"The US Supreme Court has stated that because these rights existed antecedent [prior to] the formation of either the states or the national government they are outside the government's power to alter, modify, or abolish. How's that for some strong protection!"

In this final posting on citizenship, I pray that some new truths have been revealed as to our real status as American Citizens. Our forefathers wanted to "bind government to the chains of the Constitution" and protect the God given rights of the people. Never did our founders believe that government should have the right to fraudulantly grab 65% of our income for any reason. The right to the fruits of our labor and the right to own property and travel was given to us by our Creator and no government has the right to lien on these. The Constitution provided the way for government funding and it was not anything like is occurring today.

What does this mean for us? The truth is that we the people have been defrauded. We have been deceived by one of the greatest schemes ever to hit this earth and we are still being deceived. I beg you to order the video, Theft By Deception, Larken Rose has revealed the truth behind the deception with the governments own documents. Here is a quote from his site:


Contrary to what "everyone knows," the truth of the matter is this: Congress could not, and did not, impose a tax on the income of most Americans, because of the strict limits on federal power imposed by the Constitution. Instead, they imposed a far more limited income tax, applicable primarily to income from certain types of international and foreign commerce, but wrote the law in such a way that it could easily be misinterpreted. The law itself is perfectly valid and constitutional; it is simply being misrepresented and misapplied by the tax professionals and government officials. As a result, tens of millions of Americans now make payments to the IRS based on the false assumption that they are just paying "their taxes."


To order the video go to: Taxable Income

If this statement does not shock you then we are lost!!!! If you knew a banker was stealing your money the moment you deposited it in his establishment, what would you do? Think About It!

Conclusion: Citizenship


With these powerful rights in our hands, one might wonder what sort of "rights" are possessed by "citizens of the United States".

The Poor Stepchild "citizen"

If the Citizens of the states of the Union have their "unalienable rights", what then do "citizens of the United States" have? Frankly, not much of value. For the balance of this section, we will use the term "federal citizen" to denote a "citizen of the United States".

A federal citizen has only those rights that have been granted to him by Congress by way of the numerous and various civil rights acts, and such rights as may have been invested in him by an activist US Supreme Court that felt it could legislate from the bench.

Let's be clear - the "rights" of federal citizens are not given to them by God, as are our unalienable rights. Their rights are given to them by Congress alone, and the most significant point to understand and keep in mind is that, "What Congress giveth, Congress may taketh away". It has always been this way and it will always be this way. The only thing that may be surprising in all of this is that this is the first time you're hearing it! Most Americans have no idea that there are two "classes of citizenship", nor do they understand the vast distinction between the two, and what it means in their lives.

Let's look at what the courts have said about federal citizenship:


"A 'civil right' is considered a right given and protected by law, and a person's enjoyment thereof is regulated entirely by the law that creates it."
82 CA 369. 373, 255, P 760.
"The persons declared to be citizens are, "All persons born or naturalized in the United States and subject to the jurisdiction thereof." The evident meaning of these last words is not merely subject in some respect or degree to the jurisdiction of the United States, but completely subject..."
Elk v. Wilkins, 112 US 94, 101, 102 (1884)

While Elk v. Wilkins is a 14th Amendment case, the concept is still true concerning all federal citizens. In other words, all federal citizens must be, by their very definition, a person who is "completely subject" to the jurisdiction of the federal government (such as a citizen of Washington DC). Virtually any legal concept stated by the courts concerning a 14th Amendment citizen is operative upon all federal citizens.


"The privileges and immunities clause of the 14th Amendment protects very few rights because it neither incorporates the Bill of Rights nor protects all rights of individual citizens. (See Slaughter House cases, 83 US (16 Wall.) 36, 21 L. Ed. 394 (1873)). Instead this provision protects only those rights peculiar to being a citizen of the federal government; it does not protect those rights which relate to state citizenship."
Jones v. Temmer, 839 F. Supp. 1226
"...the first eight amendments have uniformly been held not to be protected from state action by the privilege and immunities clause [of the 14th Amendment]."
Hague v. CIO, 307 US 496, 520

"The right to trial by jury in civil cases, guaranteed by the 7th Amendment…and the right to bear arms guaranteed by the 2nd Amendment…have been distinctly held not to be privileges and immunities of citizens of the United States guaranteed by the 14th Amendment…and in effect the same decision was made in respect of the guarantee against prosecution, except by indictment of a grand jury, contained in the 5th Amendment…and in respect of the right to be confronted with witnesses, contained in the 6th Amendment…it was held that the indictment, made indispensable by the 5th Amendment, and trial by jury guaranteed by the 6th Amendment, were not privileges and immunities of citizens of the United States, as those words were used in the 14th Amendment. We conclude, therefore, that the exemption from compulsory self-incrimination is not a privilege or immunity of National citizenship guaranteed by this clause of the 14th Amendment."
Twining v. New Jersey, 211 US 78, 98-99

"There are, then, under our republican form of government, two classes of citizens, one of the United States and one of the state".
Gardina v. Board of Registrars of Jefferson County, 160 Ala. 155; 48 So. 788 (1909) "The governments of the United States and of each state of the several states are distinct from one another. The rights of a citizen under one may be quite different from those which he has under the other".
Colgate v. Harvey, 296 U.S. 404; 56 S.Ct. 252 (1935)

"...rights of national citizenship as distinct from the fundamental or natural rights inherent in state citizenship".
Madden v. Kentucky, 309 U.S. 83: 84 L.Ed. 590 (1940)

"There is a difference between privileges and immunities belonging to the citizens of the United States as such, and those belonging to the citizens of each state as such".
Ruhstrat v. People, 57 N.E. 41 (1900)

"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 it's own..."
United States v. Cruikshank, 92 U.S. 542 (1875)

"It is quite clear, then, that there is a citizenship of the United States, and a citizenship of a state, which are distinct from each other and which depend upon different characteristics or circumstances in the individual".
Slaughter-House Cases, 83 U.S. (16 Wall.) 36; 21 L.Ed. 394 (1873)

It should be noted that many of the rights not attributed to federal citizens in the cases above have since been granted to them either by Congress or by the courts. These early decisions simply clarify and solidify the reality that federal citizens are not the same "class of citizen" as state Citizens.

Like so many areas in which the federal government has tread, it has unbalanced the equation. Where at one time there was no real problem with there being different classes of citizenship, with the ratification of the 14th Amendment, Congress went into overdrive with civil rights legislation. The result was a labyrinth of "rights" and protections for federal citizens. Some of these have even found their way into additional Constitutional amendments. Because the state Citizen is a member of The People; the people in whom the sovereignty of the states, and by association, the national government resides, such a Citizen is left to protect his own rights, with no special process to help him accomplish that end. In short, he must defend his rights with all his will, his energy, his money, and passion in the courts for as long as it takes to reach a final outcome.

Conversely, the federal citizen need only lodge a complaint with the appropriate federal agency and the power of the federal government moves to punish the person who has allegedly violated that federal citizen's rights. Of course this is legally appropriate since a federal citizen is little more than a ward of the national government. Such second-class citizens must be cared for by the government as they are not the masters of their government, but mere servants to it, and it is the master's responsibility to care for his servants.

Visit Original Intent For Further Information







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CITIZENSHIP: WHO ARE WE? PART 2

Good Morning. Today we are going to share a little more information on citizenship. I pray this will allow all who read to determine their status in our wonderful country. You may not be who you thought you were! Lets take a look at this interesting topic further and Think About It.

God Bless
Elaine

Citizenship: Part 2

As we have examined, courts in the latter part of the 19th century were quite clear on the intended purpose of the Freedman's Bureau Act, the Enforcement Act, the Civil Rights Act of 1866, and the 14th Amendment. However, what has the Supreme Court said in this century?

In Hurd v. Hodge (1948), the court explained that in order to understand the Civil Rights Act of 1866,


"...reference must be made to the scope and purpose of the 14th Amendment; for that statute and the Amendment were closely related both in inception and in objectives which Congress sought to achieve".
The Court further stated that the purpose of the 14th Amendment,


"was to incorporate the guaranties of the Civil Rights Act of 1866 in the organic law of the land".
The "original intent" link can also be found in several other cases as well. Justice Harlan noted that privileges and immunities protected by the 14 Amendment included [used in its restrictive sense] those set forth in the first section of the Civil Rights Act. Justice Thurgood Marshall noted that,


"the Congress that passed the 14th Amendment is the same Congress that passed the 1866 Freedman's Bureau Act",
and he concluded that the rights set forth in the Freedman's Bureau Act were dispositive of Congress' intent in the 14th Amendment.

In 1987, Justice William Brennan traced the "rights" [actually congressionally granted "privileges"] that are secured by the 14th Amendment to the Freedman's Bureau bill. He then went on to state that,


"The main target of the Civil Rights Act of 1866 were the 'black codes' enacted in the Southern States..."
As can be readily seen, even relatively recent Courts have acknowledged the fact that the 14th Amendment was simply intended to integrate elements of the Civil Rights Act of 1866 and the Freedman's Bureau Act into the Constitutional structure of the nation. Accordingly, the 14th Amendment only applies to non-citizens (aliens) who were the exclusive focus of the Civil Rights Act of 1866 and the Freedman's Bureau Act.

Now that the intent, meaning, and proper application of the 14th Amendment have been illustrated, it is clear that the Amendment made "federal citizens" out of specific aliens who otherwise would have had no form of citizenship at all. By converting these "aliens" into "federal citizens", they fell under the protection of the federal government with regard to those "rights" that had been conferred upon them by the 14th Amendment.

In consideration of these facts, Black's Law Dictionary (6th Ed.) defines the 14th Amendment this way:


The Fourteenth Amendment of the Constitution of the United States, ratified in 1868, creates or at least recognizes for the first time a citizenship of the United States, as distinct from that of the states;...
Note the vagueness in the definition - "...creates or at least recognizes for the first time...". This vagueness is because Congressional intent purported to embrace only the recently freed slaves, but at the same time, the bare language of the Amendment, (without consideration of Congressional intent) seems to merely recognize the long standing principle that the federal government has its own citizens, who are not state Citizens; a legal reality that existed long before the 14th Amendment.

We have covered a lot of ground in this piece and it is important to note that with all of the evidence that is available, it has never once been asserted by any member of Congress, or by the courts, that the 14th Amendment, or the phrase "citizen of the United States" as used before the ratification of the 14th Amendment, applies to native born Citizens of a state of the Union. It should also be noted that the original use and application of the phrase "citizen of the United States" still continues today, unaffected by the 14th Amendment, which embraced only a very narrow and specific group of persons.

To summarize the points that we have touched upon thus far:

1.There is an original Citizen of a state of the Union.
2.There is a "citizen of the United States" as that phrase has always been used.
3.There is a "citizen of the United States" as that term is used in the 14th Amendment.

At this juncture one might rightly ask what the practical distinctions are in the three forms of citizenship. Before we move forward with that, we should observe that the 14th Amendment merely constitutionalized the concepts by which the United States had been operating for decades under the doctrine of international law, defining the derivation of citizenship. What made the 14th Amendment necessary was that for the first time the federal government intended to grant federal citizenship to persons born within a state of a Union.


Rights of Citizens of the states of the Union
The Declaration of Independence states that, "all men are created equal, that they are endowed by their Creator with certain unalienable Rights…" This clearly lays out the foundation of our rights - we are all equal before God, and the law; we possess rights which are "unalienable"; those rights are given to us by God (our Creator). Although the men who wrote the Declaration of Independence said that "all men" are created equal, when it came time to create the legal framework of a government, they understood that they could not include "all men" in a Constitution, but could only speak of those people who had formed the states, which then resulted in the states creating a national government of limited power. It is the state Citizens to whom the phrase "all men" would have to be limited for governmental purposes. Accordingly, as the form of our governments began to take shape, the people who would be able to claim these, "unalienable rights", which the "Creator" granted, would only be the Citizens of the states. While this may seem like a narrow restriction, one must remember that a government can only make laws (including its Constitution) for its own "body politic", and no one else.

So what are these mysterious "unalienable rights"? The Declaration of Independence says that, "among these [rights] are Life, Liberty and the pursuit of Happiness". While "Life, Liberty and the pursuit of Happiness" is pretty all encompassing, the words of the Framers tell us that there are more rights involved, and that "among them" are found the rights of "Life, Liberty and the pursuit of Happiness". In other words, the language of the Framers tells us that "Life, Liberty and the pursuit of Happiness" is a designated group of rights within a larger body of rights referred to as our "unalienable rights".

This larger body of "unalienable rights" is vast. In fact, it is so vast that no one, not even the judicial branch, has ever attempted to list the rights contained therein. This is best illustrated by the old adage that, "My right to swing my fist ends somewhere before it hits your nose". In short, a Citizen can do virtually anything he or she wants, so long as it does not infringe on the rights of another Citizen, or endanger the community. Also inclusive in these rights are your protections against mistreatment by government; the primary protections being expressly stated in the Bill of Rights in the US Constitution.


"You have rights antecedent to all earthly governments; rights that cannot be repealed or restrained by human laws; rights derived from the Great Legislator of the Universe."
-- John Adams, Second President of the United States. (1792-1801)

The US Supreme Court has stated that because these rights existed antecedent [prior to] the formation of either the states or the national government they are outside the government's power to alter, modify, or abolish. How's that for some strong protection!







GIVE YOUR LOVED ONE THE GIFT OF HEALTH THIS YEAR

WHAT TYPE OF CITIZEN ARE YOU?

Today's posting deals with citizenship. We were all taught in Public Schools that we are Citizens of The United States. Are we? Many will get angry if you tell them they are not but the truth is not always so simple. The reason I am posting this series is because it will clearly show why you may not be a citizen subject to the graduated income tax laws of the Federal Government. Take time to read this article slowly ( I read it out loud). I promise that you probably were never taught this material and it will suprise you to know the truth. Hang with me on this posting and after it is completed, I believe that you will realize some things that are amazing! This four part expose on citizenship will clear up a lot of misunderstanding about this subject. You just might not be who you thought you were. Think About It!

God Bless
Elaine

Article is posted from the Original Intent Website:

Citizenship

As Americans, we are socialized to believe that we are all Citizens of this great nation we call the United States of America. Quite frankly, most Americans are pretty emotional about the issue. Try telling your neighbor, who fought against Hitler in WWII, that he's not a citizen of the United States, and see what reaction you get!

The problem is that the people who write laws don't write them in the same manner that you and I speak. [See the section on "legal terms" within The Law page on this site.] Laws are written to achieve certain goals and the words used within laws are selected to achieve those goals. Sometimes the goals are legitimate and the language that is used, while confusing at times, is necessary to achieve the goal. Other times confusing language is used for no other reason than to obscure the truth from the casual reader.

The issue of citizenship is no less clouded by such use of language than is any other area of law. The definitions of words or "legal terms" must be sought out diligently and the context in which they are used always carefully considered. [See The Law for information on "words" v. "legal terms" and issues of "context".]

In the Constitution of the United States, the phrase "Citizen of the United States" appears. Because this phrase appears within a Constitution, not a statute, the meaning of the phrase is determined by the meaning intended by those who wrote and signed the Constitution. If the intended meaning is manifest, there is no power on earth, including that of a criminal in a black robe, which can alter the meaning of the phrase. The meaning of the phrase "Citizen of the United States" is well understood. That phrase is shorthand for the sentence, "All the Citizens of the 13 independent nations [called "states"] that are a party to this Constitution". The important element that you should understand is that the "Citizen of the United States" spoken of in the Constitution of the United States is more properly and accurately a Citizen of the state in which he lives. The phrase "Citizen of the United States" is actually a euphemism used for convenience and brevity, and not a legal title.

After the Constitution was signed by all the states, the federal government began acquiring "territories". At the time, these territories were limited to the lands west of the established boundaries of the states, and lands not claimed by the states. People born in those federally held territories, by parents who were not Citizens of a state, became de facto "citizens of the United States". Although at that time there was no statutory authority for such a thing, international law had (and still has) a long established doctrine that, absent any extenuating circumstances, a person is a citizen of the national jurisdiction (or sovereignty) in which he's born. The federal territories were outside of the sovereignty of the individual state governments, and within the sovereignty of the United States government; hence the de facto status as a "citizen of the United States". This principle also applies to persons in Washington DC, which is under the exclusive sovereignty of the United States. [For the sake of clarity, we use a lower case "c" for a citizen of the federal government and an upper case "C" to denote a Citizen of a state of the Union.] It should be noted that "citizens of the United States" are not The People who created the states, then by state action, created the federal government. These "federal citizens" are not "parties to the Constitution" and therefore did not have legal claim to the same rights, privileges, and immunities that state Citizens did.

One should take careful note that the Citizens of the states of the Union are the only Citizens who possess all the rights, privileges, and immunities spoken of in the US Constitution, plus whatever additional rights are secured to them by their own state Constitutions. At the end of this section you will see federal and state court cases that clearly show that the rights of one class of Citizen are thoroughly different from the "rights" (actually Congressionally granted privileges) of the other class of citizen. This distinction in the "class of citizenship" continued without significant comment or concern until the end of the Civil War.

Although the Civil War was not fought over slavery (despite what you were taught in the public schools), the end of the Civil War nevertheless brought about the end of involuntary servitude and slavery in America. [See Article XIII of the Constitution of the United States.]

Prior to the Civil War, the southern states did not recognize blacks as persons who could become Citizens of their states. In fact it was well understood by the Citizens of these southern states that when their state Constitutions protected the right to own "property" or "chattel", that right included holding slaves. That was exactly what the framers of these southern Constitutions had intended and so that understanding was accurate and factual.

After the South lost the rebellion, the United States took the opportunity to free the slaves. This was easier said than done because the Constitutions of the Southern states hadn't changed a bit just because the South had lost the War. Their Constitutions still did not recognize blacks as persons who could attain citizenship.


"Prior to the adoption of the federal Constitution, states possessed unlimited and unrestricted sovereignty and retained the same even afterward…except as such was surrendered to the federal government or they were expressly prohibited from exercising by the United States Constitution."
Blair v Ridgely, 97 D. 218, 249, S.P. People v. Coleman, 60 D. 581
Congress was faced with a difficult dilemma; it wanted the freed blacks to become Citizens, but there was nothing in the US Constitution that gave Congress the power to alter the Constitutions of the Southern states. The best Congress could do in an immediate sense was to consider the South under "military occupation" of the United States (which it was) and recognize that as such, the Southern states came within the authority of Article I, Section 8, Clause 17 of the US Constitution. [See US Territorial Authority in this site.] What this meant was that as long as the Southern states were held as a "defeated foe" Congress could pass legislation that would operate within the area known as "the Southern states". However, in the future, when Congress would restored the Southern states to their former status as regular states of the Union, all such federal legislation would cease to operate in the Southern states. This meant that Congress needed a two-phase solution. The first phase being the enactment of federal laws to operate within the "occupied territories" and the second phase being a Constitutional amendment to secure the principles of those laws even after the laws themselves lost authority in the Southern states.

It should be noted at this point that although the slaves were now free, and had been born in a state of the Union, they still were not Citizens of that state. In short, they had no citizenship at all. Under long established doctrines of law, a person who is not a citizen of a place in which he resides is an alien. The legal position of the freed slaves was tenuous - yes, they were free, but they were aliens in the land of their birth and were thus not entitled to the same rights, privileges, and immunities as Citizens. Although defeated in battle, the people of the South were not yet ready to capitulate on the slavery issue and they moved quickly to use the "alien" status of the blacks against them. Almost immediately after the surrender of the Confederacy, many Southern states started enacting "Black Codes". These laws were intended to operate only upon "persons not citizens" (a phrase right out of Dred Scott v. Sanford, 19 How. 393), and thus effectively limit the new found freedom enjoyed by the former slaves by requiring them to apply for licenses to do anything from holding a job, to hunting for food.

Because the Southern states were under the "exclusive legislative jurisdiction" of Congress at this time, any state or local laws that conflicted with federal law would immediately become void and unenforceable. Congress moved quickly to quash the Black Codes. In rapid succession Congress passed the Enforcement Act, the Freedman's Bureau Act, and the Civil Rights Act of 1866. Collectively, these acts prevented the enforcement of the Black Codes and simultaneously imbued the freed black slaves with federally granted privileges that are euphemistically called "rights". It is in the Enforcement Act that we first see the phrase "citizen of the United States" used as a "legal term" embracing only the recently freed black slaves. This term is then used again in the both the Freedman's Bureau Act, and the Civil Rights Act of 1866 in the same limited manner. It should be noted at this point that the phrase "citizen of the United States" had been used for nearly 8 decades before the Civil War, but always to speak of persons within federal territories. This was the first time that Congress had used the phrase to denote a person who had been born within a state of the Union. Congress could only apply the term in this way, within federal law, at that specific point in history because the South (where the freed blacks lived) was "federal territory" as long as it was being held by the United States military as a "defeated foe".

Phase two of Congress' plan was put into action with the drafting of the 14th Amendment. Here are its pertinent parts to this discussion:


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 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. Representatives shall be apportioned among the several States according to their respective numbers, counting the whole number of persons in each State, excluding Indians not taxed. But when the right to vote at any election for the choice of electors for President and Vice President of the United States, Representatives in Congress, the Executive and Judicial officers of a State, or the members of the Legislature thereof, is denied to any of the male inhabitants of such State, being twenty-one years of age, and citizens of the United States, or in any way abridged, except for participation in rebellion, or other crime, the basis of representation therein shall be reduced in the proportion which the number of such male citizens shall bear to the whole number of male citizens twenty-one years of age in such State.
In drafting the Amendment, Congress was looking to make its federal laws (the Enforcement Act, the Freedman's Bureau Act, and the Civil Rights Act of 1866) a part of the US Constitution. In doing so they intended to ensure that the freed blacks would have certain privileges and protections remain in place after the United States pulled its army out of the South and restored the Southern states to their previous status as states of the Union. The Amendment would also insure that Congress had the national authority to enforce the provisions of the Amendment upon any state that attempted to violate them.

Because the Congressional Acts were merely intended to "hold the line" until the 14th Amendment was ratified, their intent is significant in determining the intent of the 14th Amendment.

The Civil Rights Act of 1866:


"All persons born in the United States and not subject to any foreign power, excluding Indians not taxed, are hereby declared to be citizens of the United States, and such citizen of every race and color shall have the same right in every state and territory of the United States to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white citizens."
Please note that when the drafters of this bill meant to indicate a Citizen, they clearly used the word "citizen", however when defining "who" the Act applies to, the drafters used the word "person". As they used both words within the same paragraph, it is obvious that the drafters were keenly aware of the distinction.

Clearly Congressional intent was to provide non-citizens with the same fundamental rights as de jure state Citizens (who in that day, were exclusively white). This intent was further clarified in President Johnson's speech when he vetoed that bill. President Johnson made this statement as part of his speech:


"It [the Civil Rights Bill of 1866] comprehends the Chinese of the Pacific States, Indians subject to taxation, the people called gypsies, as well as the entire race designated as blacks, persons of color, Negroes, mulattoes and persons of African blood. Every individual of those races born in the United States is made a citizen thereof."
Once again, it can clearly be seen that the intent of the this Act was to embrace "persons" (as defined in Dred Scott case), but in no way was intended to address or alter the relationship of the de jure white Citizen to his state of birth or domicile.

In the case of United States v. Otherson, the US Supreme Court found it necessary to review the historical foundations of the Enforcement Act. The Court found that Senator Stewart, who had sponsored the Enforcement Act legislation, had made the following remarks regarding the Act's intent. Stewart noted that the bill,


"...simply extends to foreigners, not citizens, the protections of our laws".
He also added that,


"This bill extends [the equal protection of laws] to aliens, so that all persons who are in the United States shall have the equal protection of our laws."
These realities were not lost upon the various courts that were later called upon to make determinations as to the intent of the various civil rights acts or the 14th Amendment. In Van Valkenburg v. Brown, 43 Cal Sup Ct. 43, the Court made the following statement:


"No white person born within the limits of the United States and subject to their jurisdiction…owes his status of Citizenship to the recent amendments to the Federal Constitution."
As we are now repeatedly drawing a distinction between blacks and whites, this is probably a good point to stop and address the topic of racism as it relates to this article. This is a historical examination of the law as it existed in the various states and the United States prior to, and after, the Civil War, and how the foundations laid down in those laws and court decisions may still affect our lives today. This article is not intended to critique or pass judgment upon the moral correctness (or lack thereof) of the laws which existed at that time, or upon the decisions of the US Supreme Court in reference to slavery, the Civil War, the various Civil Rights Acts, or the 14th Amendment. It is merely a history lesson with certain inevitable conclusions drawn at the end. Please do not impute any bias, in either direction, to Original Intent. Having said that, let's carry on.

******Review******There are three classes of citizens in this country.

1. A natural born citizen of the several states that automatically makes you a citizen of the United States.
2. A citizen according to the 14 Ammendment.
3. Native Americans

Part 2 will be posted tomorrow.









GIVE YOUR LOVED ONE THE GIFT OF HEALTH THIS YEAR

AN EDUCATION ON THE CONSTITUTION AND TAXATION. Part 2

Here is part 2 of the report on the Income Tax Issue.

Don't forget to join us on Tuesday January 7th online for the We The People Broadcast: The Right To Petition.
You can now educate yourself on the Constitution and you will discover things that were never taught in school. Hope to see you there.
Elaine Moreland

We The People TV Online

IS THE INCOME TAX CONSTITUTIONAL? CONTIUED FROM 1-5-03

Do you feel like we're narrowing in on the meat of the issue? Good, because we are!

Now that we know the points indicated above, what we really need to know is what is "16th Amendment income". Once we know that, we should be getting a pretty good handle on what is Constitutionally taxable and under what rules! Interestingly, in order to find the meaning of the word "income", as used within 16th Amendment, we must first explore the meaning of the word "income" as it is used within the 1909 Corporate Tax Act.


"As has been repeatedly remarked, the corporation tax act of 1909 was not intended to be and is not, in any proper sense, an income tax law. This court had decided in the Pollock case that the income tax law of 1894 amounted in effect to a direct tax upon property, and was invalid because not apportioned according to populations, as prescribed by the Constitution. The act of 1909 avoided this difficulty by imposing not an income tax [direct], but an excise tax [indirect] upon the conduct of business in a corporate capacity, measuring however, the amount of tax by the income of the corporation".
Stratton's Independence, LTD. v. Howbert, 231 US 399, 414 (1913)
As an indirect (excise) tax, the Corporate Tax Act of 1909 was not a tax upon property, but was a tax upon the privilege [enjoyed by the shareholders] of doing business in the corporate form, and the tax to be paid for exercising that privilege was determined by how much profit each shareholder took from the corporation.

So why is the 1909 Corporate Tax Act so important?


"[Income]must be given the same meaning, in all the Income Tax Acts of Congress that it was given in the Corporate Excise Tax Act, and what that meaning is has become definitely settled by the decisions of this court".
Merchants Loan & Trust v. Smietanka, 255 US 509 (1921)
By this decision, the Court stated that it would accept only one definition of "income" [under the 16th Amendment] and that any tax law that Congress wanted to pass under the authority of the 16th Amendment would have to use just that one definition of "income" - and that definition was the one Congress used in the 1909 Corporate Tax Act! In short, the Court was telling Congress that since the 16th Amendment was a part of the Constitution [the non-ratification issue had not yet been raised] its meaning must be fixed and permanent, and since Congress could not be trusted to stick to one single definition, the Court was giving Congress one single definition with which to work if it wished its income tax acts to pass Constitutional scrutiny by the Court.

So now that we know the "form" of the tax being laid in the 1909 Corporate Tax Act, and we know that its definition must be used in every income tax act Congress might create, what has the Court said about the definition of "income" in the 1909 Corporate Tax Act?


"[Income is] derived--from--capital--the--gain--derived--from--capitol, etc. Here we have the essential matter--not gain accruing to capitol, not growth or increment of value in the investment; but a gain, a profit, something of exchangeable value...severed from capitol however invested or employed and coming in, being "derived", that is received or drawn by the recipient for his separate use, benefit and disposal--that is the income derived from property. Nothing else answers the description...". [emphasis in original]
Eisner v. Macomber, 252 US 189 (1920)
O.K...so now we know the "form" of the 16th Amendment income tax, the fact that all 16th Amendment income taxes must use the same definition of "income", and we have the formula for determining what "16th Amendment income" is. The only thing we're really missing at this point is specifically what activity is taxable under the 16th Amendment!


"Whatever difficulty there may be about a precise and scientific definition of 'income', it imports, as used here, something entirely distinct from principle or capital either as a subject of taxation or as a measure of the tax; conveying rather the idea of gain or increase arising from corporate activities."
Doyle v. Mitchell Brother, Co., 247 US 179 (1918)
In June of 1909 President Taft made a speech before Congress. After commenting on the Pollock decision, he stated:


"...I therefore recommend an amendmentimposing on all corporationsan excise tax measured by 2% in the net income of such corporations. This is an excise on the privilege of doing business as an artificial entity"
Congressional Record, June 16, 1909, Pg. 3344
Two months later Congress drafted the Corporate Tax Act of 1909.

So, if Congress could pass a tax bill laying a tax on the profits of corporations prior to the 16th Amendment, why was the 16th Amendment needed? We may never know what the true intention of the framers of the 16th Amendment were, but there are three prevailing opinions:


They honestly felt that the Pollock decision could be a threat to taxing corporate investment profits and so they moved to overturn the Pollock decision's holding that a tax upon the gains from existing property was a direct tax.
They did not think Pollock was a threat, but it made a convenient excuse to attempt to undermine the constitutional rule of apportionment on direct taxes, which many greedy politicians found terribly restrictive to their goal of robbing the American people through taxation.
They felt that shareholder's profits from state-charted corporations could not be reached by the federal government for tax purposes without the Amendment.
Because item #3 is the least well recognized, we'll take moment to explain that theory (items #1 & 2 needing no explanation).

The vast majority of corporations that existed (then as now) were corporations chartered by the legislatures of the states of the Union. While the federal government had the power to lay excise taxes, such power was limited to certain subjects that were traditionally and historically within the purview of the federal government for excise purposes. There was no historical, traditional, or constitutional basis for the United States to assume it had the power to lay an excise tax on Citizens of the states of the Union who were enjoying a privilege which was sought solely from their state governments. The 1909 Corporate Tax Act had authority over corporations created by Congress, corporations created in a federal possession or territory, and corporations operating in interstate commerce, but not plain old state-charted corporations generally. Under this theory, the 16th Amendment was necessary only to bring the profits of state-charted corporations within the Constitutional reach of the federal government.


How Does The Corporate Tax Act and the 16th Tie Together?

"[Income]must be given the same meaning, in all the Income Tax Acts of Congress that it was given in the Corporate Excise Tax Act, and what that meaning is has become definitely settled by the decisions of this court. In determining the definition of the word 'income' thus arrived at, this court has consistently refused to enter into the refinements of lexicographers or economists, and has approved in the definitions quoted, what it believes to be the commonly understood meaning of the term which must have been in the minds of the people when they adopted the Sixteenth Amendment to the Constitution." Merchants Loan & Trust v. Smietanka, 255 US 509 (1921)
Immediately at the end of that passage from Merchant, the very first citation provided by the Court is, Doyle. And how did the Doyle court define "income"?


"...gain or increase arising from corporate activities."
We wonder how much more clear the Court has to be before people will understand that "16th Amendment income" is only related to the privilege of profiting from investing in corporations.

Let's take this a bit further and explore this statement from a US Supreme Court decision:


"The word 'income' as used in the Amendment does not include a stock dividend since such a dividend is capital and not income and can be taxed only if the tax is apportioned among the several states..."
Eisner v. Macomber, 252 US 189 (1920)
While a "cash dividend" represents profit to the shareholder, and is thus "income" under the 16th Amendment, a "stock dividend" is not profit that been "severed from capital" as is required to meet the definition of income under the 16th Amendment (ibid, Eisner). The Eisner quote featured above clearly illustrates that the apportionment clause of the Constitution is alive and well and has not been repealed or substantially altered by the 16th Amendment.

Let's take a moment to evaluate where we are:


The Constitutional question we really need to be asking is whether a particular tax is a direct tax or an indirect tax. What label that tax wears, such as "income tax", has basically become irrelevant due to misapplication of the phrase for the last 90 years.
In historical terms, an income tax (pre-16th Amendment) was always considered to be a tax that was direct.
In historical terms, and in the words of the US Supreme Court, the 1909 Corporate Tax Act was not an "income tax" [direct tax].
The 1909 Corporate Tax Act was an excise tax upon the privilege of doing business in the corporate form. This is confirmed by both Congress and the US Supreme Court.
Profit from corporate business ("16th Amendment income") is not that which the tax is laid upon, but merely a "yardstick" by which is computed the amount of tax that is due in exchange for exercising the privilege. In other words, profit from corporate business ("16th Amendment income") determines the value of the privilege, and thus the amount of tax to be paid.
The US Supreme Court has said that the definition of "income", as used in the 1909 Corporate Tax Act, must be used by Congress for all its (16th Amendment) income tax acts.
The US Supreme Court has stated that the definition of income used in the 1909 Corporate Tax Act is what the American people had in mind when they adopted the 16th Amendment.
The definition of "income" as used in the 1909 Corporate Tax Act is the exact same definition that the US Supreme Court has said must be used when applying the 16th Amendment.

Is The 16th Indirect, or Direct without Apportionment?
There has been much debate about whether the 16th Amendment authorized shareholder profits to be taxed by the federal government as a direct tax without apportionment, or merely confirmed that shareholder profits are taxable as an indirect (excise) tax, and therefore apportionment is of no constitutional concern.

At this point in history there is a judicial split. Six federal circuits see it one way, while the remaining five federal circuits see it the other way. While we feel confident that "16th Amendment income" is taxable only as an excise (for reasons too numerous to delve into here), in a broader sense we say, "Who cares?" If we know that "16th Amendment income" only applies to dividends, patronage dividends, and interest paid as profit or gain from a corporate investment, do we really care which type of tax it is? The US Supreme Court has stated that the 16th Amendment must have been intended to "harmonize" the taxing clauses of the Constitution, so whichever way one views it, a tax on "16th Amendment income" has still been deemed proper and Constitutional by the US Supreme Court. The bottom line is this: If you invest your money in corporate activities and you receive dividends, patronage dividends, or interest from your investment, you owe the tax under the authority of the 16th Amendment!

Before we leave this topic, we will tell you that in the case of Brushaber v. Union Pacific RR, Co., 240 US 1 (1916), the US Supreme Court made it clear that the purpose of the Amendment was to reverse the Pollock decision (at least in part) by taking [corporate] investment income out of the class of a direct tax, and placing it back in the class of an indirect [excise] tax, where it "inherently belongs". [If you'd like to tie your brain in knots, we encourage you to read the Brushaber decision.] Interestingly, federal circuit courts on both sides of the direct/indirect issue cite Brushaber as their primary authority.

"Business" v. Private Affairs
The law can be a tricky thing because words used in the law often times do not have the same meaning as when we use them in common speech. A prime example of that would be the word "business". When we use the word the word "business", we usually mean only that a person, or persons, is engaged in some effort to make money. We don't mean to imply any special meaning beyond that. However, when the government uses the word "business" in its laws, about 95% of the time, they mean only the activities of corporations (and other state-created fictional entities).

When an American Citizen engages in a non-regulated activity from which he earns his living, such activity is not "business", as such term is used in most statutes. When an American Citizen engages in a non-regulated activity from which he earns his living, he is actually engaged in the pursuit of his "private affairs". However, he must keep his affairs private, lest he stumble into "business"! What are some of the actions that can change your private affairs into "business"? Getting a business license; getting a resale permit; filing state or federal tax returns that reflect the earnings from your livelihood; getting involved with your state's department of Consumer Affairs, performing employee withholding under subtitle C of the Internal Revenue Code, acquiring a Taxpayer Identification Number, giving out a Taxpayer Identification Number, etc.

A "business" usually owes taxes and is generally subject to government regulation, but for most Americans the pursuit of their own "private affairs", which includes the earning of one's own livelihood, is not a taxable activity - unless you make it so.

Original Intent consultants can help you steer clear of engaging in "business". Click here for information on our consulting services, including our phone number. You can also reach us by clicking on the "contact us" icon in the left border of every page of this site.

Also, to better understand this issue we encourage you to read the Original Intent piece on Federal Income Tax.


But What If I Don't Have "16th Amendment Income"?
If one does not have "16th Amendment income", then one cannot have any tax liability under the authority of the 16th Amendment. However, it is important to note that there are others activities that can give rise to liability for other forms of taxes.

A partial list of such activities might include; being an employee of the federal government or any of the governments indicated at 26 USC 3401(c); dealing in distilled spirits under any applicable parts of Title 27 of the United States Code and Chapter 51 of the Internal Revenue Code; doing business in tobacco products covered under Chapter 52 of the Internal Revenue Code; engaging in any of the various activities covered under Subtitle D of the Internal Revenue Code, etc.

All of the above referenced activities are excise taxes. In other words, if one wishes to avoid the tax, stay away from the excise taxable activity.

If you don't have any 16th Amendment income, and you aren't involved in any excise taxable activity, the only way for the government to Constitutionally tax the money you earn in the course of pursuing your private affairs (which you now know includes earning your livelihood) is to do so by enacting a direct tax upon private earnings. No such tax exists today in America.

And remember, Subtitle 'C' "employment taxes" are not upon private Citizens involved in exchanging their labor for compensation in the private sector. For more on this subject, go to our page on Federal Employment Taxes.


Ratification of the 16th Amendment
There are serious and valid concerns about whether the 16th Amendment was lawfully ratified in accordance with the requirements of the US Constitution and the constitutions of the states of the Union. We will not delve into that discussion here because we are attempting to deal with the legal realities that currently exist concerning federal taxation. We hope that those who are pursuing the non-ratification cause will eventually be successful in having the faulty ratification process acknowledged by the federal government, and thus have the 16th Amendment invalidated.

If you wish to learn more about the issue of the non-ratification of the 16th Amendment, you may go to http://www.thelawthatneverwas.com/index.asp


Is the Income Tax Voluntary?
The answer to that question is a resounding "yes"...and "no".

Over the years some people have used the sentence, "Income tax is voluntary" as a mantra; chanting it over and over again as if it has magical qualities, or as if by repeating it enough times, their own tax liability (if any) might evaporate. Unfortunately, wishing income tax liability away will not alter reality.

First we must understand that in tax matters there are two forms of "voluntary". One is the voluntary act that creates liability; the other is "voluntary compliance". The two are not the same issue.

Voluntary compliance means that when a person properly and lawfully owes any tax, that person acts independently and responsibly to file his return and pay his tax timely. Without a reasonable amount of voluntary compliance the tax system would collapse. Of course taxation in general terms is a necessary feature of government and a collapse of the nation's legitimate tax system is not in anyone's interest. What Original Intent objects to, as we believe you do, is the unlawful and coercive collection of income taxes from American Citizens concerning whom no Constitutional income tax liability exists.

Because no direct tax on private earnings exists in this country, our tax system is voluntary. But the part that is voluntary is whether or not you want to engage in excise taxable activities, and thus create liability that would not otherwise exist. However, if you choose to engage in an excise taxable activity, the tax is not voluntary for you any longer - you volunteered and you must pay the tax.

There is another way Americans continually volunteer to pay federal and state income tax when they would not otherwise owe anything - you give people who pay you money your Social Security Number when they request a "tax number". By doing this, you declare that the money you are being paid is subject to state and federal taxation, even if it was not so subject until you gave out the number! For more on this, see our Federal Income Tax article.


What About the "Gross Income" (861) Argument?
We believe that the Gross Income argument is legally proper and sound. Its greatest proponent is undoubtedly Larken Rose. His clear and concise article on the Gross Income position can be found at http://www.taxgate.com/articles/taxable_income_larken.htm. Larken's VHS tape, Theft By Deception, which details the Gross Income argument in great detail, including its long statutory and regulatory history, can be acquired from Larken through his website, http://www.theft-by-deception.com

However, we want to make some important facts understood about the Gross Income argument. First, it is not an argument grounded upon the limits of the federal government's taxing authority under the US Constitution. It is only a regulatory argument and should never be misconstrued as a Constitutional argument.

Here is a critical point to understand: While Congress can never act lawfully beyond its constitutionally enumerated powers, there is no requirement forcing Congress to use a power that it has been granted. As an example, the US Constitution grants Congress the power to lay a direct tax upon the states. Congress has chosen not to enact such a tax. This same concept also extends to the regulatory side of law. Congress may well have the power to enact an excise tax that applies to more than the what is currently defined in the tax regulations as taxable income, but the Secretary of the Treasury has only promulgated regulations for what is taxable from domestic sources as indicated at 26 CFR § 1.861-8 (and its related sections). In other words, Congress may have authority to tax more sources of domestic income, but the Secretary has chosen to tax only the domestic source income that appears in the regulations.

And it should be well understood that in the absence of Congressional action, or the absence of regulatory enactments, no duty falls upon you and I as private Citizens.


How Can An Excise Tax Be Converted To A Direct Tax?
As you may recall, one of the foundations of an excise tax is "the element of absolute unavoidable demand is lacking". Once this element is gone, the tax becomes a de facto direct tax, solely due to the mode of enforcement. Here is what the US Supreme Court has said on the subject:


"[The Pollock court] recognized the fact that taxation on income was in its nature an excise entitled to be enforced as such unless and until it was concluded that to enforce it would amount to accomplishing the result which the requirement as to apportionment of direct tax was adapted to prevent, in which case the duty would arise to disregard the form and consider the substance alone and hence subject the tax to the regulation of apportionment which otherwise as an excise would not apply." Brushaber v. Union Pacific RR Co., 240 US 1 (1916)
What the Brushaber court is saying is that any income tax, which has been structured as an excise tax, but is enforced in such a way as to effectively covert the tax to a direct tax, would cause the court to declare it unconstitutional due to lack of apportionment. What type of enforcement might effectively convert an excise tax to a direct tax? Once the demand for the tax money is unavoidable, and you can no longer avoid the demand and/or the collection of the tax, even when you have not engaged in any excise taxable activity, that is when the Executive Branch's enforcement of the tax has converted the tax, in substance, from an excise into a direct tax.

I suspect that there are probably a couple of hundred million Americans who would agree that the way the IRS enforces today's income tax has effectively converted the excise [income] tax to a direct tax, and thus the tax should be constitutionally apportioned among the state of the Union.


Summary
This article could certainly have been at least twice as long as there is no shortage of material to examine concerning the Constitutional powers and limits of federal taxing authority. We hope that what we've given you has been effective in communicating the fundamental elements of the subject. We hope you have a better understanding of federal taxing authority than you did when you began reading the article.

Let's review what we've covered:

1.The US Constitution grants the federal government the authority to lay only two classes of taxation - direct and indirect.

2.Direct and indirect taxes are subject to Constitutional regulations concerning their mode of operation.

3.Direct taxes are subject to apportionment - even after the 16th Amendment.

4.Indirect taxes are subject to the rule of uniformity.

5.No direct tax on private earnings exists in this country - the disagreement of the federal courts notwithstanding.

6.The federal judicial circuits are split as to whether the 16th Amendment merely confirmed the government's excise taxing power concerning shareholder profits from corporate investment, or whether the Amendment created a new "special" form of direct tax that does not require apportionment.

7.In the Brushaber case, the US Supreme Court stated that any tax act under the authority of the 16th Amendment must properly be considered an excise, and is thus not subject to apportionment.

8.The definition of income used in the Corporate Tax Act of 1909 must be used in the income tax acts of Congress (passed under the authority of the 16th Amendment).

9.The definition of income used in the Corporate Tax Act of 1909 is the same definition that must be used when interpreting the 16th Amendment.

10.The 16th Amendment only pertains to "income" in the form of dividends, patronage dividends, and interest from corporate investment.

11.The 16th Amendment tax is upon the privilege (to shareholders) of operating a business as an artificial entity.

12.The 16th Amendment tax is not upon "income"; the income is only the yardstick used to determine the value of the privilege, and hence the amount of tax to be paid.

13.If you have no 16th Amendment income, you have no liability for a tax imposed under the authority of the 16th Amendment.

14.Other legitimate types of federal and state taxation do exist beyond the tax imposed under the authority of the 16th Amendment. They are all excise taxes.

15.Capital investment funds, even when invested in a corporation, are not subject to taxation except by a direct tax subject to apportionment.

16.A tax on your private earnings still needs to be apportioned to be constitutional.

17.If you wish to conduct only your private affairs, do not trespass into areas that give rise to the presumption of federal or state authority for taxation and/or regulatory authority.

18.In most statutes, "business" means the activities of a legislatively created entity such as a corporation, partnership, statutory trust, etc., and does not embrace the your private affairs, which includes your livelihood.

19.Giving out a SSN or TIN (when lawfully required) creates a powerful presumption of federal and state taxing authority over your earnings.

20.Signing any federal or state tax forms (including a Form W-4, creates a powerful presumption of federal and state taxing authority over your earnings.

21.The Gross Income argument is legally accurate, but is not intended to take the place, and does not take the place, of a constitutional argument.

22.If you choose to engage in an excise taxable activity, you must pay the tax.

23.If you choose to engage in an excise taxable activity, you are expected (by the government as well as your fellow citizens) to practice voluntary compliance.

24.An indirect tax can be effectively converted into a direct tax by improper enforcement by the Executive Branch. In that event, the US Supreme Court has said that it is its duty to declare the former excise tax to be a direct tax absent apportionment, and thus unconstitutional.

ORIGINAL INTENT







GIVE YOUR LOVED ONE THE GIFT OF HEALTH THIS YEAR

AN EDUCATION ON THE CONSTITUTION AND TAXATION.

Good morning everyone. Today I am posting a two-part short education on the Constitutionality of our income tax system. These are the basics that will show you what has happened to us. This issue is going to be a big one in 2003 I think as the people begin to wake up and ask questions of our government. The problem is that the government will not answer the questions because they know that they would have to admit fraud to the American People. Take a few minutes and absorb what this article is saying.

When people write their Congressmen about this issue, usually they get a letter back that has been prepared for them by either the IRS or the Department of Treasury. These men and women will not step out and demand answers for their constituents. Taxation means power and those who have grown comfortable in Washington refuse to look at an issue which will dilute their power to stay there.

****Don't Forget January 7th at the We The People TV site. Here is the link: We The People TV

Constitutional Issues of Taxation
For more information visit Original Intent

Most Americans understand that all government functions must be authorized by their state constitution or the Constitution of the United States. While this understanding may not be as firm as it was in our grandparents' day, it is still fairly well acknowledged. However, some feel that when it comes to matters of taxation, the government throws the Constitution out the window and all must follow the dictates of the government or pay the piper. While this is not legally true, there is ample reason for people to feel this way. The purpose of this article is to clarify what the Constitutional boundaries of taxation are and what we can do to stay clear of the boundary markers.

First and foremost we want to assure you that even government's taxing authority must be exercised in compliance with your state constitution, or if a federal tax, with the US Constitution.

Some of you who have investigated the Constitutional limits of taxation know that the subject can be difficult and frustrating. The Constitutional issues of taxation must be understood not only through a proper view of law, but also through a proper view of history. Taxation is as much a part of our nation's history as is King George III or George Washington.

We will attempt to break down the Constitutional realities of federal taxation for you without inundating you with court cases and other citations. We will try to present a plain-English explanation that weaves together all the essential legal realities that are elsewhere [in other web sites and books] explored in such excruciating minutia (sometime correctly, sometimes not). We hope to give you a strong and logical framework into which you can place all that you have read or seen, as well as all that you may find in the future.


Prior to the creation of the federal Constitution, the United States had been operating under the Articles of Confederation. The Articles of Confederation had a few glaring deficiencies, but the most problematic was the inability of the US to compel payments from the states to cover the operating costs of the federal government. In other words, Congress (which is nothing more than the states of the Union voting on what the national government will do) was authorizing the Executive Branch to take various actions, but then some of the states were not paying the bills responsibly for the actions Congress had authorized.

When the US Constitution was created, the Founding Fathers sought to correct this problem by giving the federal government clearly defined taxing powers. Direct taxes were to operate solely upon the state governments, while indirect taxes were to operate upon whomsoever would avail himself of a privileged activity (i.e. indirect taxation). However, because the states (as colonies) had been subject to taxes that were used for political punishment, as well as at times enduring taxes rates that were considered intolerably high, the Founding Fathers clearly specified the forms of the taxation that could be laid, along with the rules that the government must follow in order to Constitutionally lay such taxes.


What Does The US Constitution Permit?
The Federal Constitution only permits the government to lay two forms of taxation. One is a "direct tax" and the other an "indirect tax". Together these two forms of taxation comprise the whole; much like the northern and southern hemisphere - there's no third choice.

The term "indirect tax" never appears in the Constitution. The Constitution permits the US Government to "lay and collect taxes, duties, imposts and excises..." [See Article 1, Section 8, Clause 1.]

Although there has been some debate about the meaning of the word "taxes", as it appears in the above quote, it is generally held that its use refers to the direct taxes authorized in Article I, Section 2, Clause 3, while "duties, imposts and excises" are the three species of taxes which comprise the class of indirect taxes.

So how can we tell the difference between these two forms of taxation that the US Supreme Court has called "the two great tax classes"?

Here's a solid definition of "direct tax" straight from the US Supreme Court:


"Direct taxes bear upon persons, upon possessions, and enjoyment of rights". Knowlton v. Moore, 178 US 41
[See Article I, Section 2, Clause 3, which grants the U.S. the power to lay a direct tax.]

In other words, direct taxes cannot be avoided because they are upon things that are fixed - such as your physical being, your real property, and certain fundamental rights.

By contrast, an indirect tax is a tax that you can avoid by choosing not become involved in the activity upon which the tax is laid. An example of this might be importing products from another country into the United States. In such a circumstance one is required to pay an import duty. However, one can avoid paying an import duty simply by not importing foreign products into this country. Another example might be distilling rum in the Virgin Islands and importing it into the states of the Union. If one wishes to avoid the taxes involved in such a process, one need only to refrain form the activity.
In short, an indirect tax is a tax that you can choose to avoid without giving up the normal affairs of life. However, if one cannot avoid a taxable activity without sacrificing the ordinary affairs of life, the tax is not indirect, but direct.

Since within the class of indirect taxes, the excise tax is the one most familiar to the American public; what exactly is an excise tax?


"The term 'excise tax' and 'privilege tax' are synonymous. The two are often used interchangeably."
American Airways v. Wallace, 57 F.2d 877, 880
Here is a more detailed definition:


"The obligation to pay an excise is based upon the voluntary action of the person taxed in performing the act, enjoying the privilege or engaging in the privilege which is the subject of the excise, and the element of absolute unavoidable demand is lacking" People ex rel, Atty Gen v. Naglee, 1 Cal 232; Bank of Commerce & T. Co. v. Senter, 149 Tenn. 441SW 144
You will note that two elements are mandatory upon the government if a tax is to be classified as an excise, and thus avoid the requirement of apportionment. The first is that your actions must be "voluntary". In other words, as stated earlier, you must be free to steer clear of the "taxable activity" without sacrificing the ordinary affairs of life. Secondly, if you steer clear of the "taxable activity" the government cannot make a demand upon you for the tax that you cannot avoid by stating (or showing) that you were not involved in any excise taxable activity. We will revisit this issue later in the article.


How Does "Income Tax" Fit Into The Constitutional Scheme?
Although the tax that concerns most people is "income tax", the Constitutional question really rests on whether a tax (any tax) is a "direct tax" or an "indirect tax". As an example, Congress may pass a tax law that clearly structures a tax as a direct tax, and call that tax an "income tax". The following month they may pass another tax measure that is clearly structured as an indirect tax, and also call that an "income tax". If properly constructed, one bill would lay a direct tax, while the other bill would lay an indirect tax, and both would be referred to (by ignorant politicians) as "income tax" bills. You can see that the term "income tax" does not really answer a Constitutional question concerning taxation. For almost a century now people have been making the mistake of trying to define "income tax" as being exclusively within one tax class or the other, not understanding that it can be can be either depending on how Congress structures any particular tax.

As a nation, we have been fixated by the phrase "income tax", but it is important to know that term is one that can shift like the wind. We must focus on the issue of direct v. indirect. While the phrase "income tax" has a historic meaning in law, that formerly fixed meaning has been eroded to the point of near uselessness by misapplication of the phrase by Congress, the courts, and the public over the last 90 years.


[Editor's Note: Historically speaking, until the adoption of the 16th Amendment blurred the lines, the US Supreme Court had always viewed an "income tax" as a tax solely in the form of a direct tax. The Court did not view "excise taxes" as "income taxes". In many of the Court's decisions between 1913 and 1921, the Court clearly stated that the various tax acts passed by Congress, which laid excise taxes under the guise of "income taxes", were not really "income tax acts".]

Constitutional Regulations

In addition to allowing the national government to lay direct and indirect taxes, the US Constitution also mandates two "rules" concerning how the government can lay such taxes.


Direct taxes must be "apportioned among the several states which may be included within this Union". [See Article I, Section 2, Clause 3 and Article 1, Section 9, Clause 4.]

"All duties, imposts and excises [indirect taxes], shall be uniform throughout the United States". [See Article I, Section 8, Clause 1.]
Although there has been some debate on what apportionment actually means in a political sense, it is safe to say that it requires the population data from the most recent census be used to distribute the tax burden evenly throughout the states of the Union.

Uniform means that each person taxed in a given circumstance will be taxed at the same rate as any other person would be taxed in the very same circumstance. As an example, if a person produces 80 proof dark rum in the Virgin Islands and brings it into the United States at the port of New Orleans, he will be taxed exactly the same as any other man who would do exactly the same thing. However, if a man produces 100 proof dark rum in the Virgin Islands and brings it into port at New Orleans, it is Constitutional for him to be taxed at a different rate because his circumstance (bringing in 100 proof rum) is different from that of the first man (who was bringing in 80 proof rum).


The Dastardly 16th Amendment!
Because this site is about facts, and not about rhetoric or hyperbole, we will not delve into the ugly waters of what the 16th Amendment might have been intended (secretly or otherwise) to accomplish, or how the politics of the 16th Amendment were devious, or whether or not the 16th was properly ratified. We will stick to "what is" in this day and age.

We describe the 16th Amendment as "dastardly" not because of the politics attendant to its drafting or its alleged ratification, but because of the great misunderstandings that have followed its alleged ratification and the massive governmental theft of property from the American people that has occurred due to that misunderstanding. It is a completely factual statement to say that the 16th Amendment has resulted in the largest fraud ever perpetrated by a government against its Citizens.

We say "fraud" because one of the elements of the crime of fraud is to remain silent when there is a clear duty to speak, and certainly our government has a clear duty to come out and tell the public that most Americans do not owe a penny of Subtitle 'A' or 'C' taxes, either under the original provisions of the Constitution, or under the alleged authority of the 16th Amendment (as you will see later).

Although the government has always had a duty to speak out, recently representatives of the United States Department of Justice and the Internal Revenue Service had agreed to attend a hearing arranged by We The People Foundation for Constitutional Education and Congressman Bartlett. [The hearing was originally scheduled for Sept. of 2001, but was rescheduled for Feb. of 2002.] The purpose of the hearing was for the American people to get straight answers to some disturbing questions about US tax law and the administration of tax policy. Two weeks after receiving the first 199 questions, the DOJ and the IRS broke their word and pulled out of the hearing.

The questions that were submitted to DOJ and IRS can be viewed at, http://www.givemeliberty.org/bartlettresponse/draftquestions01-22-02.html

Furthermore, the federal government (with the state governments acting in complicity) continually seizes property not lawfully subject to seizure, routinely forces nontaxpayers into regulatory administrative tribunals, and repeatedly puts people in jail for not paying a tax they never legally owed. [See The Willful Failure to File Scam.] And all of this government deceit and manipulation became possible only because the 16th Amendment exists.

What Did The 16th Amendment Do?
The 16th Amendment was an attempt to overturn, by Constitutional Amendment, the supposed tax limitations placed on the national government by the decision of the US Supreme Court in the case of Pollock v. Farmer's Loan and Trust Co., 157 US 429 (1895). [While we see the 16th Amendment as being wholly unnecessary as a response to the Pollock decision, that discussion would require an entire separate article.]

Here is what the 16th Amendment says:


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.
That's it! That's the entire text of the Amendment that has caused so much confusion and trouble.

Historically, Americans of yesteryear were aware that a direct tax was upon their person, or their real property (including slaves), or their exercise of other fundamental rights. They were also aware that a tax on the fruits of one's property (such as receiving payment from renting a piece of real property) was also a direct tax unless those earnings where in the course of a privileged activity, and then they were subject to an excise tax.

In Pollock, the US Supreme Court stated that a tax upon earnings derived from one's existing property (real or personal) must be considered a direct tax subject to the rule of apportionment. This gave rise to concern in banking and government circles because they felt (and we agree) that corporations are something that is legislated into existence by the government and therefore the fruits therefrom is properly subject to an excise tax.

In other words, the Pollock decision made no distinction between a man earning rent from his private property, and a man earning a return on his investment in a corporation. The former must properly be considered a direct tax, while the latter should rightly be considered an excise. The rent from a man's private property is his "private affairs", and thus outside government's authority to lay any tax except a direct tax subject to apportionment.

However, profit or gain (to a shareholder) from a corporate enterprise should properly be income subject to taxation as an excise taxable activity - after all, there would be no opportunity for said profit if the state hadn't granted the corporation into existence.

We may never know whether the framers of the 16th Amendment had a legitimate concern about Pollock being used to challenge the 1909 Corporate Tax Act, or whether it simply provided a convenient excuse to try and alter the Constitution's tax regulation (i.e. apportionment for direct taxes). Fortunately, it matters not what their intentions may have been; it only matters what was actually accomplished.

The US Supreme Court has ruled on the meaning of the 16th Amendment many times. However, because each case has had different particulars, it is sometimes difficult to understand the decisions in a cohesive fashion or to give all the cases one settled meaning. Fortunately, we don't need to spend a lot of time reconciling all the various particulars of each case because the Court has been very clear as to the definition of "income" as used in the 16th Amendment. Since the Amendment only grants Congress the power to "to lay and collect taxes on incomes", that definition is rather critical.

Let's look at what the various courts have said about "income" and the 16th Amendment:


"The Treasury Department cannot, by interpretive regulations, make income out of that which is not income within the meaning of the revenue acts of Congress, nor can Congress, without apportionment, tax as income that which is not income within the meaning of the 16th Amendment."
Helvering v. Edison Bros. Stores, 133 F.2D 575
The last part of that quote is crucial to a proper understanding of the impact 16th Amendment, and indeed the entire tax structure of the federal government. It is essential that you understand that only "16th Amendment income" can be taxed without apportionment.


"The individual, unlike the corporation, cannot be taxed for the mere privilege of existing. The corporation is an artificial entity which owes its existence and charter powers to the state; but the individuals' Right to live and own property are natural rights for the enjoyment of which an excise cannot be imposed." Corn v. Fort, 95 S.W.2d 620 (1936)
From these two decisions alone, we can pinpoint some very crucial information.


All property (which includes income) other than "16th Amendment income" can only be taxed if the tax is constitutionally apportioned.

"16th Amendment income" can be taxed without apportionment.

Obviously the courts are making it clear that there is a real and significant distinction between "income" in the ordinary sense, and "16th Amendment income".

A Citizen's property (which includes ordinary income) cannot be taxed as an excise.

This Article Can Be Found At: Original Intent


****To Be Continued Tomorrow.







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