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DNA109.021
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1994-08-24
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TENNESSEE MAN FREED ON TAX CHARGES
by Bill Keller
FOR IMMEDIATE RELEASE
CHATTANOOGA, TENNESSEE
OCTOBER 14, 1993
In an amazing court case involving the "income tax" a Chattanooga jury
agreed with the argument by the defendant that the "Income tax" is actually
an EXCISE TAX and only applies to certain classes of people.
Nationally prominent attorney Lowell Becraft of Huntsville, Alabama,
assisted by attorney Russell J. Leonard of Sewanee, Tennessee, defended
Lloyd R. Long of Decherd, Tennessee, who was charged by the Internal Revenue
Service with willful failure to file income tax returns for the years 1989
and 1990.
In presenting the case for the Internal Revenue Service, assistant U.S.
Attorney Curtis Collier, assisted by special agent Michael Geasley of the
IRS, the government declared that Mr. Long had gross income in excess of
$49,000 for each of the years 1989 and 1990, and that he had "willfully"
failed to file income tax returns for those years as "required by law".
The defense admitted that Mr. Long did in fact have income in excess of
$49,000 for each of the years in question, and that he did not file a
return. He then proceeded to prove to the jury beyond a reasonable doubt
that he was not "liable" for an income tax, nor was he "required by law" to
file.
Defense testimony showed a case titled Brushaber v. Union Pacific Railroad
wherein it was the unanimous decision of the U.S. Supreme Court that the
Sixteenth Amendment did not give Congress any new power to tax any new
subjects; it merely tried to simplify the way in which the tax was imposed.
It also showed that the income tax was in fact an excise tax on corporate
privileges and privileged occupations. The defense then brought out a case
entitled Flint v. Stone Tracy wherein an excise tax was defined as tax being
laid upon the manufacture, sale, and consumption of commodities within the
country; upon licenses to pursue certain occupations; and upon corporate
privileges.
Long's attorneys also brought out a case entitled Simms v. Arehns, wherein
the court ruled that the income tax was neither a property tax nor a tax
upon occupations of common right, but was an excise tax.
The defense then brought out a case entitled Redfield v. Fisher, wherein the
court ruled that the individual, unlike the corporation, cannot be taxed for
the mere privilege of existing, but that the individual's right to live and
own property was a natural right upon which an excise cannot be imposed.
Defense also pointed to a couple of studies done by the congressional
research service that shows the INCOME TAX is an EXCISE.
TENNESSEE MAN FREED ON TAX CHARGES - Page 2.
Next defense pointed out that in Tennessee Supreme Court case Jack Cole v.
Commissioner, the court ruled that citizens are entitled by right INCOME or
EARNINGS, and that right could not be taxed as a privilege. And in another
Tennessee Supreme Court case, Corn v. Fort, the court ruled that individuals
have a right to combine their activities as partnerships; and that this is
a natural right, independent and antecedent of government.
The prosecution did not challenge or attempt to refute any of the cases
cited, or the conclusions of the courts.
Defense brought out in testimony the fact that nowhere in the entire
Internal Revenue Code was anyone actually made liable for the income tax.
They showed that in the IRS's own privacy act notice only three sections
were cited, and that none of these sections made anyone liable for the tax.
They also proved that this was not an oversight by showing that the alcohol
tax was worded so clearly that no one could misinterpret who was made liable
for the alcohol tax.
Prosecution did not challenge or attempt to refute this point, nor were they
able to show a statute that made anyone liable for the income tax.
Defense then presented the mission statement of the Internal Revenue Service
stating that the income tax relied upon "voluntary compliance," and a
statement from the head of the alcohol and tobacco tax division of the IRS
which in essence showed that the income tax is 100% voluntary, as opposed to
the alcohol tax, which is 100% enforced.
Mr. Long stated that in 1988 he knew that the income tax was in fact an
excise tax; and that he was not enjoying any corporate privileges nor
engaged in any privileged occupation; and that income or earnings from the
exercise of common right could not be taxed as an excise or otherwise; and
that nowhere in the Internal Revenue Code was he made liable for the tax;
and that the income tax was voluntary. But Mr. Long was still so
intimidated by the IRS that he filed and paid his voluntary assessment.
He then began a series of letters to the IRS explaining that he had no
licenses or privileges issued to him by the federal government. He asked
for direct answers to simple questions, such as, "Am I required to file
federal income tax returns?"; and "Am I liable for federal income taxes?".
The IRS never gave a direct answer to any of his questions. Instead they
inferred and insinuated and extrapolated and beat around the bush and
generally avoided answering. So Long testified that he decided to stop
"volunteering".
The IRS brought in two "expert" witnesses. Both were actually IRS employees
who had received training as professional witnesses. Upon cross-examination
by Becraft, one witness, a Ms. Jeu, stated that a secret code known only to
the IRS, and encoded on Mr. Long's permanent record, showed that the IRS
knew that he was not required to mail or file a return. Ms. Jeu made every
effort to avoid this admission, to the point that she was beginning to
frustrate the jury. The other witness, upon cross-examination by Mr.
Becraft gave testimony that conflicted with the privacy act notice.
The government also attempted to insinuate "guilt by association," in that
they claimed Mr. Long had known and relied upon persons of questionable
character. They argued that the writers of some of the books he red and
people he knew had been convicted of tax-related charges in the past, and
were in fact criminals.
TENNESSEE MAN FREED ON TAX CHARGES - Page 3.
Mr. Long responded that just because a person had been convicted of a crime
by a court, this did not invalidate everything he said. To illustrate his
point, he pointed out that the Apostle Paul was a murderer, but that by the
grace of God he became the greatest of the Apostles. He added that he, Mr.
Long, did not rely on anything that he did not personally check out
thoroughly.
In summation, Mr. Becraft reminded them that Galileo was imprisoned for
holding a belief that conflicted with what everyone else knew as a "fact";
and that Columbus acting on a belief which conflicted with what everyone
else knew as a "fact" discovered something no one else thought existed.
The jury agreed with the defense. By finding MR. Long NOT GUILTY on all
counts, they have ventured into hitherto uncharted territory in their
monumental decision.
A Chattanooga TV station quoted a government spokesman as saying that this
case will change the way the IRS will handle such cases in the future. They
indicated that they (the government) will be less likely to prosecute if a
jury isn't going to decide in their favor. Mr. Long's spirit was best
expressed when he was asked for a final statement by a reporter as he was
leaving the courtroom. His words: "To God be the glory!"
CLARIFICATION OF STATEMENTS AND INFERENCES IN THIS ARTICLE
What makes this case special is the fact that Mr. Long's acquittal was not
based on "willfulness" as is usually the case, but on the fact that the
prosecution could not produce a law that Mr. Long had allegedly violated.
Internal Revenue Code section 7203 states what the penalty is for "willfully
failing to file" a return required by law. It does not specify which return
was not filed. Amazingly, these indictments in income tax cases have not
included the statute that makes the filing of an income tax return
mandatory. Of course the reason is that no such statute exists.
There are several other important aspects of this case that need to be
clarified. First, contrary to what the article leads one to believe, the
income tax is not voluntary. It is mandatory for those to whom the law
applies, i.e., nonresident aliens, foreign corporations, foreign tax exempt
organizations, and U.S. citizens living abroad in a country where a tax
treaty exists with the United States (see 26 USC Sections 1441, 1442, 1443,
and 1461). Second, contrary to the article, liability for the income tax is
established in section 1461 on the "withholding agent." If you are not one
of these people, the law does not apply to you. To verify this information
for yourself, refer to Internal Revenue Code section 7701(a)(16), which is
the definition of a "withholding agent" and it will refer you to the above
mentioned code sections. Third, the article does not specify those
occupations that are "privileged" by the government. Currently, the only
"privileged" occupations are those involving the sale and/or manufacture of
alcoholic beverages, tobacco products, and firearms. THE REASONS WHY THE
ABOVE ARE TRUE ARE JUST AS IMPORTANT AS THE FACTS THEMSELVES.
For More information contact:
Save-A-Patriot Fellowship
PO Box 91
Westminster, Maryland 21158
Tel: (410) 857-4441
Fax: (410) 857-5249