Subject: Title 26 must be repealed Comment: Connie Mack III, Chairman July 26, 2005 President’s Advisory Panel on Federal Tax Reform 1440 New York Avenue NW Suite 2100 Washington, DC 20220 Subject: Title 26 must be repealed. The following is a letter that I was just forced to send the IRS to avoid an unjust assessment and lien against my retirement. I would like to start with a quote of Congressman Archer in the mid 90's when he headed the Ways and means Committee and was looking for a way to correct IRS abuses. At that time, his committee on tax reform reviewed in detail the possibility of a National Sales Tax to replace the Graduated Income Tax that we still have today because he said on National TV ‘The IRS is so broken that it can’t be fixed. It needs to be uprooted so that it can’t grow back.’ He was correct then, and that statement still holds true today. I think his committee’s recommendations then should be reopened by your panel today and given carful consideration as part of your recommendation to Congress. Senator Roth held televised hearings on IRS abuses in1998 that resulted in the 1998 IRS restructuring and reform act, the backbone of the present tax code. At that time, as a result of those publicly broadcasted hearings, some 1600 IRS agents were placed under criminal investigation. Several years latter, after a new Congress came into session, these investigations were stopped without a single indictment according to newspaper reports! That was a National disgrace. Now, the IRS has managed to alter the tax code, one line at a time to where they are still getting away with their criminal attack on the public with what appears to be immunity from prosecution. This needs to stop and NOW! The following letter to the IRS is self explanatory. The IRS has succeeded in convincing the public that it is operating within the law, when it routinely ignores its own law while totally ignoring the mandates of Congress thus emasculating Congress itself through this total contempt. I submit this letter for your review and the review of every citizen that takes the time to review the comments on your web site so as to encourage others to stand up and say enough is enough. It is time to correct this situation once and for all with the total elimination of USC Title 26, and with it the need for the IRS and the Federal Tax Court. Should your panel fail to convince Congress of the need for this vital change, it will spell the end of our Constitutionally protected right to Due Process that is suppose to be guaranteed all American citizens by the 5th amendment. Everyone in Congress has taken an oath to uphold and defend the Constitution. A vote to retain Title 26 would be a violation of that sacred oath. This should be firmly impressed upon the conscious of every Congressman and Senator in Washington. Every citizen has an obligation to support government through a proper system of taxation, but there is no excuse for trying to protect the IRS. Respectfully submitted, Thomas R. Culley, Retired Police Lieutenant Internal Revenue Service July 26, 2005 Fresno Service Center PO Box 24015 Fresno, CA 93779-4015 Attention: Tax Examiner, name unidentified RE: Letter # 2566(SC/CG) dated 07/11/2005. Dear Mr. Unidentified Tax Examiner, As per your instructions, this is my formal response to your letter according to # 3 therein: you asked for ‘A statement explaining why I believe I am not required to file or information I would like you to consider’ in order for me to avoid an automatic assessment. First let me say that I have always paid all taxes for which I believed myself to be liable and I intend to continue doing so. The reason that you do not have a 1040 from me for the year 2001 is that in the late ‘70s, I was told by an IRS agent, Mr. Scott, in your San Francisco office that taxes on my labor are voluntary; and, that I did not have to volunteer if I chose not to file. I found this rather amazing at the time in that the IRS does an excellent job at misleading the public. Up until then, I too had been mislead to the point where upon hearing this from Agent Scott, I felt compelled to check this out for myself. The first thing I found was that IRS Form 1040 only applies to “nonresident aliens”. The term alien individual means an individual who is not a citizen or a national of the United States. I am a citizen of the United States and a resident of California. Your form 1040 is only for nonresident aliens. I don’t know of any tax for which I am presently liable, but if I am liable , it follows that Form 1040 is not the correct form for me to use. I am a citizen and a resident of California. I am not an alien nor am I a nonresident. So if you expect me to fill out a tax form for taxes upon which I am liable, please properly identify the part of the tax code that makes me liable for tax on my labor and please also identify the correct form for me and send me a copy of it in that I don’t know what to look for nor where to find it. Forcing me to sending in that IRS 1040 form return would be forcing me to use the wrong form for a mandatory enforcement to collect a tax on my labor as would your carrying out your threat to assess me in that I did not assess myself. The 16th Amendment to the Constitution of The United States deals with income tax in a manner that calls for enforcement of collection of tax on one’s labor under the rules of voluntary compliance. Few people would argue against the concept that a compulsory income tax would violate the Constitution's three taxing clauses, The Bill of Rights, and the 16th Amendment --- all of which impose restrictions on the government's power and ability to tax income. The Supreme Court has even ruled in Flora v. United States, 362 U.S. 145, pg 176 that "The IRS' primary task is to collect taxes under a VOLUNTARY compliance system". I didn't volunteer. I am 74 years old and retired. Even after you recognized the withholding of $1799.00 from my retirement, you claim that I owe additional tax on my retirement which was derived from my labor before I retired. As for your computation of the tax you want for the year 2001, the inference is that somehow I must be liable for this tax. You also want interest in the amount of $304.10 and penalties of $571.62. Yet your own income tax code (USC Title 26) has a very comprehensive index in the front that includes a section headed “liability”. That part of the index lists ALL of the kinds of tax for which I might be liable along with the part of the code where I can find and read the law making me liable. There is no mention of any kind of tax on one’s labor in the index. Perhaps there is something I have missed. If so, I demand that you properly identify that part of the IRS code and send me a copy or it. I want to pay all taxes for which I am liable, but I refuse volunteer to pay any tax for which no liability exists. Title 26, IRC 7401 states: No civil action for the collection or recovery of taxes, or of any fine, penalty, or forfeiture, shall be commenced unless the Secretary authorizes or sanctions the proceedings and the Attorney Generalor his delegate directs that the action be commenced. You need a Court Order with a judge’s signature generated from a “civil action” in order for you to lien my retirement. But first you must have cause to assess me. You don’t have cause! Furthermore, the government's own regulations say: Point 1: The federal income tax applies only to one's “taxable income,” not to all income, and the income tax regulations (e.g. 26 CFR §§§§ 1.861-1(a)(1), 1.861-8(a)(1), 1.863-1(c)) clearly show that one's taxable domestic income is to be determined under the rules of 26 USC §§ 861(b) and the related regulations beginning at 26 CFR §§ 1.861-8. (Other sections explain when income from outside of the U.S. is taxable.) Point 2: So why does it matter whether we use those sections to determine our taxable domestic income? Because more than 80 years of statutory and regulatory history prove beyond any doubt that 26 USC §§ 861(b) and 26 CFR §§ 1.861-8 show income to be taxable only when it comes from certain types of international or foreign commerce. In other words, contrary to what ““everyone knows,”” most Americans do not receive taxable income, and do not owe federal income taxes. In determining that I am not liable and that I was not required to send you a IRS form 1040, I was not satisfied with just looking in USC Title 26 to determine if I was liable. I also checked a considerable amount of Case Law. I found SMITH V. RICHERT ET AL., Appellate case # 93-3711, which was decided Sept. 13, 1994 in the 7th Circuit. It was found that the State Circuit Court, the State Court of Appeals, the State Supreme Court, and the Federal District Court in Indiana were reversed regarding the Required Documents Doctrine. It stands today as precedent in every court in America that a taxpayer cannot be compelled to fill out tax forms under penalty of perjury by order of the court. In light of the 16th Amendment to the Constitution, and the Supreme Court rulings on this matter. Voluntary compliance is necessary because as a matter of law a mandate cannot issue. I also found that the Supreme Court has even ruled in Flora v. United States, 362 U.S. 145, pg 176 that "The IRS' primary task is to collect taxes under a VOLUNTARY compliance system". I didn't volunteer, and I won’t volunteer to pay a tax for which I am not liable. i did not assess myself by filing that improper IRS form 1040. After reviewing the above, should you still insist upon assessing me, I will demand a copy of the signed assessment, which is IRS form 17. Treasury Department Directive # 1995 was written by a Commissioner of the Internal Revenue Service, and it states that a "ASSESSMENT - NOTICE and DEMAND" (IRS Form 17) must be issued "which the law clearly contemplates and which the Courts hold to be necessary before the delinquent taxpayer becomes chargeable with penalty and interest". It is my belief that this directive stands as is, having not been amended or rescinded. Please don’t insult my intelligence by sending me a form 17a which is simply a summary of all of the days assessments with no direct reference to who was assessed or why. I will demand a copy of the form 17 assessment itself which is my right. Also, should you decide to assess me, make sure that the Form 17 assessing me is properly signed so that I can proceed against the person that violates me with that assessment. Finally, should you decide to assess me as you threaten, you should keep in mind that I am aware of the recent Appellate Court ruling in Schulz v. IRS, Case No. 04-0196-cv “...absent an effort to seek enforcement through a federal court, IRS summonses apply no force to taxpayers, and no consequence whatever can befall a taxpayer who refuses, ignores, or otherwise does not comply with an IRS summons until that summons is backed by a federal court order……[a taxpayer] cannot be held in contempt, arrested, detained, or otherwise punished for refusing to comply with the original IRS summons, no matter the taxpayer's reasons, or lack of reasons for so refusing.” (emphasis added) Most significantly, the Court held, relying on a 1920 decision by the United States Supreme Court, that the principles of due process apply to all administrative orders. I take that to mean the Court’’s order applies not only to IRS first party summonses, but also to IRS third party summonses, and to IRS levies and liens. Should you decide to assess me, you can not attach my pension or social security without first securing a Court Order signed by a judge of the 9th District Court. In order for you to secure the Judge’s signature, I first must be properly served a notice of the hearing so that I can present appropriate defense. If you skip this step, you will be denying me my right to Due Process. These are the reasons why you do not have a Form 1040 for the tax year 2001. I fully expect a letter from you stating either that you will not be assessing me or you properly identifying the part of the law that makes me liable while providing me with the proper form on which I am to file in that IRS form 1040 is improper in that I am not a nonresident alien. Should you not provide me with the part of the law making me liable or the proper form for me to file, this letter is my formal demand for the refund of the $1799.00 that was withheld from my retirement. Respectfully, Thomas R. Culley cc: IRS District Director, Fresno CA President Bush Congressman Thompson Senator Roth Senator Hatch IRS Commissioner Mark W. Everson President’s Advisory Panel on Federal Tax Reform |