Time: Wed Mar 19 08:24:13 1997 by primenet.com (8.8.5/8.8.5) with ESMTP id HAA02113; Wed, 19 Mar 1997 07:12:34 -0700 (MST) by usr02.primenet.com (8.8.5/8.8.5) with SMTP id HAA05419; Wed, 19 Mar 1997 07:12:25 -0700 (MST) Date: Wed, 19 Mar 1997 08:23:21 -0800 To: (Recipient list suppressed) From: Paul Andrew Mitchell [address in tool bar] Subject: SLS: [TL] How to Stop Withholding (fwd) Content-Transfer-Encoding: 8bit <snip> >HOW I STOPPED MY EMPLOYER FROM WITHHOLDING INCOME TAXES > >by "J. Otis" > >[Editor: The following was published in the October, 1994 >issue of "Terra Libra News." It's an example of someone >working in a major corporation successfully persuading >his employer to stop withholding. > >It's also an example of applying Freedom Technology in >a sensible manner. Particularly important are the steps >taken by Mr. 'Otis' to minimize the risk that terrocrats >(terrorist bureaucrats or coercive government agents) >will retaliate against him.] > >[Author's Note: The approach I'm using is based on the book >"Vultures in Eagles Clothing." For information to order >this book, contact Terra Libra. I use the nom de guerre >of "J. Otis" in honor of James Otis, the Colonial attorney >who argued so well against the Stamp Act and other abuses >of the Crown.] > >[Editor: To order "Vultures in Eagles Clothing," visit Robert >Cohen's Website at http://members.aol.com/KCohen4444/fasthome.htm. >This site contains a wealth of Freedom Technology, as well as >some recommended changes to the form letters provided by Lynne >Meredith in "Vultures in Eagles Clothing." Both Robert Cohen's >and Lynne Meredith's businesses are examples of "Sovereign >Businesses," not subject to terrocrat "jurisdiction." They >are also examples of how to make money promoting freedom.] > >Introduction >------------ >I am a computer specialist and an independent sub-contractor, >who works through a contract programming firm (for purposes >of this article, I have fictionalized my company's name to >"CompuProTech, Inc."). My odyssey through the Internal >Revenue Code began seven months ago, when I was looking for >ways, as a self-employed person, to minimize my tax liability. > >I read books by "experts," attended seminars by more "experts" >and (in the words of Omar Khayyam) "came out by the same door >as in I went," no wiser than before. So, I decided to take >the plunge and research the Code myself. > >As I did so, I noticed some strange things. Many definitions >of terms in the §7700 section of the code seemed to be circular, >and some important terms were not actually defined in the >current editions of the Code. As I tried to do a "flow trace" >of the definitions in the Code, it began to remind me of many >30-year old "spaghetti" COBOL programs I often have to debug. > >About that time, I received my first set of Terra Libra reports, >which suggested that I may not be liable for the income tax at >all. I sent for "Vultures in Eagle's Clothing," the excellent >and comprehensive book by Lynne Meredith. After I read the book, >I understood the Code in the context of relevant Supreme Court >cases and other Titles of the U.S. Code. Based on that book and >my previous research, I concluded that I, as a sovereign Citizen >of one of the 50 states and a non-Governmental employee, am not >legally liable for the 26 USC (A) §1 graduated income tax. > >Risk and Reward >--------------- >Now, I had a decision to make. If I had my own business, I could >simply file my Affidavit of State Citizenship, stop paying taxes, >cease filing 1040 returns, and wait to see if the IRS bothered to >notice. However, since I had taxes withheld from my paycheck, >that option was not readily available to me. I was warned, in >Terra Libra reports and verbally, of the risks facing me if I >took a high-profile approach. As one person said, "The law is >on your side, but the guns are on the IRS's side!" > >After much soul-searching, I decided to file exemption certificates >with my company and to accept whatever risk came with that decision. >There are several reasons why I decided to do so. First, while I >do not believe in boxing lightning with my fists, neither do I >believe in skulking around like a criminal in the exercise of my >rights. As Emerson said, "I cannot consent to pay for a privilege >where I have intrinsic right." > >Furthermore, the experience of my father's life, and of my own, >has convinced me that one does not necessarily purchase safety >by "keeping one's nose clean" and "staying out of trouble." >My father tried that, and it did not protect him from career >reversals in late middle age. More recently, I was "downsized" >out of a job shortly after receiving a superior performance >review and a large merit pay raise. > >I have learned a fundamental truth, which has penetrated to the >marrow of my bones. The truth is that there is no safety in >life, that "security" is an illusion, and that we lose our souls >in the search for it (for an excellent discussion of this idea, >see "The Wisdom of Insecurity" by Alan Watts). Indeed, the most >secure people I know are those who know their rights, who have >discovered their personal power, and who are prepared to stand >upon both. > >How I Succeeded >--------------- >Having made my decision, I filed a "Commercial Affidavit" >asserting State Citizenship and Sovereignty at my local county >courthouse. I then filed a W-8 form (Certificate of Foreign >Status), a "Statement in Lieu of W-4" and other forms documenting >my exempt status with my company. > >After one pay cycle, I noticed that taxes were still being >withheld from my pay. I telephoned my company's payroll >department, and discovered that my paperwork had been sent >to the Legal Department. I called that office, and found that >the lawyers were utterly confused by my documents. Evidently, >they were flummoxed by the W-8 form. "Why," they asked, "is >he claiming 'foreign status' when he is an American?" I >responded to them with the following letter: > >"Dear Sirs, > >"The purpose of this letter is to answer your concerns about >the truth of my sworn statements regarding withholding status >for tax purposes. You may verify the above by sending the >enclosed letter, copies of all of my documentation and the >attached Affidavit of Authority and Indemnity to the Internal >Revenue Service Center (via certified mail, return receipt >requested). The cover letter invokes the legal doctrines of >"clean hands" and "estoppel by acquiescence," thus providing >CompuProTech, Inc. with legal protection from any possible >IRS retaliation. > >"Since the IRS has no legal authority to require you to >continue to withhold from my paycheck, you should expect no >response to the letter. However, IF YOU DO RECEIVE either >the attached Affidavit, or any other correspondence from >the IRS, demanding that you continue to withhold taxes from >my paycheck, please forward a copy to me. I will show any >such letter to the U.S. Attorney. Depending upon its contents, >I will file criminal charges against the IRS Agent who signs >it, including (but not necessarily limited to) 26 USC §7214 >and 18 USC §241 and §242 for felony perjury, theft by >deception, fraud by inducement, material misrepresentation, >duress, coercion, violation of civil rights, malfeasance of >office under color of law and extortion using the mail system. >Contrary to popular misconceptions, there is ABSOLUTELY, >POSITIVELY NO LEGAL IMMUNITY for any IRS Agent who commits >perjury or acts outside the scope of his/her authority. > >"In closing, let me state that I both sympathize, and >absolutely concur, with your desire to obey all applicable >Federal laws and regulations. The burden of my argument is >that the 26 USC (A) §1 graduated income tax DOES NOT APPLY TO >ME. I am fully prepared to defend my position, under oath, >before any judge and jury in America. Meanwhile, I will do >everything within my power to protect the legal position of >CompuProTech, Inc. > >"If I can be of further assistance, please contact me. > >"Sincerely, > >'J. Otis'" > >The "enclosed letter" and the Affidavit of Authority and >Indemnity (referred to above) were modeled after those in >"Vultures in Eagles Clothing." I also enclosed a copy of >my Commercial Affidavit, a two-page summary of my legal >arguments (following this article, on page 11), and a six- >page Memorandum of Facts, Points of Law and Authorities, >providing ample documentation of my legal position. > >Results >------- >Three days later, I received the following letter from >my company's Legal Department: > >"Dear 'Mr. Otis,' > > "Re: IRS Withholding Exemption Certificate >"Please be advised that in accordance with Internal Revenue >Code Regulation Section 31.3402(n)-1, CompuProTech, Inc. >will not deduct and withhold any tax under Chapter 24 of >the Code from your wages as requested by you pursuant to >your Withholding Exemption Certificate dated July 24, 1994. >You should also be aware that, as required by IRC Regulation >Section 31.3402(f)(2)-1(g), CompuProTech, Inc. will forward >to the Internal Revenue Service your Withholding Exemption >Certificate together with a copy of all written statements >received by CompuProTech, Inc. from you in support of the >claims made by you on the certificate. > >"If you have any questions regarding this matter, you may >contact our office at (###) ###-####. Thank you. > >"Sincerely, > >'P. Mason,' >Associate General Counsel" > >As the letter stated, corporations must routinely send >Withholding Exemption Certificates to the IRS on a quarterly >basis along with their Form 941 reports. Therefore, study >the law and be thoroughly prepared before you act! > >Following Through >----------------- >To further secure my legal position, I have obtained opinion >letters from attorneys and CPAs supporting my status as a >non-taxpayer. In addition, I am taking the prudent step of >protecting my assets from illegal seizure. > >[Editor: Obtaining legal opinion letters from licensed CPAs >and attorneys is an extremely important and powerful aspect >of strategy for dealing with IRS and other terrocrats. It's >called the "Reliance Defense." It's a well-established legal >principle, confirmed by many courts, including the US Supreme >Court, that if you act in accordance with the legal advice of >licensed attorneys and CPAs, you cannot be guilty of crimes >such as "wilfull" failure to file. The Reliance Defense greatly >reduces legal risk. See "Report #TL16G: The Reliance Defense" >on the Free World Order Website at http://www.buildfreedom.com. >The Reliance Defense doesn't stop terrocrats from taking civil >action. > >Above, Mr. 'Otis' refers to "taking the prudent step of >protecting my assets from illegal seizure." This is to protect >against terrocrats taking "civil" action like stealing his car, >his home, the contents of his bank accounts, etc. The basic >principle is to own nothing the terrocrats would want to steal. >For more information on how to do this, contact Asset Protection >Services, 3531 W. Glendale Ave, #205, Phoenix, AZ 85051. Phone: >602-336-4780. Fax: 602-336-0625. Email: trusts@amug.org. Website: >http://www.amug.org/~trusts.] > >Further, I have filed with the IRS a Freedom of Information >Act request for all files they have on me. I am aware that >there are certain codes in their files which indicate whether >or not one is liable for the graduated income tax. (Hint: >Code MFR-01 means you are not required to make or file a >return). If the IRS ever decides to take me to court, those >codes would be powerful legal ammunition. > >[Editor: There have been many cases where the IRS terrocrats >have prosecuted a tax victim for not filing, even though >in their computer system they had classified the victim as >"not required to file."] > >Also, I have applied, to the IRS, for a refund of my last >three years' income taxes via 1040X returns. At best, I >will get my money back, and, at worst, I have forestalled >any threat of an audit of past tax returns. If the IRS >wants to audit my 1040X returns, let them! They won't be >able to disallow them, as the law is on my side. > >In the same envelope, I also served the IRS with a true copy >of my Commercial Affidavit and my legal Memorandum. I have >given the agency 30 days to respond, after which the doctrine >of estoppel by acquiescence prevails. I have yet to hear >from the IRS. We shall see what happens. > >A Broader Perspective >--------------------- >Obviously, we all want (and have the right) to keep the >fruits of our labor. Clearly, no person or institution has >the right to deprive us of them without our consent. However, >to me, there are other considerations involved. > >The income tax, and the welfare system it supports, assume >that adult citizens are neither generous nor mature enough to >voluntarily help others. The system operates on the Calvinist >assumption that people will not do what is right unless the >government cocks a pistol to their heads. > >My own experience is very different. I have observed that >psychologically secure and personally powerful people are >also loving and generous people. They help others because >that is how they feel; that is the way they want to be and act. >Such people think in terms of surplus and not scarcity. >Whatever they give is not lost, because they can always >replenish what they give by their own productive efforts. > >The New Testament says that "perfect love casts out fear." >I don't know if that is true, but I do know that the reverse >is true. People who are fearful, anxious and self-absorbed >cannot love others impartially. Mature and powerful people >give help where it is needed, and also creatively work for >the betterment of their society. It is only the needy, >dependent and immature who are stingy and ungenerous. >I have decided that, as an adult, I do not need the >government to extort money from me or to decide, on my >behalf, who deserves my help. I am mature enough to make >those decisions on my own. Accordingly, I have started >tithing 10 percent of my salary to worthy causes of my own >choosing. Why did I choose 10 percent as a figure? It is >a traditional proportion, and it is a place to start. Over >time, I will review my giving patterns, and adjust my giving >to reflect my values and the changing needs of myself and >others. > >There is an additional perspective that I consider helpful. >I recently attended a retreat where, with other participants, >we explored the concept of "selfless service." The conference >leader expressed it as "the soul 'on-call." The idea is that >we stand ready to offer service, help and/or assistance as the >situation requires it. This is very different from ego-driven >anxieties about being a "bad person" if one does not help. It >is also different from "reform" movements, which are usually >driven by infantile "magical thinking" and unconscious drives >toward domination and control over others. > >A Biblical example of "selfless service" is the New Testament >parable of the Good Samaritan. In the story, the Samaritan >was not running around, looking for lost wretches to help. >He was going about his affairs, when he noticed a man bleeding >by the roadside. He rendered assistance, saw to it that the man >was properly cared for, and went along his way. The Samarita >simply did what he had to do because it needed to be done. > >My own experience tells me that, as we grow older and leave >youthful anxieties, insecurities and ego-compensations behind, >we naturally grow toward "selfless service." For this, we do >not need "hell and sin" preaching, and we surely don't need 30 >to 40 percent of our salary stolen from us! > >Conclusion >---------- >If you are currently working for (or through) someone else, >you can get withholding legally stopped. You will have to do >your homework, and you must be prepared to explain your >arguments to your employer, concisely and understandably. >Indeed, if you cannot explain your position to someone else, >that may be a hint that you do not understand it yourself! > >If you choose to do as I have done, you must be psychologically >and spiritually prepared to stand upon your rights. To me, it >is essential to have a sound philosophy of life, so that you >can keep things in proper perspective. > > >SUMMARY LETTER TO PERSUADE EMPLOYER TO STOP WITHHOLDING > >by "J. Otis" > >[Note: This summary letter is not a "stand-alone" letter. >Anyone using it should be sure to attach to it their affidavits >and all other legal citations, so that their position cannot be >dismissed as "frivolous." This letter is an "executive summary" >which explains the essence of the matter, so that the recipient >does not have to plow through 20 pages of dense legal >argumentation to understand it. This letter worked for me and >I offer it to others who may need it.] > >[Your name] >[your address] > >[Date] > >[Your company's name] >[company's address] > >Subject: Summary of Legal Arguments Regarding Withholding Status > >To whom it may concern, > >The purpose of this letter is to summarize and explain, as >concisely as I can, the legal arguments supporting my claim >to be exempt from the 26 USC Subtitle A §1 graduated income >tax. Attached to this letter are all of the case law and >statutory citations needed to substantiate my claims. My >argument can be reduced to the following: > >* The 26 USC Subtitle A, §1 graduated income tax applies >only to Federal employees and residents of Federal enclaves. > >* The Sixteenth Amendment gave Congress no new power of >taxation. Further, the U.S. Supreme Court has repeatedly >defined "income" as gain severed from capital. > >Words of Art >------------ >As you may know, a statute must contain definitions of >important words and terms; otherwise, it is "void for >vagueness." In a statute, a word means precisely what >the statute says that it means. A word, in a statute, >can have a meaning very different from the "plain English," >common-sense meaning of the same word. In legal parlance, >such specially defined words are called "words of art." In >the attached documentation, I list many of the "words of >art" used in the Internal Revenue Code. Suffice it to say >here, that if words like "state," "individual," etc. meant >in Title 26 what they mean in ordinary English, the whole >statute would be blatantly unconstitutional. Title 26 is >constitutional, because these terms have been redefined as >"words of art," so as not to run afoul of the Constitution >and case law. Most of these definitions are contained in >Title 26 itself, but some are contained in previous editions >of the Internal Revenue Code, or in other Titles (Titles 4 >and 5 being prominent examples). > >Another thing to remember is that the word "include," in >statutory construction, means only those things referred >to, unless the words "including, but not limited to" are >used. > >Federal jurisdiction >-------------------- >As we will remember from our civics classes, the Constitution >gave Congress exclusive, absolute jurisdiction over Federal >territories, including Washington, D.C. The U.S. Supreme >Court has ruled that Congress is not bound by the Constitution >when legislating for these areas (see Hooven v. Evatt 324 U.S. >674). What many of us do not realize is that, by signing 1040 >forms and Social Security applications, we unwittingly declare >ourselves "Federal citizens" subject to the untrammeled >authority of Congress. Since nobody told us this when we >signed these documents, we may, at common law, legally rescind >all such signatures on grounds of constructive fraud and non- >disclosure of pertinent facts. I have done so in my Affidavit. > >Also, if you enter a plea in Federal Court, you are placing >yourself under the jurisdiction of that court, whether you >really belong there or not. > >Because of the way "words of art" are defined in Title 26, >anyone not living in Washington, D.C. or a Federal territory >or enclave is a "foreign person" and a "non-immigrant, non- >resident alien" for purposes of the Title. This does not mean >that one was born in another country, or lives abroad. It >means that one is not a "Federal citizen." After all, the >states are "foreign" to one another and to the Federal >government (see Black's Law Dictionary). That is why I filed >a W-8 form with you. That is also why I filed a statement >"In Lieu of W-4." The W-4 is the wrong form for non-Federal >citizens, and the IRS will impose a $500 fine upon those who >use it to claim EXEMPT status. > >The 16th Amendment >------------------ >Doubtless, you were also taught in your government-controlled >schools that the 16th Amendment gave Congress the power to >lay a direct, unapportioned tax upon compensation for labor. >That is dead wrong. I am sorry to have to attack well- >established belief systems, but the facts "are what they are." >The U.S. Supreme Court has repeatedly ruled that the 16th >Amendment conferred no such power. After all, the 16th >Amendment did not specifically repeal the original taxing >clauses of the Constitution, and the Constitution cannot >contradict itself! Therefore, the Court has ruled that the >Amendment was simply a "perfecting" amendment (see Brushaber >v. Union Pacific Railroad Co. 240 U.S. 1). Further, the Court >has also repeatedly ruled that compensation for labor in the >50 states is property upon which an "excise tax" cannot be >imposed (see Eisner v. Macomber 252 U.S. 189). > >Once again, none of these rulings apply within Federal >territories. To repeat: the 26 USC (A) §1 graduated income >tax is constitutional because it is limited to "Federal >citizens" and "Federal areas" where Congress is not bound by >the Constitution and may legislate as it pleases. > >"State" vs. state >----------------- >Just as there are two "United States," so there are two of >every state. The Buck Act (incorporated in Title 4 USC) >redefined "the States" as "words of art" to include (only) >Federal enclaves within the 50 states, legally ceded by the >state legislatures to the Government. So, when the Internal >Revenue Code says that such-and-such a provision applies to >"all the States," it is right! What most people don't realize >is that this does not mean North Carolina, California, etc. -- >it means "Federal enclaves within the 50 states." > >Conclusion >---------- >If you are somewhat confused after reading this for the first >time, do not feel bad. Confusion is the normal response to new >information that challenges one's fundamental view of reality. >Yes, I know; my arguments directly contradict everything you >were ever taught. The largest obstacle is not legal but >psychological. However, in law, FACT and TRUTH are sovereign, >and, in the end, all opposition (legal, psychological or >otherwise) must yield to their resistless sway. > >I hope this summary and enclosed memorandum help you better >understand the legal action I have taken. If I can be of >further assistance, please contact me either by mail or at >my daytime telephone (###) ###-####. > >Sincerely, > >[signature] > >[Editor: For expert assistance in dealing with IRS terrocrats, >you may want to contact American Rights Litigators, 2390 Old U.S. >Highway 441, #3, Mt. Dora, FL 32757. Phone: 352-383-9100. Fax: >352-383-0808. Email: arl@iag.net.] > >--------------------------------------------------------- >"The [one] who knows what freedom is will find >a way to be free" -- Robert LeFevre > >"The Fountains of Freedom have many Sources >and run along many Tributaries and Streams >into the Ocean of Liberty" -- Frederick Mann. > >Free World Order Website -- http://www.buildfreedom.com > >Subscribe to the FWO List Server by sending a message >to fwolist@sportsmen.net with the word SUBSCRIBE in the >subject/topic field. >--------------------------------------------------------- > > ======================================================================== Paul Andrew, Mitchell, B.A., M.S. : Counselor at Law, federal witness email: [address in tool bar] : Eudora Pro 3.0.1 on Intel 586 CPU web site: http://www.supremelaw.com : library & law school registration ship to: c/o 2509 N. Campbell, #1776 : this is free speech, at its best Tucson, Arizona state : state zone, not the federal zone Postal Zone 85719/tdc : USPS delays first class w/o this ========================================================================
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