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This ain't advice.
Dale Eastman:
Not every thing that is received is gross income.
If I purchase a capital asset like a building for $100,000, I have converted my capital (money) into another form of property (a building). Nothing is gained, nothing is lost. My value of capital is the same. If I sell that building a year later, for $100,000, I have not received income. I have merely converted the capital from one form to another.
The Supreme Court has said:
An examination of these and other provisions of the act makes it plain that the legislative purpose was not to tax property as such, or the mere conversion of property, but to tax the conduct of the business of corporations organized for profit by a measure based upon the gainful returns from their business operations and property from the time the act took effect.
[T]he learned Solicitor General has submitted an elaborate argument in behalf of the government, based in part upon theoretical definitions of 'capital,' 'income,' 'profits,' etc., and in part upon expressions quoted from our opinions in Flint v. Stone Tracy Co. and Anderson v. Forty-Two Broadway with the object of showing that a conversion of capital into money always produces income, and that for the purposes of the present case the words 'gross income' are equivalent to 'gross receipts'; the insistence being that the entire proceeds of a conversion of capital assets should be treated as gross income, and that by deducting the mere cost of such assets we arrive at net income. The cases referred to throw little light upon the present matter, and the expressions quoted from the opinions were employed by us with reference to questions wholly remote from any that is here presented.
When the act took effect, plaintiff's timber lands, with whatever value they then possessed, were a part of its capital assets, and a subsequent change of form by conversion into money did not change the essence. See DOYLE v. MITCHELL BROS. CO. , 247 U.S. 179 (1918)
Labor is property.
The right to labor, the right to one's self physically and intellectually, and to the product of one's own faculties, is past doubt property, and property of a sacred kind. See IN RE SLAUGHTER-HOUSE CASES, 83 U.S. 36 (1872).
The common business and callings of life, the ordinary trades and pursuits, which are innocuous in themselves, and have been followed in all communities from time immemorial, must therefore be free in this country to all alike upon the same conditions. The right to pursue them, without let or hinderance, except that which is applied to all persons of the same age, sex, and condition, is a distinguishing privilege of citizens of the United States, and an essential element of that freedom which they claim as their birthright. It has been well said that 'the property which every man has in his own labor, as it is the original foundation of all other property, so it is the most sacred and inviolable. The patrimony of the poor man lies in the strength and dexterity of his own hands, and to hinder his employing this strength and dexterity in what manner he thinks proper, without injury to his neighbor, is a plain violation of this most sacred property. It is a manifest encroachment upon the just liberty both of the workman and of those who might be disposed to employ him. As it hinders the one from working at what he thinks proper, so it hinders the others from employing whom they think proper.' Smith, Wealth Nat. bk. 1, c. 10. See BUTCHERS' UNION CO. v. CRESCENT CITY CO., 111 U.S. 746 (1884)
The principle is fundamental and vital. Included in the right of personal liberty and the right of private property-partaking of the nature of each- is the right to make contracts for the acquisition of property. Chief among such contracts is that of personal employment, by which labor and other services are exchanged for money or other forms of property. If this right be struck down or arbitrarily interfered with, there is a substantial impairment of liberty in the long-established constitutional sense. The right is as essential to the laborer as to the capitalist, to the poor as to the rich; for the vast majority of persons have no other honest way to begin to acquire property, save by working for money. See COPPAGE v. STATE OF KANSAS, 236 U.S. 1 (1915).
An overview of invested capital and the gain derived therefrom.
As the Supreme Court has stated: "'Income may be defined as the gain derived from capital, from labor, or from both combined,' provided it be understood to include profit gained through a sale or conversion of capital assets."
The differentiation between capital and labor as the substrate that gain is derived from is a distinction without meaning.
To manufacture the proverbial wooden "Widget", the Wonderful Wooden Widget Corporation will invest capital by purchasing property such as machines, tools, and a factory building. Such capital assets will lose value (depreciate) over time from wear and tear and the loss of value is rightfully deducted from the gross receipts to make the value of the capital and the capital asset match the value of the capital originally invested.
The 3W corporation will also invest capital in purchasing property such as wood and labor to make the Widgets. Both the wood and the labor are capital assets consumed as capital expenditures. As such, the consumption of the capital asset through expenditure is also rightfully deducted from the gross receipts to make the value of the capital the same as originally invested.
In creating gross receipts, capital is consumed and capital is depreciated. Deducting capital consumed and capital depreciated from the gross receipts makes the capital whole again and severs the gain from the capital it is derived from. The excess over the consumption and depreciation of the capital is the gain derived from capital, from labor, or from both combined.
Wood and labor are both capital assets that are consumed in the creation of gross receipts.
Gain MUST be severed from the capital it is derived from.
As shown in the 3W example, When gross receipts are created, capital is consumed and capital is depreciated. This capital that is consumed or depreciated is deducted from the gross receipts to make the capital whole. The excess that remains is the gain or profit derived from capital, however the capital is invested.
In the case of the 3W lumber supplier, the lumber is the supplier's consumable capital asset. When the supplier creates gross receipts, that capital asset is consumed.
If the supplier's capital was originally money, the supplier would change its form, but not its essence, by purchasing lumber. The lumber is sold to create the gross receipts, and in doing so, the capital asset is consumed. The capital consumed is deducted from the gross receipts to determine the gain or profit (the income) derived from the capital invested in the lumber. In deducting the capital consumed from the gross receipts, the gain is severed from the capital it is derived from and the capital is made whole.
The Legal Plunderer's assertion.
What if the supplier was gifted enough lumber to fill a warehouse? Inheritance taxes, if any, were paid, title to the lumber is free, clear, and unencumbered. As before, the capital asset is sold to create gross receipts, and in doing so, the capital asset is consumed. In this case, capital was not expended to purchase the lumber. According to the "legal plunderers" "The cost basis is zero, therefore the entire amount of gross receipts is income."
For those who would argue the example is not realistic, I submit that the example matches when the capital asset of labor is consumed to create gross receipts.
Your life-time, life-energy, and life-force is your capital. Labor is the consumption of your life-time, life-energy, and life-force. Labor is the consumption of your capital. Your capital is converted into money when you exchange your labor for money. The form of your capital is changed, the essence is not. It is still your capital and its consumption must be deducted from your gross receipts to make your capital whole, just like any other capital.
The "legal plunderers" assert that when you exchange your labor for money, "Your cost basis is zero, therefore the entire amount of your compensation for labor (gross receipts) is income".
There are several problems with this "belief".
Why the Legal Plunderers are wrong.
As the Supreme Court has said: "a gain, a profit, something of exchangeable value, proceeding from the property, severed from the capital, however invested or employed, and coming in, being 'derived'-that is, received or drawn by the recipient (the taxpayer) for his separate use, benefit and disposal- that is income derived from property. Nothing else answers the description."
Income is gain severed from the capital it is derived from. If a gain can not be severed from the capital, then the gain is not a gain, and therefore not income. After the gain is severed, the capital must remain whole, or the tax is a direct tax on the property (capital). In the case of labor, the entire capital is consumed, therefore there is no way to sever the alleged gain from the capital and leave the capital whole. Exchanging labor for money merely changes the form of the capital, and as the Supreme Court has stated in regard to capital: "a subsequent change of form by conversion into money did not change the essence."
My American Heritage Electronic Dictionary has this definition for "capital": 2.a. Wealth in the form of money or property, used or accumulated in a business by a person, partnership, or corporation. b. Material wealth used or available for use in the production of more wealth. c. Human resources considered in terms of their contributions to an economy.
This "legal plunderers'" "belief" denies labor is capital.
In the case of the capital asset of lumber, when the lumber is completely consumed, the original capital remains after the gain is severed from the capital and that capital can then be reinvested by purchasing more lumber. If the entire proceeds of the conversion of labor into money is income: then the income can not be severed from the original capital; the original capital can not be made whole; and there would be no capital left to purchase more life-time, life-energy, and life-force even if this wasn't impossible.
As the Supreme Court has pointed out, labor is property; and this property is "property of a sacred kind"
Converting labor to money does not change its essence. Whether in the form of labor or money, the laborer's property is still his capital, and to tax one form is to tax the other. If a person only requires 32 hours of labor to exist, and that labor is taxed at 20%, then a person would require 40 hours of labor to exist. It does not matter if the tax is imposed on the compensation for labor (money) or the (time) labor itself, the 8 extra hours of labor does not benefit the laborer.
As the Supreme Court has also said, if an excise tax is enforced in such a way as to make it a direct tax, "the duty would arise to disregard form and consider substance alone, and hence subject the tax to the regulation as to apportionment which otherwise as an excise would not apply to it."
Whether in the form of extra hours for the laborer, or any hours for the slave, the substance is the same: both are forced to work against their will, without compensation, for their masters. This is called S-L-A-V-E-R-Y.
Putting all the pieces together.
1. Income is gain or profit, derived from and severed from the capital, however the capital is invested.
2. An excise tax on the income, gain, or profit that diminishes the capital is a direct tax upon the capital and is unconstitutional if not laid according to the rule of apportionment.
3. When capital is consumed or depreciated, the diminution of the capital is deducted from the gross receipts to make the capital whole again. This frees undiminished capital to be reinvested.
4. When capital consumed or depreciated is not deducted from the gross receipts, then the capital can not be made whole.
5. If the alleged income, gain, or profit can not be severed from the capital it is derived from, then the capital can not be made whole.
6. If the capital is not made whole, then the capital is taxed. Such an excise tax enforced in this manner is a direct tax and if unapportioned is unconstitutional.
7. What was capital before conversion into money, is capital after conversion into money.
8. Labor is property.
9. Labor is not income, therefore labor must be capital.
10. Labor is exchanged for money and other forms of property.
11. Labor is capital before it is converted into money, Labor is capital after it is converted into money.
12. After the income, gain, or profit is severed from the capital, the capital remains whole, just as it was before being invested.
13. If the entire gross receipts from the conversion of labor (property, capital) into money (property, capital), then the alleged gain can not be severed from the capital, leaving the capital whole and ready to reinvest.
14. If the capital is not left whole, see points 3, 4, 5, & 6 again.
Labor is property, and any tax on property is a direct tax subject to the rule of apportionment.
Dale Eastman:
However, he is still pursuing what I feel to be a self-evident fallacy, focusing on the missing "liability" statute in Congress' laws, which I feel burdens the majority of the movement. It's my position that the liability stems from constitutional imposition as well as Supreme Court rulings, as such power to define the scope of taxation is superior to Congress' power, and thus will never be seen in the statutes.
The Supreme Court, citing a lower court judge, included his words in its opinion:
"Judge Gray, dissenting, said: 'Keeping in mind the well-settled rule that the citizen is exempt from taxation unless the same is imposed by clear and unequivocal language, and that where the construction of a tax law is doubtful, the doubt is to be resolved in favor of those upon whom the tax is sought to be laid, I cannot assent to the affirmance of the judgment of the court below in this respect." See SPRECKELS SUGAR REFINING CO. v. MCCLAIN, 192 U.S. 397 (1904).
"In the interpretation of statutes levying taxes it is the established rule not to extend their provisions, by implication, beyond the clear import of the language used, or to enlarge their operations so as to embrace matters not specifically pointed out. In case of doubt they are construed most strongly against the government, and in favor of the citizen." See GOULD v. GOULD, 245 U.S. 151 (1917).
"In view of other settled rules of statutory construction, which teach that a law is presumed, in the absence of clear expression to the contrary, to operate prospectively; that, if doubt exists as to the construction of a taxing statute, the doubt should be resolved in favor of the taxpayer..." See HASSETT v. WELCH, 303 U.S. 303 (1938)
What I take away from all that is this: Income is gain derived from the employment of capital. It's a privileged accession of wealth and fully taxable as such. It is not part of, nor equated to the original capital or its value-equivalent.
Where I'd like to go with that, and you may have already derived or at least come across the arguments, is separating what is taxable as income from what is non-taxable property compensation. That is, when one trades one's labor/intellect/time for market-rate compensation, that is an exactly-even trade with no room for profit, thus precluding common employment from being subject to the income tax for lack of income.
The sixteenth amendment authorizes the taxation of income "from whatever source derived" -- thus taking in investment income --"without apportionment among the several States." The Supreme Court has held that the sixteenth amendment did not extend the taxing power of the United States to new or excepted subjects but merely removed the necessity which might otherwise exist for an apportionment among the States of taxes laid on income whether it be derived from one source or another. So the amendment made it possible to bring investment income within the scope of a general income-tax law, but did not change the character of the tax. It is still fundamentally an excise or duty with respect to the privilege of carrying on any activity or owning any property which produces income.
The income tax is, therefor, 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 they produce. The income is not the subject of the tax: it is the basis for determining the amount of tax.
http://www.synapticsparks.info/evidence/c03/page2580.html
What is the criteria for being subject to the W-4 by both employer and employee?
http://www.synapticsparks.info/evidence/c05/index.html
http://www.synapticsparks.info/tax/W4InstructionsSay.shtml
Does being an employee subject someone to falling under the scope of the employer's privileged activity of running a business?
http://www.synapticsparks.info/evidence/c05/irc3401.html
Reb:
I wish to post here--not elsewhere.
With all due respect to the good intention of the writer/moderator, he is attempting to question what is, or is not, INCOME. By raising such a question, the court will shift onto the defendant the burden of proof to show the income does not apply in the issue before the court. Carrying the burden of proof will require convincing the court there is NO POSSIBLE WAY the unidentifed tax MIGHT apply to the accused. This burden of proof is impossible to overcome.
A valid indictment requires the prosecutor to allege a "known legal duty" (a statutory responsibility) claimed to have been violated by the accused. If that requirement is not met, the indictment is void.
Federal individual income tax indictments consistently rely upon IRC 7201 or 7203 as that known legal duty. Those statutes have been used to prosecute admission tax violations, fuel tax violations, marijuana tax violations, alcohol tax violations, etc. They obviously cannot identify a duty for an income tax. The Supreme Court has also shown the statutes apply to ALL taxes collected by the IRS. US v Sansone.
Tom Cryer, Larry Becraft, etc., decline to confront the courts with that knowledge.
Ref: http://www.synapticsparks.info/dialog/index.php?topic=31.0
Dale Eastman:
--- Quote from: Reb on January 08, 2011, 06:54:16 PM ---I wish to post here--not elsewhere.
--- End quote ---
Well it certainly looks like what you posted is on topic, so here it will stay.
--- Quote ---With all due respect to the good intention of the writer/moderator, he is attempting to question what is, or is not, INCOME.
--- End quote ---
There are a myriad of ways that show the tax does't apply according to the IRS propaganda. The definition of what income is, is just another way to show the fraud being perpetrated by the beast that has slipped it's chains.
There are a lot of things that are correct, but the courts have set up their filters, so to speak, to ignore these logically valid points.
--- Quote ---By raising such a question, the court will shift onto the defendant the burden of proof to show the income does not apply in the issue before the court. Carrying the burden of proof will require convincing the court there is NO POSSIBLE WAY the unidentifed tax MIGHT apply to the accused. This burden of proof is impossible to overcome.
--- End quote ---
The court isn't about to be convinced... Where do they get their money? In their minds, from that unidentified tax that they think you owe (them), the Grace Commission Report to Prez Reagan notwithstanding.
--- Quote ---A valid indictment requires the prosecutor to allege a "known legal duty" (a statutory responsibility) claimed to have been violated by the accused. If that requirement is not met, the indictment is void.
--- End quote ---
Yep.
Now try getting the court to pay attention to the missing statute that creates that duty. Mcbribe (sic) was quoted by eyewitnesses as saying "The law will not be discussed in my courtroom."
Did you read the Simkanin transcripts?
http://www.synapticsparks.info/tax/simkanin/railroaded.html
And I just found this researching for my reply:
http://www.hiddenmysteries.org/law/research/U.S.%20v.%20Simkanin.pdf
1.5 MB. Look at page 505.
--- Quote ---Federal individual income tax indictments consistently rely upon IRC 7201 or 7203 as that known legal duty. Those statutes have been used to prosecute admission tax violations, fuel tax violations, marijuana tax violations, alcohol tax violations, etc. They obviously cannot identify a duty for an income tax. The Supreme Court has also shown the statutes apply to ALL taxes collected by the IRS. US v Sansone.
--- End quote ---
Right. Quoting 7203:
Any person required under this title to pay any estimated tax or tax, or required by this title or by regulations made under authority thereof to make a return, keep any records, or supply any information, who willfully fails to...
Do what the master says, shall have bad things happen to them.
Who is the person required, where in the title is the duty imposed?
If you trace it, it leads to 6012(a) which hinges on the definition of income.
--- Quote ---Tom Cryer, Larry Becraft, etc., decline to confront the courts with that knowledge.
Ref: http://www.synapticsparks.info/dialog/index.php?topic=31.0
--- End quote ---
I'm out of time for using the board as it is designed, (I've been blocking spamdexing spammers doing ghost registrations on the forum and spambots abusing my bandwidth), so here's a link to a later look at "income": http://www.synapticsparks.info/dialog/index.php?topic=53.0
I've also been trying to do a re-write of the main website. I've got some good stuff written, but I need to connect it in a logical flow.
Reb:
It is stated the court declared:
--- Quote ---"The law will not be discussed in my courtroom."
--- End quote ---
I believe this is an expression that any challenge relating to the inadequacy of the law is to be presented to the judge, preferably in writing, as a motion. Any discussion, particularily with the jury present, is not acceptable.
Additional reflections will follow.
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