letters of
____________________
1 "Nomme de guerre - , lit. 'war-name', a name assumed by, or
assigned to, a person engaged in some action or enterprise."
(Oxford English Dictionary, 1971 edition)
2 "Fictitious name. A counterfeit, alias, feigned, or
pretended name taken by a person, differing in some
essential particular from his true name (consisting of
Christian name and patronymic), with the implication that it
is meant to deceive or mislead." (Black's Law Dictionary,
6th edition) Where the instant matter is concerned, the
nomme de guerre or fictitious name has been manufactured and
assigned by Mr. Kirkpatrick as a mns to evade the fact of my
sovereignty.
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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my Christian and patronymic names spelled with capital letters,
the balance of each spelled with lower case letters. Yet Mr.
Kirkpatrick, in what amounts to actionable fraud for constructive
willfulness and malicious prosecution, has persisted in employing
the fiction to further his own purpose at my expense. The court
has thus far accommodated the fraud by having denied all
defendant pleadings prior to trial while failing to judicially
determine substantive rights, legal relationships, and
application of law, jurisdictional matters included. In general,
the complicity of nonfeasance and malfeasance has been
detrimental, but faith moves the matter forward -- Paul's remedy
for the reprobate is to shine light into the darkness of intent.
Many of the particulars addressed in the balance of this
response have already been cited and otherwise placed into record
by way of or as exhibits attached to pleadings. However, it is in
the interest of all concerned, particularly with respect to
appeals if such are necessary, to bring matters forward in an
integrated instrument which demonstrates the scope of fraud
effected by Mr. Kirkpatrick and other perpetrators of the
Cooperative Federalism scheme.
I. Character & Jurisdiction of IRS;
Application of IRC Taxing Authority
During the course of trial, Ms. Tracy Foster, an inspector
with the Internal Revenue Service, was the chief Government
witness. In her testimony, Ms. Foster acknowledged that all
complaints in this case (2 x under 18 U.S.C. 1504 and 1 x under
section 1503) were registered by her in her capacity as an IRS
inspector, and all complaints in the Moore-Gunwall case (96-CR-
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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82-C; 18 U.S.C. 2, 371 & 1341 and 26 U.S.C. 7212(a)). Ms. Foster
also claimed responsibility for personally arresting or having
Mr. Wayne Gunwall arrested in the parking lot outside the Wal-
Mart store in Ponca City, Oklahoma, and for convening the grand
jury which met in November 1995 to investigate "common law
courts" in Oklahoma. Therefore, the Internal Revenue Service, or
whatever principal the Service represents, will be construed as
the party of interest in all matters relating to this case.
In post-trial motions submitted in this case, I used an
improper term to cite Ms. Foster's testimony -- I "stipulated"
where I should have "alleged" that the court was therefore
sitting in whatever capacity applies where IRS is the moving
party where the instant matter is concerned, where the Moore-
Gunwall case is concerned, and where the November 1995 grand jury
is concerned. Regardless of the incorrect term, Mr. Kirkpatrick
failed to contest the allegation so effectively confessed that
the Internal Revenue Service, or whatever principal of interest
the Internal Revenue Service represents, is the true plaintiff
behind prosecution of this case and the Moore-Gunwall case and
the November 1995 grand jury investigation. The averment,
allegation or whatever then stands: Until proven otherwise, the
Internal Revenue Service was the moving party responsible for
conduct of the November 1995 Federal grand jury investigation of
Oklahoma "common law courts", and was responsible for prosecution
of UNITED STATES OF AMERICA v. DAN LESLIE MEADOR, #96-CR-113-C
and of UNITED STATES OF AMERICA v. KENNEY F. MOORE et al., case
#96-CR-82-C.
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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As all other actual agencies of Government, the Internal
Revenue Service has a source of origin, and the Internal Revenue
Code of 1954, as amended in 1986 and since ("IRC"), has a source
or sources of origin. In other words, government operates under
the same principle as physics -- "Nothing comes from nothing."
There must be a source of authority, and law which the authority
enacts applies within the bounds of authority exercised. Where
the instant matter is concerned, determining geographical bounds
for IRS delegated authority and IRC taxing authority is
fundamental. This involves tracking three converging historical
lines to document the scope of fraud, but there is a shortcut to
demonstrate geographical limitations. The source is IRC 7621:
Sec. 7621. Internal revenue districts
(a) Establishment and alteration.
The President shall establish convenient internal revenue
districts for the purpose of administering the internal
revenue laws. The President may from time to time alter such
districts.
(b) Boundaries.
For purpose mentioned in subsection (a), the President may
subdivide any State or the District of Columbia, or may
unite into one district two or more States.
The President, by way of Executive Order No. 10289,
delegated authority to the Secretary of the Treasury to establish
revenue districts by way of the above-cited statute. Confirmation
of this source of authority is found at 26 CFR, Part 301.7621-1:
Sec. 301.7621-1 Internal revenue districts.
For delegation to the Secretary of authority to prescribe
Internal Revenue districts for the purpose of administering
the internal revenue laws, see Executive Order No. 10289,
dated September 17, 1951 (16 FR 9499), as made applicable to
the Code by Executive Order No. 10574, dated November 5,
1954 (19 FR 7249).
The President's authority to re-delegate responsibility for
establishing revenue districts is at 3 U.S.C. 301:/3
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Sec. 301. General authorization to delegate functions;
publication of delegations
The President of the United States is authorized to
designate and empower the head of any department or agency
in the executive branch, or any official thereof who is
required to be appointed by and with the advice and consent
of the Senate, to perform without approval, ratification, or
other action by the President (1) any function which is
vested in the President by law, or (2) any function which
such officer is required or authorized by law to perform
only with or subject to the approval, ratification, or other
action of the President: Provided, That nothing contained
herein shall relieve the President of his responsibility in
office for the acts of any such head or other official
designated by him to perform such functions. Such
designation and authorization shall be in writing, shall be
published in the Federal Register, shall be subject to such
terms, conditions, and limitations as the President may deem
advisable, and shall be revocable at any time by the
President in whole or in part.
(Added Oct. 31, 1951, ch. 655, Sec. 10, 65 Stat. 712.)
E.O. No. 10289 is as follows:
Ex. Ord. No. 10289. Delegation of Functions To Secretary of
the Treasury
Ex. Ord. No. 10289, Sept. 17, 1951, 16 F.R. 9499, as amended
by Ex. Ord. No. 10583, Dec. 18, 1954, 19 F.
R. 8725; Ex. Ord. No. 10882, July 18, 1960, 25 F.R. 6869;
Ex. Ord. No. 11110, June 4, 1963, 28 F.R. 5605; Ex. Ord.
No. 11825, Dec. 31, 1974, 40 F.R. 1003; Ex. Ord. No. 12608,
Sept. 9, 1987, 52 F.R. 34617, provided:
1. The Secretary of the Treasury is hereby designated and
empowered to perform the following-described functions of
the President without approval, ratification, or other
action of the President:
(a) The authority vested in the President by section 1 of
the act of August 1, 1914, ch. 223, 38 Stat. 609, 623, as
amended [19 U.S.C. 2], (1) to rearrange, by consolidation or
otherwise, the several customs-collection districts, (2) to
____________________
3 3 U.S.C. 301, E.O. No. 10289, and subsequent cites from
Title 4 of the United States Code are from the 1994 edition
of the United States Code produced by the United States
Government Printing Office, Washington: 1995. Cites from
the Internal Revenue Code are from the 1996 edition produced
by the Research Institute of America, Inc., 1996 edition.
discontinue ports of entry by abolishing the same and
establishing others in their stead, and (3) to change from
time to time the location of the headquarters in any
customs-collection district as the needs of the service may
require.
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(b) The authority vested in the President by section 1 of
the Anti-Smuggling Act of August 5, 1935, c. 438, 49 Stat.
517 [19 U.S.C. 1701], (1) to find and declare that any place
or within any area on the high seas adjacent to but outside
customs waters any vessel or vessels hover or are being kept
off the coast of the United States and that, by virtue of
the presence of any such vessel or vessels at such place or
within such area, the unlawful introduction or removal into
or from the United States of any merchandise or person is
being, or may be, occasioned, promoted, or threatened, (2)
to find and declare that certain waters on the high seas are
in such proximity to such vessel or vessels that such
unlawful introduction or removal of merchandise or persons
may be carried on by or to or from such vessel or vessels,
and (3) to find and declare that, within any customs-
enforcement area, the circumstances no longer exist which
gave rise to the declaration of such area as a customs-
enforcement area.
(c) The authority vested in the President by section 1 of
the Act of August 26, 1985, Public Law 98-89, 97 Stat. 510
(46 U.S.C. 3101); to suspend the provisions of law
requiring the inspection of foreign-built vessels admitted
to American registry.
(d) The authority vested in the President by section 5 of
the act of May 28, 1908, ch. 212, 35 Stat. 425, as amended
(46 U.S.C. Appendix 104), to determine (as a prerequisite to
the extension of reciprocal privileges by the Commissioner
of Customs) that yachts used and employed exclusively as
pleasure vessels and belonging to any resident of the United
States are allowed to arrive at and depart from any foreign
port and to cruise in the waters of such port without
entering or clearing at the custom-house thereof and without
the payment of any charges for entering or clearing, dues,
duty per ton, tonnage taxes, or charges for cruising
licenses.
(e) The authority vested in the President by section 2 of
the act of March 24, 1908, ch. 96, 35 Stat. 46 (46 U.S.C.
Appendix 134), to name the hospital ships to which section 1
of the said act [46 U.S.C. Appendix 133], shall apply and to
indicate the time when the exemptions thereby provided for
shall begin and end.
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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(f) The authority vested in the President by section 4228 of
the Revised Statutes, as amended (46 U.S.C. Appendix 141),
(1) to declare that -- upon satisfactory proof being given
by the government of any foreign nation that no
discriminating duties or tonnage or imports are imposed or
levied in the ports of such nation upon vessels wholly
belonging to citizens of the United States, or upon the
produce, manufactures or merchandise imported in the same
from the United States or from any foreign country -- the
foreign discriminating duties of tonnage and impost within
the United States are suspended and discontinued, so far as
respect the vessels of such foreign nation, and the produce,
manufactures, or merchandise imported into the United States
from such foreign nation, or from any other foreign country,
and (2) to suspend in part the operation of section 4219 of
the Revised Statutes, as amended (46 U.S.C. Appendix 121),
and section IV, J, subsection 1 of the act of October 3,
1913, c. 16 38 Stat. 195, as amended (46 U.S.C. Appendix
146), so that foreign vessels from a country imposing
partial discriminating tonnage duties upon American vessels,
or partial discriminating import duties upon American
merchandise, may enjoy in our ports the identical privileges
which the same class of American vessels and merchandise may
enjoy in such country: Provided, That prior to the issuance
of an order of the Secretary of the Treasury suspending and
discontinuing posts, and import duties within the United
States, the Department of State shall obtain and furnish to
the Secretary of the Treasury the proof required by the said
sections 4228, as amended, as the basis for that order.
(g) The authority vested in the President by section 3650 of
the Internal Revenue Code [section 3650 of the Internal
Revenue Code of 1939] [see 26 U.S.C. 7621], to establish
convenient collection districts (for the purpose of
assessing, levying, and collecting the taxes provided by the
internal revenue laws), and from time to time to alter such
districts.
(h) The authority which is now vested in the President by
section 2564(b) of the Internal Revenue Code [section
2564(b) of the Internal Revenue Code of 1939], and which on
and after January 1, 1955, will be vested in the President
by section 4735(b) of the Internal Revenue Code of 1954
[former 26 U.S.C. 4735(b)], to issue, in accordance with the
provisions of the said section 2564(b) or 4735(b), as the
case may be, orders providing for the registration and the
imposition of a special tax upon all persons in the Canal
Zone who produce, import, compound, deal in, dispense, sell,
distribute, or give away narcotic drugs.
(i) The authority vested in the President by Section 5318 of
the Revised Statutes, as amended (19 U.S.C. 540), to employ
suitable vessels other than Coast Guard cutters in the
execution of laws providing for the collection of duties on
imports and tonnage: [...]
2. The Secretary of the Treasury is hereby designated and
empowered to perform without the approval, ratification, or
other action of the President the following functions which
have heretofore, under the respective provisions of law
cited, required the approval of the President in connection
with their performance by the Secretary of the Treasury:
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(a) The authority vested in the Secretary of the Treasury by
section 6 of the act of July 8, 1937, ch. 444, 50 Stat. 480
[40 U.S.C. 728], to make rules and regulations necessary for
the execution of the functions vested in the Secretary of
the Treasury by the said act, as amended.
(b), (c) [Revoked by Ex. Ord. No. 11110, June 4, 1963, 28
F.R. 5605]
(d) [Revoked by Ex. Ord. No. 11825, Dec. 31, 1974, 40 F.R.
1003]
(e) The authority vested in the Secretary of the Treasury by
section 1 of Title II of the act of June 15, 1917, ch. 30,
40 Stat. 220 [50 U.S.C. 191], to make rules and regulations
governing the anchorage and movement of any vessel, foreign
or domestic, in the territorial waters of the United States.
3. (a) The Secretary of the Treasury and the Postmaster
General [now United States Postal Service] are hereby
designated and empowered jointly to prescribe without the
approval of the President regulations, under section 1 of
the act of July 8, 1937, ch. 444, 50 Stat. 479 [40 U.S.C.
721], governing the shipment of valuables by the executive
departments, independent establishments, agencies, wholly-
owned corporations, officers, and employees of the United
States./4
(b) The Postmaster General [now United States Postal
Service] is hereby designated and empowered to exercise
without the approval, ratification, or other action of the
President the authority vested in the President by section
504(b) of Title 18 of the United States Code to approve
regulations issued by the Secretary of the Treasury under
the authority of the said section 504(b) (relating to the
printing, publishing, or importation, or the making or
importation of the necessary plates for such printing or
publishing, of postage stamps for philatelic purposes ) (see
section 504(2) of title 18], and to approve any amendment or
repeal of any of such regulations by the Secretary of the
Treasury.
____________________
4 As is the case for other liabilities with civil and/or
criminal implications, authority to prosecute "mail fraud"
and the like must originate somewhere, and there must be
specific application. Section 3(a) of E.O. No. 10289
specifies who is liable for authority of the Secretary of
the Treasury and the Postmaster General to regulate and
prosecute mail-related offenses, i.e., 18 U.S.C. 1341. The
Constitution does not grant Congress authority to delegate
articulated powers from one branch of government to another.
Each of the several States party to the Constitution has
mail fraud statutes, and this is where mail fraud offenses
must be prosecuted so long as the alleged offense is
committed within one of the several States rather than in
United States territorial and maritime jurisdictions (see
Article III, Section 2.3 of the Constitution of the United
States).
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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4. As used in this order, the term "functions" embraces
duties, powers, responsibilities, authority, or discretion,
and the term "perform" may be construed to mean "exercise".
5. All actions heretofore taken by the President in respect
to the matters affected by this order and in force at the
time of the issuance of this order, including regulations
prescribed by the President in respect of such matters,
shall, except as they may be inconsistent with the
provisions of this order, remain in effect until amended,
modified, or revoked pursuant to the authority conferred by
this order.
[emphasis added]
Nothing in E.O. No. 10289 refers to Subtitle A & C taxes
(income, Social Security, railroad retirement, unemployment,
etc.), but authority conveyed by this Order is exclusive to
United States maritime and off-shore territorial jurisdiction and
conveys authority relating to customs laws, particularly with
respect to trade of narcotics and other drugs.
One of the more interesting quirks, hinging on terminology,
is that what are described as "internal revenue laws", which
would give rise to "internal revenue districts" (IRC 7621), are
imposts and duties -- so-called income tax, Social Security tax,
etc., are excises. They are classified as a completely different
category; taxes collected under customs laws are defined as
internal revenue laws.
Exercise of authority to change internal revenue districts
under provisions of IRC 7621, along with the Secretary's re-
delegation of authority to the Commissioner of Internal Revenue,
is demonstrated by Treasury Dept. Order 150-42 [1956 Federal
Register, page 5852]:
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
Page 14 of 165
Office of the Secretary
[Treasury Dept. Order 150-42]
Panama Canal Zone, Puerto Rico, and the Virgin Islands
Administration of Internal Revenue Laws
By virtue of the authority vested in me as Secretary of the
Treasury it is hereby ordered:
1. The Panama Canal Zone is removed from the Internal
Revenue District, Jacksonville, and from the Atlanta Region;
and Puerto Rico and the Virgin Islands of the United States
are removed from the Internal Revenue District, Lower
Manhattan, and from the New York City Region.
2. The Commissioner shall, to the extent of authority
otherwise vested in him, provide for the administration of
United States internal revenue laws in the Panama Canal
Zone, Puerto Rico, and the Virgin Islands.
3. This order shall not be deemed to affect the procedures
for administrative appeal existing immediately prior to
August 1, 1956.
4. This order shall be effective as of August 1, 1956.
Dated: July 27, 1956.
[Seal] David W. Kendall,
Acting Secretary of the Treasury.
For clarity concerning jurisdiction, it is useful to
reproduce Delegation Order 36, published the same date on the
same page, effected by the Assistant Commissioner of Internal
Revenue to the Director of International Operations:
[Delegation Order 36]
Authority Extended to Panama Canal Zone, Puerto Rico and the
Virgin Islands
Pursuant to the authority vested in me by Commissioner
Delegation Order No. 33, dated June 6, 1956, it is hereby
ordered:
1. Subject to the limitations contained in paragraph 2,
there are delegated to the Director of International
Operations the functions of administering the United States
internal revenue laws in the Panama Canal Zone, Puerto Rico,
and the Virgin Islands of the United States, and in all
other areas of the world outside the United States and the
territories of Alaska and Hawaii, to the extent of authority
delegated by Commissioner Delegation Order No. 32, dated May
1, 1956.
2. Nothing in this order shall be deemed to affect the
procedures for administrative appeal existing immediately
prior to August 1, 1956, or any function of the Assistant
Regional Commissioner (Alcohol & Tobacco Tax), New York City
Region.
3. This order is effective August 1, 1956.
Dated: July 31, 1956.
[Seal] C. W. Stowe.
Assistant Commissioner
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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Nothing in E.O. No. 10289, T.D.O. 150-42 or D.O. 36 refers
to "income tax" or Social Security and related taxes in Subtitles
A & C of the Internal Revenue Code. Taxes in these two subtitles
are classified as excise taxes, not internal revenue taxes. The
rationale behind this classification is disclosed in the
definition of "income tax" located on page 2580 of the
Congressional Record -- House, for March 27, 1943:
The income tax is, therefore, not a tax on income as such.
It is an excise tax with respect to certain activities and
privileges which is measured by reference to the income
which they produce. The income is not the subject of the
tax: it is the basis for determining the amount of tax.
It is material that in the report, the prohibition against
direct tax articulated in Pollock v. Farmers' Loan and Trust Co.
(1895), 157 U.S. 429; 158 U.S. 601, is cited as being
authoritative concerning direct tax even in 1943. Additionally,
the report recognizes the Brushaber decision as having concluded
that the Sixteenth Amendment did not grant Congress any new power
to tax, but merely clarified authority to levy excise tax (p.
2580).
That aside, whether or not the Sixteenth Amendment was
properly ratified, and what it did or didn't do with respect to
direct taxing authority, is beside the point so far as income,
Social Security (employment) and related taxes are concerned. The
corresponding definition for employee tax is at 26 CFR, Part
31.3101-1:
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Sec. 31.3101-1 Measure of employee tax.
The employee tax is measured by the amount of wages received
after 1954 with respect to employment after 1936 ....
These excise taxes are levied against "certain activities
and privileges measured by reference to the income which they
produce." Analogously, a Puerto Rican rum distiller is taxed on a
per-gallon basis. The gallon is the unit measure. Where Subtitle
A & C taxes are concerned, the measure is denominated in dollars,
but the dollars themselves, or more appropriately, "public
money", constitutes the measure, not the object of these taxes.
The object is the regulated activity or privilege attending
generation of income denominated in dollars.
The questions arise, "Where did this scheme originate? How
did it emerge?" Answers lie in one of the more bizarre tales ever
told -- three initially independent but converging historical
lines are involved. The lineage of "income tax" levied against
wages, salaries, etc., will be treated first.
The original "income tax" levied against wages, salaries,
etc., of Federal government employees was enacted during the
Civil War in the Revenue Act of July 17, 1862 (12 Stat. 432).
This was the same act which established the office of the
Commissioner of Internal Revenue in the Treasury Department --
see details in the Internal Revenue Manual 1100 at 1111.2, the
report published variously in the Federal Register at 36 F.R.
849-890, 36 F.R. 11946, and 37 F.R. 489-490. However, the report
tacitly admits that while Congress created the office of the
Commissioner of Internal Revenue, Congress did not create a
Bureau of Internal Revenue, predecessor to the Internal Revenue
Service.
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This illusion has been dispelled, too. The original office
of the Commissioner of Internal Revenue established in the
Treasury Department was effectively abolished with enactment of
the Revised Statutes of 1873. The current office of Commissioner
of Internal Revenue is not in the Treasury Department -- see IRC
7802 to find that the office is now in the Department of the
Treasury. This presents a variety of problems as the IRC vests
authority in the Treasury Department as the Secretary's delegate
(IRC 7701(a)(12)(A) & 7805(a)), not the Department of the
Treasury. As we move to the second and third historical lines, it
will be demonstrated that IRS and the Department of the Treasury
are Puerto Rico entities, operating out of, or in conjunction
with, Puerto Rico Trust #62 (Internal Revenue).
Following the Civil War, the special government employee
income or kick-back tax was repealed. However, it emerged again
in the first two decades of the Twentieth Century, probably in
1918, and in the Internal Revenue Act of Nov. 23, 1921, was in
place as "Normal Tax" and "Surtax" (Statutes at Large for Sixty-
Seventh Congress, Ch. 136, Nov. 23, 1921, pp. 233 et seq., Title
II -- Income Tax, Part II -- Individuals, Sections 210 & 211).
Those subject to these taxes are identified under "Gross
Income Defined", Sec. 213:
Sec. 213. That for the purposes of this title (except as
otherwise provided in section 233) the term "gross income"
--
(a) Includes gains, profits, and income derived from
salaries, wages, or compensation for personal service
(including in the case of the President of the United
States, the judges of the Supreme and inferior courts of the
United States, and all other officers and employees, whether
elected or appointed, of the United States, Alaska, Hawaii,
or any political subdivision thereof, or the District of
Columbia, the compensation received as such)...
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Title XIV -- General Provisions, Sec. 1400 of the Act of
Nov. 23, 1921, repealed almost all taxes from the Internal
Revenue Act of 1918 (pp. 320 & 321). Those included in the
sweeping repeal included Title II "Income Tax", Title III War-
Profits and Excess-Profits Tax, Title IV Estate Tax, Title V tax
on transportation and other facilities, and insurance, taxes on
soft drinks, ice cream, and similar articles, tax on cigars,
tobacco and manufactures thereof, tax on admissions and dues,
Title IX excise taxes, Title X special taxes, Title XI stamp
taxes, and taxes on employment of child labor.
The so-called income tax system enacted approximately
simultaneous with promulgation of the Sixteenth Amendment in 1913
was severely bashed in numerous court decisions, and was repealed
in 1921/5 as Congress commenced a radical shift in the entire
Federal tax system. As excises and other such taxes were
reinstated, application was exclusively in the geographical
United States subject to Congress' Article IV, Sec. 3.2 plenary
power -- general application taxes mandatory in the several
States party to the Constitution were wiped out.
It is unclear at this juncture whether or not the normal and
surtax imposed by the Internal Revenue Act of Nov. 23, 1921
survived from 1921 until enactment of the Public Salary Tax Act
of 1939, which was implemented as Chapter 1 of the Internal
Revenue Code of 1939. What is clear, however, is that there was
little or no effort to impose these excise taxes on the general
____________________
5 Brushaber v. Union Pacific Railroad Co. (1916) 240 U.S. 1;
William E. Peck and Co. v. Lowe (1918) 247 U.S. 1651, and
Eisner v. Macomber (1920) 252 U.S. 189, were three of the
more important decisions problematic to the Federal "income
tax" system. See notes and the general report, pp. 2580 et
seq., Congressional Record -- House, for March 27, 1943.
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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population until the Victory Tax was promulgated in 1942. As was
the case with the Public Salary Tax Act of 1939, the Victory Tax
applied only to elected and appointed officers and employees of
the United States, but patriotic Americans willing to support
World War II divvied up a "fair share" to support the enterprise.
The Victory Tax, enacted for only two years, appears to have
lapsed without being enacted a second time -- people who
voluntarily paid the tax without question simply continued the
practice throughout the war and after.
Federal judges were among those who resisted early on. The
Constitution provides that compensation to Article III judicial
officers of the United States will not be diminished. That
problem appears to have been resolved in the mid-1930's as
"volunteer compliance" was secured by way of contract --
appointments were made contingent to candidates agreeing to
endorse contractual commitments to pay Federal income tax.
A version of the so-called Social Security tax was turned
back as unconstitutional, so the second round, effected in 1935,
was implemented by way of treaty. However, Congress has no
authority to bind the several States party to the Constitution
and the American people at large to treaty agreements which
exceed constitutionally delegated authority -- a treaty may not
be used to amend the Constitution. Thus, the definition of
"State", "United States", and "citizen" at 26 CFR, Part
31.3121(e)-1:
Sec. 31.3121(e)-1 State, United States, and citizen
(a) When used in the regulations in this subpart [Subpart B
-- Federal Insurance Contributions Act (Chapter 21, Internal
Revenue Code of 1954)], the term "State" includes the
District of Columbia, the Commonwealth of Puerto Rico, the
Virgin Islands, the Territories of Alaska and Hawaii before
their admission as States, and (when used with respect to
services performed after 1960) Guam and American Samoa.
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(b) When used in the regulations in this subpart, the term
"United States", when used in a geographical sense, means
the several states (including the Territories of Alaska and
Hawaii before their admission as States), the District of
Columbia, the Commonwealth of Puerto Rico, and the Virgin
Islands. When used in the regulations in this subpart with
respect to services performed after 1960, the term "United
States" also includes Guam and American Samoa when the term
is used in a geographical sense. The term "citizen of the
United States" includes a citizen of the Commonwealth of
Puerto Rico or the Virgin Islands, and, effective January 1,
1961, a citizen of Guam or American Samoa.
[subpart identification added; emphasis added]
This is among the more revealing definitions of State,
United States, and citizen relating to Internal Revenue Code
taxing authority as it treats the status of Alaska and Hawaii
before and after they were admitted to the Union of several
States party to the Constitution and clearly identifies the
"citizen of the United States" with terminology from Section 1 of
the Fourteenth Amendment and United States geographical
authority. Territorial application is limited to Congress'
Article IV, Sec. 3.2 authority in the geographical United States,
and the "citizen of the United States" is identified in terms of
Section 1 of the Fourteenth Amendment, but the citizenship is
geographical in nature just as someone born in one of the several
States is a Citizen of his respective State, not necessarily the
United States. Case decisions and Section 1 of the Fourteenth
Amendment clarify the matter:
A citizen of any one of the States of the union, is held to
be, and called a citizen of the United States, although
technically and abstractly there is no such thing. To
conceive a citizen of the United States who is not a citizen
of one of the States, is totally foreign to the idea, and
inconsistent with the proper construction and common
understanding of the expression as used in the Constitution,
which must be deduced from its various provisions. The
object then to be attained, by the exercise of the power of
naturalization, was to make citizens of the respective
States.
[Ex Parte Knowles, 5 Cal. 300 (1855)]
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We have in our political system a Government of the United
States and a government of each of the several States. Each
one of these governments is distinct from the others, and
each has citizens of its own who owe it allegiance, and
whose rights, within its jurisdiction, it must protect. The
same person may be at the same time a citizen of the United
States and a citizen of a State, but his rights of
citizenship under one of these government will be different
from those he has under the other.
[United States v. Cruikshank, 92 U.S. 542 (1875)]
Section 1. All persons born or naturalized in the United
States, and subject to the jurisdiction thereof, are citizens of
the United States and of the State wherein they reside. No State
shall make or enforce any law which shall abridge the privileges
and immunities of citizens of the United States; nor shall any
State deprive any person of life, liberty, or property, without
due process of law; nor deny to any person within its
jurisdiction the equal protection of the laws. [Section 1,
Fourteenth Amendment (1868)]
The change from 1855 when there was no such thing as a
"citizen of the United States" to 1875 when a "citizen of the
United States" was entitled to dual citizenship was effected by
Section 1 of the Fourteenth Amendment. Originally the Amendment
was intended to accommodate citizenship for African Americans
freed as a result of the Civil War, but in years since has become
a geographical rather than racial citizenship. The intent of the
Fourteenth Amendment was framed in the Civil Rights Act of 1866
(14 Stat. 27) in anticipation of ratification:
... [A]ll persons born in the United States and not subject
to any foreign power, excluding Indians not taxes, are
hereby declared to be citizens of the United States; and
such citizens, of every race and color ... shall have the
same right, in every State and Territory in the United
States ... to full and equal benefit of all laws and
proceedings for the security of persons and property, as is
enjoyed by white citizens.
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The "citizen of the United States" was entitled to
"privileges and immunities" where the Preamble Citizen-sovereign
had and has unalienable rights -- rights he is endowed with by
God himself. The Constitution of the United States and
constitutions of the several States merely secure unalienable and
inherent rights recognized and preserved by English-American
common law tradition -- rights construed as substantive, being
antecedent to the constitutions establishing government. However,
the Fourteenth Amendment, where those who received the civil
citizenship franchise are concerned, reverses the order -- the
State, meaning the Federal State subject to Congress' Article IV,
Sec. 3.2 plenary power, is sovereign where the citizen is
subject, enjoying only those rights, privileges and benefits
conferred by Congress. Today, however, the Fourteenth Amendment
isn't so much an issue as citizenship in the geographical United
States -- the United States Code and exercise of Federal
authority is anchored to the geographical United States under
Congress' Article IV, Sec. 3.2 legislative jurisdiction. While
the Fourteenth Amendment plays a significant role in determining
rights and privileges for citizens and residents of the
geographical United States, and it is prudent to distinguish
between the sovereignty of the Citizen of a Union state and the
subject status of citizens of Federal states, territorial
jurisdiction is all-important.
The current Internal Revenue Code sheds light on the subject
with the definition of "United States person" at section
7701(a)(29):
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(29) United States person. The term "United States person"
means --
(A) a citizen or resident of the United States,
(B) a domestic partnership,
(C) a domestic corporation, and
(D) any estate or trust (other than a foreign estate or
foreign trust, within the meaning of section
7701(a)(31)).
The Preamble citizen-sovereign is unique -- he is a moral
being. The "citizen of the United States", enjoying only
privileges and civil rights conferred at the pleasure of
government, is reduced to the status of non-moral legal fictions
-- things rather than people. Thus, the decision in United States
v. United Mine Workers supra: "In common usage, term 'persons'
does not include the sovereign, and statutes employing it will
ordinarily not be construed to do so."
The "character of the party" matter is important so far as
Federal authority over the "person" is concerned, but not really
too important where taxing authority of Subtitles A & C of the
Internal Revenue Code is concerned as citizens of the
geographical United States are also exempt from Subtitle A & C
taxes if they are not government employees. Regardless of
domicile and citizenship, anyone who is not engaged in a United
States "trade or business" is not liable for these taxes, whether
he is a resident or citizen of the District of Columbia, Puerto
Rico, Oklahoma, Kansas or China. The distinction between the
"citizen or resident of the United States" and the "nonresident
alien" of the geographical United States is the rate of tax if
the person happens to be engaged in a United States trade or
business as an "employee".
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For purposes of withholding Subtitle A & C taxes at the
source, the term "employee" is defined in the current IRC at
section 3401(c):
(c) Employee.
For purposes of this chapter, the term "employee" includes
an officer, employee, or elected official of the United
States, a State, or any political subdivision thereof, or
the District of Columbia, or any agency or instrumentality
of any one or more of the foregoing. The term "employee"
also includes an officer of a corporation.
General application definitions at IRC 7701(a)(9) & (10) are
consistent with the definitions of "United States" and "State" at
26 CFR, Part 31.3121(e)-1, to wit:
(9) United States. The term "United States" when used in a
geographical sense includes only the States and the District
of Columbia.
(10) State. The term "State" shall be construed to include
the District of Columbia, where such construction is
necessary to carry out provisions of this title.
Where the Internal Revenue Code is concerned, use of the
terms "includes" and "including" is restrictive, limiting
definitions to classes for which examples are given. This is
determined at IRC 7701(c):
(c) Includes and including.
The terms "includes" and "including" when used in a
definition contained in this title shall not be deemed to
exclude other things otherwise within the meaning of the
term defined.
In other words, when the definition of the term "State"
gives examples only of Federal states subject to Congress'
Article IV, Sec. 3.2 legislative jurisdiction, the definition is
exclusive of the Union of several States party to the
Constitution of the United States. The Union state and the
Federal state are two distinct classes. Two Latin terms frame the
principle/6:
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Noscitur a sociis. It is known from its associates. The
meaning of a word is or may be known from the accompanying
words. Under the doctrine of "noscitur a sociis", the
meaning of questionable or doubtful words or phrases in a
statute may be ascertained by reference to the meaning of
other words or phrases associated with it.
Inclusio unius est exclusio alterius. The inclusion of one
is the exclusion of another. The certain designation of one
person is an absolute exclusion of all others ... This
doctrine decrees that where law expressly describes [a]
particular situation to which it shall apply, an irrefutable
inference must be drawn that what is omitted or excluded was
intended to be omitted or excluded.
The various definitions of "State" and "United States" in
the Internal Revenue Code and other titles of the United States
Code use territories and Federal "states" as examples without
mention of any given State party to the Constitution of the
United States. The definition of "State" and "United States" at
26 CFR, Part 31.3121(e)-1 demonstrates proper application by
inclusion of Alaska and Hawaii prior to the two being admitted to
the Union and exclusion after being admitted to the Union. By
applying the two principles above; the example represents the
class, and that which was omitted or excluded was intended to be
omitted or excluded, IRC use of the terms "includes" and
"including" is clarified. The terms are restrictive with respect
to class, type or kind. For instance, if a definition used "lions
and tigers" as examples, the reference would be to the large cat
family and would necessarily exclude bears and wolves.
____________________
6 Both definitions from Black's Law Dictionary, 6th edition.
UNITED STATES OF AMERICA v. DAN LESLIE MEADOR:
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The matter of "United States" character, capacity, or
identity was addressed extensively in Hooven & Allison Co. V.
Evatt, U.S.Ohio, 324 U.S. 652, 65 S.Ct. 870, 89 L.Ed. 1252
(1945). In the decision, the high court distinguished between
different characters or capacities of the "United States":
The term "United States" may be used in any one of several
senses. It may be merely the name of a sovereign occupying
the position analogous to that of other sovereigns in the
family of nations. It may designate the territory over which
the sovereignty to the United States extends, or it may be
the collective name of the states which are united by and
under the Constitution.
The matter at issue in Hooven was whether or not fiber
imported from the Philippines was an "import" or merely the
transfer of goods within jurisdiction of the United States -- was
the fiber of foreign or domestic origin? The decision to a
certain extent avoided the notion of United States territory
acquired by conquest or treaty being foreign in the sense Mexico,
Canada, European nations, etc., are foreign, but focused instead
on the status of outlying territories under Congress' Article IV,
Sec. 3.2 legislative jurisdiction relative to the several States
party to the Constitution:
... The Constitution has not made the foreign origin of
articles imported the test of importation, but only their
origin in a place over which the Constitution has not
extended its commands with respect to imports and their
taxation. Hence our question must be decided, not by
determining whether the Philippines are a foreign country,
as indeed they have been held not to be within the meaning
of the general tariff laws of the United States ... and
within the scope of other general laws ... but by
determining whether they have been united governmentally
with the United States by and under the Constitution.
That our dependencies, acquired by cession as the result of
our war with Spain, are territories belonging to, but not a
part of, the Union of states under the Constitution, was
long since established by a series of decisions in this
Court beginning with the The Insular Tax Cases in 1901 ...
This status has ever since been maintained in the practical
construction of the Constitution by all the agencies of our
government in dealing with our insular possessions. It is no
longer doubted that the United States may acquire territory
by conquest or by treaty, and may govern it through the
exercise of the power of Congress conferred by Sec. 3 of
Article IV of the Constitution "to dispose of and make all
needful Rules and Regulations respecting the Territory or
other Property belonging to the United States..."
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In exercising this power, Congress is not subject to the
same constitutional limitations, as when it is legislating
for the United States ... And in general the guaranties of
the Constitution, save as they are limitations upon the
exercise of executive and legislative power when exerted for
or over our insular possessions, extend to them only as
Congress, in the exercise of its legislative power over
territory belonging to the United States, has made those
guaranties applicable ... It follows that articles brought
from the Philippines into the United States are imports in
the sense that they are brought from territory, which is not
part of the United States, into the territory of the United
States, organized by and under the Constitution, where alone
the import clause of the Constitution is applicable.
[cites omitted; emphasis added]
In one sense, United States territories and insular
possessions are not foreign, but might better be described as
alien to the several States party to the Constitution in that the
remaining territories are now considered States, but of a
separate and distinct class from the several States party to the
Constitution. However, by particularized definition, and
application of law, they are in a real sense foreign just as one
of the several States, for purposes of its sovereign authority,
is foreign to the others. The matter of foreign status and
foreign countries is addressed in the context of "private
International law" (municipal law), in the section on "Conflict
of Laws" in American Jurisprudence:
Private international law assumes a more important aspect in
the United States than elsewhere, for the reason that the
several states, although united under the same sovereign
authority and governed by the same laws for all national
purposes embraced by the Federal Constitution, are
otherwise, at least so far as private international law is
concerned, in the same relation as foreign countries. The
great majority of questions of private international law are
therefore subject to the same rules when they arise between
two states of the Union as when they arise between two
foreign countries, and in the ensuing pages the words
"state," "nation," and "country" are used synonymously and
interchangeably, there being no intention to distinguish
between the several states of the Union and foreign
countries by the use of varying terminology.
[16 Am.Jur. 2d, "Conflict of Laws", Sec. 2]
[emphasis added]
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Congress has plenary power in the geographical United
States, but only specifically enumerated and delegated powers so
far as the several States party to the Constitution are
concerned. The geographical United States is as much a self-
interested entity as any of the several States party to the
Constitution, so has somewhat the same relationship to each of
the several States party to the Constitution as each State has to
the other -- for purposes of private international law, one is
foreign to the other. Therefore, determination of status must
depend on application of law. The Internal Revenue Code does this
with definitions at IRC 7701(a):
(4) Domestic. The term "domestic" when applied to a
corporation or partnership means created or organized in the
United States or under the law of the United States or of
any State.
(5) Foreign. The term "foreign" when applied to a
corporation or partnership means a corporation or
partnership which is not domestic.
The definitions above are dependent on definitions of
"United States" and "State" at IRC 7701(a)(9) & (10) supra. Both
definitions identify the geographical United States and its
various components, whether they are described as States,
territories, insular possessions, or whatever else -- the Act of
Congress, applicable only in the geographical United States
subject to Congress' Article IV, Section 3.2 legislative
jurisdiction, is foreign to the several States party to the
Constitution of the United States. Fortunately, the matter is
tied together reasonably well by the definition of "foreign
estate or trust" at IRC 7701(a)(31):
(31) Foreign estate or trust. The term "foreign estate" and
"foreign trust" mean an estate or trust, as the case may be,
the income of which, from sources without the United States
which is not effectively connected with the conduct of a
trade or business within the United States, is not
includible in gross income under subtitle A.
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Here taxing authority conveyed in Subtitles A & C of the
Internal Revenue Code is restricted in two ways: (1) these taxes
are mandatory only in the geographical United States subject to
Congress' Article IV, Section 3.2 legislative jurisdiction, and
(2) even in the geographical United States, only those people and
created entities engaged in "United States trade or business"
("... the performance of functions of a public office..." supra)
are subject to the taxes.
These same principles apply where the "person liable" is
concerned. If a reference is to the Native American Indian, it
might use Cherokee, Choctaw and Pawnee tribes as examples.
Depending on the extent of inclusiveness, the definition might
extend to all indigenous North American tribes or some smaller
classification or geographical location. Regardless of the extent
of application within the Native American Indian race, it would
be exclusive of all other races.
The "citizen of the United States" fraud is just as
cumbersome as defining "State" and "United States" so far as
territorial application and type classification is concerned.
However, here we can turn to the Immigration and Nationality Act
for an amount of assistance. At 8 USCS 1101(a)(36), the term
"State" is defined as follows: "(36) The term 'States' includes
(except as used in section 310(a) of title III [8 USCS 1421(a)])
the District of Columbia, Puerto Rico, Guam, and the Virgin
Islands of the United States."/7
____________________
7 The 1978 edition of United States Code Service is being used
for Title 8 definitions.
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Since relatively few Americans who think of themselves as
"citizens of the United States" were born in the District of
Columbia, Puerto Rico, Guam, or the Virgin Islands, all of which
are subject to Congress' Article IV, Section 3.2 authority, the
balance of the American people must have some kind of identity
which maintains their status with respect to the nation and their
respective States, the latter being the Union of several States
party to the Constitution of the United States. This is resolved
in the definition of "national" and application of the term with
respect to the "United States". Both definitions are at 8 USCS
1101(a):
(21) The term "national" means a person owing permanent
allegiance to a state.
(22) The term "national of the United States" means (A) a
citizen of the United States, or (B) a person who, though
not a citizen of the United States, owes permanent
allegiance to the United States.
The "national of the United States" is made reasonably clear
at 26 CFR, Part 1.1-1, reproduced in relative part:
Sec. 1.1-1 Income tax on individuals
(a) General rule. (1) Section 1 of the Code imposes an
income tax on the income of every individual who is a
citizen or resident of the United States and, to the extent
provided by section 871(b) or 877(b), on the income of a
nonresident alien individual...
(c) Who is a citizen. Every person born or naturalized in
the United States and subject to its jurisdiction is a
citizen. For other rules governing the acquisition of
citizenship, see chapters 1 and 2 of title III of the
Immigration and Nationality Act (8 U.S.C. 1401-1459)...
So far as the Immigration and Nationality Act is concerned,
as demonstrated by definitions at 8 U.S.C. 1101(a)(21) & (22), a
vast majority of the American people are Citizens of their
respective union States and nationals of the United States, they
are not citizens of the United States. The "citizen of the United
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States" terminology, particularly in 26 CFR, Part 1.1-1(c), comes
directly from Section 1 of the Fourteenth Amendment. The "citizen
of the United States" is therefore the special case citizen,
whether the African American liberated following the Civil War or
the current citizen of the United States who was born or
naturalized in the geographical United States under Congress'
Article IV, Section 3.2 legislative jurisdiction.
In the meantime, the American people, whether Citizens of
Oklahoma, Kansas, Colorado or any of the other Union states party
to the Constitution, have a common interest -- preservation of
the constitutional republic known as the United States. Thus, the
sovereign Citizen of Oklahoma, Kansas, or Colorado owes and for
the most part maintains permanent allegiance to the United States
and is obliged to comply with laws of the United States when
those laws fall within Congress' Article I delegated authority.
However, where the United States has acquired sufficient
territory to become a sprawling self-interested entity on the
order of a State or coalition of several Federal states subject
to Congress' Article IV, Section 3.2 legislative jurisdiction,
the geographical United States bears approximately the same
relationship to Oklahoma, Kansas and Colorado as one of the
several States party to the Constitution of the United States
does to the other. In other words, the "American Empire" is
comprised of 51 self-interested political entities, the Union of
several States party to the Constitution and the coalition of
Federal states subject to Congress' plenary power. Each of the 51
political entities operates within territorial bounds with each
being foreign to the others.
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For example, Kansas and Oklahoma are sister Union states
sharing a common border, but one is foreign to the other. Kansas
authorities do not enforce Kansas laws and conduct Kansas courts
in Oklahoma; Oklahoma does not enforce Oklahoma laws and set up
Oklahoma courts in Kansas. Each has its own taxing system; each
has its own traffic laws; each has its own enforcement people;
each has its own governor and legislature; each has its own
court system.
Within this scheme, a Citizen of Oklahoma is alien to
Kansas. An Oklahoman living in Oklahoma is a nonresident alien of
Kansas. On the occasion a Citizen of Oklahoma were to drive
through or simply visit someone in Kansas, he would still be a
nonresident alien who was in Kansas either incidentally or for
some specific purpose. On the other hand, a Citizen of Oklahoma
might contract a job and spend several months in Kansas while
doing the work. In that event, he might elect to retain Oklahoma
citizenship, or he might register to take Kansas citizenship. In
the latter case, he would be required to forego Oklahoma
citizenship. Where the several States party to the Constitution
are concerned, citizenship in one is exclusive of citizenship in
another. However, the "citizen of the United States" is something
of a different sort -- he may be a Citizen of one of the several
States and simultaneously retain status as a citizen of the
United States.
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So far as territorial authority is concerned (venue
jurisdiction), each of the several States party to the
Constitution is foreign to the geographical United States and its
various components or political subdivisions: The District of
Columbia, Puerto Rico, Guam, the Virgin Islands, the Northern
Mariana Islands, etc., are foreign to Oklahoma, Kansas, and
Colorado. Likewise, the Citizen of Oklahoma, Kansas, or Colorado
is alien to the geographical United States, comprised of the
District of Columbia, Puerto Rico, Guam, the Virgin Islands and
other geographical entities under Congress' Article IV, Section
3.2 legislative jurisdiction. Where the Citizen of Oklahoma,
Kansas, or Colorado does not live in one of the States under
Congress' Article IV, Section 3.2 legislative jurisdiction, he is
a nonresident alien of the geographical United States.
As is the case for Oklahoma, Kansas, and Colorado, the self-
interested, geographical United States under Congress' Article
IV, Section 3.2 legislative jurisdiction has its own laws, its
own enforcement people, and its own territorial court system, the
latter being the system of United States District Courts. This
matter is clarified in the application of terms located at Rule
54, Federal Rules of Criminal Procedure:/8
(c) Application of Terms. As used in these rules the
following terms have the designated meanings.
"Act of Congress" includes any act of Congress locally
applicable to and in force in the District of Columbia, in
Puerto Rico, in a territory or in an insular possession.
"State" includes District of Columbia, Puerto Rico,
territory and insular possession.
So far as Federal jurisdiction in the Union of several
States is concerned, limits are prescribed at 18 U.S.C. 7(3):
____________________
8 Cites from Titles 18 & 28 of the United States Code, Federal
Rules of Criminal Procedure, Federal Rules of Civil
Procedure, and Federal Rules of Evidence are from 1996
editions of West Publishing Co. U.S.C. unless otherwise
noted.
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(3) Any lands reserved or acquired for the use of the United
States, and under the exclusive or concurrent jurisdiction
thereof, or any place purchased or otherwise acquired by the
United States by consent of the legislature of the State in
which the same shall be, for the erection of a fort,
magazine, arsenal, dockyard, or other needful building.
In order for any given statute in an Act of Congress to have
general application, thus reaching beyond United States
geographical borders, United States maritime jurisdiction, or
government administration (5 U.S.C. 301), legislative regulations
prescribing application must be published in the Federal
Register, per the Federal Register Act (44 U.S.C. 1501 et seq.,
section 1505 specifying particulars pertaining to what documents
must be published in the Federal Register). Requirements for
these regulations are prescribed at 1 CFR, Parts 21.40 & 21.41:
Sec. 21.40 General requirements: Authority citations.
Each section in a document subject to codification must
include, or be covered by, a complete citation of the
authority under which the section is issued, including --
(a) General or specific authority delegated by statute; and
(b) Executive delegations, if any, necessary to link the
statutory authority to the issuing agency.
Sec. 21.41 Agency responsibility.
(a) Each issuing agency is responsible for the accuracy and
integrity of the citations of authority in the documents it
issues.
(b) Each issuing agency shall formally amend the citations
of authority in its codified material to reflect any changes
therein.
There are literally thousands of pages of regulations, so
Congress, via 44 U.S.C. 1510, authorized publication of certain
finding aids. The most useful where the instant matter is
concerned is the Parallel Table of Authorities and Rules,
published in the Index volume to the Code of Federal Regulations.
This table is organized sequentially by United States Code title
and statute number in the left column, with general application
regulations for each statute listed in the right column.
Requirements for this table are at 1 CFR, Part 8.5(a):
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Sec. 8.5 Ancillaries.
The Code shall provide, among others, the following-
described finding aids:
(a) Parallel tables of statutory authorities and rules. In
the Code of Federal Regulations Index or at such other place
as the Director of the Federal Register considers
appropriate, numerical lists of all sections of the current
edition of the United States Code (except section 301 of
title 5) which are cited by issuing agencies as rule-making
authority for currently effective regulations in the Code of
Federal Regulations. The lists shall be arranged in the
order of the titles and sections of the United States Code
with parallel citations to the pertinent titles and parts of
the Code of Federal Regulations.
If any given statute in the United States Code is not listed
in the Parallel Table of Authorities and Rules, the authority of
the statute is limited to (1) United States government agencies
and operations and government agencies and operations of United
States political subdivisions (5 U.S.C. 301; exception at 44
U.S.C. 1505(a)), (2) United States territories, and/or (3) United
States maritime jurisdiction. Unless a general application
legislative regulation is published in the Federal Register, and
identified as such in the Parallel Table of Authorities and
Rules, authority of the statute does not reach the Union of
several States party to the Constitution of the United States and
the American people at large.
____________________
9 For general purposes, "IRC" is being used in text to refer
to the Internal Revenue Code of 1954, as amended in 1986 and
since, where in special use relating to the Parallel Table
of Authorities and Rules, "Title 26" or "26 U.S.C." is being
used. See IRC 7806 for verification that Title 26 has never
been enacted as positive law, so the title remains prima
facie evidence of law. The Internal Revenue Code thus
remains Vol. 68A of the Statutes at Large, as amended in
1986 and since.
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By consulting the Parallel Table of Authorities and Rules,
it is found that 26 U.S.C. 7621 is not listed./9 This is the
statute authorizing the President to establish revenue districts,
which was examined earlier. Since there is no listing in the
Parallel Table of Authorities and Rules for the statute,
authority of 26 U.S.C. 7621 does not reach or affect the Union of
several States party to the Constitution and the population at
large.
This section has already been examined: Congress authorized
the President to re-delegate authority for certain
responsibilities via 3 U.S.C. 301. The President then exercised 3
U.S.C. 301 statutory authority by re-delegating authority
relating to United States customs laws, authority to establish
and/or change revenue districts, administer the anti-smuggling
act, etc., to the Secretary of the Treasury via E.O. No. 10289,
first effected in 1951 and revised several times since, then the
Secretary, via T.D.O. 150-42 (1956), re-delegated authority
pertaining to administration of United States internal revenue
laws to the Commissioner of Internal Revenue, with authority
delegated from the President to the Secretary and subsequently to
the Commissioner all limited to United States off-shore
territorial and maritime jurisdiction, exclusive of the Union of
several States party to the Constitution of the United States.
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Although 26 U.S.C. 7621 is not listed in the Parallel Table
of Authorities and Rules, and therefore does not have a general
application or legislative regulation published in the Federal
Register, E.O. No. 10289 is cited at 26 CFR, Part 301.7621-1 as
the Secretary's authority to establish and change revenue
districts. In other words, IRC 7621 does not apply to and has no
affect on the Union of several States and the American people at
large -- it extends to and affects only United States off-shore
territorial and maritime jurisdiction.
It will also be found that 26 U.S.C. 7801, 7802 & 7803 are
not listed in the Parallel Table of Authorities and Rules. Which
is to say, the Secretary of the Treasury, the Commissioner of
Internal Revenue and his various assistants, and the Treasury
Department do not have Internal Revenue Code administrative and
enforcement authority in the Union of several States. Their
authority, respectively, is limited to United States territorial
and maritime jurisdiction, and where applicable, to United States
government operations.
As already demonstrated, Subtitle A & C taxes are mandatory
only for "employees", as defined at IRC 3401(c) -- officers and
employees of the United States, Federal states under Congress'
Article IV, Section 3.2 legislative jurisdiction such as the
District of Columbia, Puerto Rico, the Virgin Islands, Guam,
American Samoa, etc., their respective political subdivisions,
and officers of United States corporations which operate as
instrumentalities of the United States -- the United States
Postal Service, Federal Land Bank, and other such entities. The
qualification is then narrowed even further: Only citizens and
residents of the United States providing service relating to an
employer's United States trade or business -- trade or business
is defined as performance of the functions of a public office
(IRC 7701(a)(26)).
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The next question is, "Who is ultimately liable for these
taxes?" Which is to say, those identified at IRC 3401(c), and the
types of "income" identified in the section, are subject to the
tax via withholding at the source (IRC 3402), but they aren't
necessarily subject to direct personal liability or requirements
even for filing returns and the like. The alleged mandate for
filing "1040" tax returns is a sham and hoax. This is verified at
26 CFR, Part 31.6001-1(d):
(d) Records of employees. While not mandatory (except in
the case of claims), it is advisable for each employee to
keep permanent, accurate records showing the name and
address of each employer for whom he performs services as an
employee, the dates of beginning and termination of such
services, the information with respect to himself which is
required by the regulations in this subpart to be kept by
employers, and the statements furnished in accordance with
the provisions of Sec. 31.6051-1.
[emphasis added]
Under normal circumstances, an "employee" will file for
overcollection (excess withholding) refunds directly through the
"employer". This is clarified at 26 CFR, Part 601.401(c):
(2) Overcollections from employees -- (i) Employee tax. If
an employer collects from an employee more than the correct
amount of employee tax under the Federal Insurance
Contributions Act or the Railroad Retirement Act, and the
error is ascertained within the applicable period of
limitation on credit or refund, the employer is required
either to repay the amount to the employee, or to reimburse
the employee by applying the amount of the overcollection
against employee tax which otherwise would be collected from
the employee after the error is ascertained. If the
overcollection is repaid to the employee, the employer is
required to obtain and keep the employee's written receipt
showing the date and amount of the repayment...
(ii) Income tax withholding. If, in any return period in a
calendar year, an employer withholds more than the correct
amount of income tax, and pays over to the Internal Revenue
Service the amount withheld, the employer may repay or
reimburse the employee in the excess amount in any
subsequent return period in the same calendar year. If the
amount is so repaid, the employer is required to obtain and
keep the employee's written receipt showing the date and
amount of the repayment.
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(3) Employer's claims for credit or refund of overpayments
-- (i) Employee tax. If an employer repays or reimburses an
employee for an overcollection of employee tax, as described
in subparagraph (2)(i) of this paragraph, the employer may
claim credit on a return in accordance with the instructions
applicable to the return. In lieu of claiming credit the
employer may claim refund by filing Form 843, but the
employer may not thereafter claim credit for the same
overpayment.
(ii) Income tax withholding. If an employer repays or
reimburses an employee for an excess amount withheld as
income tax, as described in subparagraph (2)(ii) of this
paragraph, the employer may claim credit on a return for a
return period in the calendar year in which the excess
amount was withheld. The employer is not otherwise permitted
to claim credit or refund for any overpayment of income tax
that the employer deducted or withheld from an employee.
The "employee" is required to file for refunds from the
Treasury Department only under special conditions. Some of those
conditions are specified in regulations at 26 CFR, Part
601.401(d):
(d) Special refunds of employee social security tax. (1) An
employee who receives wages from more than one employer
during a calendar year may, under certain conditions,
receive a "special refund" of the amount of employee social
security tax (i.e., employee tax under the Federal Insurance
Contributions Act) deducted and withheld from wages that
exceed the following amounts ... An employee who is entitled
to a special refund of employee tax with respect to wages
received during a calendar year, and who is required to file
an income tax return for such calendar year ... may obtain
the benefits of such special refund only by claiming credit
for such special refund on such income tax return in the
same manner as if such special refund were an amount
deducted and withheld as income tax at source on wages.
(2) The amount of the special refund allowed as a credit
shall be considered as an amount deducted and withheld as
income tax at the source on wages. If the amount of such
special refund when added to amounts deducted and withheld
as income tax under chapter 24 exceeds the income tax
imposed by chapter 1, the amount of the excess constitutes
an overpayment of income tax, and interest on such
overpayment is allowed to be extent provided under section
6611 of the Code upon an overpayment of income tax resulting
from a credit for income tax withheld at source on wages.
(3) If an employee entitled to a special refund of employee
social security tax is not required to file an income tax
return for the year in which such special refund may be
claimed as a credit, the employee may file a claim for
refund of the excess social security tax on Form 843. Claims
must be filed with the district director of internal revenue
for the district in which the employee resides.
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(4) Employee taxes under the Federal Insurance Contributions
Act and the Railroad Retirement Tax Act includes a
percentage rate for hospital insurance. If in 1968 or any
calendar year thereafter employee taxes under both Acts are
deducted from an employee's wages and compensation
aggregating more than $7,800, the "special refund"
provisions may apply to the portion of the tax that is
deducted for hospital insurance. The employee may take
credit on Form 1040 for the amount allowable, in accordance
with the instructions applicable to that form.
[emphasis added]
Those eligible for special refunds of employment taxes are
listed at 26 CFR, Part 31.6413(c)-1. Only in this framework, or
in the event of illegal or erroneous assessment and collection
initiatives (26 CFR, Part 301.6404-1(a)), would an "employee"
file for returns directly from the Internal Revenue Service. The
"1040" form, used to secure special refunds, is voluntary in that
an employee may elect not to file for a refund, and mandatory
only to secure a benefit, the benefit being refund of overpayment
of employee employment taxes. Thus, Internal Revenue Service
"1040" assessment used as the basis of administrative and
judicial initiatives is clearly fraudulent.
The inquiry then returns to liability: Who is liable for
Subtitle A & C taxes? The answer is, the employee designated as
withholding agent for the Government agency or United States
corporation operating as an instrumentality of the United States.
The matter is penetrated via 26 CFR, Parts 31.3403-1 & 31.3404-1:
Sec. 31.3403-1 Liability for tax.
Every employer required to deduct and withhold the tax under
section 3402 from the wages of an employee is liable for the
payment of such tax whether or not it is collected from the
employee by the employer. If, for example, the employer
deducts less than the correct amount of tax, or if he fails
to deduct any part of the tax, he is nevertheless liable for
the correct amount of the tax. See, however, Sec.
31.3402(d)-1. The employer is relieved of liability to any
other person for the amount of any such tax withheld and
paid to the district director or deposition with a duly
designated depository of the United States.
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Sec. 31.3404-1 Return and payment by governmental employer.
If the United States, or a State, Territory, Puerto Rico, or
a political subdivision thereof, or the District of
Columbia, or any agency or instrumentality of any one or
more of the foregoing, is an employer required to deduct and
withhold tax under Chapter 24, the return of the amount
deducted and withheld as such tax may be made by the officer
or employee having control of the payment of the wages or
other officer or employee appropriately designated for that
purposes. (For provisions relating to the execution and
filing of returns, see Subpart G of the regulations in this
part).
Liability of the employer is further demonstrated at 26 CFR,
Part 31.3402(d)-1:
Sec. 31.3402(d)-1 Failure to withhold.
If the employer in violation of the provisions of section
3402 fails to deduct and withhold the tax, and thereafter
the income tax against which the tax under section 3402 may
be credited is paid, the tax under section 3402 shall not be
collected from the employer. Such payment does not, however,
operate to relieve the employer from liability for penalties
or additions to the tax applicable in respect of such
failure to deduct and withhold. The employer will not be
relieved of his liability for payment of the tax required to
be withheld unless he can show that the tax against which
the tax under section 3402 may be credited has been paid.
See Sec. 31.3403-1, relating to liability for tax.
So far as liability for Subtitle A & C taxes is concerned,
IRC 1441, 1442, 1443, and 1461 stipulate that the "withholding
agent" is liable. Even if an "employee" were to fall for the
"1040" scheme by filing a return and paying whatever additional
sum is calculated as appropriate payment, the employer remains
liable for whatever penalties and interest might attend the tax.
In other words, an employee, other than the designated
withholding agent, is not liable directly to the Treasury
Department for reporting and making direct payments, nor is he
liable for interest and statutory penalties. These liabilities
all fall to the employer -- the Government employer -- by way of
the designated withholding agent. The withholding agent is also
an "employee".
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This matter is clarified at IRC 7343, to wit:
Sec. 7343. Definition of term "person."
The term "person" as used in this chapter includes an
officer or employee of a corporation, or a member or
employee of a partnership, who as such officer, employee, or
member is under a duty to perform the act in respect of
which the violation occurs.
This restrictive definition of "person" applies to Chapter
75 of the Internal Revenue Code, "Crimes, Other Offenses and
Forfeitures". It is inclusive of IRC 7201 - 7344, the chapter
covering all criminal offenses and forfeitures itemized in the
Internal Revenue Code. Where Subtitles A & C of the Code are
concerned, application of criminal laws and execution of
forfeitures are effective only against those who qualify as a
"person" within the scope of the restrictive definition at IRC
7343 the "withholding agent" identified at 26 CFR, Parts 31.3403-
1 & 31-3404-1, and made liable via 26 CFR, Parts 1.1441, 1.1442,
1.1443 & 1.1461.
The definition of "withholding agent" at 26 CFR, Part
1.1441-7 is specifically applicable to nonresident aliens,
foreign corporations, etc., but as seen above, the same general
liability occurs in the geographical United States and is
incumbent on those designated as withholding agents for all
purposes where withholding, filing returns, and paying tax is
concerned. This definition applies as the general definition of
"withholding agent", as specified at 26 CFR, Part 301.7701-16,
the statutory definition being at IRC 7701(a)(16):
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Sec. 1.1441-7 General provisions relating to withholding
agents.
(a) Withholding agent defined -- (1) In general. For
purposes of Chapter 3 of the Code, the term "withholding
agent" means any person who pays or causes to be paid an
item of income specified in Sec. 1.1441-2 to (or to the
agent of) a nonresident alien individual, a foreign
partnership, a nonresident alien or foreign fiduciary of a
trust or estate, or a foreign corporation, and who is
required to withhold tax under sections 1441, 1442, 1443, or
1451 from such item of income. Any person who meets the
definition of a withholding agent is required to file the
returns prescribed by Sec. 1.1461-1. For example, an
employer (as defined in Sec. 31.3401(d)-1 of this chapter),
to the extent the employer pays remuneration for services
performed by a nonresident alien individual in the United
States and such remuneration is excepted from the term
"wages" under Sec. 31.3401(a)(6)-(1)(c) or (e) of this
chapter, must file a return as required by Sec. 1.1461-
2(c)(1).
The mystery of how an "employee" is to file for refunds of
overpayments with the withholding agent, and the withholding
agent is to (1) repay the employee, then (2) recover the refunded
overpayment via the Internal Revenue Service, is resolved at 26
CFR, Part 1.1461-2. Where matters at hand are concerned, it isn't
necessary to detail the process, itemize forms, etc., but merely
note that Sec. 1.1461-2 is one of the few regulations pertaining
to the Internal Revenue Code which meets Paperwork Reduction Act
(44 U.S.C. 3501 et seq.), Federal Register Act (44 U.S.C. 1501 et
seq.), and Privacy Act (5 U.S.C. 552a) requirements, and is, in
fact, the controlling regulation for all regulations published in
Title 26 of the Code of Federal Regulations. Relevant portions of
26 CFR, Part 1.1461-2 are as follows:
(e) Penalties. For penalties and additions to the tax
attaching upon failure to comply with this section, see
sections 6651, 6656, 6676, and 7203.
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(f) Special items. The tax withheld in accordance with
paragraphs (b)(1), (c)(3), and (d)(1) of Sec. 1.1441-3 shall
be returned and paid in accordance with this section even
though the items involved may not constitute gross income in
whole or in part. For such purpose, a reference in this
section to an item or amount of income shall, where
appropriate, be deemed to refer also to the items specified
in such paragraphs or the amount thereof.
(g) Inconsistent regulations. All regulations inconsistent
with the provisions of this section shall be deemed to have
been modified accordingly.
(Approved by the Office of Management and Budget under
control number 1545-0795)
(Secs. 1441(c)(4) (80 Stat. 1553; 26 U.S.C. 1441(c)(4)),
3401(a)(6) (80 Stat. 1554; 26 U.S.C. 3401(a)(6)), 7805 (68A
Stat. 917; 26 U.S.C. 7805) of the Internal Revenue Code of
1954)
(T.D. 6500, 25 FR 12078, Nov. 26, 1960, as amended by T.D.
6922, 32 FR 8711, June 17, 1967; T.D. 7157, 36 FR 25228,
Dec. 30, 1971; T.D. 7977, 49 FR 36835, Sept. 20, 1984)
Where matters at hand are concerned, the lineage of this
historical line can be summarized and left at this point: The
"employee" subject to Subtitle A & C taxes is the appointed or
elected officer or agent of United States government, governments
of United States territories subject to Congress' Article IV,
Section 3.2 legislative jurisdiction, and officers of United
States corporations construed as instrumentalities of the United
States. The "employee" defined at IRC 3401(c) is approximately
the same as those identified as having "gross income" in the
Internal Revenue Act of Nov. 23, 1921 (pp. 237 & 238, Statutes at
Large for Nov. 23, 1921). However, the "withholding agent",
identified at IRC 3404 and 26 CFR, Part 31.3404, defined at IRC
7701(a)(16) and 26 CFR, Part 1.1441-7(a), is ultimately the
"person liable" for withholding, filing return reports, and
paying taxes prescribed in Subtitles A & C of the Code (see IRC
6012), and where appropriate, refunding overpayment of these
taxes to employees. The withholding agent is also the person
specified as being liable for criminal offenses and forfeitures
in the context of Chapter 75 of the Internal Revenue Code, per
IRC 7343.
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Internal Revenue Service is an Agency
of the Department of the Treasury, Puerto Rico
The second line of historical evolution pertains to identity
of the Internal Revenue Service as an agency of the Department of
the Treasury, Puerto Rico. The transition link is T.O. 150-29 of
1953, when the Secretary of the Treasury changed the name of the
Bureau of Internal Revenue to Internal Revenue Service.
The office of the Commissioner of Internal Revenue was
created in the Treasury Department by the Internal Revenue Act of
July 1, 1862. However, Congress did not create a Bureau of
Internal Revenue at that time or any time since (see report in
the Internal Revenue Manual 1100 at 1111.2; 36 F.R. 849-890, 36
F.R. 11046, 37 F.R. 489-490, particularly 36 F.R. 850). The
office of the Commissioner was effectively abolished with adopted
of the Revised Statutes of 1873.
Two entities known as the Bureau of Internal Revenue were
created in the early Twentieth Century, one by the provisional
government for the Philippines, in conjunction with Philippines
Trust #2 (internal revenue), the other by the provisional
government for Puerto Rico, in conjunction with Puerto Rico Trust
#62 (Internal Revenue) (both trusts still listed as under
management by the Secretary of the Treasury, 31 U.S.C. 1321).
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From approximately 1904 through 1938, BIR Philippines and
BIR Puerto Rico were responsible for administration and
enforcement of the China Trade Act, repealed in 1938, the Act
relating to trade in opium, cocaine and citric wines. Both
entities continued to administer treaty provisions relating to
narcotics and other controlled substances classified as drugs,
distilled spirits, etc., which replaced provisions of the China
Trade Act. The Philippines became an independent commonwealth in
1946, leaving BIR Puerto Rico as the only such agency directly
connected with the United States. The name of the Bureau of
Internal Revenue, Puerto Rico, was changed to Internal Revenue
Service via T.O. 150-29 in 1953.
Repeal of Eighteenth Amendment
Moved Federal Tax Administration Off Shore
The third historical line relates to the reasonably short
term of prohibition in the United States, 1920-1933. Ratification
of the Eighteenth Amendment in 1919 granted concurrent
jurisdiction to the United States and the Union of several States
party to the Constitution to enforce laws relating to
intoxicating liquors:
Amendment XVIII [1919]
Section 1. After one year from the ratification of this
article the manufacture, sale, or transportation of
intoxicating liquors within, the importation thereof into,
or the exportation thereof from the United States and all
territory subject to the jurisdiction thereof for beverage
purposes is hereby prohibited.
Section 2. The Congress and the several States shall have
concurrent power to enforce this article by appropriate
legislation.
The Eighteenth Amendment specifically provided for
concurrent State and Federal jurisdiction so far as enforcement
of Section 1 is concerned. However, the Twenty-First Amendment,
ratified in December 1933, eliminated the concurrent jurisdiction
provision so effectively prohibited Federal enforcement of laws
enacted by the several States:
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Amendment XXI [1933]
Section 1. The eighteenth article of amendment to the
Constitution of the United States is hereby repealed.
Section 2. The transportation or importation into any
State, Territory, or possession of the United States for
delivery or use therein of intoxicating liquors, in
violation of the laws thereof, is hereby prohibited.
At the time the Twenty-First Amendment was ratified, United
States enforcement was under 1926 legislation by way of the
Federal Alcohol Control Administration, established by Executive
Order 6474 of Dec. 4, 1933. The 1926 legislation was superseded
by the Federal Alcohol Administration Act of Aug. 29, 1935 (49
Stat. 977), and the Federal Alcohol Administration was to replace
the Federal Alcohol Control Administration. To a certain extent
this was carried out as a director for the Federal Alcohol
Administration was appointed, but the agency itself never really
got off the ground. In December 1935, the United States Supreme
Court, in United States v. Constantine, 296 U.S. 233 (1935),
ruled that repeal of the Eighteenth Amendment eliminated
concurrent Federal jurisdiction relating to intoxicating
beverages in the several States party to the Constitution -- each
State was free to adopt and enforce its own liquor laws without
Federal interference. The Constantine decision effectively
restored the Separation of Powers Doctrine articulated in Article
II of the Articles of Confederation/10 and the Tenth Amendment to
the Constitution of the United States:
____________________
10 The Articles of Confederation, along with the Declaration of
Independence, the Ordinance of 1787: The Northwest
Territorial Government, and the Constitution of the United
States, remains part of the "Organic Laws" of the United
States. See Volume One of the United States Code, 1994
edition, published by the United States Government Printing
Office.
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Article II [Articles of Confederation -- 1777]
Each State retains its sovereignty, freedom and
independence, and every power, jurisdiction and right, which
is not by this confederation expressly delegated to the
United States, in Congress assembled.
Amendment X [Constitution of the United States -- 1791]
The powers not delegated to the United States by the
Constitution, nor prohibited by it to the States, are
reserved to the States respectively, or to the people.
In the body of the Constitution, Congress is authorized only
"To provide for the Punishment of counterfeiting the Securities
and current Coin of the United States," and at Article III,
Section 3.2, "... to declare the Punishment of Treason," but even
where these crimes allegedly occur in one of the several States
party to the Constitution, "The trial of all Crimes, except in
Cases of Impeachment, shall be by Jury; and such Trial shall be
held in the State where the said Crimes shall have been
committed..." There is no grant of Federal police powers or civil
enforcement authority in the several States; State judicial
authority is undisturbed within territorial borders of the State
save on Federal enclaves where jurisdiction is ceded to the
United States.
At Article I, Section 8.10, the Constitution grants Congress
authority to define and punish piracies and felonies committed on
the high seas, and offenses against the law of nations (the "Law
of Nation" described in 1787 is not the present "private
international law" accommodated by courts of the United States,
but is basically common law recognized by Christian nations at
the time), and to regulate civil government and the military
(Article I, Section 8.14).
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At Article I, Section 8.15, Congress is empowered, "To
provide for calling forth the Militia to execute the Laws of the
Union, suppress Insurrection and repel Invasions," but so far as
application to the several States party to the Constitution is
concerned, this section must be read in conjunction with Article
IV, Section 4:
Section 4. The United States shall guarantee to ever State
in this Union a Republican Form of Government, and shall
protect each of them against Invasion; and on Application
of the Legislature, or the Executive (when the Legislature
cannot be convened) against domestic Violence.
Several amendments ratified subsequent to the Civil War
extend congressional authority with respect to voting and civil
rights violations relating to "citizens of the United States".
For example, the Fourteenth Amendment (1868), provides in Section
1 that, "No State shall make or enforce any law which shall
abridge the privileges or immunities of citizens of the United
States; nor shall any State deprive any person of life, liberty,
or property, without due process of law; nor deny to any person
within its jurisdiction the equal protection of the laws."
Section 2 of the Amendment protects "citizen of the United
States" voting rights. Section 5 provides, "The Congress shall
have power to enforce, by appropriate legislation, the provisions
of this article."
The Fifteenth Amendment (1870), again with reference to
"citizens of the United States", provides that, "The right of
citizens of the United States to vote shall not be denied or
abridged by the United States or by any State on account of race,
color, or previous condition of servitude." Section 2 of the
Amendment stipulates, "The Congress shall have power to enforce
this article by appropriate legislation."
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The Nineteenth Amendment (1920), addresses voting rights for
women: "The right of citizens of the United States to vote shall
not be denied or abridged by the United States or by any State on
account of sex." The second portion of this Amendment, which
evidently is not formally divided into section, provides,
"Congress shall have power to enforce this article by appropriate
legislation."
The Twenty-Fourth Amendment (1967) also addresses voting
rights, and Congress is empowered to make appropriate laws:
Amendment XXIV [1964]
Section 1. The right of citizens of the United States to
vote in any primary or other election for President or Vice
President, for electors for President or Vice President, or
for Senator or Representative in Congress, shall not be
denied or abridged by the United States, or any State by
reason of failure to pay any poll tax or other tax.
Section 2. The Congress shall have power to enforce this
article by appropriate legislation.
Finally, the Twenty-Sixth Amendment addresses voting rights:
Amendment XXVI [1971]
Section 1. The right of citizens of the United States, who
are eighteen years of age or older, to vote shall not be
denied or abridged by the United States or by any State on
account of age.
Section 2. The Congress shall have power to enforce this
article by appropriate legislation.
Congress' constitutionally delegated authority so far as
what might be considered crimes within the several States party
to the Constitution are concerned is thus limited by that which
is specifically articulated above: (1) Congress may prescribe
punishment for counterfeiting securities and current coin of the
United States, (2) Congress may prescribe punishment for treason,
(3) Congress may enforce the civil rights (privileges, immunities
and due process assurances) of "citizens of the United States",
and (4) Congress may prosecute violations of "citizen of the
United States" voting rights. However, Article I, Section 8.15
does not grant Congress authority to exercise civil police powers
in the several States party to the Constitution:
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[The Congress shall have Power] To provide for calling forth
the Militia to execute the Laws of the Union, suppress
Insurrection and repel Invasion.
Theoretically, the United States could enforce "income tax"
laws under authority of the Sixteenth Amendment:
Amendment XVI [1913]
The Congress shall have power to lay and collect taxes on
incomes, from whatever source derived, without apportionment
among the several States, and without regard to any census
or enumeration.
However, as already demonstrated, the original income tax
levied approximately simultaneous with promulgation of the
Sixteenth Amendment was thoroughly battered from 1916 through
1920 (see notes for Congressional Record -- House, for March 23,
1943, supra), so by way of the Internal Revenue Act of Nov. 23,
1921, Federal income and excise taxes were shifted from Congress'
Article I delegated authority relating to the Union of several
States to Congress' Article IV, Section 3.2 legislative authority
in United States territorial jurisdiction. The normal tax and
surtax prescribed in Article II of the 1921 Act, per definition
in the Congressional Record supra, were also classified as excise
rather than direct taxes as the wage or salary derived from
"United States trade or business" (performance of the functions
of public office) constitutes the measure, not the subject of the
tax.
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With the Constantine decision following repeal of the
Eighteenth Amendment supra, Federal revenue enforcement authority
with respect to the several States party to the Constitution was
effectively at an end. By way of Reorganization Plan No. III of
1940, the Federal Alcohol Administration was abolished and
functions of the Administration were merged under authority of
the Bureau of Internal Revenue, Puerto Rico.
The solid link in IRS lineage is reflected in a note on page
794 of The United States Government Manual, 1995/96 edition:
Alcohol Control Administration, Federal
Established by EO 6474 of Dec. 4, 1933. Abolished Sept. 24,
1935, on induction into office of Administrator, Federal
Alcohol Administration, as provided in act of Aug. 29, 1935
(49 Stat. 977). Abolished by Reorg. Plan No. III of 1940,
effective June 30, 1940, and functions consolidated with
activities of Internal Revenue Service.
As previously noted, the Internal Revenue Service did not
exist until the name of Bureau of Internal Revenue was changed
via T.O. 150-29 (1953). Functions of the Federal Alcohol
Administration merged with those of the Bureau of Internal
Revenue pertained to the Federal Alcohol Administration Act,
which due to the Constantine decision in December 1935, was
construed as not enforceable in the several States party to the
Constitution due to repeal of the Eighteenth Amendment. In 1953,
the name of Bureau of Internal Revenue was changed to Internal
Revenue Service, then by way of Treasury Department Order No.
221, effective July 1, 1972, "functions, powers, and duties
arising under laws relating to alcohol, tobacco, firearms, and
explosives [were transferred] from the Internal Revenue
Service..," to the Bureau of Alcohol, Tobacco and Firearms./11
____________________
11 The United States Government Manual, 1995/96 edition, page
462.
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The fact that BATF still administers the Federal Alcohol
Administration Act, merged under administration of the Bureau of
Internal Revenue, Puerto Rico, via Reorganization Plan No. III of
1940, is verified at 27 CFR, Part 1.1:
Sec. 1.1 General
The regulations in this part relate to requirements
governing the issuance, amendment, denial, revocation,
suspension, automatic termination, and annulment of basic
permits and the duration of permits, except that the
provisions of part 200, Rules of Practice in Permit
Proceedings, of this chapter are hereby made applicable to
administrative proceedings with respect to the application
for, and to the suspension, revocation, or annulment of,
basic permits under the Federal Alcohol Administration Act.
[emphasis added]
The hard link between IRS, BATF and the Department of the
Treasury, Puerto Rico, is further verified by way of definitions
at 27 CFR, Part 250.11:
Revenue Agent. Any duly authorized Commonwealth Internal
Revenue Agent of the Department of the Treasury of Puerto
Rico.
Secretary. The Secretary of the Treasury of Puerto Rico.
Secretary or his delegate. The Secretary or any officer or
employee of the Department of the Treasury of Puerto Rico
duly authorized by the Secretary to perform the function
mentioned or described in this part.
Distinction between Treasury Department and Department of
the Treasury authority is at this point reasonably easy to
demonstrate. By definition of the Secretary's delegate at IRC
7701(a)(12), it is found that the Treasury Department is
responsible for administering Internal Revenue Code taxing
authority so far as the Continental United States is concerned:
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(12) Delegate.
(A) In general. The term "or his delegate" -- (i) when used
with reference to the Secretary of the Treasury, means any
officer, employee, or agency of the Treasury Department duly
authorized by the Secretary of the Treasury directly, or
indirectly by one or more redelegations of authority, to
perform the function mentioned or described in the context;
and (ii) when used with reference to any other official of
the United States, shall be similarly construed.
[emphasis added]
The Treasury Department also has specific Code authorization
at Section 7805:
Sec. 7805. Rules and regulations.
(a) Authorization.
Except where such authority is expressly given by this title
to any person other than an officer or employee of the
Treasury Department, the Secretary shall prescribe all
needful rules and regulations for the enforcement of this
title, including all rules and regulations as may be
necessary by reason of any alteration of law in relation to
internal revenue.
[emphasis added]
The arms-length relationship between the Department of the
Treasury and the Treasury of the United States is demonstrated at
2 U.S.C. 64-3:
Sec. 64-3. Reimbursement for Capitol Police salaries paid by
Senate for service of Federal Law Enforcement Training
Center
Notwithstanding any other provision of law, the Secretary of
the Senate is authorized to receive moneys from the
Department of the Treasury as reimbursements for salaries
paid by the United States Senate in connection with certain
officers and members of the United States Capitol Police
serving as instructors at the Federal Law Enforcement
Training Center. Moneys so received shall be deposited in
the Treasury of the United States as miscellaneous receipts.
[emphasis added]
It is convenient at this point, with the three historical
lines pertaining to United States internal revenue laws and
excise taxes merged, and clear distinction between the Department
of the Treasury, Puerto Rico and the Treasury of the United
States clarified, to view a graphic depiction of Department of
the Treasury organization. A Department of the Treasury
organization chart appears on page 458 of The United States
Government Manual, 1995/96 edition.
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This chart is organized with the Secretary of the Treasury
at the top with the Deputy Secretary immediately below. There is
then a short downward line from the Deputy Secretary to a
horizontal line which stretches from left to right most of the
way across the page. Immediately to the right of the vertical
line from the Deputy Secretary, the first down line below the
long horizontal line depicts authority of the Under Secretary for
Enforcement. This line of authority goes through the Assistant
Secretary (Enforcement), to four Department of the Treasury
components (Treasury Bureaus): the Bureau of Alcohol, Tobacco
and Firearms, U.S. Customs Service, U.S. Secret Service, and the
Federal Law Enforcement Training Center.
It is unnecessary in this context to document the lineage of
the U.S. Customs Service and U.S. Secret Service, but both of
these entities are also agencies of the Department of the
Treasury, Puerto Rico, they are not formally part of the United
States Government so far as United States Government operates
within the framework of Congress' constitutionally delegated
authorities pertaining to the several States party to the
Constitution. The original Bureau of Customs created by Congress
was abolished then re-established as the United States Customs
Service in the Department of the Treasury, Puerto Rico, in much
the fashion the Federal Alcohol Administration was abolished and
functions eventually taken over by BATF; the United States
Secret Service emerged from the Capitol Police -- authority has
never extended to the several States party to the Constitution.
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The Internal Revenue Service is not listed among the bureaus
vested with Department of the Treasury enforcement authority. IRS
has no enforcement authority in the several States party to the
Constitution or anywhere else when operating in the agency's own
capacity. This is verified by following the long horizontal line
near the top of the chart to the third down line to the right of
the Under Secretary for Enforcement. At the bottom of this line,
IRS is found depicted as a stand-alone bureau.
Obviously, some loop-hole is used to justify IRS
administrative and judicial initiatives. This is found at IRC
7327:
Sec. 7327. Customs laws applicable.
The provisions of law applicable to the remission or
mitigation by the Secretary of forfeitures under the customs
laws shall apply to forfeitures incurred or alleged to have
been incurred under the internal revenue laws.
The Parallel Table of Authorities and Rules lists two
regulations for IRC 7327 and other statutes in Part II of Chapter
75: 26 CFR, Part 403 & 27 CFR, Part 72. The 27 CFR, Part 72
regulation authorizes BATF to administer customs laws