Tax protester conspiracy arguments

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Tax protesters
History Arguments Constitutional Statutory Conspiracy Notable tax protesters Robert Clarkson - Vivien Kellems Mitch Modeleski - Irwin Schiff Richard Michael Simkanin William J. Benson Wayne C. Bentson Related topics The Law That Never Was Cheek v. United States Titles of Nobility Amendment Tax avoidance and tax evasion Tax resistance Christian Patriot Posse Comitatus
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Tax protester conspiracy arguments are arguments raised by tax protesters that assert that the imposition of the income tax in the United States is the result of some kind of illicit conspiracy. Such arguments generally claim that all branches and levels of the government are part of a scheme to illegally deprive tax protesters of a portion of their income, but that this scheme is illegal based on some set of unprovable facts about the nature of the government, secret documents purported to have been destroyed generations ago, and appeals to quasi-legal sounding assertions.

These kinds of arguments are distinguished from related constitutional arguments and statutory arguments. Those arguments attempt to show that the income tax is contrary to a correct interpretations of the Constitution or statutes. Supporters of such arguments may contend that constitutional and conspiracy arguments apply as well, and raise conspiracy arguments to explain how and why every branch of the United States government nonetheless permits the collection of supposedly illegal taxes.

1 Conspiracy arguments, in general
2 Conspiracy theory regarding government employees and tax forms
3 Arguments about money
4 Notes
5 External links

[edit] Conspiracy arguments, in general

Tax protester Irwin Schiff, following his criminal conviction for tax fraud that resulted in the imposition of a 13-year prison sentence, released a statement asserting in part that "the entire federal judiciary is involved in a monumental, criminal conspiracy to collect income taxes in violation of law". As of late 2006, Schiff's internet web site continues to state: "Since the income tax was repealed in 1954 when Congress adopted the 1954 Code, it is clear that for 50 years federal judges in conspiracy with U. S. Department of Injustice prosecutors have been illegally and criminally prosecuting people for crimes that do not exist in connection with a tax that nobody owes."^[1]

One tax protester web site, called www.tax-freedom.com, quotes from an article by William Cooper entitled "BATF/IRS - Criminal Fraud", from a publication called Veritas (issue no. 6, September 1995), as follows:

Investigation of the alleged Internal Revenue Service and the Bureau of Alcohol, Tobacco and Firearms has disclosed a broad, premeditated conspiracy to defraud the Citizens of the United States of America. Examination of the United States Code, the Code of Federal Regulations, the Statutes at Large, Congressional Record, the Federal Register, and Internal Revenue manuals too numerous to list, reveals a crime of such magnitude that words cannot adequately describe the betrayal of the American people. What we uncovered has clearly been designed to circumvent the limitations of the Constitution for the United States of America and to implement the Communist Manifesto within the 50 States. Marx and Engels claimed that, in the effort to create a classless society, a "graduated income tax" could be used as a weapon to destroy the middle class. [ . . . ] Through the clever use of language, the government promotes the fraud.[2]

In explaining its numerous court defeats, the tax protester movement relies on a claim of the existence of such a conspiracy involving all federal judges, members of Congress, and executive branch officers from both parties up to the President of the United States. Among the claims made in line with this belief:

Some specific event in U.S. history, such as the Civil War, the Great Depression, or the passage of some national debt threshold, actually caused the United States to cease to exist under the Constitution; all actions in the name of the U.S. government since that event are part of a conspiracy by those in power to retain the appearance of constitutional authority.

The United States never actually achieved independence from England, and secretly continues to operate under British rule.

The government prosecutes only people who are not sufficiently well informed to make the above arguments, and secretly settles with those who are.

The United States Supreme Court grants certiorari only to cases wherein the tax protester has a poorly-defended argument.

The courts rely only on the many cases where tax protesters lost, and ignore those few where tax protesters prevail.

The gold fringe around the American flag, as displayed in many federal courts, designates them as Admiralty courts, which cannot hear other kinds of cases, or signal that the court is operating under martial law. No court has ever upheld this argument, as neither the presence (or absence) of a flag (or of any other element of decor), nor the fringe on a flag (which has no heraldic or vexillological significance), has any bearing whatever on the jurisdiction of a court.

Because the titles of court cases identify the parties in all capital letters, the persons thus identified are "fictitious entities." In other words, a court hearing a case titled "STATE v. JOHN Q. SMITH" has no authority over the defendant, "John Q. Smith" because the capitalization of the name means the court is addressing a person who does not exist. No court has ever upheld such an argument. See, e.g. United States v. Frech^[2]("Defendants' assertion that the capitalization of their names in court documents constitutes constructive fraud, thereby depriving the district court of jurisdiction and venue, is without any basis in law or fact"); United States v. Washington^[3]("defendant contends that the Indictment must be dismissed because 'Kurt Washington,' spelled out in capital letters, is a fictitious name used by the Government to tax him improperly as a business, and that the correct spelling and presentation of his name is 'Kurt Washington.' This contention is baseless"). Similar arguments have been raised unsuccessfully about things such as the presence or absence of a middle name or middle initial.

[edit] Conspiracy theory regarding government employees and tax forms

One group, calling itself "We the People," has stated that government personnel are engaged in a conspiracy in connection with Federal tax forms and "OMB [Office of Management and Budget] control numbers" in connection with a criminal tax case involving a tax protester:

In sum, the PRA [the Paperwork Reduction Act] requires that all government agencies display valid OMB control numbers and certain disclosures directly on all information collection forms that the public is requested to file. [The defendant's] sole defense was he was not required to file an IRS Form 1040 because it displays an invalid OMB control number.

Government officials knew that if the case went to trial, it would expose the fraudulent, counterfeit 1040. They also must have known that a trial would expose the ongoing conspiracy between OMB and IRS to publish 1040 forms each year that those agencies knew were in violation of the PRA. That would raise the issue that the Form 1040, with its invalid control number, is being used by the Government to cover up the underlying constitutional tort -- that is, the enforcement of a direct, unapportioned tax on the labor of every working man, women and child in America.^[4]

[edit] Arguments about money

Some protesters have argued that Federal Reserve notes (better known as dollar bills) are not actually money, because the Constitution only permits the government to "coin" money, and requires that such money be exchangeable for gold or silver; therefore, printed bills are instead symbols for use in bartering, and being paid in dollars is not the receipt of taxable income. This argument was brought before a court in Wilson v. United States^[5]. The court responded:

The contention that paper money is illegal has been consistently rejected. … Congress has exercised this power by delegation to the federal reserve system. 12 U.S.C. section 411. Federal reserve notes are legal tender for all debts, including taxes. 31 U.S.C. section 392 [now 31 U.S.C. § 5103]; Milam v. U.S. 524 F.2d 629 (9th Cir. 1974). The United States Constitution, art. 1, section 10, 'prohibits the states from declaring legal tender anything other than gold or silver, but does not limit Congress' power to declare what shall be legal tender for all debts.' U.S. v. Rifen, 577 F.2d 1111, 1112 (8th Cir. 1978). Since Congress has done so, there can be no valid challenge to the legality of federal reserve notes. United States v. Anderson, 584 F.2d 369, 374 (10th Cir. 1978).

The argument about whether Federal reserve notes are "money" also ignores the essence of the income tax, which is imposed on "income from whatever source derived," not merely on the receipt of "money."

Other occasionally encountered arguments from tax protesters include the notion that U.S. currency is valueless or unauthorized by the Constitution because the currency is fiat money untied to the gold standard. No court has upheld the validity of that argument.