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                        The Federal Zone:

              Cracking the Code of Internal Revenue

              (fourth edition: electronic version)


                               by


                         Mitch Modeleski


                          Published by


                 Account for Better Citizenship
                  c/o USPS Post Office Box 6189
                 San Rafael, California Republic
                   Postal Code 94903-0189/TDC


                          July 4, 1993


                                i

                                                The Federal Zone:


                           Disclaimer

     This book is designed to educate you about federal income
tax law, the Treasury regulations which promulgate that law, and
the various court decisions which have interpreted both. It is
sold with the understanding that the Author and Publisher are not
engaged in rendering legal services of any kind. The right to
author and publish this book, no matter how often the statutes,
regulations and case law are quoted, is explicitly guaranteed by
the First Amendment to the Constitution for the United States of
America, a written contract to which the federal government, the
50 States, and their respective agencies are all parties.
Federal and State laws are changing constantly, and no single
book can possibly address all legal situations in which you may
find yourself, now or in the future.


                        The Federal Zone:
              Cracking the Code of Internal Revenue

                      Common Law Copyright
                          July 4, 1993
                         Mitch Modeleski


     The information contained in this book is lawfully protected
from reproduction infringements for purposes of generating
revenue of any kind. Violators are hereby warned that they can
and will be prosecuted to the full extent of American law, at the
sole discretion of the Author and Publisher. The only other
restriction on the use and dissemination of the electronic fourth
edition is the requirement that users not modify the content of
the character stream in any way. The purpose of this requirement
is faithfully to preserve all punctuation, Capitalization, bold,
italics and underlines exactly as found in the original text.
Permission is hereby given to translate the electronic fourth
edition into formats compatible with different word processors,
resulting at most in cosmetic changes like different margins
which may cause changes in pagination.


                          Published by:

                 Account for Better Citizenship
                  c/o USPS Post Office Box 6189
                 San Rafael, California Republic
                   Postal Code 94903-0189/TDC


             WITH EXPLICIT RESERVATION OF ALL RIGHTS
               AND WITHOUT PREJUDICE TO ANY RIGHTS
                   PER UNIFORM COMMERCIAL CODE
                     ARTICLE 1, SECTION 207
                        (see Appendix F)


                               ii

                                                The Federal Zone:


                         Special Notice


     This book is protected by a Common Law Copyright under the
name of the author.

     One of the main purposes of this book is to explain how we,
the American People, have been deliberately deceived by
government officials who have systematically exploited this
deception to defraud us of our wealth and our freedom.

     If you make unauthorized copies of this book without paying
the Author for those copies, you are obtaining unjust enrichment
by doing so, and therefore you are no different from the
government officials who are stealing from you.

     Your continued financial support will be most appreciated
and will be spent to cover the time and expenses of people in the
Freedom Movement who are now dedicating precious time and energy
to defend your rights and your freedoms.

     To order additional copies, or to donate funds to cover
unauthorized photocopies, please dispatch first class mail to:

                 Account for Better Citizenship
                  c/o USPS Post Office Box 6189
                 San Rafael, California Republic
                   Postal Code 94903-0189/TDC

This U.S. Post Office box requires first class mail to bear
postage at the minimum rate of $0.29 for the first ounce.


Single Copy Cost: $25.00 (includes shipping and handling via
                               first class U.S. mail)

Express Mail: $35.00 (includes shipping and handling via
                               express U.S. mail)

The electronic version is shipped on a 3.5" floppy disk formatted
by MS-DOS to contain 1.44 megabytes. Appendices D, K and L are
missing from the electronic version. Printed copies of these
appendices can be obtained by writing to the publisher.

     The printed second edition remains $40 will supplies last.

     We will accept cash, checks and blank postal money orders.
A blank postal money order shows nothing on the "payee" line,
allowing us to write our own payee on this line and to negotiate
the money order freely. Sorry, but we do not take credit cards.
We reserve the right to endorse your checks "without prejudice
UCC 1-207" and without granting jurisdiction (see Appendix F).

     Thank you very much for your interest and support.


                               iii

                                                The Federal Zone:


                       Publication History


               First Edition January 1992 hard-copy

               Second Edition July 4th 1992 hard-copy

               Third Edition January 1993 electronic

               Fourth Edition July 4th 1993 electronic


                               iv

                                                The Federal Zone:


                           Dedications


           If Frank Brushaber was a Nonresident Alien,

                          then so am I,

             and so are millions of other Americans

            who will know the truth if we teach them.


      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 its own ....
     Slaughter-House Cases

           [United States vs Cruikshank, 92 U.S. 542 (1875)]
                                            [emphasis added]


     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. 36 (1873)]
                                            [emphasis added]


                    Mitch Modeleski, Founder
                 Account for Better Citizenship
                 San Rafael, California Republic
                          July 4, 1993


                                v

                                                The Federal Zone:


                            Notations

     The Supreme Court has officially defined the key term
"United States" to have three separate and distinct meanings:


     (1) It may be the name of a sovereign occupying the
          position of other sovereigns in the family of nations.

     (2) It may designate the limited territory over which the
          sovereignty of the federal government extends.

     (3) It may be the collective name for the fifty States
          which are united by and under the Constitution.


     Understanding these several meanings is absolutely crucial
to understanding the remainder of this book. Much confusion will
result from failing to recognize (or decipher) the meaning that
is used in any given context. In order to reinforce their
importance, these three meanings will be identified by using the
following convention whenever possible:


     (1) United States* or U.S.* (first meaning)

          The name of the sovereign nation, occupying the
          position of other sovereigns in the family of nations.


     (2) United States** or U.S.** (second meaning)

          The federal government and the limited territory over
          which it exercises exclusive sovereign authority.


     (3) United States*** or U.S.*** (third meaning)

          The collective name for the States united by and under
          the Constitution for the United States of America.


     At the risk of being criticized for violating formal English
style, quotations have also been modified with this notation.
The risk of misunderstanding was judged to be far more serious
than any violations of conventional style. It is the Author's
sincere intent that the addition of asterisks will be obvious in
all cases, even if the meaning of "United States" is not obvious
in any particular case.

     Exceptions to this convention will be made for book titles,
for United States Codes (abbreviated USC or U.S.C.), for the
United States (or U.S.) Constitution, and for the United States
(or U.S.) Supreme Court.


                               vi

                                                The Federal Zone:


     Other notations should be obvious from their context, but
will be repeated here for extra clarity:


     IR means Internal Revenue (e.g., IR Manual refers to the
          IRS Internal Revenue Manual)

     IRC means Internal Revenue Code (also known as Title 26)

     IRS means Internal Revenue Service in the Department of the
          Treasury

     USC means United States Code (e.g., 26 USC 7701 refers to
          Title 26, United States Codes, Section 7701)

     CFR means Code of Federal Regulations (e.g., 26 CFR 1.871-1
          are the regulations for Section 871 of Title 26)

     T.D. means Treasury Decision, a written decision published
          in the Federal Register by the Treasury Department.

     U.S. means United States decision when used to cite a ruling
          of the Supreme Court (e.g., 324 U.S. 652 refers to
          volume 324, page 652 of Supreme Court decisions)


          If a nation expects to be ignorant and free,
               it expects something it cannot be.

                                                 Thomas Jefferson


               Help us to abolish the
               specter of modern slavery
               which now threatens to destroy
               the essential rights and freedoms
               which made this a great nation
               and the envy of others
               around the world.

               Help us to restore a government
               which has drifted so far off course
               it hardly resembles
               the constitutional republic
               it was designed to be.


                                                  from Cover Page
                                           Notice to 50 Governors
                                   Account for Better Citizenship


                               vii

                                                The Federal Zone:


                        Table of Contents


Contents: Page


Disclaimer ................................................... ii

Special Notice .............................................. iii

Dedications ................................................... v

Notations .................................................... vi

Table of Contents .......................................... viii

Introduction .......................................... intro - 1

Chapter 1: The Brushaber Decision ........................ 1 - 1

Chapter 2: Status and Jurisdiction ....................... 2 - 1

Chapter 3: The Matrix .................................... 3 - 1

Chapter 4: The Three United States ....................... 4 - 1

Chapter 5: What State Are You In? ........................ 5 - 1

Chapter 6: Empirical Results ............................. 6 - 1

Chapter 7: Inside Sources ................................ 7 - 1

Chapter 8: Is it Voluntary? .............................. 8 - 1

Chapter 9: The Law of Presumption ........................ 9 - 1

Chapter 10: The Fundamental Law .......................... 10 - 1

Chapter 11: Sovereignty .................................. 11 - 1

Chapter 12: Includes What? ............................... 12 - 1

Chapter 13: Amendment 16 Post Mortem ..................... 13 - 1

Chapter 14: Conclusions .................................. 14 - 1

Appendices ..................................... (see next pages)


                              viii

                                                The Federal Zone:


                        Table of Contents


Appendices: Page


A Letter to John Knox and Memorandum of Law ............ A - 1

B Omnibus Acts ......................................... B - 1

C Treasury Decision 2313 ............................... C - 1

D Form 1040 for 1913 ..... not available in electronic version

E Viacom Transcript .................................... E - 1

F Affidavit of Rescission .............................. F - 1

G Deceptive IRS Code Words ............................. G - 1

H Analysis of U.S. vs Hicks ............................ H - 1

I Notice to 50 Governors ............................... I - 1

J Petitions to Congress ................................ J - 1

K IRS Form 1040NR ........ not available in electronic version

L IRS Form W-8 ........... not available in electronic version

M List of Organizations ................................ M - 1

N Bibliography ......................................... N - 1

O Constructive Notice and Demand ....................... O - 1

P Miscellaneous Letters ................................ P - 1

Q Apportionment Statute ................................ Q - 1

R Affirmations: Within & Without ....................... R - 1

S Affidavit of Foreign Status .......................... S - 1

T Revocation of Birth Certificate ...................... T - 1

U Revocation of Voter Registration ..................... U - 1

                                                       [more ...]


                               ix

                                                The Federal Zone:


                        Table of Contents


Appendices: Page


V Affidavit of Applicable Law .......................... V - 1

W Memos on Downes vs Bidwell ........................... W - 1

X Certificate of Exemption from Withholding ............ X - 1

Y Memoranda of Law by Richard McDonald ................. Y - 1

Z The Nature and Cause: Case Law ...................... Z - 1


                             # # #


                                x

                          Introduction


     In the late Spring of the year 1990, our small beach town in
Northern California was visited by a minor political controversy.
A local writer for the weekly newspaper, a man named Kirby
Ferris, had a number of neighbors buzzing about his recent
sequence of articles challenging the 16th Amendment, the
so-called "income tax" amendment in the U.S. Constitution. It
seems that Kirby had come across some huge collection of
documents which allegedly proved that the 16th Amendment was
never ratified. Instead of obtaining the required approval of 36
State legislatures, the proposed amendment was simply "declared"
ratified on February 25, 1913 by Philander C. Knox, a man who
purported to be Secretary of State. Kirby Ferris had, evidently,
visited one of the men responsible for assembling this collection
of 17,000 State-certified documents and returned entirely
convinced that the so-called 16th Amendment was a complete and
total fraud. The man he visited was Martin J. "Red" Beckman, a
Montana rancher whose name now appears as co-author with Bill
Benson on the cover of The Law That Never Was, a book that has
already become a classic in American historical literature.

     Up to that point in time, I had not been much of a Ferris
fan. Too often for me, his style bordered on being too
inflammatory and lacking necessary details. After all, Kirby had
spent his youth surfing waves, drinking beer, and chasing
bikinis. When this little controversy erupted, I made no secret
of my bachelor's degree in Political Science from UCLA, and my
master's degree from the University of California at Irvine in
Public Administration. Trotting out these credentials, of
course, was invariably my preface to answering the several
questions which friends and neighbors put to me about Kirby's
allegations, as if to underscore my obvious qualifications to
repudiate Kirby's claims. "If there's a problem, Congress will
just fix it," I must have said more times than I care to admit.

     One day at breakfast in the Parkside Cafe, a favorite hang-
out for all the "locals", the same conversation began again, this
time with a Vietnam War veteran by the name of Mike Taylor. Mike
is an intense man, with fierce convictions, a booming voice, a
few lingering effects of combat shell shock, and a habit of
getting right to the point. "What do you think of Kirby's
columns on income tax?" he queried. Again, as if to practice a
polished art, I repeated the same old answer one more time,
"Congress will just fix it, if there really is a problem with the
16th Amendment." The answer had worked in the past; there was
no reason why it wouldn't work on Mike too. Wrong! Mike shot
right back, "OK. You're so smart. How is Congress going to fix
it?" he retorted. "They'll pass a law. How else do you think
they would fix it?" I answered, somewhat surprised from pride to
be challenged so directly. And then Mike lowered the boom, "Are
you telling me that Congress can amend the Constitution by
passing a law? Is that what you're telling me?"


                          intro 1 of 6

                                                The Federal Zone:


     My jaw fell, as if to begin my next sentence, but no words
came out of my mouth. I knew that he had me. Congress cannot
amend the Constitution. Of course, Mike was right. In a feeble
attempt to recover, I retreated by admitting that two-thirds of
the States were required to amend the Constitution, and that
Congress alone did not have the power to do so. Then Mike
delivered the knockout punch, "It takes three-fourths of the
States to amend the Constitution, Mitch, not two-thirds." I was
had. All those years in school, all those high school civics
classes, all those papers on political theory, and all those
months of management science had left me woefully unprepared to
spar with Mike when it came to the Supreme Law of our Land. The
lesson was a good one, one that I will never forget for the rest
of my days.

     My embarrassed defeat was a terrific motivation. I went to
work ordering books and reading everything I could get my hands
on. A purchase order flew up to Red Beckman in Billings,
Montana. Within a week I was devouring my own copy of The Law
That Never Was. I had to repent for my errors, or so my
religious training had led me to believe. The book was a turning
point, in more ways than one. I knew enough about the rules of
evidence to question every page. "How could this problem have
gone undetected for such a very long time?" I asked myself. Here
were allegations which appeared to undermine a major source of
revenue for the entire federal government of the United States.
I needed more proof.

     I wrote to Kirby and explained my situation. It had been
many years since my college political activism. I was now a
senior systems consultant for a major investment bank in San
Francisco, with almost 20 years of computer experience under my
belt. I was often seen blending in among the "grey men" of the
financial district, not too far from a regional Federal Reserve
Bank. If I was going to take this problem very seriously and, in
particular, if I was ever going to do anything about the 16th
Amendment fraud, then I was going to need something more than a
printed book from some Montana rancher I had never met. After
all, with enough money, anybody can put ink to paper and put
almost anything into circulation these days. I needed something
more; I needed material evidence, as they call it in court rooms
and in law schools -- material evidence, not hearsay, and
certainly not unsubstantiated allegations that a massive fiscal
fraud had been perpetrated on the American people for more than
two generations.

     Kirby rose to the occasion. "Tell me what you need," he
said. I thought about it and invited him to come over for
coffee. If there really were 17,000 documents, all officially
certified by the Secretaries of State in the Capitol buildings of
48 of the United States***, there was no point in plowing through
such a huge mound of paperwork. Paperwork was something which I
put somewhere below a necessary evil. We put our heads together
and came up with a plan. The feds have admitted in writing that


                          intro 2 of 6

                                                     Introduction


6 States did not ratify the 16th Amendment. Since three-fourths
of the States were required to ratifyit, the amendment could
have passed with at most 12 States opposing it. If we could find
only 7 additional States which obviously failed to ratify the
amendment, that would make a total of 13 NAY's, and we would have
defeated the "income tax". What a tantalizing thought! Before
the night was over, we had our list of "The Dirty Seven", as
Kirby liked to call them.

     Kirby Ferris went home to call Red Beckman. Two days later,
Kirby left a short note on my front door: Red Beckman had agreed
to photocopy all the relevant documents for The Dirty Seven
States, and would ship them to us as soon as the copying was
done. Within a week, two large cardboard boxes were sitting on
my front porch when I returned home from work. There it was, the
evidence I needed. It was incontrovertible: the 16th Amendment
was never ratified. The act of declaring it ratified was an act
of outright fraud by Secretary of State Philander C. Knox, a man
who was sworn to obey the Constitution. This was an awesome
discovery.

     The events which have transpired since that moment have
literally changed my life. I have filed formal petitions with
two Representatives in the Congress of the United States. A
detailed notice of fraud and deception has been served on all the
governors of the 50 States. I have requested a Grand Jury
investigation into the fraud committed by Secretary of State
Philander C. Knox. I have studied and debated and learned
everything I could about the laws and regulations which bear on
this question. It has been an exhilarating and challenging
experience. Almost all of the opposition has come from
government personnel, mostly officials of the Internal Revenue
Service. That opposition has been most instructive.


     For those of you who may not know exactly how and where the
U.S. Constitution is relevant to this subject matter, the text of
the failed 16th Amendment follows:


     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.

                  [Constitution for the United States of America]
                               [text of so-called 16th Amendment]
                                                 [emphasis added]

From the beginning, the U.S. Constitution has empowered Congress
to levy two different kinds of taxes: direct and indirect.
These are powers which Congress has always had, with or without
the so-called 16th Amendment. The power to levy indirect taxes
is authorized by Article 1, Section 8, Clause 1, as follows:


                          intro 3 of 6

                                                The Federal Zone:


     The Congress shall have Power To Lay and collect Taxes,
     Duties, Imposts and Excises, to pay the Debts and provide
     for the common Defense and general Welfare of the United
     States; but all Duties, Imposts and Excises shall be
     uniform throughout the United States; ....

                  [Constitution for the United States of America]
                                 [Article 1, Section 8, Clause 1]
                                                 [emphasis added]


     Federal excise taxes on the sale of gasoline and tires are
examples of indirect taxes. The requirement that indirect taxes
be uniform throughout the several States is known as the
"uniformity rule". The power to levy direct taxes is authorized
by two separate clauses of the Constitution, as follows:


     Representatives and Direct Taxes shall be apportioned among
     the several States which may be included within this Union,
     according to their respective Numbers ....

                  [Constitution for the United States of America]
                                 [Article 1, Section 2, Clause 3]
                                                 [emphasis added]


     No Capitation, or other direct, Tax shall be laid, unless in
     Proportion to the Census or Enumeration hereinbefore
     directed to be taken.

                  [Constitution for the United States of America]
                                 [Article 1, Section 9, Clause 4]
                                                 [emphasis added]


     Thus, the requirement that direct taxes be apportioned was
considered by the Framers to be so important, it is mentioned
twice in the U.S. Constitution. This requirement is known as the
"apportionment rule", and its application is easy to understand.
If California has 10 percent of the nation's population, then
California's "portion" would be 10 percent of any direct tax
imposed by Congress. A "capitation" is another word for a direct
tax imposed on each "head" or person (caput is Latin for "head").
Federal taxes on personal property, or on the income of personal
property, are examples of direct taxes. Appendix Q shows the
State portions of a lawful direct tax that was levied by Congress
in the year 1798.


                             # # #


                          intro 4 of 6

                                                     Introduction


Reader's Notes:


                          intro 5 of 6

                                                The Federal Zone:


Reader's Notes:


                          intro 6 of 6

                           Chapter 1:
                     The Brushaber Decision


     Historically, defensive federal officials have argued that
the 16th Amendment is constitutional because the Supreme Court of
the United States has said so. In the year 1916, the high court
issued a pivotal decision which is identified in the case law as
Brushaber vs. Union Pacific Railroad Company, 240 U.S. 1. It is
important to realize that the evidence impugning the ratification
of the 16th Amendment was not published until the year 1985.
This evidence was simply not available to plaintiff Frank R.
Brushaber when he filed his first complaint on March 13, 1914 in
the District Court of the United States for the Southern District
of New York. His complaint challenged the constitutionality of
the income tax statute which Congress had passed immediately
after the 16th Amendment was declared ratified. Specifically, he
challenged the constitutionality of the income tax as it applied
to a corporation of which he was a shareholder, i.e., the Union
Pacific Railroad Company. His challenge went all the way to the
Supreme Court, and he lost.

     Ever since then, attorneys, judges and other officials of
the federal government have been quick to cite the Brushaber
case, and others which followed, as undeniable proof that the
16th Amendment is constitutional. With its constitutionality
settled by the Brushaber ruling, former Commissioner of Internal
Revenue Donald C. Alexander felt free, almost 60 years later, to
cite the 16th Amendment as the constitutional authority for the
government to tax the income of individuals and corporations.
Consider the following statement of his which was published in
the official Federal Register of March 29, 1974, in the section
entitled "Department of the Treasury, Internal Revenue Service,
Organization and Functions". His statement reads in part:

     (2) Since 1862, the Internal Revenue Service has undergone
     a period of steady growth as the means for financing
     Government operations shifted from the levying of import
     duties to internal taxation. Its expansion received
     considerable impetus in 1913 with the ratification of the
     Sixteenth Amendment to the Constitution under which Congress
     received constitutional authority to levy taxes on the
     income of individuals and corporations.

                                    [Vol. 39, No. 62, page 11572]
                                                 [emphasis added]

     What is not widely known about the Brushaber decision is the
essence of the ruling. Contrary to widespread legal opinion
which has persisted even until now, the Supreme Court ruled that
taxation on income is an indirect tax, not a direct tax. The
Supreme Court also ruled that the 16th Amendment did not change
or repeal any part of the Constitution, nor did it authorize any
direct tax without apportionment. To illustrate the persistence


                         Page 1 - 1 of 6

                                                The Federal Zone:


of wrong opinions, on a recent vacation to Montana, I had
occasion to visit the federal building in the city of Missoula.
On the wall outside the Federal District Court, Room 263, a
printed copy of the U.S. Constitution is displayed in text which
annotates the 16th Amendment with the following statement:

     This amendment modifies Paragraph 3, Section 2, of Article I
     and Paragraph 4, Section 9, of Article I.

     In light of the Brushaber decision, this statement is
plainly wrong and totally misleading. The text of the 16th
Amendment contains absolutely no references to other sections of
the Constitution (unlike the repeal of Prohibition). In his
excellent book entitled The Best Kept Secret, author Otto Skinner
reviews a number of common misunderstandings like this about the
16th Amendment, and provides ample support in subsequent case law
for the clarifications he provides. Interested readers are
encouraged to order Otto Skinner's work by referring to the
Bibliography (Appendix N).

     The U.S. Constitution still requires that federal direct
taxes must be apportioned among the 50 States of the Union.
Thus, if California has 10 percent of the nation's population,
then California's "portion" would be 10 percent of any direct
federal tax. In the Brushaber decision, the Supreme Court
concluded that income taxes are excises which fall into the
category of indirect taxes, not direct taxes. From the
beginning, the U.S. Constitution has made an explicit distinction
between the two types of taxation authorized to the Congress,
with separate limitations for each type: indirect taxes must be
uniform across the States; direct taxes must be apportioned.
Writing for the majority in one of his clearer passages, Chief
Justice Edward Douglass White explained it this way:

     [T]he conclusion reached in the Pollock Case did not in any
     degree involve holding that income taxes generically and
     necessarily came within the class of direct taxes on
     property, but on the contrary recognized the fact that
     taxation on income was in its nature an excise entitled to
     be enforced as such ....

     [Brushaber vs Union Pacific Railroad Co., 240 U.S. 1 (1916)]
                                                 [emphasis added]

     Unfortunately for Justice White, most of the language he
chose to write the majority's opinion, and the resulting logic
contained therein, are tortuously convoluted and almost totally
unintelligible, even to college-educated English majors. In his
wonderful tour de force entitled Tax Scam, author Alan Stang
quips that Justice White:

     ... turned himself into a pretzel trying to justify the new
     tax without totally junking the Constitution.
                                                        [page 45]


                         Page 1 - 2 of 6

                                           The Brushaber Decision


     Stang's book is a must, if only because his extraordinary
wit is totally rare among the tax books listed in the
Bibliography (Appendix N). Other legal scholars and experienced
constitutional lawyers have published books which take serious
aim at one or more elements of White's ruling. Jeffrey
Dickstein's Judicial Tyranny and Your Income Tax and Vern
Holland's The Law That Always Was are two excellent works of this
kind. Both authors focus on the constitutional distinctions
between direct and indirect taxes, and between the apportionment
and uniformity rules.

     Dickstein does a masterful job of tracing a century of
federal court decisions, with an emphasis on the bias and
conflict among federal court definitions of the key word
"income". He exercises rigorous logic to demonstrate how the
Brushaber ruling stands in stark contrast to the important
Supreme Court precedents that came before and after it in time.
For example, after a meticulous comparison of Pollock with
Brushaber, Dickstein is forced to conclude that:


     Justice White's indirect attempt to overturn Pollock is
     wholly unpersuasive; he clearly failed to state a
     historical, factual or legal basis for his conclusion that a
     tax on income is an indirect, excise tax. It is clear that
     Mr. Brushaber and his attorneys correctly stated the
     proposition to the Supreme Court that the Sixteenth
     Amendment relieved the income tax, which was a direct tax,
     from the requirement of apportionment, and that the
     Brushaber Court failed miserably in attempting to refute Mr.
     Brushaber's legal position.

                  [Judicial Tyranny and Your Income Tax, page 60]
                                                 [emphasis added]


Dickstein also proves that an irreconcilable conflict exists
between the Brushaber decision and a subsequent key decision of
the Supreme Court, Eisner vs Macomber, 252 U.S. 189:


     There is an irreconcilable conflict between the Brushaber
     case, which holds the income tax is an indirect tax not
     requiring apportionment, and the Eisner case, which holds
     the income tax is a direct tax relieved from apportionment.

                           [Judicial Tyranny and Your Income Tax]
                                           [footnote on page 141]


Going back even further in American history, Holland argues
persuasively that "income" taxes have always been direct taxes
which must be apportioned even today, Brushaber notwithstanding:


                         Page 1 - 3 of 6

                                                The Federal Zone:


     It results, therefore: ...

     4. That the Sixteenth Amendment did not amend the
     Constitution. The United States Supreme Court by unanimous
     decisions determined that the amendment did not grant any
     new powers of taxation; that a direct tax cannot be
     relieved from the constitutional mandate of apportionment;
     and the only effect of the amendment was to overturn the
     theory advanced in the Pollock case which held that a tax on
     income, was in legal effect, a tax on the sources of the
     income. ...

     6. [T]hat a General Tax on Income levied upon one of the
     Citizens of the several States, has always been a direct tax
     and must be apportioned.

                              [The Law That Always Was, page 220]
                                           [emphasis in original]


     There are, however, two additional lessons from the
Brushaber decision which have been entirely lost on most, if not
all of the authors who have published any analysis of this
important ruling. These are the dual issues of status and
jurisdiction, issues which it is my intention to elevate to the
level of importance which they have always deserved. An
understanding of status and jurisdiction places the Brushaber
ruling in a new and different light, and solves a number of
persistent mysteries and misunderstandings which have grown up
around an income tax law which now includes some 2,000 pages of
statute and 6,000 pages of regulations. More precisely, the
published rules of statutory construction require us to say that
the income tax law now includes only 2,000 pages of statute and
6,000 pages of regulations.

     Obviously, without a comprehensive paradigm with which to
navigate such a vast quantity of legalese, particularly when this
legalese is only slightly more intelligible than White's verbal
pretzels, it is easy to understand why professors, lawyers,
CPA's, judges, prosecutors, defendants and juries consistently
fail to fathom its meaning. In the Republic envisioned by the
Framers of the Constitution, a sophisticated paradigm should not
be necessary for the ordinary layman to understand any law. In
and of itself, the need for a sophisticated paradigm is a
sufficient ground to nullify the law for being vague and too
difficult to understand in the first place. Nevertheless, the
remainder of this book will show that status and jurisdiction
together provide a comprehensive paradigm with sufficient
explanatory power not only to solve the persistent mysteries, but
also to provide vast numbers of Americans with the tax relief
they so desperately need and deserve.


                             # # #


                         Page 1 - 4 of 6

                                           The Brushaber Decision


Reader's Notes:


                         Page 1 - 5 of 6

                                                The Federal Zone:


Reader's Notes:


                         Page 1 - 6 of 6

                           Chapter 2:
                     Status and Jurisdiction


     Understanding the status of the parties to the Brushaber
case is essential to understanding both the outcome, and the
Treasury Decision which followed soon after the Supreme Court's
landmark ruling in the case. Frank R. Brushaber filed his
original Bill of Complaint on March 13, 1914, within a year after
Philander C. Knox declared the 16th Amendment to be the supreme
Law of the Land. Addressing the judges of the District Court of
the United States for the Southern District of New York,
Brushaber began his complaint as follows:

     Frank R. Brushaber, a citizen of the State of New York and a
     resident of the Borough of Brooklyn, in the City of New
     York, brings this his bill against Union Pacific Railroad
     Company, a corporation and citizen of the State of Utah,
     having its executive office and a place of business in the
     Borough of Manhattan, in the City of New York, and the
     Southern District of New York, in his own behalf and on
     behalf of any and all of the stockholders of the defendant
     Union Pacific Railroad Company who may join in the
     prosecution and contribute to the expenses of this suit.

                                                 [emphasis added]

     Right from the beginning, Frank Brushaber made an important
statement of fact which remained unchallenged at every level in
the federal courts. He identified himself as a citizen of the
State of New York and a resident of the Borough of Brooklyn, in
the City of New York. He did not identify himself as a "United
States** citizen" or as a "resident of the  United States**". He
indicated that he lived and worked in New York State, outside the
District of Columbia and outside any territory, possession or
enclave controlled by the Congress of the United States**.
"Enclaves" are areas within the 50 States which are "ceded" to
Congress by the acts of State Legislatures (e.g. military bases).

     The federal courts concluded that Brushaber, under the law,
was a "nonresident alien". He was "nonresident" because he lived
and worked outside the areas of land over which the Congress has
exclusive jurisdiction. The authority to have exclusive
jurisdiction over this land was granted to Congress by Article 1,
Section 8, Clause 17, and Article 4, Section 3, Clause 2 of the
Constitution. In this book, I will often refer to these areas of
land as "the federal zone". Brushaber was an "alien" because his
statement of citizenship was taken as proof that he was not a
citizen of the federal zone. He was not a "United States**
citizen", either through birth or naturalization, because the
term "United States**" in this context means only the federal
zone. Therefore, he was alien with respect to the District of
Columbia and the federal enclaves, territories and possessions
over which the Congress has exclusive legislative jurisdiction.


                         Page 2 - 1 of 8

                                                The Federal Zone:


This may sound strange to the casual reader, but the law is not
referring to creatures from outer space. The law is referring to
the creation of lawyers.

     Right from the beginning, Frank Brushaber also made an
important error which contributed to his ultimate downfall in the
case. He identified his opposition as a corporation chartered by
the State of Utah:


     Your orator further shows that the defendant Union Pacific
     Railroad Company is, and at all the times hereinafter
     mentioned was, a corporation duly organized and existing
     under and by virtue of the laws of the State of Utah, and a
     citizen of the State of Utah ....

          [from original Bill of Complaint, filed March 13, 1914]


This was incorrect. The Union Pacific Railroad Company was
originally created in the year 1862 by an Act of Congress. The
stated purpose of the corporation was to aid in the construction
of a railroad and telegraph line from the Missouri River to the
Pacific Ocean. This Act was passed on July 1, 1862 by the
Thirty-Seventh Congress, Second Session, as recorded in the
Statutes at Large, (December 5, 1859 to March 3, 1863 at Chapter
CXX, page 489). At that time, Utah had not yet been admitted as
a State of the Union. It was still a territory, i.e., a "federal
state", over which the Congress had exclusive legislative
jurisdiction.

     Being a creation of Congress, the Union Pacific Railroad
Company was found to be a "domestic" corporation under the law.
This is another term which is very confusing to the casual
reader. In common, everyday language, the term "domestic" is
often used to mean "inside the country". For example, airports
are divided into different areas for domestic and foreign
flights, in order to allow Customs agents to inspect the baggage
and passports of passengers arriving on flights from foreign
countries. However, under federal tax law, the term "domestic"
does not mean "inside the country"; it means "inside the federal
zone" which is an area that is much smaller than the whole
country. Accordingly, a "foreign" corporation is a corporation
which was chartered by a government that is "outside the federal
zone". The federal zone consists of the enclaves, territories
and possessions over which the Congress of the United States**
has exclusive legislative jurisdiction. California is outside of
the federal zone, for example, and corporations which are
chartered in the State of California are foreign corporations
with respect to the federal zone. Similarly, corporations
chartered in France are likewise foreign corporations with
respect to the federal zone. It is simple, once you understand
the proper legal definitions of "foreign" and "domestic" in the
federal tax law.


                         Page 2 - 2 of 8

                                          Status and Jurisdiction


     The status of the two parties in the Brushaber case can,
therefore, be summarized as follows:


     1. State  Citizen Frank R. Brushaber was identified by his
          court documents as a nonresident alien, as that term is
          now defined in the Internal Revenue Code.

     2. The Union Pacific Railroad Company was identified by
          court documents as a domestic corporation, as that term
          is now defined in the Internal Revenue Code.


Government Propaganda

     The federal government has tried to confuse the implications
of Frank Brushaber's status by asserting that he was a French
immigrant. This is government propaganda, pure and simple. This
propaganda is designed to make us believe that Brushaber was
found to be an alien because he was born in France, not because
he declared himself to be a "citizen of the State of New York".
Accordingly, the federal officials responsible for this
propaganda are trying in vain to convince everyone that the 50
States are inside the federal zone, because they want us to
conclude that Frank Brushaber would have been a "U.S.** resident"
if he resided in New York, or a "U.S.** citizen" if he had been
born in New York. It is fairly easy (and fun) to defeat this
propaganda, because it is only make believe.

     First of all, Frank Brushaber declared himself to be a
"resident of the Borough of Brooklyn, in the City of New York".
If New York State were inside the federal zone, and if Frank
Brushaber had been born in France, he most certainly would have
been an "alien", but a "resident" alien according to the
government's own rules. After the Supreme Court's decision, the
Treasury Department published a Treasury Decision (T.D. 2313)
which clearly identified Frank Brushaber as a nonresident alien
(see below, page 2-4 and also Appendix C).

     Secondly, regardless of whether federal officials place New
York State inside or outside the federal zone, their French
immigrant theory would place Frank Brushaber in the category of
an alien who was lawfully admitted for permanent "residence".
Congress does have legislative jurisdiction over immigration and
naturalization. Being lawfully admitted for permanent residence
is also called the "green card test" (see next chapter). Again,
the government's own rules and regulations would have designated
Frank Brushaber as a "resident" alien. As we know, the Treasury
Department identified him as a nonresident alien. A native of
France would be a nonresident alien if he resided in France; he
would be a resident alien if he lawfully immigrated to America
under rules established by Congress. But no "green card" was in
evidence to prove that Brushaber was an immigrant, and current
"green cards" exhibit the words RESIDENT ALIEN in bold letters.


                         Page 2 - 3 of 8

                                                The Federal Zone:


     Thirdly, if Frank Brushaber had been a French immigrant who
applied for, and was granted U.S.** citizenship, quite obviously
he would have become a naturalized U.S.** citizen, no longer an
alien. Again, Congress does have jurisdiction over immigration
and naturalization. The government's own rules and regulations
would have designated Frank Brushaber as a U.S.** citizen.


     Finally, Frank Brushaber identified himself as a "citizen of
the State of New York". Although a native of France would also
be an "alien" with respect to the federal zone, this is not how
Frank Brushaber identified himself to the federal courts. He
identified himself as a "citizen of the State of New York". On
the basis of this status as presented to the federal courts,
those same courts, and the Treasury Department thereafter,
concluded that he was a nonresident alien, not a U.S.** citizen
and not a U.S.** resident. To argue that he was a French
immigrant is to assume facts that were not in evidence. The
courts arrived at their decisions on the basis of facts that were
in evidence. Author and scholar Lori Jacques addresses the
French immigrant theory as follows:


     ... [I]t appears that a state citizen was identified as a
     nonresident alien and taxed upon his unearned income
     deriving from a domestic corporation. This conclusion is
     possible because there would be no question that a person
     who, for example, was born and domiciled in France and who
     owned shares in Union Pacific Railway [sic] Co. would be
     taxed as a nonresident alien. Only Mr. Brushaber, citizen
     of New York State and stockholder, was considered in the
     case decided by the Supreme Court, thus there was no basis
     for the Secretary extending the decision to those not
     parties to the action.

            [A Ticket to Liberty, November 1990 edition, page 40]
                                                 [emphasis added]


     In the final analysis, it doesn't really matter whether
Frank Brushaber was a French immigrant or not. The federal
courts and the Treasury Department agreed that any person
claiming to be citizen and resident of New York was a nonresident
alien with respect to the federal zone. This is all we need to
know about the plaintiff's status. It is essential to understand
that it was the government which determined Frank Brushaber was a
nonresident alien for purposes of imposing a federal tax on his
dividends. Brushaber did not come into federal court claiming
that he was a nonresident alien; he did come into court claiming
that he was a New York State Citizen and a resident of Brooklyn.
Now you see why the French immigrant theory is really just
propaganda. In later chapters, the motive for this propaganda
will become crystal clear.


                         Page 2 - 4 of 8

                                          Status and Jurisdiction


Treasury Decision 2313

     Soon after the Brushaber decision, and as a direct result of
that decision, the Office of the Commissioner of Internal Revenue
published Treasury Decision (T.D.) 2313 to clarify the meaning
and consequences of the Supreme Court's ruling. Volume 18 of the
Treasury Decisions was published for the period of January to
December of 1916 by Secretary of the Treasury W. G. McAdoo.
Treasury Decision 2313 was written to clarify the "... taxability
of interest from bonds and dividends on stock of domestic
corporations owned by nonresident aliens, and the liabilities of
nonresident aliens under section 2 of the act of October 3,
1913."

     Frank Brushaber had purchased stock in the Union Pacific
Railroad Company. He was then paid a dividend on this stock.
The Union Pacific Railroad Company acted as a "withholding agent"
and withheld a portion of his dividend to pay the federal income
tax that was owed on that dividend. The term "withholding agent"
still has the same meaning in the current Internal Revenue Code.
Although he was a nonresident alien, Frank Brushaber received
income from a source that was inside, or "within" the federal
zone. The "source" of his income was a "domestic" corporation
because that corporation had been chartered by Congress.

     The net result of his defeat in the Supreme Court was to
render as taxable the income from bond interest and stock
dividends issued by domestic corporations to nonresident aliens
like Frank Brushaber. A key paragraph from Treasury Decision
2313 is the following:

     Under the decision of the Supreme Court of the United States
     in the case of Brushaber v. Union Pacific Railway Co. [sic],
     decided January 24, 1916, it is hereby held that income
     accruing to nonresident aliens in the form of interest from
     the bonds and dividends on the stock of domestic
     corporations is subject to the income tax imposed by the act
     of October 3, 1913.
                                                 [emphasis added]

Because Brushaber's income originated from a source "inside" or
"within" the United States**, where "United States**" means the
federal zone, the income was taxable. The "source" was the Union
Pacific Railroad Company, the issuer of the stock and the payor
of dividends. (The T.D. failed to spell the corporation's name
correctly.) The federal tax law then, as now, designates such a
dividend payor as the "withholding agent":

     The normal tax shall be withheld at the source from income
     accrued to nonresident aliens from corporate obligations and
     shall be returned and paid to the Government by debtor
     corporations and withholding agents as in the case of
     citizens and resident aliens ....
                                                 [emphasis added]


                         Page 2 - 5 of 8

                                                The Federal Zone:


This "withholding agent" must withhold a certain amount from the
dividend to cover the federal tax liability of the recipient.
The amount withheld is paid to the federal government. T.D. 2313
then went on to explain the use of Form 1040 in this situation:

     The liability, under the provisions of the law, to render
     personal returns ... of annual net income accrued to them
     from sources within the United States** during the preceding
     calendar year, attaches to nonresident aliens as in the case
     of returns required from citizens and resident aliens.
     Therefore, a return on Form 1040, revised, is required
     except in cases where the total tax liability has been or is
     to be satisfied at the source by withholding or has been or
     is to be satisfied by personal return on Form 1040, revised,
     rendered in their behalf.
                                                 [emphasis added]

For those of you who are interested, the complete text of
Treasury Decision 2313 can be found in Appendix C of this book.


Summary

     The dual issues of status and jurisdiction are closely
intertwined. The federal government has a limited area over
which it exercises exclusive legislative jurisdiction, an area I
have called "the federal zone". Congress is not limited by the
constitutional restrictions on direct and indirect taxation
within the federal zone. The birth and residency status of
natural persons situate them either inside or outside that
jurisdiction. Citizens who were naturalized by federal courts
are situated inside that jurisdiction, regardless of where they
reside. Both citizens and residents of the federal zone are
liable for federal taxes on their worldwide income, no matter
where the source of that income. If you are not a citizen, then
you are an alien. If you are not a resident, then you are a
nonresident. Nonresident aliens pay taxes only on income which
is derived from sources that are inside the federal zone. If you
work for the federal government, your pay comes from a source
that is inside the federal zone.

     Likewise, artificial "persons" like corporations are either
foreign or domestic. (It may appear strange at first, but a
corporation is also a "person" as that term is defined in the
Internal Revenue Code.) A corporation that is chartered by
Congress is domestic with respect to the federal zone. A
corporation that is chartered by one of the 50 States of the
Union is foreign with respect to the federal zone. A corporation
that is chartered by a foreign country like France is likewise
foreign with respect to the federal zone. Imagine what a
difference it would make if all individuals and corporations knew
and asserted their correct status with respect to the exclusive
legislative jurisdiction of the federal zone.


                         Page 2 - 6 of 8

                                          Status and Jurisdiction


Reader's Notes:


                         Page 2 - 7 of 8

                                                The Federal Zone:


Reader's Notes:


                          Page 2 - 8 of 8

                           Chapter 3:
                          "The Matrix"


     This chapter contains an essential key with the potential to
set you free. One of the biggest obstacles to understanding
federal tax law is that it never uses diagrams or pictures. If a
picture is worth a thousand words, then the Internal Revenue Code
(IRC) would certainly lose a lot of weight if it were reduced to
pictures; but there would still be a lot of pictures! A careful
examination of certain key terms like "resident" and "citizen"
reveals a certain two-dimensional quality to the statutory
relationship among these terms. Specifically, you are an alien
if you are not a citizen, and you are a nonresident if you are
not a resident. This careful examination led to the following
diagram, which I like to call "The Matrix". The Matrix is the
key that unlocks the whole puzzle of federal income taxation.
When you understand The Matrix, you will know exactly where you
stand with respect to the federal zone:


                    column 1: column 2:
                +-----------------------------------+
                | United States** | |
                | citizen | alien |
                |-----------------+-----------------|
                | | |
                | | |
  resident | X | X | row 1
                | | |
                |-----------------+-----------------|
                | | |
                | | |
  nonresident | X | | row 2
                | | |
                +-----------------------------------+

     The validity of The Matrix is supported by a large body of
evidence, only a small part of which can be covered effectively
in a single book. The IRC is not a good place to begin, because
Chapter 1 of that Code imposes a tax on the taxable income of
"individuals", a term which the Code simply does not define. The
definitions that do exist are found in Chapter 79 and in other
places which are spread around the Code like leaves blowing in
the wind. The Code of Federal Regulations (CFR) is a much better
place to begin a review of the evidence. The regulations in the
CFR are considered to be official publications of the federal
government because they are "judicially noticed" (courts must
defer to them) and because they are considered by law to be
official supplements to The Federal Register. According to the
federal regulations which promulgate the Internal Revenue Code,
the liability for federal income tax is imposed on all citizens
of the United States** and all residents of the United States**,
as follows:


                        Page 3 - 1 of 12

                                                The Federal Zone:


     In general, all citizens of the United States**, wherever
     resident, and all resident alien individuals are liable to
     the income taxes imposed by the Code whether the income is
     received from sources within or without the United States**.
     ... As to tax on nonresident alien individuals, see
     sections 871 and 877.
                                                [26 CFR 1.1-1(b)]

     Thus, the regulations impose an income tax on all citizens,
whether they are resident or nonresident (column 1 in The
Matrix), and on all residents, whether they are citizens or
aliens (row 1 in The Matrix). These same regulations define a
United States** citizen as someone who is either born or
naturalized in the United States** and who is subject to the
jurisdiction of the United States**, as follows:


     Every person born or naturalized in the United States** and
     subject to its jurisdiction is a citizen.

                                                [26 CFR 1.1-1(c)]
                                                 [emphasis added]


     The official IRS "Publications" are another excellent source
of evidence which supports the validity of The Matrix. These
publications can be obtained by ordering them directly from the
Internal Revenue Service. For example, Publication number 519,
U.S. Tax Guide for Aliens, begins with the following statements:


     Introduction

     For tax purposes, an alien is an individual who is not a
     U.S.** citizen. Aliens are classified as nonresident aliens
     and resident aliens. ...
                                           [emphasis in original]


     Clearly, an alien is an individual who is not a U.S.**
citizen. Aliens are individuals who were born outside of the
federal zone, and who never elected to become U.S.** citizens via
naturalization. Publication 519 then explains the difference
between a resident alien and a nonresident alien, as follows:


     Resident or nonresident?

     Resident aliens generally are taxed on their worldwide
     income, the same as U.S.** citizens. Nonresident aliens
     generally are taxed only on their income from sources within
     the United States**. ...

                                                  [continued ...]


                        Page 3 - 2 of 12

                                                       The Matrix


     Nonresident aliens are taxed on their U.S.** source income
     (and on certain foreign source income that is effectively
     connected with a trade or business in the United States**).

                                           [emphasis in original]


     How does one become a "resident" of the United States**?
Remember, as used in the Internal Revenue Code and its
regulations, the term "United States**" means the area over which
Congress exercises exclusive legislative jurisdiction, that is,
the federal zone. The IRC contains a relatively clear definition
of the terms "resident alien" and "nonresident alien", as
follows:


     Definition of Resident Alien and Nonresident Alien. --

     (1) In General. -- For purposes of this title (other than
          subtitle B) --


          (A) Resident Alien. -- An alien individual shall be
               treated as a resident of the United States** with
               respect to any calendar year if (and only if) such
               individual meets the requirements of clause (i),
               (ii), or (iii):

               (i) Lawfully Admitted for Permanent Residence.
                    -- Such individual is a lawful permanent
                    resident of the United States** at any time
                    during such calendar year.

               (ii) Substantial Presence Test.
                    -- Such individual makes the election
                    provided in paragraph (3).

               (iii) First Year Election.
                    -- Such individual makes the election
                    provided in paragraph (4).


          (B) Nonresident Alien. -- An individual is a
               nonresident alien if such individual is neither a
               citizen of the United States** nor a resident of
               the United States** (within the meaning of
               subparagraph (A)).

                                    [IRC 7701(b), emphasis added]


     Being lawfully admitted for permanent residence is also
called "the green card test". IRS Publication 519 explains the
green card test as follows:


                        Page 3 - 3 of 12

                                                The Federal Zone:


     You are a resident for tax purposes if you are a lawful
     permanent resident of the United States** at any time during
     the calendar year. ... This is known as the "green card"
     test. You are a lawful permanent resident of the United
     States** at any time if you have been given the privilege,
     according to the immigration laws, of residing permanently
     in the United States** as an immigrant, and this status has
     not been taken away and has not been administratively or
     judicially determined to have been abandoned. You have this
     status if you have been issued an alien registration card,
     also known as a "green card," by the Immigration and
     Naturalization Service.
                                           [emphasis in original]

     American Citizens who were born free in one of the 50 States
of the Union are not required to obtain an alien registration
card, because their presence in one of the 50 States is not a
privilege; on the contrary, it is an unalienable right which is
guaranteed to them by the United States Constitution because they
were born free and Sovereign. The Constitution refers to these
people as "natural born Citizens" (2:1:5), "free Persons" (1:2:3)
and "Citizens of a State" (3:2:1 and 4:2:1). On the basis of
this criterion alone, the natural born State Citizen enjoys a
significant right which is not enjoyed by a person who must apply
for residence as a privilege granted by government. (Throughout
this book, the terms "native American Citizen", "native-born
American Citizen" and "American Citizen" will be synonymous with
"natural born Citizens" as in 2:1:5 of the Constitution, and with
"State Citizens" as in 3:2:1 and 4:2:1 of the Constitution, to
avoid problems that do arise solely from terminology.)

     Publication 519 explains the "substantial presence test"
using rules which closely parallel those which are actually found
in the Internal Revenue Code:

     You will be considered a U.S.** resident for tax purposes if
     you meet the substantial presence test for the calendar
     year. To meet this test, you must be physically present in
     the United States** on at least:

          (1) 31 days during the current year, and

          (2) 183 days during the 3-year period that includes
               the current year and the 2 years immediately
               before, counting:

               - all the days you were present in the current
                    year ... , and

               - 1/3 of the days you were present in the first
                    year before the current year ... , and

               - 1/6 of the days you were present in the
                    second year before the current year ...


                        Page 3 - 4 of 12

                                                       The Matrix


     Example. You were physically present in the United States**
     on 120 days in each of the years 1988, 1989, and 1990. To
     determine if you meet the substantial presence test for
     1990, count the full 120 days of presence in 1990, 40 days
     in 1989 (1/3 of 120), and 20 days in 1988 (1/6 of 120).
     Since the total for the 3-year period is 180 days, you are
     not considered a resident under the substantial presence
     test for 1990.
                                           [emphasis in original]


     An individual may elect to be treated as a resident of the
United States**. The rules for making this election are found in
the statute (IRC Section 7701(b)(4)) and in the regulations which
promulgate this statute (26 CFR 1.871 et seq.). Why anyone would
want to do this, without actually residing in the United
States**, remains a mystery to me. Many Americans have been
duped into believing that electing to be treated as a resident is
a "beneficial" thing to do. Subsequent chapters will discuss the
so-called "benefits" of U.S.** residence and U.S.** citizenship
by contrasting revocable privileges and unalienable rights.

     At last, we arrive at the definition of "nonresident alien".
We have taken the long way around the mountain, but it is the
only way around the mountain (as it turns out) because Chapter 1
of the Internal Revenue Code imposes the tax on undefined
"individuals". It is in Chapter 79, near the end of the Code,
where it states that an individual is a nonresident alien if such
individual is neither a citizen of the United States** nor a
resident of the United States**. If you were born outside the
federal zone, either as a Sovereign Citizen natural born free in
one of the 50 States of the Union, or as a native citizen of a
foreign country like France, then you are not automatically a
"citizen of the United States**". You may, of course, obtain
"U.S.** citizenship" by applying for this "privilege" with the
Immigration and Naturalization Service, even if you are a
Sovereign State Citizen. You may also relinquish U.S.**
citizenship at will, through a process known as "expatriation".
If you were born inside the federal zone, then you are
automatically a "citizen of the United States**". The rules for
residency have already been reviewed above.

     The validity of The Matrix is also reinforced clearly by a
man named Roger Foster who, in the year 1915, wrote a forgotten
treatise on the Act of 1913, the year the so-called 16th
Amendment was declared ratified. Some people argue that these
older materials are not relevant because they do not take into
account the changes that have occurred in the statute and its
regulations. Although changes have indeed occurred, the
relevance of these materials lies in their proximity in time to
the origins of income taxation in America, and to the intent of
the original statutes. It is a principle of law that the intent
of a statute is always decisive. The following excerpt is taken
from A Treatise on the Federal Income Tax under the Act of 1913,


                        Page 3 - 5 of 12

                                                The Federal Zone:


by Roger Foster of the New York Bar, published by The Lawyers
Co-operative Publishing Company, Rochester, New York, in 1915:

     Section 35: Incidence of the tax with respect to persons.

          Under [the statute] four possible cases arise. Two are
     of citizens, with reference to their residence or
     nonresidence, and two are of aliens, with reference likewise
     to their residence or nonresidence. There is no question as
     to the first two, that the whole income of every citizen
     whether residing at home or abroad is taxed; it is so
     specifically provided in the act. Similarly, it is
     expressly provided in the act that every person residing in
     the United States** shall pay a tax upon all his income,
     from whatever source derived, which without question
     includes all resident aliens. Whatever, therefore, the
     power of Congress may be, its intent is clear, that in case
     of non-resident aliens the only measure of the tax is income
     derived within the United States**.

          With reference to aliens, therefore, it must be
     determined whether they are resident in which case they must
     pay the tax on their whole income; or if not resident
     whether they own property or carry on a business, trade or
     profession in the United States**.

          In the latter case, they are taxable only with
     reference to income earned or paid in this country. If they
     are non-resident and do not derive an income from any source
     within our territory of course they are not taxable at all.

                                               [pages 153 to 155]
                                                 [emphasis added]

     Note, in particular, that Foster makes reference to "income
earned or paid in this country". You might be sorely tempted to
conclude, therefore, that he meant to define the "United States"
to mean the several States of the Union (then 48) in addition to
the federal zone. He did not. This question is squarely settled
in another section of his treatise, in which he considers the
incidence of the tax with respect to territory:

     Section 34: Incidence of the tax with respect to territory
     and places exempted from the same.

     The tax ... is levied in Alaska, the District of Columbia,
     Porto Rico [sic] and the Philippine Islands. ... The Act
     expressly directs:

          "That the word 'State' or 'United States**' when used
          in this section shall be construed to include any
          Territory, Alaska, the District of Columbia, Porto
          Rico, and the Philippine Islands, when such
          construction is necessary to carry out its provisions."


                        Page 3 - 6 of 12

                                                       The Matrix


     Although there might be ground for argument that the phrase
     "any Territory" applies to the Hawaiian Islands, it was the
     evident intention of Congress that the residents of Hawaii,
     at least when not citizens of the United States**, are
     exempt from the tax, for the reason that the Legislature of
     Hawaii has imposed an Income Tax upon all residents of that
     territory.
                               [pages 152 to 153, emphasis added]

It is important to appreciate that Roger Foster was considered by
many to be a recognized authority on federal law. In addition to
his treatise on the Federal Income Tax Act of 1913, he wrote
numerous other treatises and articles, including (but not limited
to) "Commentaries on the Constitution of the United States",
"Federal Judiciary Acts", and "The Federal Income Tax of 1894".
In the published opinion of author John L. Sasscer, Sr., any
doubts about Foster's intentions are completely dissolved by his
choice of words for the heading to Section 34: incidence of the
tax with respect to territory and places exempted from the same:

     If the income tax were levied within the states of the union
     there is no doubt that he would have so stated. The absence
     of any mention of the states of the union as being
     "territory" where the tax is imposed, shows that Mr. Foster
     recognized the income tax was imposed in those mentioned
     areas only, all of which were federal territories in 1913.

     ["Deciphering The Internal Revenue Code: The Keys Revealed"]
         [by John L. Sasscer, Sr., in Economic Survival, page 27]
                                           [emphasis in original]

In subsequent chapters, a principle of statutory construction is
applied to the IRC to show that the inclusion of one thing is
equivalent to the exclusion of all other things not explicitly
mentioned. This principle also applies to persons and to places.
Laws are constructed in strict obedience to the rules of formal
English; one of these formal rules is that a "noun" is either a
person, a place, or a thing. Both Sasscer and Foster evidence
their keen awareness of these rules. Notice how Foster mentions
the incidence of the tax with respect to persons and to places.
The States of the Union are not mentioned anywhere among the
places where the tax is imposed.

     There you have it! Four possible cases arise for natural
born persons like you and me. Go back to The Matrix and to the
cover of this book. Focus carefully on the lonely cell found at
row 2, column 2. You are a nonresident alien if you are not a
citizen of the United States** and you are not a resident of the
United States**:

     The term "nonresident alien individual" means an individual
     whose residence is not within the United States**, and who
     is not a citizen of the United States**.
                                                 [26 CFR 1.871-2]


                        Page 3 - 7 of 12

                                                The Federal Zone:


     At this point, you may still be wondering if it is indeed
correct to use the term "nonresident alien" to describe Sovereign
State Citizens who were born free in one of the 50 States of the
Union, and who also live and work in one of the 50 States of the
Union. All that remains to prove it correct is to verify the
correct legal meaning of the term "United States**" in the IRC.
This proof requires an overview of the several meanings of the
terms "United States" and "State" as they are defined in the
statute itself, in the case law, and elsewhere.

     An exhaustive proof is not necessary here because other
capable authors have already completed a massive amount of work
on this subject. Interested readers are encouraged to review the
Bibliography, found in Appendix N, and to obtain copies of the
key publications entitled Good-Bye April 15th! by Boston T.
Party, Which One Are You? by The Informer, United States Citizen
versus National of the United States and A Ticket to Liberty both
by Lori Jacques, The Omnibus by Ralph F. Whittington, and Free At
Last -- From the IRS by N. A. "Doc" Scott. Taken as a group,
these authors have published a wealth of irrefutable
documentation which proves, beyond any doubt, the true meaning of
"nonresident alien" in the federal income tax statutes. Author
Ralph Whittington's book is particularly valuable because its
appendices contain true and correct copies of key documents like
Roger Foster's treatise and selected Acts of Congress.


     The following anecdote summarizes nicely many of the key
points which we have covered thus far:


          Several years ago in a coffee shop while talking with a
     friend about "tax matters," a man in the adjacent booth
     overheard our conversation and asked to join us. The
     conversation continued, and centered mainly on IRS abuses.
     This gentleman seemed particularly knowledgeable about the
     subject and we asked him what he did for a living. He told
     us his name and that he was an attorney with the Tax
     Division of the Department of Justice in Washington.
     Naturally, this put us on guard, but he quickly put us at
     ease by agreeing in large part with the conclusion we had
     drawn.

          Reluctantly, I asked him this question, "Why are
     defendants in federal district court always asked if they
     are 'citizens of the United States'?" He replied without
     hesitation, "So we can determine jurisdiction. In many
     cases the federal court does not have jurisdiction over a
     citizen unless they testify they are a citizen of the United
     States -- meaning a federal citizen under the 14th
     Amendment."

                                                  [continued ...]


                        Page 3 - 8 of 12

                                                       The Matrix


          My friend innocently asked, "What's a federal citizen?"
     The attorney replied, "That's a person who receives benefits
     or privileges or is an alien that has been admitted as a
     citizen of the United States."

          I quickly interjected, "What if the individual denied
     being a citizen of the United States and claimed to be a
     sovereign citizen of Oklahoma?" The attorney bowled me over
     with, "We don't get jurisdiction."

          He had to catch a plane.

             [Freeman Letter, March 1989, page 6, emphasis added]
          [as quoted in "Brief of Law for Zip Code Implications"]
                 [by Walter C. Updegrave, revised March 28, 1992]


     The implications of the 14th Amendment are considered in
some detail in Chapter 11 and in Appendix Y. For now, it is best
to remember that we have in America a government of the United
States**, and a government of each of the several States;
moreover, each of these governments is distinct from the others,
and each has citizens of its own. In parallel with the federal
and State governments, there are federal citizens and there are
State Citizens. Federal citizens are the same as "U.S.**
citizens" and "citizens of the United States**". If you are not
a federal citizen, then you are an "alien" with respect to the
federal government. If you get confused, just recall the
familiar distinction between State and federal governments, and
then remember that each has citizens of its own. For consistency
throughout this book, federal citizens will be spelled with a
lower-case "c" and State Citizens will be spelled with an
UPPER-CASE "C". Happily for us, this convention is strictly
obeyed throughout the Internal Revenue Code (IRC) and throughout
the Code of Federal Regulations (CFR) which promulgates the IRC.


Summary


     The citizen/alien distinction explains the two columns of
The Matrix. By definition, you are an alien with respect to the
United States** if you are not a citizen of the United States**.
The happy result of The Matrix is the legal and logical equation
which exists between most State Citizens and nonresident aliens.
A citizen of the United States** is the same thing as a federal
citizen. Anyone who is not a federal citizen is an "alien" with
respect to the United States**. Therefore, as long as a State
Citizen is not also a federal citizen, then such a State Citizen
is an "alien" as that term is defined in the IRC. State Citizens
are free to reside wherever they choose, because their right to
travel is an unalienable right. However, the term "resident" has
a very specific meaning in the IRC, whether it is used as an
adjective or a noun.


                        Page 3 - 9 of 12

                                                The Federal Zone:


     The resident/nonresident distinction explains the two rows
of The Matrix. An alien can be either a resident alien, or a
nonresident alien. There are three and only three criteria to
distinguish resident aliens from nonresident aliens: (1) lawful
admission for permanent residence (2) substantial presence test
and (3) election to be treated as a resident. All three of
these criteria depend for their legal meaning upon the statutory
definition of "United States". Therefore, if State Citizens are
"residents" of the United States** according to these criteria,
then they are resident aliens, by definition. If State Citizens
are not "residents" of the United States** according to these
criteria, then they are nonresident aliens, by definition. A
deliberately confusing statute is clarified considerably by
understanding the legal and logical equation which exists between
State Citizens and nonresident aliens (like Frank R. Brushaber).
They are one and the same thing, to the extent that State
Citizens do not reside in the United States** and to the extent
that they are not also federal citizens.

     The issue of citizenship in America has been complicated a
great deal because the federal government recognizes the legal
possibility that one can be a federal citizen and a State citizen
at the same time. This possibility exists primarily because of
Section 1 of the so-called 14th Amendment. This amendment was
carefully worded to recognize a dual citizenship, federal and
State, but the State citizenship which it recognized was still a
second class of citizenship. That is the reason why the term
"citizens" in the 14th Amendment is spelled with a small "c".
The mountain of litigation that resulted from this amendment is
proof that the issue of citizenship has become unnecessarily
complicated in America. There is a logical path through this
complexity, however, and a subsequent chapter will delineate this
path as clearly and as simply as possible (see Chapter 11:
Sovereignty). The main obstacles standing in the way of greater
clarity are removed entirely by the all important finding that
the 14th Amendment was never properly approved and adopted, just
like the 16th Amendment.


                             # # #


                        Page 3 - 10 of 12

                                                       The Matrix


Reader's Notes:


                        Page 3 - 11 of 12

                                                The Federal Zone:


Reader's Notes:


                        Page 3 - 12 of 12

                           Chapter 4:
                     The Three United States


     In the previous chapter, a handy matrix was developed to
organize the key terms which define the concepts of status and
jurisdiction as they apply to federal income taxation. In
particular, an alien is any individual who is not a United
States** citizen. The term "citizen" has a specific meaning in
the regulations which promulgate the Internal Revenue Code (IRC):


     Every person born or naturalized in the United States and
     subject to its jurisdiction is a citizen.

                                [26 CFR 1.1-1(c), emphasis added]

     What, then, is meant by the term "United States" and what is
meant by the phrase "its jurisdiction"? In this regulation, is
the term "United States" a singular phrase, a plural phrase, or
is it both? The astute reader has already noticed that an
important clue is given by regulations which utilize the phrase
"its jurisdiction". The term "United States" in this regulation
must be a singular phrase, otherwise the regulation would need to
utilize the phrase "their jurisdiction" or "their jurisdictions"
to be grammatically correct.

     As early as the year 1820, the U.S. Supreme Court was
beginning to recognize that the term "United States" could
designate either the whole, or a particular portion, of the
American empire. In a case which is valuable, not only for its
relevance to federal taxation but also for its terse and discrete
logic, Chief Justice Marshall exercised his characteristic
brilliance in the following passage:


     The power, then, to lay and collect duties, imposts, and
     excises, may be exercised, and must be exercised throughout
     the United States. Does this term designate the whole, or
     any particular portion of the American empire? Certainly
     this question can admit of but one answer. It is the name
     given to our great republic, which is composed of states and
     territories. The District of Columbia, or the territory
     west of the Missouri, is not less within the United States*
     than Maryland or Pennsylvania ....

                  [Loughborough vs Blake, 15 U.S. (5 Wheat.) 317]
                              [5 L.Ed. 98 (1820), emphasis added]

By 1945, the year of the first nuclear war on planet Earth, the
Supreme Court had come to dispute Marshall's singular definition,
but most people were too distracted to notice. The high Court
confirmed that the term "United States" can and does mean three
completely different things, depending on the context:


                        Page 4 - 1 of 14

                                                The Federal Zone:


     The term "United States" may be used in any one of several
     senses. [1] It may be merely the name of a sovereign*
     occupying the position analogous to that of other sovereigns
     in the family of nations. [2] It may designate the territory
     over which the sovereignty of the United States** extends,
     or [3] it may be the collective name of the states*** which
     are united by and under the Constitution.

             [Hooven & Allison Co. vs Evatt, 324 U.S. 652 (1945)]
                           [brackets, numbers and emphasis added]

This same Court authority is cited by Black's Law Dictionary,
Sixth Edition, in its definition of "United States":

     United States. This term has several meanings. [1] It may
     be merely the name of a sovereign occupying the position
     analogous to that of other sovereigns in family of nations,
     [2] it may designate territory over which sovereignty of
     United States extends, or [3] it may be collective name of
     the states which are united by and under the Constitution.
     Hooven & Allison Co. v. Evatt, U.S. Ohio, 324 U.S. 652, 65
     S.Ct. 870, 880, 89 L.Ed. 1252.

                           [brackets, numbers and emphasis added]

     In the first sense, the term "United States*" can refer to
the nation, or the American empire, as Justice Marshall called
it. The "United States*" is one member of the United Nations.
When you are traveling overseas, you would go to the U.S.*
embassy for help with passports and the like. In this instance,
you would come under the jurisdiction of the President, through
his agents in the U.S.* State Department, where "U.S.*" refers to
the sovereign nation. The Informer summarizes Citizenship in
this "United States*" as follows:

     1. I am a Citizen of the United States* like you are a
     Citizen of China. Here you have defined yourself as a
     National from a Nation with regard to another Nation. It is
     perfectly OK to call yourself a "Citizen of the United
     States*." This is what everybody thinks the tax statutes
     are inferring. But notice the capital "C" in Citizen and
     where it is placed. Please go back to basic English.

                    [Which One Are You?, page 11, emphasis added]


     Secondly, the term "United States**" can also refer to "the
federal zone", which is a separate nation-state over which the
Congress has exclusive legislative jurisdiction. (See Appendix Y
for a brief history describing how this second meaning evolved.)
In this sense, the term "United States**" is a singular phrase.
It would be proper, for example, to say, "The United States** is
..." or "Its jurisdiction is ..." and so on. The Informer
describes citizenship in this United States** as follows:


                        Page 4 - 2 of 14

                                          The Three United States


     2. I am a United States** citizen. Here you have defined
     yourself as a person residing in the District of Columbia,
     one of its Territories, or Federal enclaves (area within a
     Union State) or living abroad, which could be in one of the
     States of the Union or a foreign country. Therefore you are
     possessed by the entity United States** (Congress) because
     citizen is small case. Again go back to basic english
     [sic]. This is the "United States**" the tax statutes are
     referring to. Unless stated otherwise, such as 26 USC
     6103(b)(5).
                    [Which One Are You?, page 11, emphasis added]


     Thirdly, the term "United States***" can refer to the 50
sovereign States which are united under the Constitution for the
United States of America. In this third sense, the term "United
States***" does not include the federal zone, because the
Congress does not have exclusive legislative authority over any
of the 50 sovereign States of the Union. In this sense, the term
"United States***" is a plural, collective term. It would be
proper therefore to say, "These United States***" or "The United
States*** are ..." and so on. The Informer completes the trio by
describing Citizenship in these "United States***" as follows:

     3. I am a Citizen of these United States***. Here you
     have defined yourself as a Citizen of all the 50 States
     united by and under the Constitution. You are not possessed
     by the Congress (United States**). In this way you have a
     national domicile, not a State or United States** domicile
     and are not subject to any instrumentality or subdivision of
     corporate governmental entities.

                [Which One Are You?, pages 11-12, emphasis added]

Author and scholar Lori Jacques summarizes these three separate
governmental jurisdictions in the same sequence, as follows:

     It is noticeable that Possessions of the United States** and
     sovereign states of the United States*** of America are NOT
     joined under the title of "United States." The president
     represents the sovereign United States* in foreign affairs
     through treaties, Congress represents the sovereign United
     States** in Territories and Possessions with Rules and
     Regulations, and the state citizens are the sovereignty of
     the United States*** united by and under the Constitution
     .... After becoming familiar with these historical facts,
     it becomes clear that in the Internal Revenue Code, Section
     7701(a)(9), the term "United States**" is defined in the
     second of these senses as stated by the Supreme Court: it
     designates the territory over which the sovereignty of the
     United States** extends.

                    [A Ticket to Liberty, Nov. 1990, pages 22-23]
                            [emphasis added, italics in original]


                        Page 4 - 3 of 14

                                                The Federal Zone:


     It is very important to note the careful use of the word
"sovereign" by Chief Justice Stone in the Hooven case. Of the
three different meanings of "United States" which he articulates,
the United States is "sovereign" in only two of those three
meanings. This is not a grammatical oversight on the part of
Justice Stone. Sovereignty is not a term to be used lightly, or
without careful consideration. In fact, it is the foundation for
all governmental authority in America, because it is always
delegated downwards from the true source of sovereignty, the
People themselves. This is the entire basis of our
Constitutional Republic. Sovereignty is so very important, an
entire chapter of this book is later dedicated to this one
subject (see Chapter 11 infra).


     The federal zone over which the sovereignty of the United
States** extends is the District of Columbia, the territories and
possessions belonging to Congress, and a limited amount of land
within the States of the Union, called federal "enclaves".


     The Secretary of the Treasury can only claim exclusive
jurisdiction over this federal zone and citizens of this zone.
In particular, the federal enclaves within the 50 States can only
come under the exclusive jurisdiction of Congress if they consist
of land which has been properly "ceded" to Congress by the act of
a State Legislature. A good example of a federal enclave is a
"ceded" military base. The authority to exercise exclusive
legislative jurisdiction over the District of Columbia and the
federal enclaves originates in Article 1, Section 8, Clause 17
(1:8:17) of the U.S. Constitution. By virtue of the exclusive
authority that is vested in Congress by this clause, Congress
shall have the power:


     To exercise exclusive Legislation in all Cases whatsoever,
     over such District (not exceeding ten Miles square) as may,
     by Cession of particular States, and the Acceptance of
     Congress, become the Seat of the Government of the United
     States**, and to exercise like Authority over all Places
     purchased by the Consent of the Legislature of the State in
     which the Same shall be, for the Erection of Forts,
     Magazines, Arsenals, dock-Yards, and other needful
     Buildings;

                  [Constitution for the United States of America]
                                [Article l, Section 8, Clause 17]
                                                 [emphasis added]

     The power of Congress to exercise exclusive legislative
authority over its territories and possessions, as distinct from
the District of Columbia and the federal enclaves, is given by a
different authority in the U.S. Constitution. This authority is
Article 4, Section 3, Clause 2 (4:3:2), as follows:


                        Page 4 - 4 of 14

                                          The Three United States


     The Congress shall have Power to dispose of and make all
     needed Rules and Regulations respecting the Territory or
     other Property belonging to the United States**;

                  [Constitution for the United States of America]
                                 [Article 4, Section 3, Clause 2]
                                                 [emphasis added]

Within these areas, it is essential to understand that the
Congress is not subject to the same constitutional limitations
which restrict its power in the areas of land over which the 50
States exercise their respective sovereign authorities:


     ... [T]he United States** may acquire territory by conquest
     or by treaty, and may govern it through the exercise of the
     power of Congress conferred by Section 3 of Article IV of
     the Constitution .... In exercising this power, Congress is
     not subject to the same constitutional limitations, as when
     it is legislating for the United States***. ... And in
     general the guaranties [sic] of the Constitution, save as
     they are limitations upon the exercise of executive and
     legislative power when exerted for or over our insular
     possessions, extend to them only as Congress, in the
     exercise of its legislative power over territory belonging
     to the United States**, has made those guaranties [sic]
     applicable.

             [Hooven & Allison Co. vs Evatt, 324 U.S. 652 (1945)]
                                                 [emphasis added]

In other words, the guarantees of the Constitution extend to the
federal zone only as Congress makes those guarantees applicable,
either to the territory or to the citizens of that zone, or both.
Remember, this is the same Hooven case which officially defined
three separate and distinct meanings of the term "United States".
The Supreme Court ruled that this case would be the last time it
would address official definitions of the term "United States".
Therefore, the Hooven case must be judicially noticed by the
entire American legal community. See Appendix W for other
rulings and for citations to important essays published in the
Harvard Law Review on the controversy that surrounds the meaning
of "United States" even today. In particular, author Langdell's
article "The Status of Our New Territories" is a key historical
footing for the three Hooven definitions. To avoid confusion, be
careful to note that Langdell arranges the three "United States"
in a sequence that is different from that of Hooven:


     Thirdly. -- ... [T]he term "United States" has often been
     used to designate all territory over which the sovereignty
     of the United States** extended. [a tautology]

                                                  [continued ...]


                        Page 4 - 5 of 14

                                                The Federal Zone:


     The conclusion, therefore, is that, while the term "United
     States" has three meanings, only the first and second of
     these are known to the Constitution; and that is equivalent
     to saying that the Constitution of the United States*** as
     such does not extend beyond the limits of the States which
     are united by and under it, -- a proposition the truth of
     which will, it is believed, be placed beyond doubt by an
     examination of the instances in which the term "United
     States" is used in the Constitution.

                 [Langdell, "The Status of Our New Territories" ]
                 [12 Harvard Law Review 365, 371, emphasis added]

     Note carefully that Langdell's third definition and Hooven's
second definition both exhibit subtle tautologies, that is, they
use the word they are defining in the definitions of the word
defined. A careful reading of his article reveals that
Langdell's third definition of "United States" actually implies
the whole American "empire", namely, the States and the federal
zone combined, making it identical to Justice Marshall's
definition (see above). Therefore, because it contains a
provable tautology, the second Hooven definition is clearly
ambiguous too; it can be interpreted in at least two completely
different ways: (1) as the federal zone only, or (2) as the 50
States and the federal zone combined (i.e., the whole "empire").

     So now, what is "sovereignty" in this context? The
definitive solution to this nagging ambiguity is found in the
constitutional meaning of the word "exclusive". Strictly
speaking, the federal government is "sovereign" over the 50
States only when it exercises one of a very limited set of powers
enumerated for it in Article 1, Section 8 of the Constitution.
In this sense, the federal government does NOT exercise exclusive
jurisdiction inside the 50 States of the Union; it does,
however, exercise exclusive jurisdiction inside the federal zone.
This exclusive authority originates from 1:8:17 and 4:3:2 in the
U.S. Constitution, as quoted above. Now, apply sections 1:8:17
and 4:3:2 to the jurisdictional claims of the Secretary of the
Treasury for the "internal" revenue laws, as follows:


     The term "United States**" when used in a geographical sense
     includes any territory under the sovereignty of the United
     States**. It includes the states, the District of Columbia,
     the possessions and territories of the United States**, the
     territorial waters of the United States**, the air space
     over the United States**, and the seabed and subsoil of
     those submarine areas which are adjacent to the territorial
     waters of the United States** and over which the United
     States** has exclusive rights, in accordance with interna-
     tional law, with respect to the exploration and exploitation
     of natural resources.
                              [26 CFR 1.911-2(g), emphasis added]
                                       [note the tautology again]


                        Page 4 - 6 of 14

                                          The Three United States


Here's the tautology, in case you missed it:


     "United States" includes any territory under the sovereignty
     of the United States and over which the United States has
     exclusive rights.


This is very much like saying:


     A potato is a plant that grows in a potato field.

                            [Speech of Vice President Dan Quayle]
                                     [1992 Campaign Spelling Bee]

     Notice also the singular form of the phrase "the United
States** has ..."; notice also the pivotal term "exclusive
rights". When this regulation says that the jurisdiction
"includes the States", it cannot mean all the land areas enclosed
within the boundaries of the 50 States, because Congress does not
have exclusive jurisdiction over the 50 States. Within the 50
States, Congress only has exclusive jurisdiction over the federal
enclaves inside the boundaries of the 50 States. These enclaves
must have been officially "ceded" to Congress by an explicit act
of the State Legislatures involved. Without a clear act of
"cession" by one of the State legislatures, the 50 States retain
their own exclusive, sovereign jurisdiction inside their borders,
and Congress cannot lawfully take any of their own sovereign
jurisdiction away from the States. This separation of powers is
one of the key reasons why we have a "federal government" as
opposed to a "national government"; its powers are limited to
the set specifically enumerated for it by the Constitution.


     Technically speaking, the 50 States are "foreign countries"
with respect to each other and with respect to the federal zone.
A key authority on this question is the case of Hanley vs
Donoghue, in which the U.S. Supreme Court defined separate bodies
of State law as being "foreign" with respect to each other:


     No court is to be charged with the knowledge of foreign
     laws; but they are well understood to be facts which must,
     like other facts, be proved before they can be received in a
     court of justice. [cites omitted] It is equally well
     settled that the several states of the Union are to be
     considered as in this respect foreign to each other, and
     that the courts of one state are not presumed to know, and
     therefore not bound to take judicial notice of, the laws of
     another state.

                  [Hanley vs Donoghue, 116 U.S. 1, 29 L. Ed. 535]
                        [6 S.Ct. 242, 244 (1885), emphasis added]


                        Page 4 - 7 of 14

                                                The Federal Zone:


Another key Supreme Court authority on this question is the case
of In re Merriam's Estate, 36 NE 505 (1894). Before you get the
idea that this meaning of "foreign" is now totally antiquated,
consider the current edition of Black's Law Dictionary, Sixth
Edition, which defines "foreign state" very clearly, as follows:

     The several United States*** are considered "foreign" to
     each other except as regards their relations as common
     members of the Union. ... The term "foreign nations," as
     used in a statement of the rule that the laws of foreign
     nations should be proved in a certain manner, should be
     construed to mean all nations and states other than that in
     which the action is brought; and hence one state of the
     Union is foreign to another, in the sense of that rule.

                                                 [emphasis added]

And a recent federal statute proves that Congress still refers to
the 50 States as "countries". When a State court in Alaska
needed a federal judge to handle a case overload, Congress
amended Title 28 to make that possible. In its reference to the
50 States, the statute is titled the "Assignment of Judges to
courts of the freely associated compact states". Then, Congress
refers to these freely associated compact states as "countries":

     (b) The Congress consents to the acceptance and retention by
     any judge so authorized of reimbursement from the countries
     referred to in subsection (a) .... [!!!]

                        [28 U.S.C. 297, 11/19/88, emphasis added]

Indeed, international law is divided roughly into two groups:
(1) public international law and (2) private international law.
As it turns out, citizenship is a term of private international
law (also known as municipal law) in which the terms "state",
"nation" and "country" are all synonymous:

          Private international law assumes a more important
     aspect in the United States than elsewhere, for the reason
     that the several states, although united under the same
     sovereign authority and governed by the same laws for all
     national purposes embraced by the Federal Constitution, are
     otherwise, at least so far as private international law is
     concerned, in the same relation as foreign countries. The
     great majority of questions of private international law are
     therefore subject to the same rules when they arise between
     two states of the Union as when they arise between two
     foreign countries, and in the ensuing pages the words
     "state," "nation," and "country" are used synonymously and
     interchangeably, there being no intention to distinguish
     between the several states of the Union and foreign
     countries by the use of varying terminology.

         [16 Am Jur 2d, Conflict of Laws, Sec. 2, emphasis added]


                        Page 4 - 8 of 14

                                          The Three United States


This foreign relationship between the 50 States and the federal
zone is also recognized in the definition of a "foreign country"
that is found in the Instructions for Form 2555, entitled
"Foreign Earned Income", as follows:

     Foreign Country. A foreign country is any territory
     (including the air space, territorial waters, seabed, and
     subsoil) under the sovereignty of a government other than
     the United States**. It does not include U.S.** possessions
     or territories.

             [Instructions for Form 2555: Foreign Earned Income]
           [Department of the Treasury, Internal Revenue Service]
                                                 [emphasis added]


Notice that a "foreign country" does NOT include U.S.**
possessions or territories. U.S.** possessions and territories
are not "foreign" with respect to the federal zone; they are
"domestic" with respect to the federal zone because they are
inside the federal zone. This relationship is also confirmed by
the Treasury Secretary's official definition of a "foreign
country" that is published in the Code of Federal Regulations:


     The term "foreign country" when used in a geographical sense
     includes any territory under the sovereignty of a government
     other than that of the United States**. It includes the
     territorial waters of the foreign country (determined in
     accordance with the laws of the United States**), the air
     space over the foreign country, and the seabed and subsoil
     of those submarine areas which are adjacent to the
     territorial waters of the foreign country and over which the
     foreign country has exclusive rights, in accordance with
     international law, with respect to the exploration and
     exploitation of natural resources.

                              [26 CFR 1.911-2(h), emphasis added]
                                [note the subtle tautology again]


If this regulation were to be interpreted any other way, except
that which is permitted by the U.S. Constitution, then the
sovereign jurisdiction of the federal government would stand in
direct opposition to the sovereign jurisdiction of the 50 States
of the Union. In other words, such an interpretation would be
reduced to absurd consequences (in Latin, reductio ad absurdum).
Sovereignty is the key. It is indivisible. There cannot be two
sovereign governmental authorities over any one area of land.
Sovereignty is the authority to which there is politically no
superior. Sovereignty is vested in one or the other sovereign
entity, such as a governmental body or a natural born Person
(like you and me).


                        Page 4 - 9 of 14

                                                The Federal Zone:


     This issue of jurisdiction as it relates to Sovereignty is a
     major key to understanding our system under our
     Constitution.
                              [The Omnibus, Addendum II, page 11]


     In reviewing numerous acts of Congress, author and scholar
Lori Jacques has come to the inescapable conclusion that there
are at least two classes of citizenship in America: one for
persons born outside the territorial jurisdiction of the United
States**, and one for persons born inside the territorial
jurisdiction of the United States**. This territorial
jurisdiction is the area of land over which the United States**
is sovereign and over which it exercises exclusive legislative
jurisdiction, as stated in the Hooven case and the many others
which have preceded it, and followed it:

     When reading the various acts of Congress which had declared
     various people to be "citizens of the United States", it is
     immediately apparent that many are simply declared "citizens
     of the United States***" while others are declared to be
     "citizens of the United States**, subject to the
     jurisdiction of the United States**." The difference is
     that the first class of citizen arises when that person is
     born out of the territorial jurisdiction of the United
     States** Government. 3A Am Jur 1420, Aliens and Citizens,
     explains: "A Person is born subject to the jurisdiction of
     the United States**, for purposes of acquiring citizenship
     at birth, if his birth occurs in territory over which the
     United States** is sovereign ..." [!!]

                        [A Ticket to Liberty, Nov. 1990, page 32]
                                                 [emphasis added]

     The above quotation from American Jurisprudence is a key
that has definitive importance in the context of sovereignty (see
discussion of "The Key" in Appendix P). Note the pivotal word
"sovereign", which controls the entire meaning of this passage.
A person is born "subject to its jurisdiction", as opposed to
"their jurisdictions", if his birth occurs in territory over
which the "United States**" is sovereign. Therefore, a person is
born subject to the jurisdiction of the "United States**" if his
birth occurs inside the federal zone. Conversely, a natural born
person is born a Sovereign if his birth occurs outside the
federal zone and inside the 50 States. This is jus soli, the law
of the soil, whereby citizenship is usually determined by laws
governing the soil on which one is born.

     Sovereignty is a principle that is so important and
fundamental, a subsequent chapter of this book is dedicated
entirely to discussing its separate implications for political
authorities and for sovereign individuals. It is also important
to keep the concept of sovereignty uppermost in your thoughts,
where it belongs, as we begin our descent into the dense jungle


                        Page 4 - 10 of 14

                                          The Three United States


called statutory construction. (This is your Captain speaking.)
So, fasten your seat belts. The Hooven decision sets the stage
for a critical examination of key definitions that are found in
the IRC itself.

     One of the many statutory definitions of the term "United
States" is found in chapter 79 of the IRC, where the definitions
are located:

     When used in this title, where not otherwise distinctly
     expressed or manifestly incompatible with the intent
     thereof-- ...

     (9) United States. -- The term "United States" when used in
          a geographical sense includes only the States and the
          District of Columbia.
                                                 [IRC 7701(a)(9)]
                                                 [emphasis added]

     Setting aside for the moment the intended meaning of the
phrase "in a geographical sense", it is obvious that the District
of Columbia and the "States" are essential components in the IRC
definition of the "United States". There is no debate about the
meaning of "the District of Columbia", but what are "the States"?
The same question can be asked about a different definition of
"United States" that is found in another section of the IRC:

     For purposes of this chapter --

     (2) United States. -- The term "United States" when used in
          a geographical sense includes the States, the District
          of Columbia, the Commonwealth of Puerto Rico, and the
          Virgin Islands.
                                 [IRC 3306(j)(2), emphasis added]

Again, there is no apparent debate about the meanings of the
terms "the Commonwealth of Puerto Rico" and "the Virgin Islands".
But what are "the States"? Are they the 50 States of the Union?
Are they the federal states which together constitute the federal
zone? Determining the correct meaning of "the States" is
therefore pivotal to understanding the statutory definition of
"United States" in the Internal Revenue Code. The next chapter
explores this question in some detail.

     In addition to keeping sovereignty uppermost in your
thoughts, keep your eyes fixed on the broad expanse of the dense
jungle you are about to enter. This jungle was planted and
watered by a political body with a dual, or split personality.
On the one hand, Congress is empowered to enact public laws for
the 50 States, subject to certain written restrictions. On the
other hand, it is also empowered to enact "municipal" statutes
for the federal zone, subject to a different set of restrictions.
Therefore, think of Congress as "City Hall" for the federal zone.
In 1820, Justice Marshall described it this way:


                        Page 4 - 11 of 14

                                                The Federal Zone:


     ... [Counsel] has contended, that Congress must be
     considered in two distinct characters. In one character as
     legislating for the states; in the other, as a local
     legislature for the district [of Columbia]. In the latter
     character, it is admitted, the power of levying direct taxes
     may be exercised; but, it is contended, for district
     purposes only, in like manner as the legislature of a state
     may tax the people of a state for state purposes. Without
     inquiring at present into the soundness of this distinction,
     its possible influence on the application in this district
     of the first article of the constitution, and of several of
     the amendments, may not be altogether unworthy of
     consideration.

                  [Loughborough vs Blake, 15 U.S. (5 Wheat.) 317]
                              [5 L.Ed. 98 (1820), emphasis added]


The problem thus becomes one of deciding which of these "two
distinct characters" is doing the talking. The language used to
express the meaning of "States" in the IRC is arguably the best
place to undertake a careful diagnosis of this split personality.
(Therapy comes later.)


                             # # #


                        Page 4 - 12 of 14

                                          The Three United States


Reader's Notes:


                        Page 4 - 13 of 14

                                                The Federal Zone:


Reader's Notes:


                        Page 4 - 14 of 14

                           Chapter 5:
                     What State Are You In?

                             Answer:

         Mostly liquid, some solid, and occasional gas!


     This answer is only partially facetious. In something as
important as a Congressional statute, one would think that key
terms like "State" would be defined so clearly as to leave no
doubt about their meaning. Alas, this is not the case in the
Internal Revenue Code (IRC) brought to you by Congress. The term
"State" has been deliberately defined so as to confuse the casual
reader into believing that it means one of the 50 States of the
Union, even though it doesn't say "50 States" in so many words.
For the sake of comparison, we begin by crafting a definition
which is deliberately designed to create absolutely no doubt or
ambiguity about its meaning:


     For the sole purpose of establishing a benchmark of clarity,
     the term "State" means any one of the 50 States of the
     Union, the District of Columbia, the territories and
     possessions belonging to the Congress, and the federal
     enclaves lawfully ceded to the Congress by any of the 50
     States of the Union.


Now, compare this benchmark with the various definitions of the
word "State" that are found in Black's Law Dictionary and in the
Internal Revenue Code. Black's is a good place to start, because
it clearly defines two different kinds of "states". The first
kind defines a member of the Union, i.e., one of the 50 States
which are united by and under the Constitution:


     The section of territory occupied by one of the United
     States***. One of the component commonwealths or states of
     the United States of America.
                                                 [emphasis added]


The second kind defines a federal state, which is entirely
different from a member of the Union:


     Any state of the United States**, the District of Columbia,
     the Commonwealth of Puerto Rico, and any territory or
     possession subject to the legislative authority of the
     United States. Uniform Probate Code, Section 1-201(40).

                                                 [emphasis added]


                        Page 5 - 1 of 22

                                                The Federal Zone:


Notice carefully that a member of the Union is not defined as
being "subject to the legislative authority of the United
States". Also, be aware that there are also several different
definitions of "State" in the IRC, depending on the context. One
of the most important of these is found in a chapter specifically
dedicated to providing definitions, that is, Chapter 79 (not
exactly the front of the book). In this chapter of definitions,
we find the following:


     When used in this title, where not otherwise distinctly
     expressed or manifestly incompatible with the intent
     thereof-- ...

     (10) State. -- The term "State" shall be construed to
          include the District of Columbia, where such
          construction is necessary to carry out provisions of
          this title.
                                                [IRC 7701(a)(10)]
                                                 [emphasis added]

Already, it is obvious that this definition leaves much to be
debated because it is ambiguous and it is not nearly as clear as
our "established benchmark of clarity" (which will be engraved in
marble a week from Tuesday). Does the definition restrict the
term "State" to mean only the District of Columbia? Or does it
expand the term "State" to mean the District of Columbia in
addition to the 50 States of the Union? And how do we decide?

     Even some harsh critics of federal income taxes, like Otto
Skinner, have argued that ambiguities like this are best resolved
by interpreting the word "include" in an expansive sense, rather
than a restrictive sense. To support his argument, Skinner cites
the definitions of "includes" and "including" that are actually
found in the Internal Revenue Code:

     Includes and Including. -- The terms "includes" and
     "including" when used in a definition contained in this
     title shall not be deemed to exclude other things otherwise
     within the meaning of the term defined.
                                                    [IRC 7701(c)]
                                                 [emphasis added]

     Skinner reasons that the Internal Revenue Code provides for
an expanded definition of the term "includes" when used in other
definitions contained in that Code. Using his logic, then, the
definition of "State" at IRC Sec. 7701(a)(10) must be interpreted
to mean the District of Columbia, in addition to other things.
But what other things? Are the 50 States to be included also?
What about the territories and possessions? And what about the
federal enclaves ceded to Congress by the 50 States? If the
definition itself does not specify any of these things, then
where, pray tell, are these other things "distinctly expressed"
in the Code? If these other things are distinctly expressed


                        Page 5 - 2 of 22

                                           What State Are You In?


elsewhere in the Code, is their expression in the Code manifestly
compatible with the intent of that Code? Should we include also
a state of confusion to our understanding of the statute?

     Quite apart from the meaning of "includes" and "including",
defining the term "include" in an expansive sense leads to an
absurd result that is manifestly incompatible with the
Constitution. If the expansion results in defining the term
"State" to mean the District of Columbia in addition to the 50
States of the Union, then these 50 States must be situated within
the federal zone. Remember, the federal zone is the area of land
over which the Congress has unrestricted, exclusive legislative
jurisdiction. But, the Congress does not have unrestricted,
exclusive legislative jurisdiction over any of the 50 States. It
is bound by the chains of the Constitution in this other zone, to
paraphrase Thomas Jefferson. Specifically, Congress is required
to apportion direct taxes which it levies within the 50 States.
This is a key limitation on the power of Congress. It has never
been explicitly repealed (as Prohibition was repealed).

     Unlike the Brushaber case, other federal cases can be cited
to support the conclusions that taxes on income are direct taxes,
and that the 16th Amendment actually removed this apportionment
rule from direct taxes laid on "income". Sorry, but the Supreme
Court is not always consistent in this area, and the Appellate
Courts are even less consistent. These other cases are highly
significant, if only because they provide essential evidence of
other attempts by federal courts to isolate the exact effects of
a ratified 16th Amendment. The following ruling by the Sixth
Circuit Court of Appeals is unique, among all the relevant
federal cases, for its clarity and conciseness on this question:


     The constitutional limitation upon direct taxation was
     modified by the Sixteenth Amendment insofar as taxation of
     income was concerned, but the amendment was restricted to
     income, leaving in effect the limitation upon direct
     taxation of principal.

          [Richardson vs United States, 294 F.2d 593, 596 (1961)]
                                                 [emphasis added]

The constitutional limitation upon direct taxes is apportionment.
It is not difficult to find Supreme Court decisions which arrived
at the very same conclusion about the 16th Amendment, long before
the Richardson case:

     ... [I]t does not extend the taxing power to new or excepted
     subjects, but merely removed all occasion, which otherwise
     might exist, for an apportionment among the states of taxes
     laid on income, whether it be derived from one source or
     another.
                        [Peck & Co. vs Lowe, 247 U.S. 165 (1918)]
                                                 [emphasis added]


                        Page 5 - 3 of 22

                                                The Federal Zone:


     And, in what is arguably one of the most significant Supreme
Court decisions to define the precise meaning of "income", the
Eisner Court simply paraphrased the Peck decision when it
attributed the exact same effect to the 16th Amendment, namely,
income taxes had become direct taxes relieved of apportionment:

     As repeatedly held, this did not extend the taxing power to
     new subjects, but merely removed the necessity which
     otherwise might exist for an apportionment among the States
     of taxes laid on income. ...

     A proper regard for its genesis, as well as its very clear
     language, requires also that this Amendment shall not be
     extended by loose construction, so as to repeal or modify,
     except as applied to income, those provisions of the
     Constitution that require an apportionment according to
     population for direct taxes upon property, real and
     personal.

               [Eisner vs Macomber, 252 U.S. 189, 205-206 (1919)]
                                                 [emphasis added]

     Contrary to statements about it in the Brushaber decision,
the earlier Pollock case, without any doubt, defined income taxes
as direct taxes. It also overturned an Act of Congress precisely
because that Act levied a direct tax without apportionment:

     First. We adhere to the opinion already announced, that,
     taxes on real estate being indisputably direct taxes, taxes
     on the rents or income of real estate are equally direct
     taxes.

     Second. We are of the opinion that taxes on personal
     property, or on the income of personal property, are
     likewise direct taxes.

                           [Pollock vs Farmers' Loan & Trust Co.]
                            [158 U.S. 601 (1895), emphasis added]

     Another Supreme Court decision is worthy of note, not only
because it appears to attribute the exact same effect to the 16th
Amendment, but also because it fails to clarify which meaning of
the term "United States" is being used:

     No doubt is suggested (the former requirement of
     apportionment having been removed by constitutional
     amendment) as to the power of Congress thus to impose taxes
     upon incomes produced within the borders of the United
     States [?] or arising from sources located therein, even
     though the income accrues to a non-resident alien.

                                 [Shaffer vs Carter, 252 U.S. 37]
                               [emphasis and question mark added]


                        Page 5 - 4 of 22

                                           What State Are You In?


     In the Shaffer decision, it is obvious that Justice Pitney
again attributed the same effect to the 16th Amendment. However,
if he defined "United States" to mean the federal zone, then he
must have believed that Congress also had to apportion direct
taxes within that zone before the 16th Amendment was "declared"
ratified. Such a belief contradicts the exclusive legislative
authority which Congress exercises over the federal zone:


     In exercising this power [to make all needful rules and
     regulations respecting territory or other property belonging
     to the United States**], Congress is not subject to the same
     constitutional limitations, as when it is legislating for
     the United States***.

             [Hooven & Allison Co. vs Evatt, 324 U.S. 652 (1945)]
                                                 [emphasis added]

     On the other hand, if Justice Pitney defined "United States"
to mean the several States of the Union, he as much admits that
the Constitution needed amending to authorize an unapportioned
direct tax on income produced or arising from sources within the
borders of those States. Unfortunately for us, Justice Pitney
did not clearly specify which meaning he was using, and we are
stuck trying to make sense of Supreme Court decisions which
contradict each other. For example, compare the rulings in Peck,
Eisner, Pollock and Shaffer (as quoted above) with the rulings in
Brushaber and Stanton vs Baltic Mining Co., and also with the
ruling In re Becraft (a recent Appellate case). To illustrate,
the Stanton court ruled as follows:


     ... [T]he  Sixteenth Amendment conferred no new power of
     taxation but simply prohibited the previous complete and
     plenary power of income taxation possessed by Congress from
     the beginning from being taken out of the category of
     indirect taxation to which it inherently belonged ....

          [Stanton vs Baltic Mining Company, 240 U.S. 103 (1916)]
                                                 [emphasis added]

     Now, contrast the Stanton decision with a relatively recent
decision of the Ninth Circuit Court of Appeals in San Francisco.
In re Becraft is classic because that Court sanctioned a seasoned
defense attorney $2,500 for raising issues which the Court called
"patently absurd and frivolous", sending a strong message to any
licensed attorney who gets too close to breaking the "Code".
First, the Court reduced attorney Lowell Becraft's position to
"one elemental proposition", namely, that the 16th Amendment does
not authorize a direct non-apportioned income tax on resident
United States** citizens and thus such citizens are not subject
to the federal income tax laws. Then the 9th Circuit dispatched
Becraft's entire argument with exemplary double-talk, as follows:


                        Page 5 - 5 of 22

                                                The Federal Zone:


     For over 75 years, the Supreme Court and the lower federal
     courts have both implicitly and explicitly recognized the
     Sixteenth Amendment's authorization of a non-apportioned
     direct income tax on United States** citizens residing in
     the United States*** and thus the validity of the federal
     income tax laws as applied to such citizens. See, e.g.,
     Brushaber .... [M]uch of Becraft's reply is also devoted to
     a discussion of the limitations of federal jurisdiction to
     United States** territories and the District of Columbia and
     thus the inapplicability of the federal income tax laws to a
     resident of one of the states*** [from footnote 2].

        [In re Becraft, 885 F.2d 547, 548 (1989), emphasis added]

Here, the 9th Circuit credits the 16th Amendment with authorizing
a non-apportioned direct tax, completely contrary to Brushaber.
Then the term "United States" is used two different ways in the
same sentence; we know this to be true because a footnote refers
to "one of the [50] states". The Court also uses the term
"resident" to mean something different from the statutory meaning
of "resident" and "nonresident", thus exposing another key facet
of their fraud (see Chapter 3). Be sure to recognize what's
missing here, namely, any mention whatsoever of State Citizens.

     For the lay person, doing this type of comparison is a
daunting if not impossible task, and demonstrates yet another
reason why federal tax law should be nullified for vagueness, if
nothing else. If Appellate and Supreme Court judges cannot be
clear and consistent on something as fundamental as a
constitutional amendment, then nobody can. And their titles are
Justice. Are you in the State of Confusion yet?

     When it comes to federal income taxes, we are thus forced to
admit the existence of separate groups of Supreme Court decisions
that flatly contradict each other. One group puts income taxes
into the class of indirect taxes; another group puts them into
the class of direct taxes. One group argues that a ratified 16th
Amendment did not change or repeal any other clause of the
Constitution; another group argues that it relieved income taxes
from the apportionment rule. Even experts disagree. To
illustrate the range of disagreement on such fundamental
constitutional issues, consider once again the conclusion of
legal scholar Vern Holland, quoted in a previous chapter:

     [T]he Sixteenth Amendment did not amend the Constitution.
     The United States Supreme Court by unanimous decisions
     determined that the amendment did not grant any new powers
     of taxation; that a direct tax cannot be relieved from the
     constitutional mandate of apportionment; and the only
     effect of the amendment was to overturn the theory advanced
     in the Pollock case which held that a tax on income, was in
     legal effect, a tax on the sources of the income.

                  [The Law That Always, page 220, emphasis added]


                        Page 5 - 6 of 22

                                           What State Are You In?


Now consider an opposing view of another competent scholar.
After much research and much litigation, author and attorney
Jeffrey A. Dickstein offers the following concise clarification:

     A tax imposed on all of a person's annual gross receipts is
     a direct tax on personal property that must be apportioned.
     A tax imposed on the "income" derived from those gross
     receipts is also a direct tax on property, but as a result
     of the Sixteenth Amendment, Congress no longer has to enact
     legislation calling for the apportionment of a tax on that
     income.
               [Judicial Income and Your Income Tax, pages 60-61]

     Recall now that 17,000 State-certified documents have been
assembled to prove that the 16th Amendment was never ratified.
As a consistent group, the Pollock, Peck, Eisner and Richardson
decisions leave absolutely no doubt about the consequences of the
failed ratification: the necessity still exists for an
apportionment among the 50 States of all direct taxes, and income
taxes are direct taxes. Using common sense as our guide, an
expansive definition of "include" results in defining the term
"State" to mean the District of Columbia in addition to the 50
States. This expansive definition puts the 50 States inside the
federal zone, where Congress has no restrictions on its exclusive
legislative jurisdiction. But, just a few sentences back, we
proved that the rule of apportionment still restrains Congress
inside the 50 States. This is an absurd result: it is not
possible for the restriction to exist, and not exist, at the same
time, in the same place, for the same group of people, for the
same laws, within the same jurisdiction. Congress cannot have
its cake and eat it too, as much as it would like to! Absurd
results are manifestly incompatible with the intent of the IRC
(or so I am told).

     Other problems arise from Skinner's reasoning. First of
all, like so much of the IRC, the definitions of "includes" and
"including" are outright deceptions in their own right. A
grammatical approach can be used to demonstrate that these
definitions are thinly disguised tautologies. Note, in
particular, where the Code states that these terms "shall not be
deemed to exclude other things". This is a double negative. Two
negatives make a positive. This phrase, then, is equivalent to
saying that the terms "shall be deemed to include other things".
Continuing with this line of reasoning, the definition of
"includes" includes "include", resulting in an obvious tautology.
(I just couldn't resist.) Forgive them, for they know not what
they do.

     The definitions of "includes" and "including" can now be
rewritten so as to "include other things otherwise within the
meaning of the term defined". So, what things are otherwise
within the meaning of the term "State", if those things are not
distinctly expressed in the original definition? You may be
dying to put the 50 States of the Union among those things that


                        Page 5 - 7 of 22

                                                The Federal Zone:


are "otherwise within the meaning of the term", but you are using
common sense. The Internal Revenue Code was not written with
common sense in mind; it was written with deception in mind.
The rules of statutory construction apply a completely different
standard. Author Ralph Whittington has this to say about the
special definitions that are exploited by lawyers and lawmakers:

     The Legislature means what it says. If the definition
     section states that whenever the term "white" is used
     (within that particular section or the entire code), the
     term includes "black," it means that "white" is "black" and
     you are not allowed to make additions or deletions at your
     convenience. You must follow the directions of the
     Legislature, NO MORE -- NO LESS.

                                     [Omnibus, Addendum II, p. 2]

     Unfortunately for Otto Skinner and others who try valiantly
to argue the expansive meaning of "includes" and "including",
Treasury Decision No. 3980, Vol. 29, January-December 1927, and
some 80 court cases have adopted the restrictive meaning of these
terms:

     The supreme Court of the State ... also considered that the
     word "including" was used as a word of enlargement, the
     learned court being of the opinion that such was its
     ordinary sense. With this we cannot concur. It is its
     exceptional sense, as the dictionaries and cases indicate.

        [Montello Salt Co. vs State of Utah, 221 U.S. 452 (1911)]
                                                 [emphasis added]

     An historical approach yields similar results. Without
tracing the myriad of income tax statutes which Congress has
enacted over the years, it is instructive to examine the
terminology found in a revenue statute from the Civil War era.
The definition of "State" is almost identical to the one quoted
from the current IRC at the start of this chapter. On June 30,
1864, Congress enacted legislation which contained the following
definition:

     The word "State," when used in this Title, shall be
     construed to include the Territories and the District of
     Columbia, where such construction is necessary to carry out
     its provisions.

                [Title 35, Internal Revenue, Chapter 1, page 601]
                        [Revised Statutes of the United States**]
                            [43rd Congress, 1st Session, 1873-74]

Aside from adding "the Territories", the two definitions are
nearly identical. The Territories at this point in time were
Washington, Utah, Dakota, Nebraska, Colorado, New Mexico, and the
Indian Territory.


                        Page 5 - 8 of 22

                                           What State Are You In?


     One of the most fruitful and conclusive methods for
establishing the meaning of the term "State" in the IRC is to
trace the history of changes to the United States Codes which
occurred when Alaska and Hawaii were admitted to the Union.
Because other authors have already done an exhaustive job on this
history, there is no point in re-inventing their wheels here. It
is instructive to illustrate these Code changes as they occurred
in the IRC definition of "State" found at the start of this
chapter. The first Code amendment became effective on January 3,
1959, when Alaska was admitted to the Union:


     Amended 1954 Code Sec. 7701(a)(10) by striking out
     "Territories", and by substituting "Territory of Hawaii".

                                                [IRC 7701(a)(10)]


The second Code amendment became effective on August 21, 1959,
when Hawaii was admitted to the Union:


     Amended 1954 Code Sec. 7701(a)(10) by striking out "the
     Territory of Hawaii and" immediately after the word
     "include".

                                                [IRC 7701(a)(10)]


Applying these code changes in reverse order, we can reconstruct
the IRC definitions of "State" by using any word processor and
simple "textual substitution" as follows:


     Time 1: Alaska is a U.S.** Territory
               Hawaii is a U.S.** Territory

7701(a)(10): The term "State" shall be construed to include the
               Territories and the District of Columbia, where
               such construction is necessary to carry out
               provisions of this title.


Alaska joins the Union. Strike out "Territories" and substitute
"Territory of Hawaii":


     Time 2: Alaska is a State of the Union
               Hawaii is a U.S.** Territory

7701(a)(10): The term "State" shall be construed to include the
               Territory of Hawaii and the District of Columbia,
               where such construction is necessary to carry out
               provisions of this title.


                        Page 5 - 9 of 22

                                                The Federal Zone:


Hawaii joins the Union. Strike out "the Territory of Hawaii and"
immediately after the word "include":


     Time 3: Alaska is a State of the Union
               Hawaii is a State of the Union

7701(a)(10): The term "State" shall be construed to include the
               District of Columbia, where such construction is
               necessary to carry out provisions of this title.


     Author Lori Jacques has therefore concluded that the term
"State" now includes only the District of Columbia, because the
former Territories of Alaska and Hawaii have been admitted to the
Union, Puerto Rico has been granted the status of a Commonwealth,
and the Philippine Islands have been granted their independence
(see United States Citizen versus National of the United States,
page 9, paragraph 5). It is easy to see how author Lori Jacques
could have overlooked the following reference to Puerto Rico,
found in the IRC itself:

     Commonwealth of Puerto Rico. -- Where not otherwise
     distinctly expressed or manifestly incompatible with the
     intent thereof, references in this title to possessions of
     the United States** shall be treated as also referring to
     the Commonwealth of Puerto Rico.
                                                    [IRC 7701(d)]

     In order to conform to the requirements of the Social
Security scheme, a completely different definition of "State" is
found in the those sections of the IRC that deal with Social
Security. This definition was also amended on separate occasions
when Alaska and Hawaii were admitted to the Union. The first
Code amendment became effective on January 3, 1959, when Alaska
was admitted:


     Amended 1954 Code Sec. 3121(e)(1), as it appears in the
     amendment note for P.L. 86-778, by striking out "Alaska,"
     where it appeared following "includes".
                                                 [IRC 3121(e)(1)]

The second Code amendment became effective on August 21, 1959,
when Hawaii was admitted:


     Amended 1954 Code Sec. 3121(e)(1), as it appears in the
     amendment note for P.L. 86-778, by striking out "Hawaii,"
     where it appeared following "includes".
                                                 [IRC 3121(e)(1)]

Applying these code changes in reverse order, we can reconstruct
the definitions of "State" in this Section of the IRC as follows:


                        Page 5 - 10 of 22

                                           What State Are You In?


     Time 1: Alaska is a U.S.** Territory
               Hawaii is a U.S.** Territory

 3121(e)(1): The term "State" includes Alaska, Hawaii, the
               District of Columbia, Puerto Rico, and the Virgin
               Islands.


Alaska joins the Union. Strike out "Alaska," where it appeared
following "includes":


     Time 2: Alaska is a State of the Union
               Hawaii is a U.S.** Territory

 3121(e)(1): The term "State" includes Hawaii, the District of
               Columbia, Puerto Rico, and the Virgin Islands.


Hawaii joins the Union. Strike out "Hawaii," where it appeared
following "includes":


     Time 3: Alaska is a State of the Union
               Hawaii is  a State of the Union

 3121(e)(1): The term "State" includes the District of
               Columbia, Puerto Rico, and the Virgin Islands.


Puerto Rico becomes a Commonwealth. For services performed after
1960, Guam and American Samoa are added to the definition:


     Time 4: Puerto Rico becomes a Commonwealth
               Guam and American Samoa join Social Security

 3121(e)(1): The term "State" includes the District of
               Columbia, the Commonwealth of Puerto Rico, the
               Virgin Islands, Guam, and American Samoa.


Notice carefully how Alaska and Hawaii only fit these definitions
of "State" before they joined the Union. It is most revealing
that these Territories became States when they were admitted to
the Union, and yet the United States Codes had to be changed
because Alaska and Hawaii were defined in those Codes as "States"
before admission to the Union, but not afterwards. This apparent
anomaly is perfectly clear, once the legal and deliberately
misleading definition of "State" is understood. The precise
history of changes to the Internal Revenue Code is detailed in
Appendix B of this book. The changes made to the United States
Codes when Alaska joined the Union were assembled in the Alaska
Omnibus Act. The changes made to the federal Codes when Hawaii


                        Page 5 - 11 of 22

                                                The Federal Zone:


joined the Union were assembled in the Hawaii Omnibus Act. The
following table summarizes the sections of the IRC that were
affected by these two Acts:


          IRC Section Alaska Hawaii
          changed: joins: joins:
          ----------- ------ ------

          2202 X X
          3121(e)(1) X X
          3306(j) X X
          4221(d)(4) X X
          4233(b) X X
          4262(c)(1) X X
          4502(5) X X
          4774 X X
          7621(b) X <-- Note
          7653(d) X X
          7701(a)(9) X X
          7701(a)(10) X X


     Section 7621(b) sticks out like a sore thumb when the
changes are arrayed in this fashion. The Alaska Omnibus Act
modified this section of the IRC, but the Hawaii Omnibus Act did
not. Let's take a close look at this section and see if it
reveals any important clues:


     Sec. 7621. Internal Revenue Districts.

     (a) Establishment and Alteration. -- The President shall
     establish convenient internal revenue districts for the
     purpose of administering the internal revenue laws. The
     President may from time to time alter such districts.

                                                    [IRC 7621(a)]

Now witness the chronology of amendments to IRC Section 7621(b),
entitled "Boundaries", as follows:


     Time 1: Alaska is a U.S.** Territory.
     <1/3/59 Hawaii is a U.S.** Territory. ("<" means "before")

     7621(b): Boundaries. -- For the purpose mentioned in
               subsection (a), the President may subdivide any
               State, Territory, or the District of Columbia, or
               may unite two or more States or Territories into
               one district.


                        Page 5 - 12 of 22

                                           What State Are You In?


     Time 2: Alaska is a State of the Union.
     1/3/59 Hawaii is a U.S.** Territory.

     7621(b): Boundaries. -- For the purpose mentioned in
               subsection (a), the President may subdivide any
               State, Territory, or the District of Columbia, or
               may unite into one District two or more States or
               a Territory and one or more States.


     Time 3: Alaska is a State of the Union.
     2/1/77 Hawaii is a State of the Union.

     7621(b): Boundaries. -- For the purpose mentioned in
               subsection (a), the President may subdivide any
               State or the District of Columbia, or may unite
               into one district two or more States.


     The reason why the Hawaii Omnibus Act did not change section
7621(b) is not apparent from reading the statute, nor has time
permitted the research necessary to determine why this section
was changed in 1977 and not in 1959. After Alaska joined the
Union, Hawaii was technically the only remaining Territory. This
may explain why the term "Territories" was changed to "Territory"
at Time 2 above. However, this is a relatively minor matter,
when compared to the constitutional issue that is involved here.
There is an absolute constitutional restriction against
subdividing or joining any of the 50 States, or any parts
thereof, without the consent of Congress and of the Legislatures
of the States affected. This restriction is very much like the
restriction against direct taxes within the 50 States without
apportionment:


     New States may be admitted by the Congress into this Union;
     but no new State shall be formed or erected within the
     Jurisdiction of any other State; nor any State be formed by
     the Junction of two or more States, or Parts of States,
     without the Consent of the Legislatures of the States
     concerned as well as of the Congress.

                  [Constitution for the United States of America]
                                 [Article 4, Section 3, Clause 1]
                                                 [emphasis added]

     This point about new States caught the keen eye of author
and scholar Eustace Mullins. In his controversial and heart-
breaking book entitled A Writ for Martyrs, Mullins establishes
the all-important link between the Internal Revenue Service and
the Federal Reserve System, and does so by charging that Internal
Revenue Districts are "new states" which have been established
within the jurisdiction of legal States of the Union, as follows:


                        Page 5 - 13 of 22

                                                The Federal Zone:


     The income tax amendment and the Federal Reserve Act were
     passed in the same year, 1913, because they function as an
     essential team, and were planned to do so. The Federal
     Reserve districts and the Internal Revenue Districts are
     "new states," which have been established within the
     jurisdiction of legal states of the Union.

                    [see Appendix "I", page I-12, emphasis added]

     Remember, the federal zone is the area of land over which
the Congress exercises an unrestricted, exclusive legislative
jurisdiction. The Congress does not have unrestricted, exclusive
legislative jurisdiction over any of the 50 States. It is bound
by the chains of the Constitution. This point is so very
important, it bears repeating throughout the remaining chapters
of this book. As in the apportionment rule for direct taxes and
the uniformity rule for indirect taxes, Congress cannot join or
divide any of the 50 States without the explicit approval of the
Legislatures of the State(s) involved. This means that Congress
cannot unilaterally delegate such a power to the President.
Congress cannot lawfully exercise (nor delegate) a power which it
simply does not have.

     How, then, is it possible for section 7621(b) of the
Internal Revenue Code to give this power to the President? The
answer is simple: the territorial scope of the Internal Revenue
Code is the federal zone. The IRC only applies to the land that
is internal to that zone. If the territorial scope of the IRC
were the 50 States of the Union, then section 7621(b) would, all
by itself, render the entire statute  unconstitutional for
violating clause 4:3:1 of the Constitution (see above). Numerous
other constitutional violations would also occur if the
territorial scope of the IRC were the 50 States. A clear and
unambiguous definition of "State" must be known before status and
jurisdiction can be decided with certainty. After seeing and
verifying all  of the evidence discussed above, the editors of a
bulletin published by the Monetary Realist Society wrote the
following long comment about the obvious problems it raises:


     A serious reader could come to the conclusion that Missouri,
     for example, is not one of the United States referred to in
     the code. This conclusion is encouraged by finding that the
     code refers to Hawaii and Alaska as states of the United
     States before their admission to the union! Is the IRS
     telling us that the only states over which it has
     jurisdiction are Guam, Washington D.C., Puerto Rico, the
     Virgin Islands, etc.? Well, why not write and find out?
     Don't expect an answer, though. Your editor has asked this
     question and sought to have both of his Senators and one
     Congresswoman prod the IRS for a reply when none was
     forthcoming. Nothing.
                                                  [continued ...]


                        Page 5 - 14 of 22

                                           What State Are You In?


     And isn't that strange? It would be so simple for the
     service to reply, "Of course Missouri is one of the United
     States referred to in the code" if that were, indeed, the
     case. What can one conclude from the government's refusal
     to deal with this simple question except that the government
     cannot admit the truth about United States citizenship? I
     admit that the question sounds silly. Everybody knows that
     Missouri is one of the United States, right? Sure, like
     everybody knows what a dollar is! But the IRS deals with
     "silly" questions every day, often at great length. After
     all, the code occupies many feet of shelf space, and covers
     almost any conceivable situation. It just doesn't seem to
     be able to cope with the simplest questions!

                              ["Some Thoughts on the Income Tax"]
                   [The Bulletin of the Monetary Realist Society]
                                 [March 1993, Number 152, page 2]

     Although this book was originally intended to focus on the
Internal Revenue Code, the other 49 U.S. Codes contain a wealth
of additional proof that the term "State" does not always refer
to one of the 50 States of the Union. Just to illustrate, the
following statutory definition of the term "State" was found in
Title 8, the Immigration and Nationality Act, as late as 1987:

     (36) The term "State" includes (except as used in section
     310(a) of title III [8 USCS Section 1421(a)]) the District
     of Columbia, Puerto Rico, Guam, and the Virgin Islands of
     the United States.

                  [8 USC 1101(a)(36), circa 1987, emphasis added]

The "exception" cited in this statute tells the whole story here.
In section 1421, Congress needed to refer to courts of the 50
States, because their constitutions and laws granted to those
courts the requisite jurisdiction to naturalize. For this
reason, Congress made an explicit exception to the standard,
federal definition of "State" quoted above. The following is the
paragraph in section 1421 which contained the exceptional uses of
the term "State" (i.e. Union State, not federal state):

     1421. Jurisdiction to naturalize

     (a) Exclusive jurisdiction to naturalize persons as
     citizens of the United States** is hereby conferred upon the
     following specified courts: District courts of the United
     States now existing, or which may hereafter be established
     by Congress in any State ... also all courts of record in
     any State or Territory now existing, or which may hereafter
     be created, having a seal, a clerk, and jurisdiction in
     actions at law or equity, or law and equity, in which the
     amount in controversy is unlimited.

                      [8 USC 1421(a), circa 1987, emphasis added]


                        Page 5 - 15 of 22

                                                The Federal Zone:


In a section entitled "State Courts", the interpretive notes and
decisions for this statute contain clear proof that the phrase
"in any State" refers to any State of the Union (e.g. New York):

     Under 8 USCS Section 1421, jurisdiction to naturalize was
     conferred upon New York State Supreme Court by virtue of its
     being court of record and having jurisdiction in actions at
     law and equity. Re Reilly (1973) 73 Misc 2d 1073, 344 NYS2d
     531.
                  [8 USCS 1421, Interpretive Notes and Decisions]
                       [Section II. State Courts, emphasis added]


Subsequently, Congress removed the reference to this exception in
the amended definition of "State", as follows:

     (36) The term "State" includes the District of Columbia,
     Puerto Rico, Guam, and the Virgin Islands of the United
     States.
                                  [8 USC 1101(a)(36), circa 1992]


     Two final definitions prove, without any doubt, that the IRC
can also define the terms "State" and "United States" to mean the
50 States as well as the other federal states. The very existence
of multiple definitions provides convincing proof that the IRC is
intentionally vague, particularly in the section dedicated to
general definitions (IRC 7701(a)). The following definition is
taken from Subtitle D, Miscellaneous Excise Taxes, Subchapter A,
Tax on Petroleum (which we all pay taxes at the pump to use):


     (A) In General. -- The term "United States" means the 50
          States, the District of Columbia, the Commonwealth of
          Puerto Rico, any possession of the United States, the
          Commonwealth of the Northern Mariana Islands, and the
          Trust Territory of the Pacific Islands. [!!]

                                              [IRC 4612(a)(4)(A)]
                                                 [emphasis added]

     Notice that this definition uses the term "means". Why is
this definition so clear, in stark contrast to other IRC
definitions of the "United States"? Author Ralph Whittington
provides the simple, if not obvious, answer:

     The preceding is a true Import Tax, as allowed by the
     Constitution; it contains all the indicia of being Uniform,
     and therefore passes the Constitutionality test and can
     operate within the 50 Sovereign States. The language of
     this Revenue Act is simple, specific and definitive, and it
     would be impossible to attach the "Void for Vagueness
     Doctrine" to it.
                           [The Omnibus, page 83, emphasis added]


                        Page 5 - 16 of 22

                                           What State Are You In?


     The following definition of "State" is required only for
those Code sections that deal with the sharing of tax return
information between the federal government and the 50 States of
the Union. In this case, the 50 States need to be included in
the definition. So, the lawmakers can do it when they need to
(and not do it, in order to put the rest of us into a state of
confusion):

     (5) State -- The term "State" means -- [!!]

          (A) any of the 50 States, the District of Columbia,
               the Commonwealth of Puerto Rico, the Virgin
               Islands, the Canal Zone, Guam, American Samoa, and
               the Commonwealth of the Northern Mariana Islands.

                                 [IRC 6103(b)(5), emphasis added]

It is noteworthy [!!] that these sections of the IRC also utilize
the term "means" instead of the terms "includes" and "including",
and instead of the phrase "shall be construed to include". It is
certainly not impossible to be clear. If it were impossible to
be clear, then just laws would not be possible at all, and the
Constitution could never have come into existence anywhere on
this planet. Authors like The Informer (as he calls himself)
consider the very existence of multiple definitions of "State"
and "United States" to be highly significant proof of fluctuating
statutory intent, even though a definition of "intent" is nowhere
to be found in the statute itself. Together with evidence from
the Omnibus Acts, these fluctuating definitions also expose
perhaps the greatest fiscal fraud that has ever been perpetrated
upon any people at any time in the history of the world.

     Having researched all facets of the law in depth for more
than ten full years, The Informer summarizes what we have learned
thus far with a precision that was unique for its time:


     The term "States" in 26 USC 7701(a)(9) is referring to the
     federal states of Guam, Virgin Islands, Etc., and NOT the 50
     States of the Union. Congress cannot write a municipal law
     to apply to the individual nonresident alien inhabiting the
     States of the Union. Yes, the IRS can go into the States of
     the Union by Treasury Decision Order, to seek out those
     "taxpayers" who are subject to the tax, be they a class of
     individuals that are United States** citizens, or resident
     aliens. They also can go after nonresident aliens that are
     under the regulatory corporate jurisdiction of the United
     States**, when they are effectively connected with a trade
     or business with the United States** or have made income
     from a source within the United States** ....

                    [Which One Are You?, page 98, emphasis added]


                        Page 5 - 17 of 22

                                                The Federal Zone:


     Nevertheless, despite a clarity that was rare, author Lori
Jacques has found good reasons to dispute even this statement.
In a private communication, she explained that the Office of the
Federal Register has issued a statement indicating that Treasury
Department Orders 150-10 and 150-37 (regarding taxation) were not
published in the Federal Register. Evidently, there are still no
published orders from the Secretary of the Treasury giving the
Commissioner of Internal Revenue the requisite authority to
enforce the Internal Revenue Code within the 50 States of the
Union. Furthermore, under Title 3, Section 103, the President of
the United States, by means of Presidential Executive Order, has
not delegated authority to enforce the IRC within the 50 States
of the Union. Treasury Department Order No. 150-10 can be found
in Commerce Clearinghouse Publication 6585 (an unofficial
publication). Section 5 reads as follows:

     U.S. Territories and Insular Possessions. The Commissioner
     shall, to the extent of authority otherwise vested in him,
     provide for the administration of the United States internal
     revenue laws in the U.S. Territories and insular possessions
     and other authorized areas of the world.

     Thus, the available evidence indicates that the only
authority delegated to the Internal Revenue Service is to enforce
tax treaties with foreign territories, U.S. territories and
possessions, and Puerto Rico. To be consistent with the law,
Treasury Department Orders, particularly TDO's 150-10 and 150-37,
needed to be published in the Federal Register. Thus, given the
absence of published authority delegations within the 50 States,
the obvious conclusion is that the various Treasury Department
orders found in Internal Revenue Manual 1229 have absolutely no
legal bearing, force or effect on sovereign Citizens of the 50
States. Awesome, yes? Our hats are off, once again, to Lori
Jacques for her superb legal research.

     The astute reader will notice another basic disagreement
between authors Lori Jacques and The Informer. Lori Jacques
concludes that the term "State" now includes only the District of
Columbia, a conclusion that is supported by IRC Sec. 7701(a)(10).
The Informer, on the other hand, concludes that the term "States"
refers to the federal states of Guam, Virgin Islands, etc. These
two conclusions are obviously incompatible, because singular and
plural must, by law, refer to the same things.

     It is important to realize that both conclusions were
reached by people who have invested a great deal of earnest time
and energy studying the relevant law, regulations, and court
decisions. If these honest Americans can come to such
diametrically opposed conclusions, after competent and sincere
efforts to find the truth, this is all the more reason why the
law should be declared null and void for vagueness. Actually,
this is all the more reason why we should all be pounding nails
into its coffin, by every lawful method available to boycott this


                        Page 5 - 18 of 22

                                           What State Are You In?


octopus. The First Amendment guarantees our fundamental right to
boycott arbitrary government, by our words and by our deeds.

     Moreover, the "void for vagueness" doctrine is deeply rooted
in our right to due process (under the Fifth Amendment) and our
right to know the nature and cause of any accusation (under the
Sixth Amendment). The latter right goes far beyond the contents
of any criminal indictment. The right to know the nature and
cause of any accusation starts with the statute which a defendant
is accused of violating. A statute must be sufficiently specific
and unambiguous in all its terms, in order to define and give
adequate notice of the kind of conduct which it forbids. If it
fails to indicate with reasonable certainty just what conduct the
legislature prohibits, a statute is necessarily void for
uncertainty, or "void for vagueness" as the doctrine is called.
Any prosecution which is based upon a vague statute must fail
together with the statute itself. A vague criminal statute is
unconstitutional for violating the 5th and 6th Amendments. The
U.S. Supreme Court has agreed unequivocally:

     That the terms of a penal statute creating a new offense
     must be sufficiently explicit to inform those who are
     subject to it what conduct on their part will render them
     liable to its penalties, is a well-recognized requirement,
     consonant alike with ordinary notions of fair play and the
     settled rules of law. And a statute which either forbids or
     requires the doing of an act in terms so vague that men of
     common intelligence must necessarily guess at its meaning
     and differ as to its application, violates the first
     essential of due process of law.

                    [Connally et al. vs General Construction Co.]
                        [269 U.S 385, 391 (1926), emphasis added]

     The Informer's conclusions appear to require definitions of
"includes" and "including" which are expansive, not restrictive.
The matter could be easily decided if the IRC would instead
exhibit sound principles of statutory construction, state clearly
and directly that "includes" and "including" are meant to be used
in the expansive sense, and itemize those specific persons,
places, and/or things that are "otherwise within the meaning of
the terms defined". If the terms "includes" and "including" must
be used in the restrictive sense, the IRC should state, clearly
and directly, that the expressions "includes only" and "including
only" must be used.

     Alternatively, the IRC could exhibit sound principles of
statutory construction by stating clearly and directly that
"includes" and "including" are always meant to be used in the
restrictive sense. Better yet, abandon the word "include"
entirely, together with all of its grammatical variations, and
use instead the word "means" (which does not suffer from a long
history of semantic confusion). It would also help a lot if the
50 States were consistently capitalized and the federal states


                        Page 5 - 19 of 22

                                                The Federal Zone:


were not. These, again, are excellent grounds for deciding that
the IRC is vague and therefore null and void. Of course, if the
real intent is to expand the federal zone in order to subjugate
the 50 states under the dominion of Federal States (defined along
something like ZIP code boundaries) and  to replace the sovereign
Republics with a monolithic socialist dictatorship, carved up
into arbitrary administrative "districts", that is another
problem altogether.

     The absurd results which obtain from expanding the term
"State" to mean the 50 States, however, are problems which will
not go away, no matter how much we clarify the definitions of
"includes" and "including" in the IRC. There are 49 other U.S.
Codes which have the same problem. Moreover, the mountain of
material evidence impugning the ratification of the so-called
16th Amendment should leave no doubt in anybody's mind that
Congress must still apportion all direct taxes levied inside the
sovereign borders of the 50 States. Likewise, Congress is not
empowered to delegate unilateral authority to the President to
subdivide or to join any of the 50 States. There are many other
constitutional violations which result from expanding the term
"State" to mean the 50 States of the Union. In this context, the
mandates and prohibitions found in the Bill of Rights are
immediately obvious, particularly as they apply to State
Citizens.

     Clarifying the definitions of "includes" and "including" in
the IRC is one thing; clarifying the exact extent of sovereign
jurisdiction is quite another. Congress is just not sovereign
within the borders of the 50 States. Sorry, all you Senators and
Representatives. When you took office, you did not take an oath
to uphold and defend the Ten Commandments. You did not take an
oath to uphold and defend the Uniform Commercial Code. You did
not take an oath to uphold and defend the Communist Manifesto.
You did take an oath to uphold and defend the Constitution for
the United States of America.

     It should be obvious, at this point, that capable authors
like Lori Jacques and The Informer do agree that the 50 States do
not belong in the standard definition of "State" because they are
in a class that is different from the class of federal states.
Within the borders of the 50 States, the "geographical" extent of
exclusive federal jurisdiction is confined to the federal
enclaves; this extent does not encompass the 50 States
themselves. We cannot blame the average American for failing to
appreciate this subtlety. The confusion that results from the
vagueness we observe is inherent in the statute and evidently
intentional, which raises some very serious questions concerning
the real intent of that statute in the first place. Could money
have anything to do with it? The question answers itself.


                             # # #


                        Page 5 - 20 of 22

                                           What State Are You In?


Reader's Notes:


                        Page 5 - 21 of 22

                                                The Federal Zone:


Reader's Notes:


                        Page 5 - 22 of 22

                           Chapter 6:
                        Empirical Results


     Up to this point, I have defined a set of key terms and
created a scheme for understanding how these key terms relate to
each other. This scheme was summarized in the form of a diagram
which I have called The Matrix (see chapter 3 and also the cover
of this book). The Matrix is a two-by-two table which permutes
every combination of citizen, alien, resident and nonresident to
create four unique cases:

               1. resident citizen
               2. resident alien
               3. nonresident citizen
               4. nonresident alien

     As a body of law, the Internal Revenue Code (IRC) and its
regulations together require all "citizens" and all "residents"
of the United States** to pay taxes on their worldwide incomes.
This requirement applies to three of the four cases shown above,
namely, resident citizens, resident aliens and nonresident
citizens. In the fourth case, nonresident aliens only pay tax on
income which is effectively connected with a U.S.** trade or
business, and on income from sources within the U.S.** (like
Frank Brushaber's dividend). Their tax liability is succinctly
summarized by the Code itself. Note how the relevant Code
section utilizes the phrase "includes only" as follows:

     General Rule. -- In the case of a nonresident alien
     individual, except where the context clearly indicates
     otherwise, gross income includes only -- [!!]

     (1) gross income which is derived from sources within the
          United States** and which is not effectively connected
          with the conduct of a trade or business within the
          United States**, and

     (2) gross income which is effectively connected with the
          conduct of a trade or business within the United
          States**.
                                     [IRC 872(a), emphasis added]

     This may sound all well and good, in theory. How does it
work in practice? With so many words to document the recipe for
pudding, how does the pudding taste? Two case histories provide
the necessary proof.

Case 1

     Figure 1 shows a letter which an American Citizen sent to
the District Director of the Internal Revenue Service in Ogden,
Utah. This letter was prepared in response to an unsigned letter
from the IRS, requesting that he file a 1040 Form. Note, in


                        Page 6 - 1 of 12

                                                The Federal Zone:
December 5, 1990
District Director
Internal Revenue Service
Ogden, Utah 84201

Re: NRA SSN #___-__-____

     On or about December 1, 1990, I received an unsigned
document claiming that you have not received the tax return 1040,
and requesting that the form 1040 be filed. I have enclosed a
copy of that request. I know of no such code that requires me to
file a "tax return 1040". If you know of such a code, please
identify that code for me.

     I have enclosed a copy of the letter that I have sent to the
Director of the Foreign Operations District, concerning this
matter.

     In researching the revenue code book which your people
kindly supplied to me, I discovered that only an "individual" is
required to file a tax return (26 USC 6012) and then only under
certain circumstances. In looking at Section 7701(a)(1) of the
code, I discovered that the term "individual" is defined as a
"person". Then, in checking under 7701(a)(30), I discovered the
definition of a "United States person" as meaning a "citizen of
the United States", "resident of the United States", "domestic
corporation", "domestic partnership" and a "domestic trust or
estate". There is no INDIVIDUAL defined under 7701(a)(30) and
therefore I cannot be an "individual" within the meaning of
7701(a)(1) and/or 26 USC 6012.

     As well, the Supreme Court in the case of  Wills vs Michigan
State Police, 105 L.Ed.2d 45 (1989) made it perfectly clear that
I, the sovereign, cannot be named in any statute as merely a
"person", or "any person". I am a member of the "sovereignty" as
defined in Yick Wo vs Hopkins, 118 U.S. 356 and the Dred Scott
case, 60 U.S. 393.

     Therefore and until you can prove otherwise, I am not a
"taxpayer", nor an "individual" that is required to file a tax
return. Please forward to me a letter stating that I am not
liable for this tax return, or produce the documentation that
requires me to file the "requested" tax return.

     If you have any questions concerning this letter, you may
write to me at the address shown below. Please sign all papers
so that I know who I am dealing with. Until such a time as I
hear from you or your office, I will take the position that I am
no longer liable for filing the return. Failure to respond will
be taken as meaning that you have "acquiesced" and that, from
this date forward, the doctrine of "estoppel by acquiescence"
will prevail.

Sincerely,

/s/ NRA

             Figure 1: Letter to District Director

                        Page 6 - 2 of 12

                                                Empirical Results


particular, his use of the key words "citizen of the United
States**", "resident of the United States**", "domestic
corporation", "domestic partnership", "domestic trust or estate"
and "sovereign". He asserted his status by explicitly claiming
to be a sovereign who was not the "person" defined at IRC
7701(a)(1), and who was not the "United States** person" defined
at 7701(a)(30). The IRC defines "person" as follows:


     Person. -- The term "person" shall be construed to mean and
     include an individual, a trust, estate, partnership,
     association, company or corporation.
                                                 [IRC 7701(a)(1)]


The IRC defines "United States** person" as follows:


     United States** person. -- The term "United States** person"
     means --

     (A) a citizen or resident of the United States**,
     (B) a domestic partnership,
     (C) a domestic corporation, and
     (D) any estate or trust (other than a foreign estate or
          foreign trust, within the meaning of Section
          7701(a)(31)).
                                                [IRC 7701(a)(30)]


     Again, note the use of the key words "citizen", "resident",
"domestic", and "foreign" which have been highlighted for
emphasis. These key words relate directly to The Matrix. The
key words "domestic" and "foreign" relate directly to the
boundaries of the federal zone, that is, the "United States**" as
that term is defined in relevant sections of the United States
Codes (USC). A domestic corporation is one which was chartered
inside the federal zone. A foreign estate or foreign trust are
foreign because they were established outside the federal zone.
Without making these statements in so many words, our intrepid
American's letter in Figure 1 can be used to draw the following
inferences about his status with respect to the exclusive
legislative jurisdiction of the "United States**":


     1. He is a sovereign as defined by the Supreme Court
     2. He is not a citizen of the United States**
     3. He is not a resident of the United States**
     4. He is not a domestic corporation
     5. He is not a domestic partnership
     6. He is not a domestic estate and
     7. He is not a domestic trust


                        Page 6 - 3 of 12

                                                The Federal Zone:


     There is one important thing his letter did not state
explicitly about him, and that is his status as a nonresident
alien. Nevertheless, this inference can, in turn, be drawn from
two of the above inferences: (2) he is not a citizen of the
United States** and (3) he is not a resident of the United
States**. As a human being, he is not an artificial "person"
like a corporation, partnership, estate, or trust. If he is not
a citizen of the United States**, then he is an alien. If he is
not a resident of the United States**, then he is a nonresident.
Therefore, he is a nonresident alien, according to the statute
and its regulations.


     Now, let's take the pudding out of the oven and see how it
tastes. After taking some time to review his letter, the IRS
addressed the following response to our intrepid American:

     Department of the Treasury
     Internal Revenue Service
     Ogden, UT 84201
                                   In reply refer to: 9999999999
                                   June 27, 1991 LTR 2358C
                                   ___-__-____ 8909 05 0000
                                   Input Op: 9999999999 07150
     To: NRA
         Address
         City, State Zip

     Taxpayer Identification Number : ___-__-____
                           Tax Form : 1040
                         Tax Period : Sep. 30, 1989
       Correspondence Received Date : June 13, 1991

     Dear Taxpayer:

     Based on our information, you are no longer liable for
     filing this tax return. We may contact you in the future if
     issues arise that need clarification. You do not need to
     reply to this letter.

                                   Sincerely yours,

                                   /s/ J. M. Wood
                                   Chief, Collection Branch
Case 2

     It would have been interesting to see what kind of response
NRA would have received if he had stated explicitly his status as
a nonresident alien. Based on what we know already about the law
and its regulations, such an explicit statement might have
expedited the processing of his letter. But hindsight is always
20/20. Fortunately, we do have another example where an American
Citizen did just that, in response to a similar IRS request for a
1040 form. The following is the text of the IRS request:


                        Page 6 - 4 of 12

                                                Empirical Results


     Department of the Treasury
     Internal Revenue Service
     Ogden, UT 94201
                                   Date of this Notice: 08-19-91
                                   Taxpayer Identification: (ssn)
                                   Form: 1040
                                   Tax Periods: 12-31-89
     To: ARN

         Your tax return is overdue -- Contact us immediately

     We still have not received your tax return, Form 1040 U.S.
     Individual Income Tax Return, for the year ending 12-31-89.

     We must resolve this matter. Contact us immediately, or we
     may take the following action:

          1. Summon you to come in with your books and records
               as provided by Sections 7602 and 7603 of the
               Internal Revenue Code;

          2. Criminal prosecution that includes a fine,
               imprisonment, or both, for persons who willfully
               fail to file a tax return or provide tax
               information (Code Section 7203).

     To prevent these actions, file your tax return today and
     attach your payment for any tax due. Even if you can't pay
     the entire amount of tax you owe now, it is important that
     you file your tax return today. Pay as much as you can and
     tell us when you will pay the rest. We may be able to
     arrange for you to pay in installments. Detach and enclose
     the form below with your return. To expedite processing,
     use the enclosed envelope.

     If you are not required to file or have previously filed,
     please contact us at the phone number shown above.

     [unsigned]


     I always enjoy it very much when the IRS states that "you
can pay in installments". Somebody should write to them and
recommend that they consider augmenting their "Services" by
implementing a layaway plan. They may even have a special form
for this very thing: Service Augmentation Request Form (RF)
#6666666, kind of like their "internal" Form 4685, as described
on page 34 of the IRS Printed Product Catalog, Document 7130:

          Form 4685 41890S (Each)
          News Clipping Mounting Guide
          This guide sheet is used for mounting news clippings
          for submittal to the National Office.
          C:PA:L Internal Use


                        Page 6 - 5 of 12

                                                The Federal Zone:


     Now, our second intrepid American, coded with the initials
ARN (Non Resident Alien abbreviated backwards) also took it upon
himself to respond in writing. This time, however, he wrote the
following words right on the IRS letter and sent it back to them,
certified mail, return receipt requested, on September 13, 1991:


     PLEASE BE ADVISED that ARN is a non-resident alien of the
     United States**, never having lived, worked, nor having
     income from any source within the District of Columbia,
     Puerto Rico, Virgin Islands, Guam, American Samoa or any
     other Territory within the United States**, which entity has
     its origin and jurisdiction from Article 1, Section 8,
     Clause 17 of the U.S. Constitution. Therefore, he is a non-
     taxpayer outside of the venue and jurisdiction of 26 U.S.C.


     This response gets right to the point. In his first
sentence, ARN is explicit and unequivocal about his status as a
nonresident alien with respect to the United States**. He has
never lived or worked in the United States**. He has never had
income from any source inside ("within") the District of
Columbia, Puerto Rico, Virgin Islands, Guam, American Samoa, or
any other Territory within the United States**. He exhibits his
knowledge of the relevant authority for "internal" revenue laws
by correctly citing Article 1, Section 8, Clause 17 (1:8:17) of
the U.S. Constitution. Lastly, he concludes that he is a
"non-taxpayer" who is outside the "venue" and jurisdiction of 26
U.S.C. (Title 26, United States Code).


     English Philosopher William of Occam (1300-1349) put it
succinctly when he said:


              "The simplest solution is the best."


Contrast this, the simplest of statements, with the dictionary
definition of "Occam's razor", as it is called:


     Occam's razor n [William of Ockham]: a scientific and
     philosophic rule that entities should not be multiplied
     unnecessarily which is interpreted as requiring that the
     simplest of competing theories be preferred to the more
     complex or that explanations of unknown phenomena be sought
     first in terms of known quantities.

                            [Webster's New Collegiate Dictionary]
                                            [G. & C. Merriam Co.]
                                        [Springfield, Mass. 1981]


                        Page 6 - 6 of 12

                                                Empirical Results


I wonder if the people who write for G. & C. Merriam Company also
obtain supplementary compensation for services performed inside
the exclusive legislative jurisdiction of the federal democracy
of the United States** (i.e., moonlight in the federal zone).

     Exactly two weeks later, ARN received the following letter
from J. M. Wood, signed with "hand writing" that lines up
perfectly with the same signature received by NRA. Could it have
been a computer signature?


     Department of the Treasury
     Internal Revenue Service
     Ogden, UT 84201

                                   In reply refer to: 9999999999
                                   Sep. 30, 1991 LTR 2358C
                                   ___-__-____ 8902 30 000
                                   Input Op: 9999999999 07150
     To: ARN
         Address
         City, State Zip

     Taxpayer Identification Number : ___-__-____
                           Tax Form : 1040
                         Tax Period : Dec. 31, 1989
       Correspondence Received Date : Sep. 16, 1991


     Dear Taxpayer:

     Based on our information, you are no longer liable for
     filing a tax return for this period. If other issues arise,
     we may need to contact you in the future. You do not need
     to reply to this letter.

                                   Sincerely yours,

                                   /s/ J. M. Wood
                                   Chief, Collection Branch


Now, that's what I call fast internal revenue service.


     To give you some idea just how far we need to elevate the
importance of status and jurisdiction, consider the following
lengthy quotes from the written work of author, attorney at law
and constitutional expert Jeffrey A. Dickstein. These quotes
were buried deep among the footnotes at the end of chapters in
his brilliant book entitled Judicial Tyranny and Your Income Tax:


                        Page 6 - 7 of 12

                                                The Federal Zone:


     The term "individual" which is used not only in Section
     6012(a)(1) but also in Section 1 as the subject upon whose
     income the tax is imposed, is not defined in the Internal
     Revenue Code. It is, however, defined in the treasury
     regulations accompanying Section 1. The regulations make a
     distinction between "citizens" and "residents" of the United
     States**, and define a "citizen" as every person born or
     naturalized in the United States** and subject to its
     jurisdiction [ see 26 CFR Section 1.1-1 (a) - (c) ]. An
     extremely strong argument can be made that the federal
     income tax as passed by Congress and as implemented by the
     Treasury Department was only meant to apply to individuals
     within the "territorial or exclusive legislative
     jurisdiction of the United States**," as those individuals
     would be subject to the "jurisdiction of the United
     States**." These exclusive areas, per Article I, Section 8,
     Clause 17, of the United States Constitution, are
     Washington, D.C., federal enclaves and United States**
     possessions and territories. Outside of these exclusive
     areas, state law controls, not federal law. Thus a State
     citizen, residing in a State, would not meet the two part
     test for being an "individual" upon whose income the tax is
     imposed by Section 1 of the Internal Revenue Code, and would
     not have the "status" of a "taxpayer." It is the official
     policy of the I.R.S. [Policy P-(11)-23] to issue, upon
     written request, rulings and determination letters regarding
     status for tax purposes prior to the filing of a return. On
     August 29, 1988, I requested such a "status determination"
     from the I.R.S. on behalf of one of my clients; as of the
     date of the publication of this book, the I.R.S. had still
     not responded.

              [Judicial Tyranny and Your Income Tax, pages 83-84]

     Evidently, Dickstein was exposed to this particular argument
by another attorney and constitutional expert, Lowell Becraft of
Huntsville, Alabama. It is very revealing that Dickstein could
justify the following observations even with a legal presumption
that the Sixteenth Amendment had been ratified:

     ... Attorney Lowell Becraft of Huntsville, Alabama, has made
     a powerful territorial/legislative jurisdictional argument
     that under the Supreme Court's holding in Brushaber, the
     income tax cannot be imposed anywhere except within those
     limited areas within the states in which the Federal
     government has exclusive legislative authority under Article
     I, Section 8, Clause 17, of the United States Constitution,
     such as on military bases, national forests, etc., and
     within United States territories, such as Puerto Rico, etc.
     Indeed, Treasury Department delegation orders and the
     language of Treasury Regulation 26 C.F.R. Section 1.1-1(c)
     fully supports Mr. Becraft's scholarly analysis.

                    [Judicial Tyranny and Your Income Tax, p. 33]


                        Page 6 - 8 of 12

                                                Empirical Results


     After publishing Judicial Tyranny, Jeffrey Dickstein made an
absolutely stunning presentation to Judge Paul E. Plunkett in
defense of William J. Benson before the federal district court in
Chicago. From the transcript of that hearing, it is obvious that
Dickstein had continued to distill his vast knowledge even
further, by isolating the following essential core:

     The statutes are in the Internal Revenue Code. I submit
     they mean something different if the Sixteenth Amendment was
     ratified than they do if the Sixteenth Amendment was not
     ratified. If the Sixteenth Amendment was ratified it means
     you can go into the states and collect this direct tax
     without apportionment. If it's not ratified you can't go
     into the states and do that. And since Pollock says it's a
     direct tax, what other connotation can you give to the
     statutes? The connotation that makes it constitutional is
     that it applies everywhere except within the states --
     which would be where? On army bases, federal enclaves,
     Washington, D.C., the possessions and the territories.

           [You Can Rely On The Law That Never Was!, pages 20-21]
                                                 [emphasis added]

     Sometimes, the answer is staring us right in the face. In
retrospect, I dedicate this chapter to Jeffrey Dickstein and
Larry Becraft, who have done so much to bring the truth about our
federal government into the bright light of day. Jeff and Larry,
we have only ourselves to blame for not paying closer attention
to your every words.

     In the passage quoted above from pages 83 and 84 of Judicial
Tyranny, author Dickstein refers to IRS Policy #P-(11)-23, from
the official Internal Revenue Manual (IRM). This "policy" reads
as follows:

     RULINGS, DETERMINATION LETTERS, AND CLOSING AGREEMENTS AS TO
     SPECIFIC ISSUES

     P-(11)-23 (Approved 6-14-87)

     Rulings and determination letters in general

          Rulings and determination letters are issued to
     individuals and organizations upon written requests,
     whenever appropriate in the interest of wise and sound tax
     administration, as to their status for tax purposes and as
     to the tax effect of their acts or transactions, prior to
     their filing of returns or reports as required by the
     revenue laws. Rulings are issued only by the National
     Office. Determination letters are issued only by District
     Directors and the Director of International Operations.
     Reference to District Director or district office in these
     policy statements also includes the office of the Director
     of International Operations. [emphasis added]


                        Page 6 - 9 of 12

                                                The Federal Zone:


This IRS "policy", as published in their Internal Revenue Manual,
prompted the National Commodity and Barter Association in Denver,
Colorado, to draft the following example of a request letter,
updated by this author for extra clarity and authority:


                    EXAMPLE OF REQUEST LETTER

     Director of International Operations
     Foreign Operations Division
     Internal Revenue Service
     11601 Roosevelt Boulevard
     Philadelphia, Pennsylvania 19422

     Dear Director:

          My research of the Internal Revenue Code and related
     Regulations has left me confused about my status for
     purposes of Federal Income Taxation.

          Pursuant to I.R.M. Policy #P-(11)-23, "upon written
     request" I can obtain from your office a determination of my
     status for purposes of Federal Income Taxation.

          This is my written, formal request for a determination
     letter as to my status for Federal Income Tax purposes.

          Please take note that your determination letter must be
     signed under penalty of perjury, per IRC Section 6065.

          If this is not the proper format for making this
     request, please send me the proper format with instructions.

          If I do not receive a determination letter from you
     within 30 days, I will be entitled to presume that I am not
     subject to any provisions of the IRC, Titles 26 or 27.

     Sincere yours,
     /s/ John Q. Doe
     all rights reserved


     What is the lesson in all of this? At the end of Chapter 1,
I expressed my intention to elevate status and jurisdiction to
the level of importance which they have always deserved. I am by
no means and in no way advising any Americans to utter, or to
sign their names on, any statements which they know to be false.
On the contrary, it is fair to say that I have been criticized
more often in life for being too honest. If you are a
nonresident alien with respect to the federal zone, then say so.
If you are not a nonresident alien with respect to the federal
zone, then think about changing your status. You can if you want
to, because involuntary servitude is forbidden everywhere in this
land. It's the Supreme Law!


                        Page 6 - 10 of 12

                                                Empirical Results


Reader's Notes:


                        Page 6 - 11 of 12

                                                The Federal Zone:


Reader's Notes:


                        Page 6 - 12 of 12

                           Chapter 7:
                         Inside Sources


     Frank Brushaber was taxed on a dividend he received from the
stock of a domestic corporation. Remember, the term "domestic"
in this context means "inside" the federal zone. The dividend
came, therefore, from a "source" that was situated inside this
zone. The exact legal meaning of the term "source" has been the
subject of much debate, both inside and outside the federal
courts. I would not presume to be the one who settles this
debate once and for all, least of all in the few pages dedicated
to this chapter. It is important to understand that the
Brushaber Court's decision turned, in large part, on a
determination of the "source" of the dividend which Frank
Brushaber received. That source was a domestic corporation which
had been chartered by Congress to build a railroad and telegraph
through the Utah Territory. As such, it was an "inside source"
-- a source that was situated inside the federal zone.

     Frank Brushaber's income was "unearned" income. This means
that he did not exchange any of his labor in order to receive the
dividend paid to him by the Union Pacific Railroad Company.
Earned income, on the other hand, is income which is derived from
exchanging labor for something of value, like money. Also beyond
the scope of this chapter are the sad debate, and considerable
mass of IRS-sponsored confusion, that surround the legal
definition of "income". Author Jeffrey Dickstein has done an
extremely thorough job of documenting the history of judicial
definitions of the term "income". Many of those definitions are
in direct conflict with each other, but all Supreme Court
decisions on the question have been completely consistent with
each other. In Appendix J of this book, you will find one of our
formal petitions to Congress in which are summarized a number of
rulings on this issue by the Supreme Court and by lower courts
which concur. If you must also review the courts which do not
concur, you gluttons for punishment should buy Dickstein's great
book on the subject.

     Back to sources. IRS Publication 54 explains in simple
terms that: "The source of earned income is the place where you
perform the services." I always enjoyed it when Sister Theresa
Marie would tell our third-grade class that the whole world is
divided into persons, places and things. How I long for those
simpler days! The courts have used the technical term "situs"
instead of "place" as follows:


     We think the language of the statutes clearly demonstrates
     the intendment [sic] of Congress that the source of income
     is the situs of the income-producing service.

           [C.I.R. vs Piedras Negras HB Co., 127 F.2d 260 (1942)]
                                                 [emphasis added]


                        Page 7 - 1 of 14

                                                The Federal Zone:


     It is useful to repeat the section of the Internal Revenue
Code (IRC) which was quoted in the last chapter. Specifically,
in the case of a nonresident alien individual, except where the
context clearly indicates otherwise, gross income includes only:


     (1) gross income which is derived from sources within the
          United States** and which is not effectively connected
          with the conduct of a trade or business within the
          United States**, and

     (2) gross income which is effectively connected with the
          conduct of a trade or business within the United
          States**.
                                                     [IRC 872(a)]
                                                 [emphasis added]


     The term "gross income" is crucial, because it is the
quantity which triggers the filing requirement. It is like a
threshold, or so we are told by august members of the black robe
like Judge Eugene Lynch of the Federal District Court in San
Francisco. Section 6012 of the IRC reads, in pertinent part:


     General Rule. -- Returns with respect to income taxes under
     subtitle A shall be made by the following:

     (1)(A) Every individual having for the taxable year gross
               income which equals or exceeds the exemption
               amount ...

     except that subject to such conditions, limitations, and
     exceptions and under such regulations as may be prescribed
     by the Secretary, nonresident alien individuals subject to
     the tax imposed by section 871 ... may be exempted from the
     requirement of making returns under this section.

                                                    [IRC 6012(a)]
                                                 [emphasis added]


     Section 6012 is a pivotal section, if only because the IRS
is now citing this section (among others) as their authority for
requiring "taxpayers" to make and file income tax returns. As
you can plainly read with your own eyes, nonresident alien
individuals may be exempted from the requirement of making
returns. Diving into the many thousands of regulations which
have been "prescribed by the Secretary" is also beyond the scope
of this book. For now, realize that the regulations do exist and
that the quantity "gross income" for nonresident aliens includes
only two things: (1) gross income derived from sources within
the United States** and (2) gross income that is effectively
connected with a U.S.** trade or business. That's it!


                        Page 7 - 2 of 14

                                                   Inside Sources


     You will note that the statute and its regulations make
frequent use of the terms "within" and "without", in order to
contrast the two terms as antonyms, or opposites. In this
context, the term "within" is synonymous with "inside"; the term
"without" is synonymous with "outside". "Within" and "without"
are antonyms. And the term "antonym" is an antonym for a
synonym! ("Good grief," declared Charlie Brown.) Thus, if you
are outside the federal zone, you are "without" the United
States** in the languid language of federal tax law. (Languid:
drooping or flagging from, or as if from exhaustion.) Can we
ever get along "without" the United States**?

     The importance of "within" and "without" cannot be
emphasized too much. In the context of everything we now know
about jurisdiction within the federal zone, these terms are
crucial to understanding the territorial extent of the IRC. To
underscore this point, consider IRC Section 862(a), entitled
"Income from Sources Without the United States**":


     (a) Gross Income from Sources without United States**. --

          The following items of gross income shall be treated as
          income from sources without the United States**: ...

          (3) compensation for labor or personal services
               performed without the United States**.

                                              [IRC 862(a)-(a)(3)]
                                                 [emphasis added]


     Now, turn to IRS Form 1040NR. A copy of this form is found
in Appendix K. The "NR" stands for "NonResident". Nonresident
aliens file this form to report and pay tax on gross income as
defined in IRC Section 872(a). On page one of the 1990 version
of this form, there is a block of line items numbered 8 thru 22.
These items are summed to produce a total on line 23. "This is
your total effectively connected income," states the form. Now,
turn the form clockwise 90 degrees. Note, in particular, the
phrase near the left margin of page one which reads:


     Income Effectively Connected With U.S.** Trade/Business


If you are a nonresident alien and you have no income which is
effectively connected with a U.S.** trade or business, then you
can, in good conscience, put a big fat ZERO on line 23. But,
this is not the whole story. On page 4 of Form 1040NR, there is
a table for computing "Tax on Income Not Effectively Connected
with a U.S.** Trade or Business". What would this be?


                        Page 7 - 3 of 14

                                                The Federal Zone:


     Recall IRC Section 872(a), quoted above. The only other
component of gross income for nonresident aliens is income which
is derived from sources within the United States**, like Frank
Brushaber's stock dividend. Lo and behold, this table itemizes
such things as dividends, interest, royalties, pensions, and
annuities. These are all items of unearned income, that is,
profits and gains derived from U.S.** sources other than
compensation for labor or personal services performed "within"
the United States**. The total tax is computed and entered on
line 81 of Form 1040NR. Unfortunately, true to form, line 81 in
this table says that "This is your tax on income not effectively
connected with a U.S.** trade or business." This is very
deceptive. Remember, gross income for nonresident aliens
includes only two kinds of gross income:


     (1) gross income derived from sources within the U.S.**
          which is not effectively connected with a U.S.** trade
          or business and

     (2) gross income which is effectively connected with the
          conduct of a trade or business within the United
          States**


Line 81 of Form 1040NR is referring to the first kind of gross
income, namely, gross income which is "not effectively connected
with a U.S.** trade or business". The second kind of gross
income is entered on page 1 at line 23 of this form. Again, it's
simple when you know enough to decode the Code. It's also very
easy to get confused when the confusion is intentional.
("Encode" and "decode" are antonyms, by the way.)

     Unfortunately, the filing requirements for nonresident
aliens are not as straightforward as you might think, because the
regulations contain certain rules that are not found in the Code
itself, and the Code is frequently vague. To understand these
requirements, the regulations must be reviewed as they apply to
your particular situation. A brief overview is in order.

     If you are a nonresident alien with no gross income from
sources within the U.S.**, and with no U.S.** trade or business,
is it a good idea to file a 1040NR with zeroes everywhere? No,
it is not. The main reason is that filing any 1040 form can
provide the IRS with a legal reason to presume that you are a
"taxpayer", as that term is defined in the IRC. A later chapter
of this book will explore the "law of presumption" in some
detail. Your filed return can be used as evidence that you are a
taxpayer, that is, one who is subject to any internal revenue tax
because you are engaged in a "revenue taxable activity". A
U.S.** trade or business is a revenue taxable activity. Thus, a
key issue for nonresident aliens is whether or not they are
engaged in any U.S.** trade or business. The CFR regulations say
this about the filing requirement for nonresident aliens:


                        Page 7 - 4 of 14

                                                   Inside Sources


     ... [E]very nonresident alien individual ... who is engaged
     in a trade or business in the United States at any time
     during the taxable year or who has income which is subject
     to taxation under Subtitle A of the Code shall make a return
     on Form 1040NR. For this purpose it is immaterial that the
     gross income for the taxable year is less than the minimum
     amount specified in section 6012(a) for making a return.
     Thus, a nonresident alien individual who is engaged in a
     trade or business in the United States** at any time during
     the taxable year is required to file a return on Form 1040NR
     even though

     (a) he has no income which is effectively connected with
          the conduct of a trade or business in the United
          States**,

     (b) he has no income from sources within the United
          States**, or

     (c) his income is exempt from income tax by reason of an
          income tax convention or any section of the Code.

                                          [26 CFR 1.6012-1(b)(1)]
                                                 [emphasis added]

     Thus, the gross income "threshold" defined in the filing
requirement at IRC 6012(a) is not relevant if a nonresident alien
is engaged in any U.S.** trade or business. Conversely, the
rules are somewhat different if a nonresident alien is not
engaged in any U.S.** trade or business. The regulations have
this to say about a nonresident alien in the latter situation:


     A nonresident alien individual ... who at no time during the
     taxable year is engaged in a trade or business in the United
     States** is not required to make a return for the taxable
     year if his tax liability for the taxable year is fully
     satisfied by the withholding of tax at source under Chapter
     3 of the Code.

                                          [26 CFR 1.6012-1(b)(2)]
                                                 [emphasis added]

     If a nonresident alien has no U.S.** trade or business and
no tax liability that required withholding (such as U.S.** source
income), then a return is not required. If you are a nonresident
alien and you remain in doubt as to whether or not you are
required to file a Form 1040NR, you might begin by reading all
the rules found in the Instructions for Form 1040NR. In general,
the instructions are much easier to read than the regulations,
but also understand that the regulations have the force of law
and the instructions do not. The instructions for form 1040NR
address the question of who must file as follows:


                        Page 7 - 5 of 14

                                                The Federal Zone:


     Use Form 1040NR if any of the four conditions listed below
     and on page 2 applies to you:

     1. You were a nonresident alien engaged in a trade or
          business in the United States** during 1990. You must
          file Form 1040NR even if:

          a. none of your income came from a trade or businesss
               conducted in the United States**,

          b. you have no income from U.S.** sources, or

          c. your income is exempt from U.S.** tax.

          In any of the above three cases, do not complete the
          schedules for Form 1040NR. Instead, attach a list of
          the kinds of exclusions you claim and the amount of
          each.

     2. You were a nonresident alien not engaged in a trade or
          business in the United States** during 1990 with income
          on which not all U.S.** tax that you owe was withheld.

     3. You represent a deceased person who would have had to
          file Form 1040NR.

     4. You represent an estate or trust that would have had to
          file Form 1040NR.

                           [Instructions for Form 1040NR, page 1]


     Now, what is a "trade or business" within the United
States**? Author and legal scholar Lori Jacques has concluded
that the meaning of a "trade or business" is confined to
performing the functions of a public office. This conclusion is
supported by an explicit definition of "trade or business" that
is found in the IRC itself:


     Trade or Business. -- The term "trade or business" includes
     the performance of the functions of a public office.

                                                [IRC 7701(a)(26)]


The Informer has come to the same conclusion, after years of
research. All of this "trade or business" activity, thus
defined, boils down to one simple thing: government employment.
If you work for the federal government, even if you are a
nonresident alien, the Congress reserves the power to define that
work as a "privilege", the exercise of which Congress can tax.
The measure of that tax is the amount of income derived. Author
Lori Jacques summarizes government employment as follows:


                        Page 7 - 6 of 14

                                                   Inside Sources


     It appears that the federal income tax is the graduated tax
     on income effectively connected with a U.S.** trade or
     business as described in IR Code Sec. 871(b) which is
     government employment. Remember the nonresident alien does
     not pay tax on non U.S.** source income. If the nonresident
     alien signs a Form W-4 he is obviously presumed to be a
     government employee with "effectively connected income."

    [United States Citizen vs National of the United States]
                                        [page 39, emphasis added]


     Another competent author and IRS critic, Frank Kowalik, has
also arrived at similar conclusions about the "taxability" of
employment with the federal government. In his thorough book
entitled IRS Humbug, IRS Weapons of Enslavement, Kowalik argues
with exhaustive proof that a tax "return" is really just a
kickback. Government employees are expected to return or "kick
back" some of their earnings to the Treasury, in obvious and
grateful tribute to the great giver of all federal privileges,
Uncle Sam. Kowalik's arguments and accompanying complaints are
so persuasive that Rep. Jack Brooks, Chairman of the House
Judiciary Committee, has scheduled Kowalik's request for redress
as Petition No. 107. In a personal letter to me, Frank Kowalik
wrote the following:


     I read with interest your Redress (12-24-90) to Barbara
     Boxer. I also delivered a Redress to Congress making Tom
     Foley, House Speaker, my personal representative. My book
     "IRS Humbug" was an exhibit in this Redress. Jack Brooks,
     Chairman of the House Judiciary Committee, was among those
     copied. From his letter (copy attached) my Redress has been
     referred to the Committee on the Judiciary as Petition No.
     107. As I understand it, it will be heard in the session
     after the holidays. I also provide information on "IRS
     Humbug" that covers the fact that federal income tax is not
     a tax on labor. It is a kickback program between the
     federal government and its employees.

                      [personal communication, December 10, 1991]
                                                 [emphasis added]


     Taken together, The Informer, Lori Jacques and Frank Kowalik
appear unanimous in understanding the term "trade or business" to
include only the performance of the functions of a public office.
This conclusion is, of course, supported by the explicit
definition of "trade or business" which is found in the IRC
itself at Sec. 7701(a)(26). Note, however, that this definition
does not say "includes only"; it says "includes".


                        Page 7 - 7 of 14

                                                The Federal Zone:


     Once again, we are haunted by the ambiguity that results
from not knowing for sure whether "includes" is expansive or
restrictive. If "includes" is restrictive, then The Informer,
Lori Jacques, and Frank Kowalik are all correct about the
inferences they have drawn from the statute and its regulations.
If "includes" is expansive, however, then we have to look
elsewhere for things that are "otherwise within the meaning of
the term defined", that is, otherwise within the meaning of
"U.S.** trade or business".

     An expansive intent is manifested by the explicit
definitions of "includes" and "including" that are found at IRC
7701(c). The issues of statutory construction that arise from
these definitions of "includes" and "including" are so complex, a
subsequent chapter of this book will revisit these terms in more
detail. The conclusions in that chapter should already be
obvious to you. For now, suffice it to say that the intended
clarification at 7701(c) is anything but. The hired lawyers who
wrote this stuff should have known better than to use terms that
have a long history of semantic confusion. For this reason, and
for this reason alone, I am now convinced that the confusion is
inherent in the language chosen by these hired "guns" and is
therefore deliberate.

     There is evidence that the meaning of "trade or business" is
not limited to the performance of the functions of a public
office. The Code itself contains a second definition of "trade
or business within the United States**" as follows:


     Trade or Business within the United States**. --

     For purposes of this part, part II, and chapter 3, the term
     "trade or business within the United States**" includes the
     performance of personal services within the United States**
     at any time within the taxable year ....

                                                     [IRC 864(b)]
                                                 [emphasis added]


     It is tempting to interpret this definition only "for
purposes of this part, part II, and chapter 3". I will not take
the bait, because it is more important to stay above a major
addiction of the federal zone: obfuscation. You may have
already begun to notice how frequently the IRC makes reference to
other sections, subsections, subparts, subtitles, and
subchapters. Sure, these other places in the law must be taken
into account before the "performance of personal services" can be
fully understood as defined. I can see that as well as anybody
else. But two can play this game. Is there any reason in the
statute to suspect that these remote references might not even be
valid? First, read the following sub-statute within the statute,
and then decide for yourself (go ahead, you have my permission):


                        Page 7 - 8 of 14

                                                   Inside Sources


     Construction of Title.

                         [Sec. 7806(b)]

     (b) Arrangement and Classification. -- No inference,
          implication, or presumption of legislative construction
          shall be drawn or made by reason of the location or
          grouping of any particular section or provision or
          portion of this title, nor shall any table of contents,
          table of cross references, or similar outline,
          analysis, or descriptive matter relating to the
          contents of this title be given any legal effect. The
          preceding sentence also applies to the side notes and
          ancillary tables contained in the various prints of
          this Act before its enactment into law.

                                    [IRC 7806(a), emphasis added]

     Many people, unschooled in the finer points of statutory
construction, interpret this section of the IRC to mean that the
entire Code has no legal effect. However, a close reading
reveals that this section is limited to tables of contents,
tables of cross references, side notes, ancillary tables and
outlines, in other words, everything but the meat of the Code.
Nevertheless, notice the last sentence; it contains a rule which
also applies the "preceding sentence" to the side notes and
ancillary tables contained in the various prints of the Code
before its enactment into law. So, the obvious question is this:
has Title 26 been enacted into law? The shocking answer is: NO,
it has not been enacted into positive law. In a preface dated
January 14, 1983 and included in the 1982 edition of the United
States Code, Speaker of the House Thomas P. O'Neill wrote the
following:


     Titles 1, 3, ... 23, 28, ... have been revised, codified,
     and enacted into positive law and the text thereof is legal
     evidence of the laws therein contained. The matter
     contained in the other titles of the Code is prima facie
     evidence of the laws.


Notice that Title 26 is clearly missing from the list of titles
which have been enacted into positive law. This fact can also be
confirmed by examining the inside cover page of any volume of the
United States Codes in any law library. There you will find that
Title 26 is missing the asterisk "*" which indicates that the
title has been enacted into positive law. The implications of
this finding can be found in Subtitle F, Subchapter B, which
deals with effective dates and related provisions. There the
general rule for provisions of subtitle F reads as follows:


                        Page 7 - 9 of 14

                                                The Federal Zone:


     General Rule. -- The provisions of subtitle F shall take
     effect on the day after the date of enactment of this title
     and shall be applicable with respect to any tax imposed by
     this title.

                              [IRC 7851(a)(6)(A), emphasis added]

Believe it or not, subtitle F contains all the enforcement
provisions of the IRC, such as filing requirements, assessment
and collection, liens, levies and seizures. In other words, the
enforcement provisions of the Internal Revenue Code have still
not taken effect because, as of this writing, Title 26 has still
not been enacted. If you don't mind getting frustrated, notice
also that section 7851 is also part of subtitle F!

     If the statute itself is entirely too frustrating to
decipher, it is no wonder why the IRS has published literally
hundreds of instruction booklets and official IRS "Publications"
to help "clarify" the myriad rules and forms. At last count,
there were more than 5,000 IRS forms in the IRS Printed Product
Catalog quoted elsewhere in this book. To conclude our
discussion of "U.S.** trade or business", you might want to
obtain a copy of IRS Publication 519, U.S. Tax Guide for Aliens.
This 40-page booklet expresses the English language in words that
are much easier to understand than the statute itself. It even
has its own Index. Be forewarned, however, that official IRS
"Publications" do not have the force of law because they have not
been published in the Federal Register, nor do any of them
display control numbers and expiration dates issued by the Office
of Management and Budget (OMB). (If the IRS makes an error, it's
not their fault anyway.) Publication 519 has this to say about a
trade or business inside the United States**:


     Trade or Business

     Whether you are engaged in a trade or business in the United
     States** depends on the nature of your activities. The
     discussions that follow will help you determine whether you
     are engaged in a trade or business in the United States**.

     Personal Services

     If you perform personal services in the United States** at
     any time during the tax year, you usually are considered
     engaged in a trade or business in the United States**. You
     are engaged in a trade or business in the United States** if
     you perform services in this country and receive
     compensation such as wages, salaries, fees, tips, bonuses,
     honoraria, or commissions.

                     [Publication 519: U.S. Tax Guide for Aliens]
                                                         [page 8]


                        Page 7 - 10 of 14

                                                   Inside Sources


     Back to sources one more time. (It's so easy to get
sidetracked by some remote code reference that has no legal
effect!) The interested reader and intrepid investigator will be
happy to know that there are literally "oodles" of regulations
which go into details, great and small, about the life and times
of Mr. and Mrs. Nonresident Alien. Here is a blockbuster for
which I am eternally grateful to Tarzan The Informer for weeding
out of the jungle of slippery lines and double negatives:

     Nonresident aliens. A nonresident alien individual never
     has self-employment income. While a nonresident alien
     individual who derives income from a trade or business
     carried on within the United States**, Puerto Rico, the
     Virgin Islands, Guam, or American Samoa (whether by agents
     or employees, or by a partnership of which he is a member)
     may be subject to the applicable income tax provisions on
     such income, such nonresident alien individual will not be
     subject to the tax on self-employment income, since any net
     earnings which he may have from self-employment do not
     constitute self-employment.

                                            [26 CFR 1402(b)-3(d)]
                                                 [emphasis added]

A nonresident alien individual never has self-employment income.
I agree completely with The Informer: "never" always means never.

     The point of this chapter is to stress the extreme
importance of understanding "sources" as they affect the
nonresident alien like you and me. Remember how Frank Brushaber
ultimately lost his bid to the Supreme Court of the United
States. He received a dividend that was issued by a "domestic"
corporation. Even though he was found to be a nonresident alien
with respect to the United States**, his dividend was found to be
unearned income from a source inside the United States**, inside
the federal zone. The Informer nicely summarizes the overall
situation as follows:

     YOU ARE NOT TAXABLE IF YOU ARE:

          ITEM 1: a non resident alien NOT carrying on a trade
                    or business with the U.S.** or State of a
                    Union State;

          ITEM 2: a non resident alien NOT making source income
                    from within the United States**;

          ITEM 3: a non resident alien NOT having a trademark,
                    patent, or copyright;

          ITEM 4: a non resident who is NOT a fiduciary, so you
                    cannot be a person of incidence with respect
                    to a person of adherence;
                                                  [continued ...]


                        Page 7 - 11 of 14

                                                The Federal Zone:


     then the income tax is not imposed, under subtitle A,
     chapter 1 on a non resident alien. So you fit the
     description under 26 USC Sections 2(d) & 872.

                                    [Which One Are You?, page 24]
                                           [emphasis in original]


     The complex issues of patents, trademarks, copyrights and
fiduciaries are beyond the scope of this book. My "sources" tell
me that The Informer is writing another book, hopefully to
clarify some of the legal in's and out's of being a fiduciary.
Author Lori Jacques has arrived at a remarkably similar
conclusion about nonresident aliens. The first person "I" in the
following excerpt is author Jacques:

     It is conclusive the Department of Treasury, Internal
     Revenue Service, has no authority within the several states,
     it is just as conclusive that any income deriving from
     within the jurisdiction of the national government is
     taxable to the person receiving it. The treasury decision
     on Brushaber confirms that.

     The tax on the nonresident alien conforms to all
     constitutional provisions:

     1. Uniform taxation of 30% on unearned income from U.S.**
          sources.

     2. No reporting of private information as the tax is
          withheld at source or else the government has all the
          information of amount it has paid -- just return the
          receipt to prove the tax was paid.

     3. Graduated taxation on income received from trade or
          business conducted within the United States**,
          permitted because only the states are parties to the
          compact guaranteeing unalienable rights and
          uniform/apportioned taxation. The federal areas are
          always exempt from laws guaranteeing equal treatment.

     4. No public notice has been published in the Federal
          Register since state citizens, nonresident to the
          United States** as defined, are not affected by the
          delegation of authority orders.

     After the evidence is in, I now believe that under the
     internal revenue law I am a "national" and a nonresident
     alien to federal jurisdiction who has no U.S.** source
     income nor any effectively connected income with a U.S.**
     trade or business for which I am liable to render a return.

         [United States Citizen vs National of the United States]
                                        [page 44, emphasis added]


                        Page 7 - 12 of 14

                                                   Inside Sources


     This lengthy excerpt does an excellent job of summarizing a
mountain of earnest legal research and writing by author and
scholar Lori Jacques. My hat's off to you, Lori, for doing a
"totally boss" and uniquely thorough job. I take issue only with
your statement above that "the Internal Revenue Service has no
authority within the several States." Without clarifying the tax
liability that attaches to income from "inside sources", this
statement could be misleading. Remember that Frank Brushaber's
liability attached to income from such a source. The Informer
has accurately qualified the precise extent of federal tax
jurisdiction within the 50 States of the Union as follows:


     Yes, the IRS can go into the States of the Union by Treasury
     Decision Order, to seek out those "taxpayers" who are
     subject to the tax, be they a class of individuals that are
     United States** citizens, or resident aliens. They also can
     go after nonresident aliens that are under the regulatory
     corporate jurisdiction of the United States**, when they are
     effectively connected with a trade or business with the
     United States** or have made income from a source within the
     United States** that they have entered into an agreement
     with, for then they are in the state of the forum.

                                    [Which One Are You?, page 98]
                                                 [emphasis added]

     For the reader who is motivated to investigate the question
of "inside sources" in greater detail, Appendix V in this edition
of The Federal Zone contains an Affidavit of Applicable Law.
This affidavit contains numerous citations to IRC sections which
are pertinent to the crucial distinction between "inside" sources
and "outside" sources. This same affidavit can be used formally
to deny specific liability for federal income taxes during any
given calendar year(s).


                             # # #


                        Page 7 - 13 of 14

                                                The Federal Zone:


Reader's Notes:


                        Page 7 - 14 of 14

                           Chapter 8:
                        Is it Voluntary?


     One of the great deceptions in federal income taxation is
the widespread IRS propaganda that the system is "voluntary".
Commissioners of the IRS have repeatedly published statements to
this effect in all kinds of places like The Federal Register,
annual reports to Congress, various instruction booklets and
other printed materials. Even the Supreme Court has joined the
cadre (cacophony?) of federal government officials who admit,
when cornered, that it is voluntary. So, this "voluntary" thing
has not been a mistake or an occasional slip here and there; it
has been the consistent policy of top officials of the Internal
Revenue Service, the Justice Department and the Supreme Court,
believe it or not. A thorough sampling of these admissions is
now in order.

     In 1953, Mr. Dwight E. Avis, head of the Alcohol and Tobacco
Tax Division of the Bureau of Internal Revenue, made the
following remarkable statement to a subcommittee of the Committee
on Ways and Means in the House of Representatives:


     Let me point this out now: Your income tax is 100 percent
     voluntary tax, and your liquor tax is 100 percent enforced
     tax. Now, the situation is as different as day and night.

                                 [Internal Revenue Investigation]
                         [Hearings before a Subcommittee of the ]
                                    [Committee on Ways and Means]
                       [Feb. 3 thru Mar. 13, 1953, emphasis added]


     In 1971, the following quote was found in the IRS
instruction booklet for Form 1040:


     Each year American taxpayers voluntarily file their tax
     returns and make a special effort to pay the taxes they owe.

                                                 [emphasis added]


     In 1974, Donald C. Alexander, Commissioner of Internal
Revenue, published the following statement in the March 29 issue
of The Federal Register:


     The mission of the Service is to encourage and achieve the
     highest possible degree of voluntary compliance with the tax
     laws and regulations ....
                                    [Vol. 39, No. 62, page 11572]
                                                 [emphasis added]


                        Page 8 - 1 of 16

                                                The Federal Zone:


     One year later, in 1975, his successor, Mortimer Caplin
authored the following statement in the Internal Revenue Audit
Manual:


     Our tax system is based on individual self-assessment and
     voluntary compliance.
                                                 [emphasis added]


     In 1980, yet another IRS Commissioner, Jerome Kurtz (their
turnover is high) issued a similar statement in their Internal
Revenue Annual Report:


     The IRS's primary task is to collect taxes under a voluntary
     compliance system.
                                                 [emphasis added]


     Even the Supreme Court of the United States has held that
the system of federal income taxation is voluntary:


     Our tax system is based upon voluntary assessment and
     payment, not upon distraint.

                           [Flora vs United States, 362 U.S. 145]
                                                 [emphasis added]

The dictionary defines "distraint" to mean the act or action of
distraining, that is, seizing by distress, levying a distress, or
taking property by force.


     IRS Publication 21 is widely distributed to high schools.
It acknowledges that compliance with a law that requires the
filing of returns is voluntary. (Get to those young minds early,
and it's easier to wash their brains later on in life.) At the
same time, it suggests that the filing of a return is mandatory,
as follows:


     Two aspects of the Federal income tax system -- voluntary
     compliance with the law and self-assessment of tax -- make
     it important for you to understand your rights and
     responsibilities as a taxpayer. "Voluntary compliance"
     places on the taxpayer the responsibility for filing an
     income tax return. You must decide whether the law requires
     you to file a return. If it does, you must file your return
     by the date it is due.
                                                 [emphasis added]


                        Page 8 - 2 of 16

                                                 Is It Voluntary?


     Perhaps one of the most famous quotes on this question came
from Roger M. Olsen, Assistant Attorney General, Tax Division,
Department of Justice, Washington, D.C.  On Saturday, May 9,
1987, author, colleague and constitutional authority Godfrey
Lehman was in the audience when Olsen told an assemblage of tax
lawyers:

     We encourage voluntary compliance by scaring the heck out of
     you!
                                                 [emphasis added]

This was a remarkable admission by an Assistant Attorney General
in the Justice Department, or the "Just Us" department, as they
have come to be known in certain circles of the well informed.

     What gives? Are there any bases in law for concluding that
federal income taxes are truly voluntary, in the everyday garden
variety of the term? Yes, there are several. Some of these
reasons may be "old hat" to those of you who are in these certain
circles. Other reasons may come as a total shock, particularly
because the federal government has been guilty of systematic
fraud against the American people. Let us begin with this fraud.

     Reach in your wallet and pull out a dollar bill. Already,
you have a big problem in your hands. Read what it says on the
front of your dollar bill. It says "Federal Reserve Note".
First of all, the Federal Reserve is not "federal". It is no
more federal than Federal Express, or Federated Hardware Stores.
For detailed proof, see Lewis vs United States, 680 F.2d 1239
(9th Circuit, 1982). There is no government copyright or
trademark on using the word "federal".

     Secondly, there is no "reserve". Federal Reserve banks are
privileged to loan money they don't have. This is called
"fractional reserve" banking. Thirdly, Federal Reserve Notes are
not real promissory notes, because they do not promise to pay
anything, like gold, or silver, or something else with real
substance.

     The Federal Reserve system was conceived by a conspiracy of
bankers and politicians who met secretly off the coast of Georgia
to create the Federal Reserve Act. This Act of Congress was
designed to remove the Constitution as a constraint on the
financial operations of the U.S. government. It created a
private credit monopoly which Congressman Louis T. McFadden once
called "one of the most corrupt institutions the world has ever
known". Congressman McFadden was Chairman of the House Banking
and Currency Committee from 1920 to 1933.

     The operations of the Federal Reserve are complicated and
secretive. For example, this huge syndicate of private banks has
never been publicly audited. I will do my best to simplify its
operations for you. The Federal Reserve System was set up to
encourage Congress to spend money it doesn't have -- lots of it.


                        Page 8 - 3 of 16

                                                The Federal Zone:


Rather than honestly taxing Americans for all the money it wants
to spend, Congress runs up a huge deficit which it covers by
printing ink on paper and calling them bonds, or Treasury Bills.

     Some of these T-bills are purchased by hard-working
Americans like you and me, with money that we obtained from real
labor, something that has real value. But the deficits have
become so huge, the wage earners do not have enough money to
purchase all these bonds every year. So, Congress walks across
the street and offers these bonds to the Federal Reserve. The
FED says, "Sure, we'll buy those bonds. Your interest rate is
8.25, or 9 and a half. Take it or leave it." Congress always
takes it, because there's nobody else with that kind of money.
Remember, the Federal Reserve is a private credit monopoly.

     Now, what does the FED use to purchase those bonds? They
create money out of thin air, using bookkeeping entries to
manufacture credit out of nothing. They used to do it with pen
and ink, then typewriters, and now computers do the job. This
artificial money would normally create very rapid inflation.
This happened in Germany just prior to World War II, when Louis
McFadden was a Congressman. It eventually took a wheel barrow
full of Deutsche marks just to buy one loaf of bread. Imagine
that, if you can!

     The bankers realized that a mechanism was needed to withdraw
this artificial money out of circulation as quickly as it was put
into circulation. Enter the Internal Revenue Service. The IRS
is really a collection agency for the Federal Reserve. The FED
pumps money into the economy, and the IRS sucks it out of the
economy, like two pumps working in tandem. This has the effect
of artificially maintaining the purchasing power of this "fiat
money", as it is called by monetary experts.

     This is one of the primary purposes of the income tax. We
know this to be true, because a man named Beardsley Ruml
explained it clearly in an essay he published in the magazine
American Affairs in January of 1946. Beardsley Ruml was Chairman
of the Federal Reserve Bank of New York, so he was in a position
to know. The shocking fact is that Federal income taxes do not
pay for any government services; they are used to make interest
payments on the federal debt. These interest payments are now
approaching 40 percent of the annual federal budget.

     The Federal Reserve Act is unconstitutional for many
reasons, foremost among which is that Congress delegated to a
private corporation a power which Congress never had, that is, to
counterfeit money. It is unlawful for Congress to exercise a
power which is not authorized to it by the Constitution. The
people, you and I, and the 50 States reserve all powers not
expressly delegated to the federal government.

     Congress got hooked on this sweetheart deal and started
spending money so fast, it quickly bankrupted the federal


                        Page 8 - 4 of 16

                                                 Is It Voluntary?


government. This may also come as a shock to many of you. And
you might feel that what I am about to say is paranoid or crazy.
We felt this way too when we first discovered it. We couldn't
believe it. So we investigated. Our research discovered that
the bankers foreclosed the United States Treasury no later than
the year 1933. They called the loans and confiscated all the
gold then being held by the U.S. Treasury.

     An Act of Congress caused all that gold to be transferred to
the Federal Reserve banks. Remember, those are private banks,
and the Treasury Department is not the U.S. Treasury Department.
If you need proof, try enclosing a check payable to the "U.S.
Treasury Department" with your next tax return. Notice also that
IRS stationery says "Department of the Treasury" and not the
"U.S. Department of the Treasury".

     To secure the rest of their debt, Congress then liened, in
effect, on the future property and earnings of all the American
people, through Social Security taxes, payroll withholding taxes,
inheritance taxes, and the like. Congress mortgaged the American
people, using our labor and our property as collateral.

     What Congress did was analogous to this: I walk into a
large department store and see a new toaster I want. I tell the
sales person to ship it to my home tomorrow, and to send the bill
to Willie Brown. Now, when Willie Brown gets the bill for this
toaster, he's going to be pretty mad, and rightly so. He didn't
order the toaster; he doesn't own the toaster; he wasn't a
party to the toaster transaction. In fact, he didn't even know
about it. And yet, I am holding him responsible to pay for the
toaster. In this example, I am Congress; the department store
is the Federal Reserve; and Willie Brown represents the American
People (some of the time).

     This is fraud, because Congress did not openly and freely
disclose the real reasons for its actions. Lack of full
disclosure is grounds for fraud in any contract. The Uniform
Commercial Code says so. And yet, all Americans are being
unlawfully enslaved by this fraud, to help discharge the debt
which Congress has tried to impose upon all of us. (Rumor has it
that the New York banking establishment refers to our money as
Federal Reserve Accounting Unit Devices, F-R-A-U-D. Film at 11.)

     Your "income" is private property. Absent an apportioned
direct tax, or some commercial agreement to the contrary, the
federal government is not empowered to obtain a controlling
interest in, or otherwise lien on private property so as to
compel a private Citizen's specific performance to any third-
party debt or obligation. Moreover, it is a well established
principle in law that government cannot tax a Sovereign State
Citizen for freely exercising a right guaranteed by the U.S.
Constitution. The acquisition and exchange of private property
is such a right. The pursuit of common-law occupations is
another such right.


                        Page 8 - 5 of 16

                                                The Federal Zone:


     Now, if you want to "volunteer" to help reduce the national
debt, you may, and Congress will of course accept your "gift"
without question. You have the right to volunteer yourself as a
third-party to the outstanding principal debt which Congress has
amassed. As a "principal" in your own right, you have the right
to obligate yourself as a "performance unit" on the national debt
(unlike so many Americans whose birth certificates have ended up,
without their knowledge, in the hands of the International
Monetary Fund in Brussels, Belgium. See Appendix T if you decide
to revoke your birth certificate.) Thus obligated, you will have
turned yourself into someone who is subject to all the rules and
regulations which have been established by the Secretary of the
Treasury to discharge the massive federal debt. But, as long as
you remain a Sovereign State Citizen, who is neither a resident
nor a citizen of the United States**, and as long as you do not
derive income from sources inside the United States** or from a
U.S.** trade or business, you are completely outside the
jurisdiction of the federal zone. The federal debt is not your
burden to carry.

     You cannot be compelled, at law, to perform under any third-
party debt or obligation. If you are ever so compelled, it is
extortion, or "tax-tortion" as Godfrey Lehman calls it. You are
not only the victim of extortion. You are also the victim of a
massive fiscal fraud which Congress and other officials of the
federal government have perpetrated upon Sovereign State Citizens
at least since 1913, the year the Federal Reserve Act was passed
into law, and also the year the so-called 16th Amendment was
simply "declared" into law: two pumps, working in tandem, one
pumping money and credit into the economy, the other sucking it
out of the economy. The Rothschild-Hamilton money and banking
system, as it is called, is older than everyone alive.

     The constitutional experts and experienced staff at the
National Commodity and Barter Association in Denver, Colorado
have done a fine job of summarizing "voluntary compliance" in one
of their aging flyers that is still circulating:


     The term "voluntary compliance" appears to be contradictory,
     but careful analysis shows the words to be accurate and
     appropriate. An act is voluntary when one does it of his
     own free will, not because he is forced by law to do it. If
     a law applies to an individual, his compliance with the law
     is mandatory, not voluntary. However, individuals engaged
     in occupations of common right are not subject to the income
     (excise) tax. For them, compliance with the law is
     voluntary, not mandatory, because the law does not apply to
     them.
                     [brochure entitled Must You Pay Income Tax?]

     So, now you know at least some of the many reasons why
federal officials admit that income taxes are voluntary. It's a
deception, because they will admit that it's voluntary, but they


                        Page 8 - 6 of 16

                                                 Is It Voluntary?


won't tell you why. Quite possibly, they don't even know why
because they, too, have been deceived. When the U.S. Treasury's
gold was transferred into the vaults of the Federal Reserve
banks, lots of people were deceived into believing that Uncle Sam
was simply moving that gold out of his right hand and into his
left hand. Many of those deceived were Uncle Sam's employees.
Only an elite few really knew that the Federal Reserve was
established as a private corporation, a Class A common stock
corporation, to be exact.

     Are there any other reasons, like this, why federal income
taxes are voluntary? Yes. In previous chapters, the concepts of
"U.S.** resident", "nonresident", "U.S.** citizen", and "alien"
were explored in some detail. Nonresident aliens with respect to
the federal zone are required to pay taxes only on income derived
from sources within that zone. Those sources may be a "U.S.**"
trade or business, "U.S.**" corporations which sell stocks and
bonds and pay dividends, or employment with the federal
government.

     Doing business with the federal zone is your option; it's
voluntary. Nobody is compelling you to buy stock from a domestic
"U.S.**" corporation. Nobody is compelling you to derive income
from a "U.S.**" trade or business. Nobody is compelling you to
work for the federal government. But, if you choose to do so,
then you will be held liable for federal taxes on the "privilege"
of deriving income from these sources, because these sources are
situated inside a zone over which the Congress has exclusive
legislative jurisdiction. That is, Congress can do pretty much
whatever it wants inside that zone. If you don't like the tax
rates, then don't choose a U.S.** trade or business. If you
don't want to reside inside their zone, then move somewhere else.
If you don't want to be one of their "citizens", then expatriate.
Remember, involuntary servitude is forbidden everywhere in this
land, even within the federal zone. It's relatively simple, when
the boundaries and authorities of the federal zone are taken into
full account, the Account for Better Citizenship.

     When I say that Congress can do pretty much whatever it
wants inside the federal zone, I mean to say that Congress is
free to create a system of democratic socialism within that zone
(see Appendix W). Outside the federal zone, Congress is bound by
the chains of the Constitution to guarantee a Republic to the 50
States. Social Security is perhaps the most glaring example of a
"voluntary" system offered by the democratic socialists who
actually write the laws. These socialists then pay the "law
makers" to vote for the laws, even though the real "makers" are
not the ones who do the actual voting. (If you want to have some
fun, ask your representatives in the House or Senate if they've
ever read the IRC, and if so, how much of it they have read and
understood.) The actual scope of Social Security is limited to
the federal zone, except for those outside the zone who wish to
partake of its "benefits" knowingly, intentionally, and
voluntarily. Ralph F. Whittington nails it down as follows:


                        Page 8 - 7 of 16

                                                The Federal Zone:


     Do you now understand that the Social Security Act was
     written under the authority of Article 1, Section 8, Clause
     17, and Article 4, Section 3, Clause 2, of the Constitution,
     exclusive authority given to the Congress by "WE THE PEOPLE"
     ???

     The "USE" of a Social Security Account Number is evidence of
     the following:

     1. You are a card carrying and practicing member of
          National Socialism.

  2. You have voluntarily derogated your "Sovereignty", and
          make public and notorious declaration that you prefer
          to have the protection of Congress, and prefer to be a
          "Subject" under the "Exclusive Powers" of Congress and
          the Bureaucrats that have been assigned certain duties
          by Congress.

     3. You make a public and notorious declaration that you
          are a "Taxpayer", and will follow the rules as laid
          down in the United States Code Title 26 (Tax Code), and
          the various other Laws which are written for
          enforcement upon the "Subjects of Congress".

     4. The use of your Social Security Account Number is
          evidence of your FRANCHISE with the Federal Government,
          a Franchise that provides you with Privileges and
          Advantages, protected by the Federal Government.

     5. Makes you, voluntarily, a "United States** Person" (per
          definition). See 26 U.S.C., Sec. 7701(a)(30).

     6. You have rejected the protections of the Constitution
          for a dole, and prefer to be judged in the "King's
          Court" if you violate any of his rules.

                                       [The Omnibus, pages 73-74]
                                           [emphasis in original]

     Thus, if you are participating knowingly, voluntarily, and
intentionally in the "Franchise" called "Social Security", then
your participation is evidence that you have volunteered to
classify yourself as a "taxpayer", as that term is defined in the
Internal Revenue Code. Under the "Law of Presumption", your use
of a social security number can be seen by the federal government
as prima facie evidence that you have opted to obtain benefits
from the federal zone. If you are not participating knowingly,
voluntarily and intentionally, then the government's presumption
can be rebutted. Aside from creating money via fractional
counterfeits, how else do you think the feds obtain the money
which they pay to "benefit" recipients? Contrary to federal
propaganda, there still is no free lunch.


                        Page 8 - 8 of 16

                                                 Is It Voluntary?


     Remember, there is no "reserve", not in the Federal Reserve,
and certainly not in Social Security. As the famous "baby boom"
advances in age, this generational cohort is acting like a "pig
in a python" to devastate the fiscal integrity of the entire
Social Security system. Perhaps you thought that Social Security
was really an insurance fund, like an annuity. That's another
grand deception (and fraud), the details of which are also beyond
the scope of this chapter. Funds have not been "set aside" for
you. Social Security is a TAX, and it says so in the law. It's
a tax with a bear trap hidden in the bushes. That bear trap
converts you from a Sovereign into a subject. Now that you know,
you may want to consider changing your status, while you still
can. At the very least, continue to educate yourself about this.

     There is yet another reason why federal income taxes are
voluntary. The Internal Revenue Code says that nonresident
aliens may "elect" to be treated as "residents". Think back to
The Matrix. If you are a nonresident alien, you are in row 2,
column 2. Now think of it as a game of checkers, on a board with
only four squares. It's your move. If you volunteer to move
from the square at row 2/column 2 to any other square, you will
thereby incur a tax liability. According to Publication 519, an
alien may be both a resident alien and a nonresident alien during
the same tax year:


     This usually occurs for the year you arrive in or depart
     from the United States**.

             [Publication 519, U.S. Tax Guide for Aliens, page 3]


Such an alien is called a "dual status" alien.

     A nonresident alien can also "elect" or volunteer to be
treated as a resident alien. My reading of the law and the
related publications leads me to conclude that this "election" is
available only to a nonresident alien who is married, but I am
open to persuasion on this point. Specifically, the IRC has this
to say about "elections":


     Election to Treat Nonresident Alien Individual as Resident
     of the United States**. --

     (1) In General. -- A nonresident alien individual with
          respect to whom this subsection is in effect for the
          taxable year shall be treated as a resident of the
          United States** --

          (A) for purposes of chapters 1 and 5 for all of such
               taxable year, and

                                                  [continued ...]


                        Page 8 - 9 of 16

                                                The Federal Zone:


          (B) for purposes of chapter 24 (relating to wage
               withholding) for payments of wages made during
               such taxable year.

     (2) Individuals with Respect to Whom This Subsection is in
          Effect. -- This subsection shall be in effect with
          respect to any individual who, at the close of the
          taxable year for which an election under this
          subsection was made, was a nonresident alien individual
          married to a citizen or resident of the United
          States**, if both of them made such election to have
           the benefits of this subsection apply to them.

                                                    [IRC 6013(g)]
                                                 [emphasis added]

     The Instructions for IRS Form 1040NR, U.S. Nonresident Alien
Income Tax Return, shed more light on these "election returns":


     Election to be Taxed as a Resident Alien

     Under some circumstances you can elect to be taxed as a
     U.S.** resident for the whole year. You can make this
     election if either of the following applies to you:


     - You were a nonresident alien on the last day of the tax
          year, and your spouse was a U.S.** citizen or resident
          alien on the last day of the tax year.


     - You were a nonresident alien at the beginning of the
          tax year, but you were a resident alien on the last day
          of the tax year and your spouse was a U.S.** citizen or
          resident alien on the last day of the tax year. (This
          also applies if both you and your spouse were
          nonresident aliens at the beginning of the tax year and
          both were resident aliens at the end of the tax year.)


     If you elect in 1990 to be taxed as a U.S.** resident, you
     and your spouse must file a joint return on Form 1040 or
     1040A for 1990. Your worldwide income for the whole year
     will be taxed under U.S.** tax laws. You must agree to keep
     the records, books, and other information needed to figure
     the tax. If you made the election in an earlier year, you
     may file a joint return or separate return on Form 1040 or
     1040A for 1990. Your worldwide income for the whole year
     must be included whether you file a joint or separate
     return.
                           [Instructions for Form 1040NR, page 2]
                                                 [emphasis added]


                        Page 8 - 10 of 16

                                                 Is It Voluntary?


     If nonresident aliens "elect" to be treated as "resident"
aliens, they are thereby required to file IRS Form 1040 or 1040A
instead of Form 1040NR. Filing Form 1040 or 1040A can be taken
by the government as prima facie evidence that you want to be
treated as a "resident". This, in turn, allows the government to
presume that you have volunteered to be treated as a "taxpayer",
that is, one who is entitled to the "benefits", and subject to
the liabilities, of the federal zone's legislative democracy.
The chain of cause and effect is clarified considerably by
couching the discussion in terms of The Matrix: four-square
checkers (like candidate Richard M. Nixon's famous pet dog).
Author and scholar Lori Jacques has summarized it succinctly as
follows:


     IR Code Sec. 6013(g) grants an election to treat nonresident
     alien spouse as resident of the United States**. If the
     nonresident alien individual makes this election by filing a
     1040 form, then returns must be filed for the current year
     and all subsequent years until the election is terminated.

        [United States Citizen vs. National of the United States]
                                        [page 40, emphasis added]


     Again, an "election" can be terminated voluntarily. This
termination is described in the IRC as follows:


     Termination of Election. -- An election under this
     subsection shall terminate at the earliest of the following
     times:

     (A) Revocation by Taxpayers. -- If either taxpayer revokes
          the election, as of the first taxable year for which
          the last day prescribed by law for filing the return of
          tax under chapter 1 has not yet occurred. ...

                                                 [IRC 6013(g)(4)]

     We have not taken the time to determine if there are similar
provisions in the IRC and its regulations for unmarried
nonresident aliens. (Remember, the statute has 2,000 pages and
the regulations have 6,000 pages.) Author Lori Jacques has taken
note of the CFR provisions for terminating "voluntary"
withholding, which may be effective in this case. An affidavit
is attached to an individual's Form W-4, specifying the name,
address and social security number of the employee making the
request, the name and address of the employer, and a statement
that the employee desires to terminate withholding of federal
income tax and desires that the agreement terminate on a specific
date. The report by Lori Jacques goes on to explain:


                        Page 8 - 11 of 16

                                                The Federal Zone:


     This arrangement can be found in 2 USC 60 for the Congress.
     Possibly the same format could be used, thereby revoking a
     presumed election to be treated as "resident of the United
     States**."

     For the nonresident alien's exemption from withholding and
     taxation to apply, a statement is to be made stating the
     kind of exclusion claim.

     (1) No income from United States** source
     (2) No income from effectively connected United States**
          source
     (3) No income from a trade or business conducted within the
          United States**
     (4) Income excluded under "fundamental law"

        [United States Citizen vs. National of the United States]
                                        [page 40, emphasis added]


     A close examination of the CFR regulations for terminating
voluntary withholding reveals a trap, however. A number of
natural born Sovereign State Citizens have been misled by well
intended but ignorant Patriots who thought they had found in
those regulations a method to stop paycheck withholding, without
any adverse consequences. This method is the infamous section
"1441" of the CFR:


     1.1441-5 Claiming to be a person not subject to withholding.

     (a) Individuals. For purposes of chapter 3 of the Code, an
          individual's written statement that he or she is a
          citizen or resident of the United States** may be
          relied upon by the payer of the income as proof that
          such individual is a citizen or resident of the United
          States**.
                                                [26 CFR 1.1441-5]
                                                 [emphasis added]

In a now famous circular entitled "We Will Pay $10,000 If You Can
Prove the Following Statements of Fact To Be False!", the
Save-A-Patriot Fellowship included the following "fact":


     FACT #23: The implementation of IRS Treasury Regulation
     1.1441-5 is explained in Publication 515 on page 2: If an
     individual gives you [the domestic employer or withholding
     agent] a written statement, in duplicate, stating that he or
     she is a citizen or resident of the United States, and you
     do not know otherwise, you may accept this statement and are
     relieved from the duty of withholding the tax.


                        Page 8 - 12 of 16

                                                 Is It Voluntary?


IRS Publication 515 is entitled Withholding of Tax on Nonresident
Aliens and Foreign Corporations, and the Save-A-Patriot quotation
is accurate. However, by referring to The Matrix in chapter 3 of
this book (and on the cover), it should now be obvious why such a
statement is precisely the wrong thing to do. Nonresident aliens
thereby declare themselves to be either citizens of the United
States** or residents of the United States**, voluntarily
rendering themselves liable for federal income taxes. To
underscore why section 1441 is a trap, a Sovereign California
Citizen received the following in a letter from the Employment
Development Department of the State of California after filing a
1441 statement:


     Your statement submitted in compliance with Title 26, Code
     of Federal Regulations, Section 1.1441-5, specifically
     Section 1.1441-5(c) is also noted. Your declaration,
     received without a date, has been logged and filed into EDD
     records.
                              [Employment Development Department]
                                          [private communication]
                                                 [emphasis added]


     Author Lori Jacques summarizes the "1441" statement with
surgical accuracy:


     ... [I]t seems rather incomprehensible to file a statement
     claiming to be a U.S.** citizen (if one is not) making
     oneself obligated for a tax on income from whatever source
     -- within and without the United States**. Although one
     may be exempt from the 30% withholding under this provision,
     employers do not withhold a flat 30% rate anyway. Some day
     that declaration of U.S.** citizenship will surely come back
     to haunt its declarant when the IRS wants the returns and
     payment of a graduated tax for all of that undeclared
     income.

            [A Ticket to Liberty, November 1990 edition, page 45]


     There is a much better method for nonresident aliens to stop
withholding. It is called a "Certificate of Exemption from
Withholding in Lieu of W-4". This certificate is authorized by
section 3402(n) of the IRC (see Appendix X). Details for
completing and serving this certificate can also be obtained from
Doc Scott's great book entitled Free at Last -- From the IRS,
listed in the Bibliography (see Appendix N). Be careful to avoid
explicitly declaring yourself as an "employee", however, since
this term has a specific meaning in that chapter of the IRC (see
the definition of "employee" at IRC 3401(c)). Your certificate
is made so as to be "consistent with", or in pari materia with,
section 3402(n).


                        Page 8 - 13 of 16

                                                The Federal Zone:


     Alternatively, IRS Form 8233 can be  used as an alternative
to a CERTIFICATE OF EXEMPTION FROM WITHHOLDING IN LIEU OF W-4.
The following is the abstract describing Form 8233 in the IRS
Printed Product Catalog, Document 7130:


     8233 62292K (Each)

     Exemption from Withholding of Compensation for Personal
     Services

     Used by non resident alien individuals to claim exemption
     from withholding on compensation for personal services
     because of an income tax treaty or the personal exemption
     amount. D:R:FP:F Tax Related Public Use

                                    [IRS Printed Product Catalog]
                                [Document 7130, Rev. 6-89, p. 66]

Summary

     It is really exciting to discover that federal income taxes
are indeed voluntary for nonresident aliens who derive no income
from sources inside the federal zone. It is equally exciting to
discover that aliens who have "elected" to be "resident aliens"
may also terminate that election. (Terminating an election is
something that most of us would never even think of doing! Let's
all work and pray to ensure it never happens in this country.)
Lastly, is it imperative to understand that the filing of prior
1040 forms can be taken as evidence that a nonresident alien has
elected to be a resident alien, for purposes of federal tax law.
The federal government is thereby entitled to presume that you
are either required to file, or that you have elected to be
treated as one who is required to file, if and when your signed
1040 or 1040A form arrives in a pouch of mail destined for an IRS
Service Center. The Law of Presumption is so important, the next
chapter will be dedicated to this one subject. Even the perjury
oath under which you sign your name on IRS tax forms is a subtle
indicator of your status vis-a-vis the federal zone. For proof,
see Appendix R for the relevant statute from Title 28.


                             # # #


                        Page 8 - 14 of 16

                                                 Is It Voluntary?


Reader's Notes:


                        Page 8 - 15 of 16

                                                The Federal Zone:


Reader's Notes:


                        Page 8 - 16 of 16

                           Chapter 9:
                     The Law of Presumption


     A nonresident alien who has filed one or more Forms 1040 in
the past is presumed by the IRS to be an individual who was
required to file those forms. The filed forms entitle the IRS to
presume that this individual either was required to file, or
elected to be treated as one who is required to file. Such a
requirement would be triggered by changing to resident status,
changing to citizen status, and/or opting to derive income from a
source inside the federal zone (like federal employment).
Accordingly, the IRS is entitled to presume that this nonresident
alien has "volunteered" to become a "taxpayer", that is, a person
who is subject to an internal revenue tax. Quite apart from the
day-to-day assumptions we all make about life in general, the
term "presumption" has a very special meaning in law. A
presumption in law is a logical inference which is made in favor
of a particular fact. The Uniform Commercial Code (UCC) defines
"presumption" and "presumed" as follows:

     "Presumption" or "presumed" means that the trier of fact
     must find the existence of the fact presumed unless and
     until evidence is introduced which would support a finding
     of its nonexistence.
                                                 [UCC 1-201 (31)]


Black's Law Dictionary, Sixth Edition, defines "presumption" as
follows:

     A presumption is a rule of law, statutory or judicial, by
     which finding of a basic fact gives rise to existence of
     presumed fact, until presumption is rebutted. ... A legal
     device which operates in the absence of other proof to
     require that certain inferences be drawn from the available
     evidence.

     There are, in law, two different and directly opposite kinds
of presumptions: a conclusive presumption and a rebuttable
presumption. A conclusive presumption is one for which proof is
available to render some fact so "conclusive", it cannot be
rebutted. To "rebut" a fact is to expose it as false, to
disprove it. Thus, a "rebuttable fact" is one which can be
disproven and exposed as false. In other words, a rebuttable
fact is a lawyer's way of describing a fact that is not a fact.
(1984 was a long time ago; the book is even older than that.)
The opposite kind of presumption is a rebuttable presumption. A
rebuttable presumption is a one that can be overturned or
disproven by showing sufficient proof. We are interested
primarily in this second type of presumptions -- rebuttable
presumptions -- because the Code of Federal Regulations makes
explicit certain presumptions about nonresident aliens. The
regulations have this to say about the proof of alien residence:


                        Page 9 - 1 of 10

                                                The Federal Zone:


     Proof of residence of aliens.

     (a) Rules of evidence. The following rules of evidence
          shall govern in determining whether or not an alien
          within the United States** has acquired residence
          therein for purposes of the income tax.

     (b) Nonresidence presumed. An alien by reason of his
          alienage, is presumed to be a nonresident alien.

                                                 [26 CFR 1.871-4]
                                                 [emphasis added]

     The regulations are very clear about a key presumption which
the IRS does make about aliens. Because of their "alienage",
that is, because of their status as aliens in the first place,
all aliens are presumed by Treasury regulations to be nonresident
aliens. This presumption is built into the law, because the Code
of Federal Regulations is considered to have the force of law.
(The CFR is judicially noticed, and courts have ruled that the
CFR is a supplement to the published Federal Register, which puts
the general public on actual notice too.) This presumption is
not a conclusive presumption, however; it is a rebuttable
presumption. The regulations establish the rules by which this
presumption can be rebutted or disproven, as follows:


     Other aliens. In the case of other [not departing] aliens,
     the presumption as to the alien's nonresidence may be
     overcome by proof --

     (i) That the alien has filed a declaration of his intention
          to become a citizen of the United States** under the
          naturalization laws; or

     (ii) That the alien has filed Form 1078 or its equivalent;
          or

     (iii) Of acts and statements of the alien showing a definite
          intention to acquire residence in the United States**
          or showing that his stay in the United States** has
          been of such an extended nature as to constitute him a
          resident.
                                                 [26 CFR 1.871-4]

     Filing a declaration of intent to become a U.S.** citizen
will "rebut the presumption". Acts or statements by aliens
showing a definite intent to acquire residence will also "rebut
the presumption". Form 1078 is a Certificate of Alien Claiming
Residence in the United States**. The IRS Printed Product
Catalog, Document 7130, describes this form as follows:


                        Page 9 - 2 of 10

                                           The Law of Presumption


     1078 171951 (Each)
     Certificate of Alien Claiming Residence in the United States

     Who May File. A resident alien may file the original and
     one copy of this certificate with the withholding agent to
     claim the benefit of U.S.** residence for income tax
     purposes. (A withholding agent is responsible for
     withholding tax from your income.) D:RF:F Tax Form or
     Instruction

                                        [page 10, emphasis added]


     Notice, in particular, the explicit reference to "the
benefit of U.S.** residence for income tax purposes". What are
the benefits of U.S.** residence for income tax purposes?
Recall, from the previous chapter, the "benefits" of being under
the protection of Congress and thereby subject to its exclusive
jurisdiction. The actual scope of Social Security, for example,
is limited to the federal zone, except for those outside the zone
who wish to partake of its "benefits" voluntarily. Under the law
of presumption, your use of a social security number can be seen
by the federal government as proof that you have opted to obtain
benefits from the federal zone. Form 1078 is likewise ready-made
for those who begin as nonresident aliens, but later opt to
declare themselves "resident" in the United States** in order to
claim the benefit of that "residence". Simply stated, Form 1078
declares a nonresident alien to be a "resident" for income tax
purposes. It moves nonresident aliens out of the square at row
2/column 2 in The Matrix, and into the square at row 1/column 2.

     There are other ways by which the presumed nonresidence of
aliens can be rebutted, or disproven, thereby moving their four-
square checkers into a square that is within the federal zone.
The regulations make reference to Form 1078 or its equivalent.
(Try to find a definition of the term "equivalent" in the statute
or its regulations.) If nonresident aliens sign a Form W-4, for
example, they are presumed to be government employees with income
from a source inside the federal zone. Employers are to treat
all employees as "residents" and to withhold pay as if the
employers have not been instructed otherwise.

     Notice how the presumption has shifted. Contrary to the
regulations at 26 CFR 1.871-4 (quoted above), employers are told
by the IRS to make the opposite "presumption" about the residence
of their employees, even if they are not true "employees" as that
term is defined in the IRC. If individuals have W-4 and W-2
forms, the presumption is that they were either required to sign
these forms, or they have made elections to be treated as
residents. Recall that the instructions for Form 1040NR describe
the "election to be taxed as a resident alien". This is
accomplished by filing an income tax return on Form 1040 or
1040A, and attaching a statement confirming the "election".


                        Page 9 - 3 of 10

                                                The Federal Zone:


     An extremely subtle indicator of one's status is the perjury
oath which is found on IRS forms. Under Title 28 of the U.S.**
Codes, Section 1746, there are two different perjury oaths to
which penalties attach: one within the United States**, and one
without the United States** (see Appendix R for the precise
wording of 28 USC 1746). If an oath is executed without the
United States**, it reads, "I declare ... under the laws of the
United States of America." If an oath is executed within the
United States**, it reads, "I declare ... that the foregoing is
true and correct." Thus, your signature under the latter oath
can be presumed to mean that you are already subject to the
jurisdiction of the United States**. This latter oath is the one
found on IRS Form 1040.

     It should be clear by now that the IRS may well be making
presumptions about your status which are, in fact, not correct.
If an original presumption of nonresidence has been rebutted, for
example, because a nonresident alien filed one or more 1040 forms
in the past, the filed forms do not cast the situation into
concrete. The IRS is entitled to formulate a presumption from
these filed forms, but this presumption is also rebuttable. If
you filed under the mistaken belief that you were required to
file, that mistaken belief, in and of itself, does not suddenly
turn you into a person who is required to file. Tax liability is
not a matter of belief; it is a matter that arises from status
and jurisdiction.

     The best approach is to "clean the slate". In other words,
clear the administrative record of any written documents which
may have been filed in error, or in the mistaken belief that the
filer was required. In Appendix F of this book, there is an
Affidavit of Rescission which can be used to clean the slate.
This affidavit is not meant to be a document with universal
application, because everyone's situation is different. For
example, the affidavit makes certain statements about the laws
and regulations which have been studied by the individual who
signs it. Not everyone has read these same laws and regulations.
The affidavit does, however, cover a wide range of factual
matters which will serve to educate the reader about the
constructive fraud which Congress and other federal officials
have perpetrated on the American people. Various qualified
organizations are now available to assist individuals with the
procedure for executing this affidavit, filing it with a County
Recorder, and serving it on the appropriate government officials.
The National Commodity and Barter Association is one such
organization. Their address is in the list of organizations
found in Appendix M of this book.

     Now, let's have a little fun with this law of presumption,
as it is called. The law works both ways. This means that you
can use it to your advantage as well as anyone else can. One of
the most surprising and fascinating discoveries made by the
freedom movement in America concerns the bank signature card. If
you have a checking or savings account at a bank, you may


                        Page 9 - 4 of 10

                                           The Law of Presumption


remember being asked by the bank officer to sign your name on
several documents when you opened that account. One of these
documents was the bank signature card. You may have been told
that the bank needed your signature in order to compare it with
the signatures that would be found on the checks you write, to
detect forgeries. That explanation sounded reasonable, so you
signed your name on the card.

     What the bank officer probably did not tell you was that you
signed your name on a contract whereby you agreed to abide by all
rules and regulations of the Secretary of the Treasury. You see,
bank signature cards typically contain such a clause in the fine
print. These rules and regulations include, but are not limited
to the IRC (all 2,000 pages of it) and the Code of Federal
Regulations for the IRC (all 6,000 pages of it). These rules may
also include every last word of the Federal Reserve Act, another
gigantic statute. Now, did the bank have all 8,000 pages of the
IRC and its regulations on exhibit for you to examine upon
request, before you signed the card? Your bank should be
willing, at the very least, to identify clearly what rules and
regulations adhere to your signature.

     You are presumed to be a person who knows how to read, and
who knows how to read a contract before signing your name to it.
Once your signature is on the contract, the federal government is
entitled to presume that you knew what you were doing when you
signed this contract. Their presumption is that you entered into
this contract knowingly, voluntarily, and intentionally. Why?
Because your signature is on the contract. That's why. Is this
presumption rebuttable? You bet it is. Here's why:

     Instead of telling you that the bank needed your signature
to catch forgeries, imagine that the bank officer described the
signature card as follows:


     Your signature on this card will create a contract
     relationship between you and the Secretary of the Treasury.
     This Secretary is not the U.S. Secretary of the Treasury,
     because the U.S. Treasury Department was bankrupted in the
     year 1933. The Treasury Department referred to on this card
     is a private corporation which has been set up to enforce
     private rules and regulations. These rules and regulations
     have been established to discharge the bankruptcy of the
     federal government. Your signature on this card will be
     understood to mean that you are volunteering to subject
     yourself to a foreign jurisdiction, a municipal corporation
     known as the District of Columbia and its private offspring,
     the Federal Reserve system. You accept the benefits of
     limited liability offered to you by this corporation for
     using their commercial paper, Federal Reserve Notes, to
     discharge your own debts without the need for gold or
     silver.
                                                 [continued ... ]


                        Page 9 - 5 of 10

                                                The Federal Zone:


     By accepting these benefits, you are admitting to the waiver
     of all rights guaranteed to you by the Constitution for the
     United States of America, because that Constitution cannot
     impair any obligations in the contract you will enter by
     signing this card. Your waiver of these rights will be
     presumed to be voluntary and as a result of knowingly
     intelligent acts done with sufficient awareness of the
     relevant circumstances and likely consequences, as explained
     by the Supreme Court in the case of Brady vs U.S. With your
     signature on this card, the Internal Revenue Service, a
     collection agency for the Federal Reserve system, will be
     authorized to attach levies against any and all of your
     account balances in order to satisfy any unpaid liabilities
     which the IRS determines to exist. You will waive all
     rights against self-incrimination. You will not be entitled
     to due process in federal administrative tribunals, where
     the U.S. Constitution cannot be invoked to protect you.
     Your home, papers and effects will not be secured against
     search and seizure. Now, please sign this card.


     How does the law of presumption help you in this situation?
First of all, you presumed that your signature was required, to
compare it with the signatures on checks you planned to write.
This was a reasonable presumption, because that's what the bank
officer told you, but it is also a rebuttable presumption,
because of what the fine print says. That fine print can be used
to rebut, or disprove, your presumption when push comes to shove
in a court of law. The federal government is entitled to presume
that you knew what you were doing when you signed this contract.
Well, did you? Did the bank officer explain all the terms and
conditions attached thereto, as explained above? Did you read
all 8,000 pages of law and regulations before deciding to sign
this contract? Did you even know they existed? Was your
signature on this contract a voluntary, intentional and knowingly
intelligent act done with sufficient awareness of all its
relevant consequences and likely circumstances? The Supreme
Court has stated clearly that:

     Waivers of Constitutional Rights not only must be voluntary,
     but must be knowingly intelligent acts done with sufficient
     awareness of the relevant circumstances and likely
     consequences.

               [Brady vs United States, 397 U.S. 742, 748 (1970)]

     Fortunately, the federal government's presumption about you
is also rebuttable. Why? Because the feds are guilty of fraud,
among other reasons, by not disclosing the nature of the
bankruptcy which they are using to envelope the American people,
like an octopus with a suction tentacle in everybody's wallet,
adults and children alike. The banks became unwitting parties to
this fraud because the Congress has obtained a controlling
interest in the banks through the Federal Deposit Insurance


                        Page 9 - 6 of 10

                                           The Law of Presumption


Corporation and their traffic in Federal Reserve Notes and other
commercial paper issued by the Federal Reserve banks, with the
help of their agent, the private Treasury Department.

     Because this fraud can attach to bank accounts without your
knowledge or consent, it is generally a good idea to notify your
bank(s), in writing, that the IRS cannot inspect any of your bank
records unless you have specifically authorized such inspections
by executing IRS Form 6014. The IRS Printed Products Catalog
describes this form as follows:

     6014 42996R (Each)

     Authorization -- Access to Third Party Records for Internal
     Revenue Service Employees

     Authorization from Taxpayer to third party for IRS employees
     to examine records. Re-numbered as a 4-digit form from
     Letter 995(DO) (7/77). Changes suggested per IRM Section
     4082.1 to help secure the correct information from the third
     party. EX:E:D Tax Related Public Use

                                    [IRS Printed Product Catalog]
                                [Document 7130, Rev. 6-89, p. 49]

Make explicit reference to this Form in a routine letter to your
bank(s). Inform the appropriate bank officers that they must
have a completed Form 6014 on file, with your authorized
signature, before they can legally allow any IRS employees to
examine your records. Then state, discretely, that you hereby
reserve your fundamental right to withhold your authorized
signature from Form 6014, because it might otherwise constitute a
waiver of your 4th Amendment Rights, and no agency of government
can compel you to waive any of your fundamental Rights such as
those explicitly guaranteed by the 4th Amendment in the
Constitution for the United States of America. (Banks are
chartered by the States in which they do business, and as such
they are "agencies" of State government.) For good measure, you
might also cite pertinent sections in your State Constitution,
particularly if it mandates that the U.S. Constitution is the
Supreme Law of the Land, as it does in the California
Constitution of 1879. Finally, you may wish to state that Form
6014 is not applicable to you anyway, because you are not a
"Taxpayer" as that term is defined by Section 7701(a)(14) of the
Internal Revenue Code. Therefore, the bank is simply not
authorized to release information about you to IRS employees,
period!


     Social Security is another example of a fraudulent contract
with a built-in presumption. Your signature on the original
application for Social Security, the SS-5 Form, is presumed by
the federal government to mean that you knew what you were
getting into, namely, that you knew it was voluntary, that you


                        Page 9 - 7 of 10

                                                The Federal Zone:


knew it wasn't a true insurance program, that you knew it was a
tax, that you knew Congress reserved to itself the authority to
change the rules at any time, and that you knew it would render
you a subject of the Congress because you knowingly,
intentionally and voluntarily chose to accept the "benefits" of
this government program. Now ask yourself the 64,000 dollar
questions: How could you have known any of these things, if
nobody told you? How could you have known, if the real truth was
systematically kept from you? How could you have known, if all
applicable terms and conditions were not disclosed to you before
you joined the program? And how could you have made a capable,
adult decision in this matter when you signed the form as a
minor, or your parents signed it for you? The answers to these
questions are all the same: there is just no way.

     For the record, Black's Law Dictionary, Sixth Edition,
defines "fraud" as follows:

     An intentional perversion of truth for the purpose of
     inducing another in reliance upon it to part with some
     valuable thing belonging to him or to surrender a legal
     right. A false representation of a matter of fact, whether
     by words or by conduct, by false or misleading allegations,
     or by concealment of that which should have been disclosed,
     which deceives and is intended to deceive another so that he
     shall act upon it to his legal injury.
                                                 [emphasis added]

The law with respect to fraud is crystal clear. "Constructive
fraud as well as actual fraud may be the basis of cancellation of
an instrument." El Paso Natural Gas Co. vs Kysar Insurance Co.,
605 Pacific 2d. 240 (1979).

     How do you reverse these ominous presumptions which the
federal government is entitled to make about the "contract" you
signed at your friendly local bank, or the "contract" you signed
to apply for Social Security? Spend some time to read carefully
the Affidavit found in Appendix F of this book. This Affidavit
is normally served on the Secretary of the Treasury. You might
also be motivated to obtain and study some of the other books
listed in the Bibliography (Appendix N) and/or to join some of
the organizations listed in Appendix M. The situation is a
serious one, but knowledge can help to set you free. It is
better to light a candle than to curse the darkness. And light
always drives out darkness; darkness never drives out light.


                             # # #


                        Page 9 - 8 of 10

                                           The Law of Presumption


Reader's Notes:


                        Page 9 - 9 of 10

                                                The Federal Zone:


Reader's Notes:


                        Page 9 - 10 of 10

                           Chapter 10:
                       The Fundamental Law


     The law of presumption is in the class of laws akin to
esoteric technicalities. It is quite possible that we could get
along quite well without it. The fundamental law, on the other
hand, is just what it says: it is a law that is essential, of
central importance. We could not get along without it. It
determines the essential structure and function of our society.
It serves as an original and generating source. A fundamental
right, for example, is one which is innate to all free people.
When used as a noun, the term "fundamental" refers to one of the
minimum constituents, without which a system would not be what it
is. In Latin, it is the sine qua non, without which there is
nothing. What, then, is the fundamental law in our country?

     The fundamental law in America is the Constitution for the
United States of America. Black's Law Dictionary, Sixth Edition,
contains a definition of "fundamental law" as follows:


     Fundamental law. The law which determines the constitution
     of government in a nation or state, and prescribes and
     regulates the manner of its exercise. The organic law of a
     nation or state; its constitution.


     The Constitution is a contract of delegated powers. These
powers flow downhill, like water down a mountain stream. The
ultimate source of all power is the Creator, who endowed His
creations with certain unalienable rights. You and I are His
creations, and we receive our power directly from the Creator;
there is nothing standing between us and the Creator. We the
people, in turn, delegate some of our powers to the States of the
Union. We do not relinquish our powers; we delegate them. The
50 States exist to defend our rights in ways which are difficult
if not impossible for individuals to defend those rights alone.

     Power from the 50 States continues to flow downhill in the
form of a contract to the federal government. The Constitution
for the United States is a contract of powers delegated to the
federal government by the 50 States, to perform specific
enumerated services which are difficult if not impossible for
individual States to provide for themselves. The fundamental law
is, therefore, a "law of agency" whereby the 50 States created an
agent in the federal government to exercise a limited set of
government services on behalf of the 50 States. These States in
turn perform a limited set of services for their creators, the
people, above whom there is nothing but the Creator.

     The fundamental law is the foundation of our society. In
the United States of America, it is the Constitution. Through
this document, our fundamental rights are secured and protected


                        Page 10 - 1 of 16

                                                The Federal Zone:


against infringement by the federal government and by the State
governments, because the States are also parties to this
contract. To paraphrase the Declaration of Independence, we hold
these truths to be self-evident: that all of us are created
equal; that we are endowed by our Creator with certain
unalienable rights; that among these are the rights to life,
liberty, and the pursuit of happiness; that to secure these
rights, governments are instituted among us, deriving their just
power from our consent. These rights are unalienable,
fundamental, and inherent.

     The fundamental law is intimately connected with fundamental
rights, because the ultimate purpose of that law is to protect
and defend the fundamental rights of Sovereign individuals. The
Supreme Court of the United States put it very eloquently when it
said:

     Sovereignty itself is, of course, not subject to law, for it
     is the author and source of law; but in our system, while
     sovereign powers are delegated to the agencies of
     government, sovereignty itself remains with the people, by
     whom and for whom all government exists and acts. And the
     law is the definition and limitation of power.

                   [Yick Wo vs Hopkins, 118 U.S. 356, 370 (1886)]
                                                 [emphasis added]

     Every Sovereign State Citizen is endowed with certain
unalienable rights, for the enjoyment of which no written law or
statute is required. "These are fundamental or natural rights,
recognized among all free people," wrote Chancellor Kent in the
case of United States vs Morris. The U.S. Supreme Court has
repeatedly stated that fundamental rights are natural rights
which are inherent in State Citizenship:


     This position is that the privileges and immunities clause
     protects all citizens against abridgment by states of rights
     of national citizenship as distinct from the fundamental or
     natural rights inherent in state citizenship.

                         [Madden v. Kentucky, 309 U.S. 83 (1940)]
                          [84 L.Ed. 590, at 594; emphasis added]


What are the fundamental or natural rights recognized among all
free people? Chancellor Kent answered as follows:


     That the rights to lease land and to accept employment as a
     laborer for hire are fundamental rights, inherent in every
     free citizen, is indisputable.

           [United States vs Morris, 125 F.Rept. 322, 331 (1903)]


                        Page 10 - 2 of 16

                                              The Fundamental Law


     One of the most precious of fundamental rights is the
natural right to enjoy the fruits of our own labor, our own
"industry". In the year 1919, the Secretary of the Treasury
recognized as "fundamental" the right of Sovereign State Citizens
to accept employment as laborers for hire, and to enjoy the
fruits of their own labor:


     Gross income excludes the items of income specifically
     exempt by ... fundamental law free from such tax.

                  [Treasury Decisions under Internal Revenue Laws
                       of the United States, Vol. 21, Article 71]
                                                 [emphasis added]

In the year 1921, the Secretary of the Treasury reiterated this
statement concerning the fundamental law:


     Gross income excludes the items of income specifically
     exempted by the statute and also certain other kinds of
     income by statute or fundamental law free from tax.

                      [Treasury Decision 3146, Vol. 23, page 376]
                                                 [emphasis added]

And again in the year 1924, the identical statement was published
concerning the fundamental law:


     Gross income excludes the items of income specifically
     exempted by the statute and also certain other kinds of
     income by statute or fundamental law free from tax.

                      [Treasury Decision 3640, Vol. 26, page 769]
                                                 [emphasis added]

     The Constitution is, therefore, the fundamental law. Within
the 50 States where Congress is restrained by the Constitution,
"gross income" excludes certain kinds of income which are free
from tax under the fundamental law. Labor is personal property.
The fruits of labor are personal property. A tax on personal
property is a direct tax, or "capitation" tax. Outside the
federal zone and inside the 50 States, Congress is restrained
from imposing a direct tax on Sovereign State Citizens, unless
that tax is apportioned (see 1:9:4 and 1:2:3). Apportionment is
a very simple concept. If California has 10 percent of the
nation's population, then California's "portion" would be 10
percent of any direct tax levied by Congress (see Appendix Q).
Thus, the income from labor is also personal property, which is
free from direct taxation by Congress, unless that tax is
apportioned among the 50 States of the Union. In the year 1895,
the Supreme Court overturned an Act of Congress precisely because
it levied a direct tax without apportionment on a State Citizen:


                        Page 10 - 3 of 16

                                                The Federal Zone:


     First. We adhere to the opinion already announced, that,
     taxes on real estate being indisputably direct taxes, taxes
     on the rents or income of real estate are equally direct
     taxes.

     Second. We are of the opinion that taxes on personal
     property, or on the income of personal property, are
     likewise direct taxes.

     Third. The tax imposed by sections twenty-seven to thirty-
     seven, inclusive, of the act of 1894, so far as it falls on
     the income of real estate and of personal property, being a
     direct tax within the meaning of the Constitution, and
     therefore, unconstitutional and void because not apportioned
     according to representation, all those sections, consisting
     of one entire scheme of taxation, are necessarily invalid.

                           [Pollock vs Farmers' Loan & Trust Co.]
                                            [158 U.S. 601 (1895)]
                                                 [emphasis added]


It is important to realize that Charles Pollock was a Citizen of
Massachusetts; he was not a citizen of the United States**.
This fact is often overlooked in discussions of the Pollock case,
because the U.S. Supreme Court's decision explored the history
and meaning of direct taxes in such great depth. Pollock's
political status can easily get lost like a needle in a haystack.
Even experts like author and attorney Jeffrey Dickstein have been
mistaken about Pollock's status:


     The Pollock Court clearly found that a tax on the entire
     income of a United States** citizen was a direct tax that
     required apportionment to withstand constitutional validity.

                  [Judicial Tyranny and Your Income Tax, page 20]
                                                 [emphasis added]


Nevertheless, the political status of Charles Pollock is clearly
established in the very first sentence of the Pollock decision,
as follows:

     This was a bill filed by Charles Pollock, a citizen of the
     state of Massachusetts, on behalf of himself and all other
     stockholders of the defendant company similarly situated,
     against the Farmers' Loan & Trust Company, a corporation of
     the state of New York, and its directors ....

                           [Pollock vs Farmers' Loan & Trust Co.]
                                       [157 U.S. 673, 674 (1895)]
                                                 [emphasis added]


                        Page 10 - 4 of 16

                                              The Fundamental Law


Notice also that the Farmers' Loan & Trust Company was a
corporation of the State of New York. As such, it was a foreign
corporation with respect to the federal zone, not a domestic
corporation. This is one of the key factual differences between
the Pollock and Brushaber cases. This difference has similarly
been ignored by many of those who have done any analysis of
Pollock. A headnote in the decision explains the corporate
implications, as understood by the Supreme Court at that time:

     5. In so far as the act levies a tax upon income derived
     from municipal bonds, it is invalid, because such tax is a
     tax on the power of the states and their instrumentalities
     to borrow money, and consequently repugnant to the
     constitution.
                           [Pollock vs Farmers' Loan & Trust Co.]
                            [157 U.S. 673 (1895), emphasis added]

The Pollock case has never been overturned and is still the
holding case law on direct taxes. In light of some 17,000 State-
certified documents which prove that the so-called 16th Amendment
never became law, the importance of the Pollock ruling is vastly
enhanced. All direct taxes levied upon State Citizens inside the
50 States must be apportioned, as required by the Constitution.

     The situation within the federal zone is entirely different.
Remember that Congress has exclusive legislative authority within
the federal zone. This means that Congress is not restrained by
the Constitution within this zone. Therefore, Congress is not
required to apportion a direct tax within the federal zone. When
it comes to law, the areas inside and outside the federal zone
are heterogeneous with respect to each other, resulting in a
principle of territorial heterogeneity. This principle states
that areas within the federal zone are subject to one set of
rules; the areas without the federal zone are subject to a
different set of rules. The Constitution rules outside the zone;
the acts of Congress rule inside the zone. (See Appendix W for a
summary of Downes vs Bidwell, the pivotal case on this question.)
In describing the powers delegated to Congress by Article 1,
Section 8, Clause 17 and by Article 4, Section 3, Clause 2 of the
Constitution, the Supreme Court has explained this principle as
follows:

     In exercising this power, Congress is not subject to the
     same constitutional limitations, as when it is legislating
     for the United States***. ... And in general the guarantees
     of the Constitution, save as they are limitations upon the
     exercise of executive and legislative power when exerted for
     or over our insular possessions, extend to them only as
     Congress, in the exercise of its legislative power over
     territory belonging to the United States**, has made those
     guarantees applicable.

             [Hooven & Allison Co. vs Evatt, 324 U.S. 653 (1945)]
                                                 [emphasis added]


                        Page 10 - 5 of 16

                                                The Federal Zone:


Without referring to it as such, author Lori Jacques describes
the principle of territorial heterogeneity as follows:

     The "graduated income tax" is not a constitutionally
     authorized tax within the several states; however, Congress
     is apparently not prohibited from levying that type of tax
     upon the "subjects of the sovereign" in the Possessions and
     Territories. The definitions of "United States" and "State"
     are stated "geographically to include" only those areas
     constitutionally within congress' exclusive legislative
     jurisdiction upon whom a graduated tax can be imposed.

                     [A Ticket to Liberty, November 1990 edition]
                                        [page 54, emphasis added]


     The limitation against direct taxes without apportionment is
not the only limitation on Congress outside the federal zone.
There are many other limitations. The most famous of these is
the Bill of Rights, which recently celebrated its 200th
Anniversary (with little if any fanfare by federal government
officials). The Bill of Rights is the first 10 amendments to the
U.S. Constitution. There is a widespread misunderstanding that
the Constitution, as amended by the Bill of Rights, is the source
of those rights which are enumerated in the first 10 amendments.
Even Black's Law Dictionary makes this "fundamental" error as
follows:

     Fundamental rights. Those rights which have their source,
     and are explicitly or implicitly guaranteed, in the federal
     constitution.


     The rights enumerated in the Bill of Rights did not have
their source in the federal Constitution. If this were the case,
then our unalienable rights would not have existed before that
Constitution was written. Of course, this is nonsense. The
Declaration of Independence existed long before the U.S.
Constitution. One has only to read that Declaration carefully to
appreciate the source of our fundamental, unalienable rights. We
are endowed "by our Creator with certain unalienable rights".
These rights are not endowed by the Constitution. They are
inherent rights which exist quite independently of any form of
government we might invent to secure those rights. We relinquish
our rights if and only if we waive those rights knowingly,
intentionally and voluntarily, or act in such a way as to
infringe on the rights of others. As the Supreme Court has said:


     ... [A]cquiescence in loss of fundamental rights will not be
     presumed.
                       [Ohio Bell vs Public Utilities Commission]
                                                   [301 U.S. 292]


                        Page 10 - 6 of 16

                                              The Fundamental Law


     Unfortunately, public awareness of the Bill of Rights is in
a sorry state. The following article was published in the San
Francisco Chronicle on the 200th Anniversary of the signing of
the Bill of Rights:

     The right to be ignorant

          A new survey shows most Americans don't know much about
     James Madison's handiwork or the legacy he left them.

          The poll, commissioned by the American Bar Association
     in honor of the Bill of Rights' 200th birthday, found that:

          > Sixty-seven percent of those surveyed don't know the
     Bill of Rights is the first 10 amendments to the
     Constitution. That's worse than the 59 percent found in a
     similar survey in 1987, when the five-year celebration of
     the Constitution's bicentennial started.

          > Only 10 percent know the Bill of Rights was approved
     to protect individuals and states against the power of the
     federal government.

          > More than half are willing to give up some of their
     Fourth Amendment protections against search and seizure to
     help win the war on drugs.

          > 51 percent believe government should prohibit hate
     speech that demeans someone's race, sex, national origin or
     religion, despite First Amendment free-speech protections.

          > Forty-six percent think Congress should be able to
     ban media coverage of any national security issue unless
     government gives its prior approval, despite the First
     Amendment's free-press guarantee.

                                        [San Francisco Chronicle]
                                   [December 16, 1991, page A-20]

     The Bill of Rights must be viewed as a set of rules which
constrain Congress from passing laws which infringe on our
unalienable rights. The Bill of Rights does not say that the
Constitution endows us with the right to freedom of speech. It
does say that "Congress shall make no law ... abridging the
freedom of speech, or of the press." There is a world of
difference between these two views. Similarly, it is a common
mistake to believe that we enjoy only those rights which are
enumerated in the Bill of Rights. This is also a fundamental
error. The rights which are enumerated in the Bill of Rights are
not the only rights which we enjoy. This is clearly expressed by
the 9th and 10th Amendments:


                        Page 10 - 7 of 16

                                                The Federal Zone:


     The enumeration in the Constitution, of certain rights,
     shall not be construed to deny or disparage others retained
     by the people.

                  [Constitution for the United States of America]
                                                [Ninth Amendment]


     The powers not delegated to the United States by the
     Constitution, nor prohibited by it to the States, are
     reserved to the States respectively, or to the people.

                  [Constitution for the United States of America]
                                                [Tenth Amendment]


     With this in mind, it is important to appreciate how the
Bill of Rights can be utilized to restrain federal government
agents outside the federal zone. Even if it is does operate as a
private mercantile organization, the IRS is an "agency" of the
federal government. The right to be secure in our persons,
houses, papers and effects is guaranteed by the 4th Amendment:


     The right of the people to be secure in their persons,
     houses, papers, and effects, against unreasonable searches
     and seizures, shall not be violated, and no Warrants shall
     issue, but upon probable cause, supported by Oath or
     affirmation, and particularly describing the place to be
     searched, and the persons or things to be seized.

                  [Constitution for the United States of America]
                                               [Fourth Amendment]


     Similarly, the rights against self-incrimination and of due
process of law are also guaranteed by the 5th Amendment:


     ... [N]or shall any person be subject for the same offense
     to be twice putin jeopardy of life or limb; nor shall be
     compelled in any criminal case to be a witness against
     himself, nor be deprived of life, liberty, or property,
     without due process of law; nor shall private property be
     taken for public use without just compensation.

                  [Constitution for the United States of America]
                                                [Fifth Amendment]


     The Internal Revenue Service is well aware of these
amendments to the U.S. Constitution. For example, many persons
are incorrect to believe that the IRS has authority to force
disclosure of private books and records. Even though the IRS may


                        Page 10 - 8 of 16

                                              The Fundamental Law


have authority to issue a summons in certain circumstances, it
has absolutely no authority to compel disclosure of private books
and records. This means that you must bring your books and
records to an audit, if lawfully summoned to do so, but you are
under no obligation to open those books and records, or to submit
them to the Internal Revenue Service. As amazing as this may
seem, this restraint is documented in the official IRS Tax Audit
Guidelines (IR Manual MT 9900-26, 1-29-75), as follows:


     242.12 Books and Records of An Individual

     (1) An individual taxpayer may refuse to exhibit his books
          and records for examination on the ground that
          compelling him to do so might violate his right against
          self-incrimination under the Fifth Amendment and
          constitute an illegal search and seizure under the
          Fourth Amendment. However, in the absence of such
          claims, it is not error for a court to charge the jury
          that it may consider the refusal to produce books and
          records, in determining willfulness.

     (2) The privilege against self-incrimination does not
          permit a taxpayer to refuse to obey a summons issued
          under IRC 7602 or a court order directing his
          appearance. He is required to appear and cannot use
          the Fifth Amendment as an excuse for failure to do so,
          although he may exercise it in connection with specific
          questions. He cannot refuse to bring his records, but
          may decline to submit them for inspection on
          Constitutional grounds. In the Vader case [U.S. vs
          Vader, 119 F.Supp. 330], the Government moved to hold a
          taxpayer in contempt of court for refusal to obey a
          court order to produce his books and records. He
          refused to submit them for inspection by the
          Government, basing his refusal on the Fifth Amendment.
          The court denied the motion to hold him in contempt,
          holding that disclosure of his assets would provide a
          starting point for a tax evasion case.

                                                 [emphasis added]

     Note, in particular, where this IR Manual uses the phrase
"in the absence of such claims". In general if you do not assert
your rights, explicitly and in a timely fashion, then you can be
presumed to have waived them. There's the "law of presumption"
again. You can, therefore, assert your rights under the Fourth
and Fifth Amendments to the Constitution, by refusing to submit
your books and records for inspection, even though you cannot
refuse to bring those books and records to an audit. This may
seem like splitting hairs. However, if the federal government
could compel your submission of books and records to IRS agents,
then the federal government could compel persons to be witnesses
against themselves. This would violate the Fifth Amendment.


                        Page 10 - 9 of 16

                                                The Federal Zone:


Similarly, the federal government could compel the search and
seizure of books and records without a warrant issued upon
probable cause and describing the place to be searched and the
persons or things to be seized. This would violate the Fourth
Amendment. Agencies of the federal government are constrained by
law to avoid infringing upon the rights guaranteed by the Fourth
and Fifth Amendments to the U.S. Constitution.

     How do you assert your rights in a polite yet convincing
way, so that everyone who needs to know is placed on notice that
you have done so? One of the most effective ways of asserting
your rights is to become totally alert to every document which
bears your signature, past, present and future. Know that your
signature is the touch which magically transforms common pieces
of paper into commercial contracts, or "commercial agreements" as
they are called in the Uniform Commercial Code. Always sign your
name with the following phrase immediately above your signature
on all contracts which involve bank credit or Federal Reserve
Notes:

           With Explicit Reservation of All My Rights
               and Without Prejudice U.C.C. 1-207


A short-hand way of doing the same thing is to utilize the phrase
"All Rights Reserved". This phrase appears in most published
books and in film credits. The use of these phrases above your
signature on any document indicates that you have exercised the
"Remedy" provided for you in the Uniform Commercial Code (UCC) in
Article 1 at Section 207. This "Remedy" provides a valid legal
mechanism to reserve a fundamental, common law right which you
possess. Under the common law, you enjoy the right not to be
compelled to perform under any contract or commercial agreement
which you did not enter knowingly, intentionally and voluntarily.

     Moreover, your explicit reservation of rights serves notice
upon all administrative agencies of government, whether
international, national, state, or local, that you do not, and
will not accept the liability associated with the "compelled"
benefit of any unrevealed commercial agreements. As you now know
from reading previous chapters, the federal government is famous
for making presumptions about you, because your signature is on
documents which bind you to "commercial agreements" with tons of
unrevealed terms and conditions. Think back to the terms and
conditions attached to the bank signature card, for example. An
unrevealed term is proof of constructive fraud, and constructive
fraud is a legal basis for cancelling any written instrument.

     Last but not least, your valid reservation of rights results
in preserving all your rights, and prevents the loss of any such
rights by application of the concepts of waiver or estoppel. A
"waiver" has occurred when you sign your name on an agreement
which states that you knowingly, intentionally and voluntarily
waive one of your fundamental rights. Kiss it goodbye. As long


                       Page 10 - 10 of 16

                                              The Fundamental Law


as you are not infringing on the rights of others, only you can
waive one or more of your fundamental rights. In law, "estoppel"
means that a party is prevented by his own acts from claiming a
right, to the detriment of another party who was entitled to rely
on such conduct and who has acted accordingly. If all parties
were acting in good faith, for example, estoppel prevents you
from changing your mind and claiming a right after the fact, in
order to get out of an otherwise valid contract. The doctrine of
estoppel holds that an inconsistent position or course of conduct
may not be adopted to the loss or injury of another. However, if
the other party has been responsible for actual fraud,
constructive fraud or deliberate misrepresentation, then the
estoppel doctrine goes out the window and the contract is
necessarily null and void. And there is no statute of
limitations on fraud.

     The remedy provided for us  in the Uniform Commercial Code
was first brought to my attention by a Patriot named Howard
Freeman, who has written a classic essay entitled "The Two United
States and the Law". This essay does an excellent job of
describing the tangled legal mess that has resulted from the
bankruptcy of the federal government in the year 1933.
Specifically, the Supreme Court decision of Erie Railroad vs
Thompkins in 1938 changed our entire legal system in this country
from public law to private commercial law. Prior to 1938, all
Supreme Court decisions were based upon public law, i.e., the
system of law that was controlled by Constitutional limitations.
Ever since the Erie decision in 1938, all Supreme Court decisions
have been based upon what is termed "public policy". Public
policy concerns commercial transactions made under the Uniform
Commercial Code (U.C.C.). Freeman describes the overall
consequences for our system of government as follows:


     Our national Congress works for two nations foreign to each
     other, and by legal cunning both are called The United
     States. One is the Union of Sovereign States, under the
     Constitution, termed in this article the Continental United
     States***. The other is a Legislative Democracy which has
     its origin in Article I, Section 8, Clause 17 of the
     Constitution, here termed the Federal United States**. Very
     few people, when they see some "law" passed by Congress, ask
     themselves, "Which nation was Congress working for when it
     passed this or that so-called law?" Or, few ask, "Does this
     particular law apply only to residents of the District of
     Columbia and other named enclaves, or territories, of the
     Democracy called the Federal United States**?"

                                           [emphasis in original]


     The "Federal United States**" to which Freeman refers is the
federal zone. Because of its sweetheart deal with the Federal
Reserve, Congress deliberately failed in its duty to provide a


                       Page 10 - 11 of 16

                                                The Federal Zone:


constitutional medium of exchange for the Citizens of the 50
States. Instead of real money, Congress created a "wealth" of
commercial credit for the federal zone, where it is not bound by
constitutional limitations. After the tremendous depression that
began in 1929, Congress used its emergency authority to remove
the remaining real money (gold and silver) from circulation
inside the 50 States, and made the commercial paper of the
federal zone a legal tender for all Citizens of the 50 States to
use in discharging their debts. Freeman goes on to describe the
"privilege" we now enjoy for being able to discharge our debts
with limited liability, that is, by using worthless commercial
paper instead of intrinsically valuable gold and silver:


     ... Congress granted the entire citizenry of the two nations
     the "benefit" of limited liability in the discharge of all
     debts by telling the citizenry that the gold and silver
     coins of the Republic were out of date and cumbersome. The
     citizens were told that gold and silver (substance) was no
     longer needed to pay their debts, that they were now
     "privileged" to discharge debt with this more "convenient"
     currency, issued by the Federal United States**.
     Consequently, everyone was forced to "go modern," and to
     turn in their gold as a patriotic gesture. The entire news
     media complex went along with the scam and declared it to be
     a forward step for our democracy, no longer referring to
     America as a Republic.


     You are strongly encouraged to read and study Freeman's
entire essay, which can be obtained by writing Howard Freeman,
c/o P. O. Box 364, Lusk, Wyoming. A copy of this essay can also
be obtained from the Account for Better Citizenship. The
compound metaphor of "Two United States" is rich in meanings and
long on prophetic insight.

     America is now submerged in a tangled legal mess which began
in 1901 and reached critical mass in 1913. This mess is due, in
large part, to systematic efforts to destroy the Constitution as
the fundamental law in this country, and to devolve the nation
from a Republic into a Democracy (mob rule) and eventually a
socialist dictatorship. The Supreme Court gave its official
blessing to the dubious principle of territorial heterogeneity in
the Insular Cases. These controversial precedents then paved the
way for unrestricted monetary devolution under a private credit
monopoly created by the Federal Reserve Act; this Act followed
closely behind the fraudulent 16th Amendment in order to justify
"municipal" income taxation (two pumps, working in tandem). The
Supreme Court stepped into line once again when their Erie
decision threw out almost 100 years of common law precedent.
Echoing Justice Harlan's eloquent dissent in Downes vs Bidwell,
author Lori Jacques identifies territorial heterogeneity as a
root cause of the disease she calls "governmental absolutism":


                       Page 10 - 12 of 16

                                              The Fundamental Law


          There has been no cure for the disease of governmental
     absolutism introduced into our body politic by the
     acquisition of Dependencies and the subsequent alleged
     Sixteenth Amendment. ... [T]hrough Rules and Regulations
     meant for the Territories and insular Possessions, which are
     not limited by the Constitution, Congress has extended this
     limited legislative power into the several states by clever
     design thereby usurping the states' right to a republican
     form of Government and virtually destroying the concept of
     Liberty of the individual. ...

          Until the person who receives benefits from the
     Government is not permitted to vote, or buy himself benefits
     to the detriment of another, the Liberty of the Individual
     will be denied. "Benefits" granted by the Government are
     the rights transferred by the Individual to the Government
     and then returned as "privileges" by its formula of
     felicific calculus.

                     [A Ticket to Liberty, November 1990 edition]
                                  [pages 145-146, emphasis added]

These efforts to destroy the Constitution have not been entirely
successful, however. Due to the concerted efforts of many
courageous Americans like Howard Freeman, the United States
Constitution is alive, if not well, and remains the Supreme Law
of the Land even today. Any statute, to be valid, must be in
agreement with the Constitution and, therefore, with all relevant
provisions for amending it. It is impossible for both the
Constitution and a law violating it to be valid; one must
prevail. That "one" is the Constitution, the fundamental law in
these United States. This is succinctly stated as follows:

     The general rule is that an unconstitutional statute, though
     having the form and name of law, is in reality no law, but
     is wholly void and ineffective for any purpose; since
     unconstitutionality dates from the time of its enactment,
     and not merely from the date of the decision so branding it.
     An unconstitutional law, in legal contemplation, is as
     inoperative as if it had never been passed. Such a statute
     leaves the question that it purports to settle just as it
     would be[,] had the statute not been enacted.

     Since an unconstitutional law is void, the general
     principles follow that it imposes no duties, confers no
     rights, creates no office, bestows no power or authority on
     anyone, affords no protection, and justifies no acts
     performed under it ....

     A void act cannot be legally consistent with a valid one.
     An unconstitutional law cannot operate to supersede any
     existing valid law. Indeed, insofar as a statute runs
     counter to the fundamental law of the land, it is superseded
     thereby.


                       Page 10 - 13 of 16

                                                The Federal Zone:


     No one is bound to obey an unconstitutional law, and no
     courts are bound to enforce it.

                      [16 American Jurisprudence 2d, Section 177]
                                                 [emphasis added]

     The vivid pattern that is now  painfully emerging is that
"citizens of the United States", as defined in federal tax law,
are the intended victims of a modern statutory slavery that was
predicted by the infamous Hazard Circular soon after the Civil
War began. These statutory slaves are now burdened with a bogus
federal debt which is spiralling out of control. The White House
budget office recently invented a new kind of "generational
accounting" so as to project a tax load of seventy-one percent on
future generations of these "citizens of the United States". It
is our duty to ensure that this statutory slavery is soon gone
with the wind, just like its grisly and ill-fated predecessor.


                             # # #


                       Page 10 - 14 of 16

                                              The Fundamental Law


Reader's Notes:


                       Page 10 - 15 of 16

                                                The Federal Zone:


Reader's Notes:


                       Page 10 - 16 of 16

                           Chapter 11:
                           Sovereignty


     The issue of jurisdiction as it relates to sovereignty is a
major key to understanding our system of government under the
Constitution. In the most common sense of the word,
"sovereignty" is autonomy, freedom from external control. The
sovereignty of any government usually extends up to, but not
beyond the borders of its jurisdiction. This jurisdiction
defines a specific territorial boundary which separates the
"external" from the "internal", the "within" from the "without".
It may also define a specific function or set of functions which
a government may lawfully perform within a particular territorial
boundary. Black's Law Dictionary, Sixth Edition, describes
sovereignty as follows:

     ... [T]he international independence of a state, combined
     with the right and power of regulating its internal affairs
     without foreign dictation.

On a similar theme, Black's defines "sovereign states" to be
those which are not under the control of any foreign power:

     No foreign power or law can have control except by
     convention. This power of independent action in external
     and internal relations constitutes complete sovereignty.

     It is a well established principle of law that the 50 States
are "foreign" with respect to each other, just as the federal
zone is "foreign" with respect to each of them (In re Merriam's
Estate, 36 NE 505 (1894)). The status of being foreign is the
same as "belonging to" or being "attached to" another state or
another jurisdiction. The proper legal distinction between the
terms "foreign" and "domestic" is best seen in Black's
definitions of foreign and domestic corporations, as follows:

     Foreign corporation. A corporation doing business in one
     state though chartered or incorporated in another state is a
     foreign corporation as to the first state, and, as such, is
     required to consent to certain conditions and restrictions
     in order to do business in such first state.

     Domestic corporation. When a corporation is organized and
     chartered in a particular state, it is considered a domestic
     corporation of that state.

     The federal zone is an area over which Congress exercises
exclusive legislative jurisdiction. It is the area over which
the federal government exercises its sovereignty. Despite its
obvious importance, the subject of federal jurisdiction had been
almost entirely ignored outside the courts until the year 1954.
In that year, a detailed study of federal jurisdiction was
undertaken. The occasion for the study arose from a school


                        Page 11 - 1 of 20

                                                The Federal Zone:


playground, of all places. The children of federal employees
residing on the grounds of a Veterans' Administration hospital
were not allowed to attend public schools in the town where the
hospital was located. An administrative decision against the
children was affirmed by local courts, and finally affirmed by
the State supreme court. The residents of the area on which the
hospital was located were not "residents" of the State, since
"exclusive legislative jurisdiction" over this area had been
ceded by the State to the federal government.

     A committee was assembled by Attorney General Herbert
Brownell, Jr. Their detailed study was reported in a publication
entitled Jurisdiction over Federal Areas within the States, April
1956 (Volume I) and June 1957 (Volume II). The committee's
report demonstrates, beyond any doubt, that the sovereign States
and their laws are outside the legislative and territorial
jurisdiction of the United States** federal government. They are
totally outside the federal zone. A plethora of evidence is
found in the myriad of cited court cases (700+) which prove that
the United States** cannot exercise exclusive legislative
jurisdiction outside territories or places purchased from, or
ceded by, the 50 States of the Union. Attorney General Brownell
described the committee's report as an "exhaustive and analytical
exposition of the law in this hitherto little explored field".
In his letter of transmittal to President Dwight D. Eisenhower,
Brownell summarized the two volumes as follows:

     Together, the two parts of this Committee's report and the
     full implementation of its recommendations will provide a
     basis for reversing in many areas the swing of "the pendulum
     of power * * * from our states to the central government" to
     which you referred in your address to the Conference of
     State Governors on June 25, 1957.

              [Jurisdiction over Federal Areas within the States]
                  [Letter of Transmittal, page V, emphasis added]

     Once a State is admitted into the Union, its sovereign
jurisdiction is firmly established over a predefined territory.
The federal government is thereby prevented from acquiring
legislative jurisdiction, by means of unilateral action, over any
area within the exterior boundaries of this predefined territory.
State assent is necessary to transfer jurisdiction to Congress:

     The Federal Government cannot, by unilateral action on its
     part, acquire legislative jurisdiction over any area within
     the exterior boundaries of a State. Article 1, Section 8,
     Clause 17, of the Constitution, provides that legislative
     jurisdiction may be transferred pursuant to its terms only
     with the consent of the legislature of the State in which is
     located the area subject to the jurisdictional transfer.

              [Jurisdiction over Federal Areas within the States]
                             [Volume II, page 46, emphasis added]


                        Page 11 - 2 of 20

                                                      Sovereignty


     Under Article 1, Section 8, Clause 17 of the Constitution,
States of the Union have enacted statutes consenting to the
federal acquisition of any land, or of specific tracts of land,
within those States. Secondly, the federal government has also
made "reservations" of jurisdiction over certain areas in
connection with the admission of a State into the Union. A third
means for transfer of legislative jurisdiction has also come into
considerable use over time, namely, a general or special statute
whereby a State makes a cession of specific functional
jurisdiction to the federal government. Nevertheless, the
Committee report explained that "... the characteristics of a
legislative jurisdiction status are the same no matter by which
of the three means the Federal Government acquired such status"
[Volume II, page 3]. There is simply no federal legislative
jurisdiction without consent by a State, cession by a State, or
reservation by the federal government:

     It scarcely needs to be said that unless there has been a
     transfer of jurisdiction (1) pursuant to clause 17 by a
     Federal acquisition of land with State consent, or (2) by
     cession from the State to the Federal Government, or unless
     the Federal Government has reserved jurisdiction upon the
     admission of the State, the Federal Government possesses no
     legislative jurisdiction over any area within a State, such
     jurisdiction being for exercise entirely by the State ....

              [Jurisdiction over Federal Areas within the States]
                             [Volume II, page 45, emphasis added]


     The areas which the 50 States have properly ceded to the
federal government are called federal "enclaves":

     By this means some thousands of areas have become Federal
     islands, sometimes called "enclaves," in many respects
     foreign to the States in which they are situated. In
     general, not State but Federal law is applicable in an area
     under the exclusive legislative jurisdiction of the United
     States**, for enforcement not by State but Federal
     authorities, and in many instances not in State but in
     Federal courts.

              [Jurisdiction over Federal Areas within the States]
                              [Volume II, page 4, emphasis added]

These federal enclaves are considered foreign with respect to the
States which surround them, just as the 50 States are considered
foreign with respect to each other and to the federal zone:
"...[T]he several states of the Union are to be considered as in
this respect foreign to each other ...." Hanley vs Donoghue, 116
U.S. 1 (1885). Once a State surrenders its sovereignty over a
specific area of land, it is powerless over that land; it is
without authority; it cannot recapture any of its transferred
jurisdiction by unilateral action, just as the federal government


                        Page 11 - 3 of 20

                                                The Federal Zone:


cannot acquire jurisdiction over State area by its unilateral
action. The State has transferred its sovereign authority to a
foreign power:

     Once a State has, by one means or another, transferred
     jurisdiction to the United States**, it is, of course,
     powerless to control many of the consequences; without
     jurisdiction, it is without the authority to deal with many
     of the problems, and having transferred jurisdiction to the
     United States**, it cannot unilaterally capture any of the
     transferred jurisdiction.

              [Jurisdiction over Federal Areas within the States]
                              [Volume II, page 7, emphasis added]


     Once sovereignty has been relinquished, a State no longer
has the authority to enforce criminal laws in areas under the
exclusive jurisdiction of the United States**. Privately owned
property in such areas is beyond the taxing authority of the
State. Residents of such areas are not "residents" of the State,
and hence are not subject to the obligations of residents of the
State, and are not entitled to any of the benefits and privileges
conferred by the State upon its residents. Residents of federal
enclaves usually cannot vote, serve on juries, or run for office.
They do not, as matter of right, have access to State schools,
hospitals, mental institutions, or similar establishments.

     The acquisition of exclusive jurisdiction by the Federal
Government renders unavailable to the residents of the affected
areas the benefits of the laws and judicial and administrative
processes of the State relating to adoption, the probate of wills
and administration of estates, divorce, and many other matters.
Police, fire-fighting, notaries, coroners, and similar services
performed by, or under, the authority of a State may result in
legal sanction within a federal enclave. The "old" State laws
which apply are only those which are consistent with the laws of
the "new" sovereign authority, using the following principle from
international law:

     The vacuum which would exist because of the absence of State
     law or Federal legislation with respect to civil matters in
     areas under Federal exclusive legislative jurisdiction has
     been partially filled by the courts, through extension to
     these areas of a rule of international law that[,] when one
     sovereign takes over territory of another[,] the laws of the
     original sovereign in effect at the time of the taking[,]
     which are not inconsistent with the laws or policies of the
     second[,] continue in effect, as laws of the succeeding
     sovereign, until changed by that sovereign.

              [Jurisdiction over Federal Areas within the States]
                    [Volume II, page 6, commas added for clarity]
                                                 [emphasis added]


                        Page 11 - 4 of 20

                                                      Sovereignty


     It is clear, then, that only one "state" can be sovereign at
any given moment in time, whether that "state" be one of the 50
Union States, or the federal government of the United States**.
Before ceding a tract of land to Congress, a State of the Union
exercises its sovereign authority over any land within its
borders:


     Save only as they are subject to the prohibitions of the
     Constitution, or as their action in some measure conflicts
     with the powers delegated to the national government or with
     congressional legislation enacted in the exercise of those
     powers, the governments of the states are sovereign within
     their territorial limits and have exclusive jurisdiction
     over persons and property located therein.

                        [72 American Jurisprudence 2d, Section 4]
                                                 [emphasis added]

After a State has ceded a tract of land to Congress, the
situation is completely different. The United States**, as the
"succeeding sovereign", then exercises its sovereign authority
over that land. In this sense, sovereignty is indivisible, even
though the Committee's report documented numerous situations in
which jurisdiction was actually shared between the federal
government and one of the 50 States. Even in this situation,
however, sovereignty rests either in the State, or in the federal
government, but never both. Sovereignty is the authority to
which there is politically no superior. Outside the federal
zone, the States of the Union remain sovereign, and their laws
are completely outside the exclusive legislative jurisdiction of
the federal government of the United States**.


     Now, if a State of the Union is sovereign, is it correct to
say that the State exercises an authority to which there is
absolutely no superior? No, this is not a correct statement.
There is no other political body which is superior to the
political body which retains sovereignty. The sovereignty of
governments is an authority to which there is politically no
superior, but there is absolutely a superior body. The source of
all sovereignty in a constitutional Republic like the 50 States,
united by and under the Constitution for the United States of
America, is the people themselves. Remember, the States, and the
federal government acting inside those States, are both bound by
the terms of a contract known as the U. S. Constitution. That
Constitution is a contract of delegated powers which ultimately
originate in the sovereignty of the Creator, who endowed
creation, individual people like you and me, with sovereignty in
that Creator's image and likeness. Nothing stands between us and
the Creator. I think it is fair to say that the Supreme Court of
the United States was never more eloquent when it described the
source of sovereignty as follows:


                        Page 11 - 5 of 20

                                                The Federal Zone:


     Sovereignty itself is, of course, not subject to law, for it
     is the author and source of law; but in our system, while
     sovereign powers are delegated to the agencies of
     government, sovereignty itself remains with the people,  by
     whom and for whom all government exists and acts. And the
     law is the definition and limitation of power. It is
     indeed, quite true, that there must always be lodged
     somewhere, and in some person or body, the authority of
     final decision; and in many cases of mere administration
     the responsibility is purely political, no appeal except to
     the ultimate tribunal of the public judgement, exercised
     either in the pressure of opinion or by means of the
     suffrage. But the fundamental rights to life, liberty, and
     the pursuit of happiness, considered as individual
     possessions, are secured by those maxims of constitutional
     law which are the monuments showing the victorious progress
     of the race in securing to men the blessings of civilization
     under the reign of just and equal laws, so that, in the
     famous language of the Massachusetts Bill of Rights, the
     government of the commonwealth "may be a government of laws
     and not of men." For, the very idea that one man may be
     compelled to hold his life, or the means of living, or any
     material right essential to the enjoyment of life, at the
     mere will of another, seems to be intolerable in any country
     where freedom prevails, as being the essence of slavery
     itself.
                   [Yick Wo vs Hopkins, 118 U.S. 356, 370 (1886)]
                                                 [emphasis added]

     More recently, the Supreme Court reiterated the fundamental
importance of US the people as the source of sovereignty, and the
subordinate status which Congress occupies in relation to the
sovereignty of the people. The following language is terse and
right on point:

     In the United States***, sovereignty resides in the people
     who act through the organs established by the Constitution.
     [cites omitted] The Congress as the instrumentality of
     sovereignty is endowed with certain powers to be exerted on
     behalf of the people in the manner and with the effect the
     Constitution ordains. The Congress cannot invoke the
     sovereign power of the people to override their will as thus
     declared.

               [Perry vs United States, 294 U.S. 330, 353 (1935)]
                                                 [emphasis added]

     No discussion of sovereignty would be complete, therefore,
without considering the sovereignty that resides in US, the
people. The Supreme Court has often identified the people as the
source of sovereignty in our republican form of government.
Indeed, the federal Constitution guarantees to each and every
State in the Union a "Republican Form" of government, in so many
words:


                        Page 11 - 6 of 20

                                                      Sovereignty


     Section 4. The United States shall guarantee to every State
     in this Union a Republican Form of Government, and shall
     protect each of them against Invasion; ....

               [United States Constitution, Article 4, Section 4]
                                                 [emphasis added]

What exactly is a "Republican Form" of government? It is one in
which the powers of sovereignty are vested in the people and
exercised by the people. Black's Law Dictionary, Sixth Edition,
makes this very clear:

     Republican government. One in which the powers of
     sovereignty are vested in the people and are exercised by
     the people, either directly, or through representatives
     chosen by the people, to whom those powers are specially
     delegated. In re Duncan, 139 U.S. 449, 11 S.Ct. 573, 35
     L.Ed. 219; Minor v. Happersett, 88 U.S. (21 Wall.) 162, 22
     L.Ed. 627.

The Supreme Court has clearly distinguished between the operation
of governments in Europe, and government in these United
States*** of America, as follows:

     In Europe, the executive is almost synonymous with the
     sovereign power of a State; and generally includes
     legislative and judicial authority. When, therefore,
     writers speak of the sovereign, it is not necessarily in
     exclusion of the judiciary; and it will often be found that
     when the executive affords a remedy for any wrong, it is
     nothing more than by an exercise of its judicial authority.
     Such is the condition of power in that quarter of the world,
     where it is too commonly acquired by force or fraud, or
     both, and seldom by compact. In America, however, the case
     is widely different. Our government is founded upon
     compact. Sovereignty was, and is, in the people.

                     [Glass vs The Sloop Betsey, 3 Dall 6 (1794)]
                                                 [emphasis added]

     The federal Constitution makes a careful distinction between
natural born Citizens and citizens of the United States**
(compare 2:1:5 with Section 1 of the so-called 14th Amendment).
One is an unconditional Sovereign by natural birth, who is
endowed by the Creator with certain unalienable rights; the
other has been granted the revocable privileges of U.S.**
citizenship, endowed by the Congress of the United States**. One
is a Citizen, the other is a subject. One is a Sovereign, the
other is a subordinate. One is a Citizen of our constitutional
Republic; the other is a citizen of a legislative democracy (the
federal zone). Notice the superior/subordinate relationship
between these two statuses. I am forever indebted to M. J. "Red"
Beckman, co-author of The Law That Never Was with Bill Benson,
for clearly illustrating the important difference between the


                        Page 11 - 7 of 20

                                                The Federal Zone:


two. Red Beckman has delivered many eloquent lectures based on
the profound simplicity of the following table:

          Chain of command and authority in a:

          Majority Rule Constitutional
          Democracy Republic

          X Creator
          Majority Individual
          Government Constitution
          Public Servants Government
          Case & Statute Law Public Servants
          Corporations Statute Law
          individual Corporations


     In this illustration, a democracy ruled by the majority
places the individual at the bottom, and an unknown elite, Mr.
"X" at the top. The majority (or mob) elects a government to
hire public "servants" who write laws primarily for the benefit
of corporations. These corporations are either owned or
controlled by Mr. X, a clique of the ultra-wealthy who seek to
restore a two-class "feudal" society. They exercise their vast
economic power so as to turn all of America into a "feudal zone".
The rights of individuals occupy the lowest priority in this
chain of command. Those rights often vanish over time, because
democracies eventually self-destruct. The enforcement of laws
within this scheme is the responsibility of administrative
tribunals, who specialize in holding individuals to the letter of
all rules and regulations of the corporate state, no matter how
arbitrary and with little if any regard for fundamental human
rights:

     A democracy that recognizes only manmade laws perforce
     obliterates the concept of Liberty as a divine right.

           [A Ticket to Liberty, November 1990 edition, page 146]
                                                 [emphasis added]

     In the constitutional Republic, however, the rights of
individuals are supreme. Individuals delegate their sovereignty
to a written contract, called a constitution, which empowers
government to hire public servants to write laws primarily for
the benefit of individuals. The corporations occupy the lowest
priority in this chain of command, since their primary objectives
are to maximize the enjoyment of individual rights, and to
facilitate the fulfillment of individual responsibilities. The
enforcement of laws within this scheme is the responsibility of
sovereign individuals, who exercise their power in three arenas:
the voting booth, the trial jury, and the grand jury. Without a
jury verdict of "guilty", for example, no law can be enforced and
no penalty exacted. The behavior of public servants is tightly
restrained by contractual terms, as found in the written


                        Page 11 - 8 of 20

                                                      Sovereignty


Constitution. Statutes and case law are created primarily to
limit and define the scope and extent of public servant power.

     Sovereign individuals are subject only to a common law,
whose primary purposes are to protect and defend individual
rights, and to prevent anyone, whether public official or private
person, from violating the rights of other individuals. Within
this scheme, Sovereigns are never subject to their own creations,
and the constitutional contract is such a creation. To quote the
Supreme Court, "No fiction can make a natural born subject."
Milvaine vs Coxe's Lessee, 8 U.S. 598 (1808). That is to say, no
fiction, be it a corporation, a statute law, or an administrative
regulation, can mutate a natural born Sovereign into someone who
is subject to his own creations. Author and scholar Lori Jacques
has put it succinctly as follows:

     As each state is sovereign and not a territory of the United
     States**, the meaning is clear that state citizens are not
     subject to the legislative jurisdiction of the United
     States**. Furthermore, there is not the slightest
     intimation in the Constitution which created the "United
     States" as a political entity that the "United States" is
     sovereign over its creators.

            [A Ticket to Liberty, November 1990 edition, page 32]
                                                 [emphasis added]

     Accordingly, if you choose to investigate the matter, you
will find a very large body of legal literature which cites
another fiction, the so-called 14th Amendment, from which the
federal government presumes to derive general authority to treat
everyone in America as subjects and not as Sovereigns:

     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.

         [United States Constitution, Fourteenth Amendment [sic]]
                                                 [emphasis added]

A careful reading of this amendment reveals an important subtlety
which is lost on many people who read it for the first time. The
citizens it defines are second class citizens because the "c" is
lower-case, even in the case of the State citizens it defines.
Note how the amendment defines "citizens of the United States**"
and "citizens of the State wherein they reside"! It is just
uncanny how the wording of this amendment closely parallels the
Code of Federal Regulations (CFR) which promulgates Section 1 of
the Internal Revenue Code (IRC). Can it be that this amendment
had something to do with subjugation, by way of taxes and other
means? Section 1 of the IRC is the section which imposes income
taxes. The corresponding section of the CFR defines who is a
"citizen" as follows:


                        Page 11 - 9 of 20

                                                The Federal Zone:


     Every person born or naturalized in the United States** and
     subject to its jurisdiction is a citizen.

                               [26 CFR 1.1-1(c), emphasis addded]

Notice the use of the term "its jurisdiction". This leaves no
doubt that the "United States**" is a singular entity in this
context. In other words, it is the federal zone. Do we dare to
speculate why the so-called 14th Amendment was written instead
with the phrase "subject to the jurisdiction thereof"? Is this
another case of deliberate ambiguity? You be the judge.

     Not only did this so-called "amendment" fail to specify
which meaning of the term "United States" was being used; like
the 16th Amendment, it also failed to be ratified, this time by
15 of the 37 States which existed in 1868. The House
Congressional Record for June 13, 1967, contains all the
documentation you need to prove that the so-called 14th Amendment
was never ratified into law (see page 15641 et seq.). For
example, it itemizes all States which voted against the proposed
amendment, and the precise dates when their Legislatures did so.
"I cannot believe that any court, in full possession of its
faculties, could honestly hold that the amendment was properly
approved and adopted." State vs Phillips, 540 P.2d. 936, 941
(1975). The Utah Supreme Court has detailed the shocking and
sordid history of the 14th Amendment's "adoption" in the case of
Dyett vs Turner, 439 P.2d 266, 272 (1968).

     A great deal of written material on the 14th Amendment has
been assembled on computer files by Richard McDonald, whose
mailing address is 585-D Box Canyon Road, Canoga Park, California
Republic (not "CA"). He requests that ZIP codes not be used on
his incoming mail. If you must use a ZIP code when you write to
him, show it on a separate line, preceded by the words "POSTAL
ZONE" and followed by "/TDC" or "without prejudice U.C.C. 1-207".
McDonald has done a mountain of legal research and writing on the
origins and effects of the so-called 14th Amendment. He
documents how key court decisions like the Slaughter House Cases,
among many others, all found that there is a clear distinction
between a Citizen of a State and a citizen of the United States**
(e.g., see 16 Wall. 36, 74). A State Citizen is a Sovereign,
whereas a citizen of the United States** is subject to Congress.
The exercise of federal citizenship is a statutory privilege
which can be taxed with excises. The exercise of State
Citizenship is a Common Law Right which cannot be taxed because
governments simply cannot tax the exercise of a Right, ever.

     The case of U.S. vs Cruikshank is famous, not only for
confirming this distinction between State Citizens and U.S.**
citizens, but also for establishing a key precedent in the area
of due process. This precedent underlies the "void for vagueness"
doctrine which can and should be applied to nullify the IRC. On
the issue of citizenship, the Cruikshank court ruled as follows:


                       Page 11 - 10 of 20

                                                      Sovereignty


     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 its own who owe it allegiance, and
     whose rights, within its jurisdiction, it must protect. The
     same person may be at the same time a citizen of the United
     States** and a citizen of a State, but his rights of
     citizenship under one of these governments will be different
     from those he has under the other. Slaughter-House Cases

                [United States vs Cruikshank, 92 U.S. 542 (1875)]
                                                 [emphasis added]

The leading authorities for this pivotal distinction are, indeed,
a series of U.S. Supreme Court decisions known as the Slaughter
House Cases, which examined the so-called 14th Amendment in
depth. An exemplary paragraph from these cases is the following:

     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. 36 (page 408)]
                               [16 Wall. 36, 21 L.Ed. 394 (1873)]
                                                 [emphasis added]

A similar authority is found in the case of K. Tashiro vs Jordan,
decided by the Supreme Court of the State of California almost
fifty years later. Notice, in particular, how the California
Supreme Court again cites the Slaughter House Cases:

     That there is a citizenship of the United States** and a
     citizenship of a state, and the privileges and immunities of
     one are not the same as the other is well established by the
     decisions of the courts of this country. The leading cases
     upon the subjects are those decided by the Supreme Court of
     the United States and reported in 16 Wall. 36, 21 L. Ed.
     394, and known as the Slaughter House Cases.

                   [K. Tashiro vs Jordan, 256 P. 545, 549 (1927)]
                                                 [emphasis added]

This case was subsequently appealed on a writ of certiorari to
the U.S. Supreme Court, where it was affirmed in the case of
Jordan vs K. Tashiro, 278 U.S. 123 (1928).

     In the fundamental law, the notion of a "citizen of the
United States" simply did not exist before the 14th Amendment;
at best, this notion is a fiction within a fiction. In
discussing the power of the States to naturalize, the California
State Supreme Court put it rather bluntly when it ruled that
there was no such thing as a "citizen of the United States":


                       Page 11 - 11 of 20

                                                The Federal Zone:


     A citizen of any one of the States of the union, is held to
     be, and called a citizen of the United States, although
     technically and abstractly there is no such thing. To
     conceive a citizen of the United States who is not a citizen
     of some one of the States, is totally foreign to the idea,
     and inconsistent with the proper construction and common
     understanding of the expression as used in the Constitution,
     which must be deduced from its various other provisions.
     The object then to be attained, by the exercise of the power
     of naturalization, was to make citizens of the respective
     States.
                            [Ex Parte Knowles, 5 Cal. 300 (1855)]
                                                 [emphasis added]

This decision has never been overturned!

     What is the proper construction and common understanding of
the term "Citizen of the United States" as used in the original
Constitution, before the so-called 14th Amendment? This is an
important question, because this status is still a qualification
for the offices of Senator, Representative and President. No
Person can be a Representative unless he has been a Citizen of
the United States for seven years (1:2:2); no Person can be a
Senator unless he has been a Citizen of the United States for
nine years (1:3:3); no Person can be President unless he is a
natural born Citizen, or a Citizen of the United States (2:1:5).
If these requirements had been literally obeyed, there could have
been no elections for Representatives to Congress for at least
seven years after the adoption of the Constitution, and no one
would have been eligible as a Senator for nine years after its
adoption. Author John S. Wise, in a rare book now available on
Richard McDonald's electronic bulletin board system (BBS),
explains away the problem very simply as follows:


     The language employed by the convention was less careful
     than that which had been used by Congress in July of the
     same year, in framing the ordinance for the government of
     the Northwest Territory. Congress had made the
     qualification rest upon citizenship of "one of the United
     States***," and this is doubtless the intent of the
     convention which framed the Constitution, for it cannot have
     meant anything else.
                                  [Studies in Constitutional Law:
                             [A Treatise on American Citizenship]
                    [by John S. Wise, Edward Thompson Co. (1906)]
                                                 [emphasis added]

This quote from the Northwest Ordinance is faithful to the letter
and to the spirit of that law. In describing the eligibility for
"representatives" to serve in the general assembly for the
Northwest Territory, the critical passage from that Ordinance
reads as follows:


                       Page 11 - 12 of 20

                                                      Sovereignty


     ... Provided, That no person be eligible or qualified to act
     as a representative, unless he shall have been a citizen of
     one of the United States*** three years, and be a resident
     in the district, or unless he shall have resided in the
     district three years; ....

                  [Northwest Ordinance, Section 9, July 13, 1787]
                       [The Confederate Congress, emphasis added]


     Without citing the case as such, the words of author John S.
Wise sound a close, if not identical parallel to the argument for
the Respondent filed in the case of People vs De La Guerra,
decided by the California Supreme Court in 1870. The following
long passage elaborates the true meaning of the Constitutional
qualifications for President and Representative:

     As it was the adoption of the Constitution by the
     Conventions of nine States that established and created the
     United States***, it is obvious there could not then have
     existed any person who had been seven years a citizen of the
     United States***, or who possessed the Presidential
     qualifications of being thirty-five years of age, a natural
     born citizen, and fourteen years a resident of the United
     States***. The United States*** in these provisions, means
     the States united. To be twenty-five years of age, and for
     seven years to have been a citizen of one of the States
     which ratifies the Constitution, is the qualification of a
     representative. To be a natural  born citizen of one of the
     States which shall ratify the Constitution, or to be a
     citizen of one of said States at the time of such
     ratification, and to have attained the age of thirty-five
     years, and to have been fourteen years a resident within one
     of the said States, are the Presidential qualifications,
     according to the true meaning of the Constitution.

                [People vs De La Guerra, 40 Cal. 311, 337 (1870)]
                                                 [emphasis added]

     Thus, the phrase "Citizen of the United States" as found in
the original Constitution is synonymous with the phrase "Citizen
of one of the United States***", i.e., a Union State Citizen.
This simple explanation will help cut through the mountain of
propaganda and deception which have been foisted on all Americans
by government bureaucrats and their high-paid lawyers. With this
understanding firmly in place, it is very revealing to discover
that many reprints of the Constitution now utilize a lower-case
"c" in the sections which describe the qualifications for the
offices of Senator, Representative and President. This is
definitely wrong, and it is probably deliberate, so as to confuse
everyone into equating Citizens of the United States with
citizens of the United States, courtesy of the so-called 14th
Amendment. There is a very big difference between the two
statuses.


                       Page 11 - 13 of 20

                                                The Federal Zone:


     Moreover, it is quite clear that one may be a State Citizen
without also being a "citizen of the United States", whether or
not the 14th Amendment was properly ratified! In a book to which
this writer has returned time and time again, author Alan Stang
faithfully cites the relevant court authorities as follows:

     Indeed, just as one may be a "citizen of the United States"
     and not a citizen of a State; so one apparently may be a
     citizen of a State but not of the United States. On July
     21, 1966, the Court of Appeal of Maryland ruled in Crosse v.
     Board of Supervisors of Elections, 221 A.2d 431; a headnote
     in which tells us: "Both before and after the Fourteenth
     Amendment to the federal Constitution, it has not been
     necessary for a person to be a citizen of the United States
     in order to be a citizen of his state ...." At page 434,
     Judge Oppenheimer cites a Wisconsin ruling in which the
     court said this: "Under our complex system of government,
     there may be a citizen of a state, who is not a citizen of
     the United States in the full sense of the term ...."

          [Tax Scam, 1988 edition, pages 138-139, emphasis added]


Conversely, there may be a citizen of the United States** who is
not a Citizen of any of the 50 States. In People vs De La Guerra
quoted above, the published decision of the California Supreme
Court clearly maintained this crucial distinction between the two
classes of citizenship, and did so only two years after the
alleged ratification of the so-called 14th Amendment:

     I have no doubt that those born in the Territories, or in
     the District of Columbia, are so far citizens as to entitle
     them to the protection guaranteed to citizens of the United
     States** in the Constitution, and to the shield of
     nationality abroad; but it is evident that they have not
     the political rights which are vested in citizens of the
     States. They are not constituents of any community in which
     is vested any sovereign power of government. Their position
     partakes more of the character of subjects than of citizens.
     They are subject to the laws of the United States**, but
     have no voice in its management. If they are allowed to
     make laws, the validity of these laws is derived from the
     sanction of a Government in which they are not represented.
     Mere citizenship they may have, but the political rights of
     citizens they cannot enjoy until they are organized into a
     State, and admitted into the Union.

                 [People vs De La Guerra, 40 Cal. 311, 342 (1870]
                                                 [emphasis added]

     In one of the brilliant text files on his electronic
bulletin board system (BBS), Richard McDonald utilized his
voluminous research into the so-called 14th Amendment when he
made the following pleading in opposition to a traffic citation:


                       Page 11 - 14 of 20

                                                      Sovereignty


     17. The Accused Common-Law Citizen [defendant] hereby
     places all parties and the court on NOTICE, that he is not a
     "citizen of the United States**" under the so-called 14th
     Amendment, a juristic person or a franchised person who can
     be compelled to perform to the regulatory Vehicle Codes
     which are civil in nature, and challenges the In Personam
     jurisdiction of the Court with this contrary conclusion of
     law. This Court is now mandated to seat on the law side of
     its capacity to hear evidence of the status of the Accused
     Citizen.
                   [see MEMOLAW.ZIP on McDonald's electronic BBS]
                           [see also FMEMOLAW.ZIP and Appendix Y]
                                                 [emphasis added]

     You might be wondering why someone would go to so much
trouble to oppose a traffic citation. Why not pay the fine and
get on with your life? The answer lies, once again, in the
fundamental law of our land, the Constitution for the United
States of America. Sovereigns have learned to assert their
rights, because rights belong to the belligerent claimant in
person. The Constitution is the last bastion of the Common Law
in our country. Were it not for the Constitution, the Common Law
would have been history a long time ago:

     There is, however, one clear exception to the statement that
     there is no national common law. The interpretation of the
     constitution of the United States is necessarily influenced
     by the fact that its provisions are framed in the language
     of the English common law, and are to be read in the light
     of its history.

        [United States vs Wong Kim Ark, 169 U.S. 891, 893 (1898)]
                                                 [emphasis added]

     Under the Common Law, we are endowed by our Creator with the
right to travel. "Driving", on the other hand, is defined in
State Vehicle Codes to mean the act of chauffeuring passengers
for hire. "Passengers" are those who pay a "driver" to be
chauffeured. Guests, on the other hand, are those who accompany
travelers without paying for the transportation. Driving, under
this definition, is a privilege for which a State can require a
license. Similarly, if you are a citizen of the United States**,
you are subject to its jurisdiction, and a State government can
prove that you are obligated thereby to obey all administrative
statutes and regulations to the letter of the law. These
regulations include, of course, the requirement that all subjects
apply and pay for licenses to use the State and federal highways,
even though the highways belong to the people. The land on which
they were built, and the materials and labor expended in their
construction, were all paid for with taxes obtained from the
people. Provided that you are not engaged in any "privileged" or
regulated activity, you are free to travel anywhere you wish
within the 50 States. Those States are parties to the
Constitution and are therefore bound by all its terms.


                       Page 11 - 15 of 20

                                                The Federal Zone:


     Another one of your Common Law rights is the right to own
property free and clear of any liens. ("Unalienable" rights are
rights against which no lien can be established precisely because
they are un-lien-able.) You enjoy the right to own your vehicle
outright, without any lawful requirement that you "register" it
with the State Department of Motor Vehicles. The State
governments violated your fundamental rights when they concealed
the legal "interest" which they obtained in your vehicle, by
making it appear as if you were required to register the vehicle
when you purchased it, as a condition of purchase. This is fraud.
If you don't believe me, then try to obtain the manufacturer's
statement of origin (MSO) the next time you buy a new car or
truck. The implications and ramifications of driving around
without a license, and/or without registration, are far beyond
the scope of this book. Suffice it to say that effective methods
have already been developed to deal with law enforcement officers
and courts, if and when you are pulled over and cited for driving
without a license or tags. Richard McDonald is second to none
when it comes to preparing a successful defense to the civil
charges that might result. A Sovereign is someone who enjoys
fundamental, Common Law rights, and owning property free and
clear is one of those fundamental rights.

     If you have a DOS-compatible personal computer and a 2400-
baud modem, Richard McDonald can provide you with instructions
for accessing his electronic bulletin board system (BBS). There
is a mountain of information, and some of his computer files were
rather large when he began his BBS. Users were complaining of
long transmission times to "download" text files over phone lines
from his BBS to their own personal computers. So, McDonald used
a fancy text "compression" program on all the text files
available on his BBS. As a consequence, BBS users must first
download a DOS program which "decompresses" the compressed files.
Once this program is running on your personal computer, you are
then free to download all other text files and to decompress them
at your end. For example, the compressed file "14AMREC.ZIP"
contains the documentation which proves that the so-called 14th
Amendment was never ratified. If you have any problems or
questions, Richard McDonald is a very patient and generous man.
And please tell him where you read about him and his computer
bulletin board (voice: 818-703-5037, BBS: 818-888-9882).

     As you peruse through McDonald's numerous court briefs and
other documents, you will encounter many gems to be remembered
and shared with your family, friends and associates. His work
has confirmed an attribute of sovereignty that is of paramount
importance. Sovereignty is never diminished in delegation.
Thus, as sovereign individuals, we do not diminish our
sovereignty in any way by delegating our powers to State
governments, to perform services which are difficult, if not
impossible for us to perform as individuals. Similarly, States
do not diminish their sovereignty by delegating powers to the
federal government, via the Constitution. As McDonald puts it,
powers delegated do not equate to powers surrendered:


                       Page 11 - 16 of 20

                                                      Sovereignty


     17. Under the Constitutions, "... we the People" did not
     surrender our individual sovereignty to either the State or
     Federal Government. Powers "delegated" do not equate to
     powers surrendered. This is a Republic, not a democracy,
     and the majority cannot impose its will upon the minority
     because the "LAW" is already set forth. Any individual can
     do anything he or she wishes to do so long as it does not
     damage, injure, or impair the same Right of another
     individual. This is where the concept of a corpus delicti
     comes from to prove a "crime" or a civil damage.

           [see MEMOLAW.ZIP on Richard McDonald's electronic BBS]
                           [see also FMEMOLAW.ZIP and Appendix Y]
                                                  [mphasis added]


     Indeed, to be a Citizen of the United States*** of America
is to be one of the Sovereign people, "a constituent member of
the sovereignty, synonymous with the people" [see 19 How. 404].
According to the 1870 edition of Bouvier's Law Dictionary, the
people are the fountain of sovereignty. It is extremely
revealing that there is no definition of "United States" as such
in this dictionary. However, there is an important discussion of
the "United States of America", where the delegation of
sovereignty clearly originates in the people and nowhere else:


     The great men who formed it did not undertake to solve a
     question that in its own nature is insoluble. Between
     equals it made neither superior, but trusted to the mutual
     forbearance of both parties. A larger confidence was placed
     in an enlightened public opinion as the final umpire. The
     people parcelled out the rights of sovereignty between the
     states and the United States**, and they have a natural
     right to determine what was given to one party and what to
     the other. ...


     It is a maxim consecrated in public law as well as common
     sense and the necessity of the case, that a sovereign is
     answerable for his acts only to his God and to his own
     conscience.

                   [Bouvier's Law Dictionary, 14th Edition, 1870]
                    [in definition of "United States of America"]
                                                 [emphasis added]

     We don't need to reach far back into another century to find
proof that the people of America are sovereign. In a Department
of Justice booklet revised on October 12, 1988 (M-76), the
meaning of American Citizenship was described with these eloquent
and moving words by the Commissioner of Immigration and
Naturalization:


                       Page 11 - 17 of 20

                                                The Federal Zone:


                  The Meaning of American Citizenship
             Commissioner of Immigration and Naturalization

          Today you have become a citizen of the United States of
     America. You are no longer an Englishman, a Frenchman, an
     Italian, a Pole. Neither are you a hyphenated-American -- a
     Polish-American, an Italian-American. You are no longer a
     subject of a government. Henceforth, you are an integral
     part of this Government -- a freeman -- a Citizen of the
     United States of America.

          This citizenship, which has been solemnly conferred on
     you, is a thing of the spirit -- not of the flesh. When you
     took the oath of allegiance to the Constitution of the
     United States you claimed for yourself the God-given
     unalienable rights which that sacred document sets forth as
     the natural right of all men.

          You have made sacrifices to reach this desired goal.
     We, your fellow citizens, realize this, and the warmth of
     our welcome to you is increased proportionately. However,
     we would tincture it with friendly caution.

          As you have learned during these years of preparation,
     this great honor carries with it the duty to work for and
     make secure this longed-for and eagerly-sought status.
     Government under our Constitution makes American citizenship
     the highest privilege and at the same time the greatest
     responsibility of any citizenship in the world.

          The important rights that are now yours and the duties
     and responsibilities attendant thereon are set forth
     elsewhere in this souvenir booklet. It is hoped that they
     will serve as a constant reminder that only by continuing to
     study and learn about your new Country, its ideals,
     achievements, and goals, and by everlastingly working at
     your citizenship can you enjoy its fruits and assure their
     preservation for generations to follow.

          May you find in this Nation the fulfillment of your
     dreams of peace and security, and may America, in turn,
     never find you wanting in your new and proud role of Citizen
     of the United States.

                        [A Welcome to U.S.A. Citizenship, page 3]
                                     [U.S. Department of Justice]
                         [Immigration and Naturalization Service]
                                                 [emphasis added]


                             # # #


                       Page 11 - 18 of 20

                                                      Sovereignty


Reader's Notes:


                       Page 11 - 19 of 20

                                                The Federal Zone:


Reader's Notes:


                       Page 11 - 20 of 20

                           Chapter 12:
                         Includes What?


     Now, we juxtapose the sublime next to the ridiculous. In a
previous chapter, the issues of statutory construction that arose
from the terms "includes" and "including" were so complex,
another chapter is required to revisit these terms in greater
detail. Much of the debate revolves around an apparent need to
adopt either an expansive or a restrictive meaning for these
terms, and to stay with this choice. The restrictive meaning
settles a host of problems. It confines the meaning of all
defined terms to the list of items which follow the words
"include", "includes" and "including". An official Treasury
Decision, T.D. 3980, and numerous court decisions have reportedly
sided with this restrictive school of ambiguous terminology. The
Informer provides a good illustration of this school of thought
by defining "includes" and "include" very simply as follows:


     ... [T]o use "includes" as defined in IRC is restrictive.

                                    [Which One Are You?, page 20]


     ... [I]n tax law it is defined as a word of restriction ....

                                   [Which One Are You?, page 131]


     In every definition that uses the word "include", only the
     words that follow are defining the Term.

                                    [Which One Are You?, page 13]


     Author Ralph Whittington cites Treasury Decision (T.D.) 3980
as his justification for joining the restrictive school.
According to his reading of this T.D., the Secretary of the
Treasury has adopted a restrictive meaning by stating that
"includes" means to "comprise as a member", to "confine", to
"comprise as the whole a part". This was the definition as found
in the New Standard Dictionary at the time this T.D. was
published:

     "(1) To comprise, comprehend, or embrace as a component
     part, item, or member; as, this volume includes all his
     works, the bill includes his last purchase."

     "(2) To enclose within; contain; confine; as, an oyster
     shell sometimes includes a pearl."

     It is defined by Webster as follows:
                                                  [continued ...]


                        Page 12 - 1 of 16

                                                The Federal Zone:


     "To comprehend or comprise, as a genus of the species, the
     whole a part, an argument or reason the inference; to take
     or reckon in; to contain; embrace; as this volume
     includes the essays to and including the tenth."

     The Century Dictionary defines "including," thus: "to
     comprise as a part."

                 [Treasury Decision 3980, January-December, 1927]
                               [Vol. 29, page 64, emphasis added]

     Authors like Whittington may have seized upon a partial
reading of this T.D., in order to solve what we now know to be a
source of great ambiguity in the IRC and in other United States
Codes. For example, contrary to the dictionary definitions cited
above, page 65 of T.D. 3980 goes on to say the following:

     Perhaps the most lucid statement the books afford on the
     subject is in Blanck et al. vs Pioneer Mining Co. et al.
     (Wash.; 159 Pac. 1077, 1079), namely, "the word 'including'
     is a term of enlargement and not a term of limitation, and
     necessarily implies that something is intended to be
     embraced in the permitted deductions beyond the general
     language which precedes. But granting that the word
     'including' is a term of enlargement, it is clear that it
     only performs that office by introducing the specific
     elements constituting the enlargement. It thus, and thus
     only, enlarges the otherwise more limited, preceding general
     language. * * * The word 'including' introduces an
     enlarging definition of the preceding general words, 'actual
     cost of the labor,' thus of necessity excluding the idea of
     a further enlargement than that furnished by the enlarging
     clause to introduced. When read in its immediate context,
     as on all authority it must be read, the word 'including' is
     obviously used in the sense of its synonymous 'comprising;
     comprehending; embracing.'"

                 [Treasury Decision 3980, January-December, 1927]
                               [Vol. 29, page 65, emphasis added]

Now, didn't that settle the matter once and for all? Yes? No?
Treasury Decision 3980 is really not all that decisive, since it
obviously joins the restrictive school on one page, and then
jumps ship to the expansive school on the very next page. If you
are getting confused already, that's good. At least when it
comes to "including", be proud of the fact you are not alone:

     This word has received considerable discussion in opinions
     of the courts. It has been productive of much controversy.

                 [Treasury Decision 3980, January-December, 1927]
                  [Vol. 29, page 64, paragraph 3, emphasis added]

Amen to that!


                        Page 12 - 2 of 16

                                                   Includes What?


     One of my goals in this chapter is to demonstrate how the
continuing controversy is proof that terms with a long history of
semantic confusion should never be used in a Congressional
statute. Such terms are proof that the statute is null and void
for vagueness. The confusion we experience is inherent in the
language, and no doubt deliberate, because the controversy has
not exactly been a well kept national security secret.

     Let us see if the Restrictive School leads to any absurd
results. Reductio ad absurdum to the rescue again! Notice what
results obtain for the definition of "State" as found in the
7701, the "Definitions" section of the Internal Revenue Code:


     Step 1: Define "State" as follows:

     The term "State" shall be construed to include the District
     of Columbia, where such constructionis necessary to carry
     out provisions of this title.
                                                [IRC 7701(a)(10)]


     Step 2: Define "United States" as follows:

     The term "United States" when used in a geographical sense
     includes only the States and the District of Columbia.

                                                 [IRC 7701(a)(9)]


     Step 3: Substitute text from one into the other:

     The term "United States" when used in a geographical sense
     includes only the Districts of Columbia and the District of
     Columbia. (Or is it the District of Columbias?)


     This is an absurd result, no? yes? none of the above? Is
the definition of "United States" clarified by qualifying it with
the phrase "when used in a geographical sense"? yes or no? This
qualifier only makes our situation worse, because the IRC rarely
if ever distinguishes Code sections which do use "United States"
in a geographical sense, from Code sections which do not use it
in a geographical sense. Nor does the Code tell us which sense
to use as the default, that is, the intended meaning we should
use when the Code does not say "in a geographical sense".
Identical problems arise if we must be specific as to "where such
construction is necessary to carry out provisions of this title",
as stated in 7701(a)(10). Where is it not so necessary?

     The Informer's work is a good example of the confusion that
reigns in this empire of verbiage. Having emphatically sided
with the Restrictive School, he then goes on to define the term
"States" to mean Guam, Virgin Islands and "Etc.", as follows:


                        Page 12 - 3 of 16

                                                The Federal Zone:


     The term "States" in 26 USC 7701(a)(9) is referring to the
     federal states of Guam, Virgin Islands, Etc., and NOT the 50
     States of the Union.
                                    [Which One Are You?, page 98]

     You can't have it both ways, can you? no? yes? maybe?
Let us marshall some help directly from the IRC itself. Against
the fierce winds of hot air emanating from the Restrictive School
of Language Arts, there is a section of the IRC which does appear
to evidence a contrary intent to utilize the expansive sense:

     Includes and Including. The terms "includes" and
     "including" when used in a definition contained in this
     title shall not be deemed to exclude other things otherwise
     within the meaning of the term defined.

                                    [IRC 7701(c), emphasis added]

Perhaps we should give this school a completely different name.
How about the Federal Area of Restrictive Terminology (F-A-R-T)?
All in favor, say AYE! (Confusion is a gaseous state.)

     Section 7701(c) utilizes the key phrase "other things",
which now requires us to examine the legal meaning of things.
(So, what else is new?) Black's Law Dictionary, Sixth Edition,
defines "things" as follows:

     Things. The objects of dominion or property as contra-
     distinguished from "persons." Gayer v. Whelan, 138 P.2d 763,
     768. ... Such permanent objects, not being persons, as are
     sensible, or perceptible through the senses.
                                                 [emphasis added]

This definition, in turn, requires us to examine the legal
meaning of "persons" in Black's, as follows:

     Person. In general usage, a human being (i.e. natural
     person), though by statute term may include labor
     organizations, partnerships, associations, corporations,
     legal representatives, trustees, trustees in bankruptcy, or
     receivers.

Here, Black's Law Dictionary states that "person" by statute may
include artificial persons, in addition to natural persons. How,
then, does the IRC define "person"?

     Person. -- The term "person" shall be construed to mean and
     include an individual, a trust, estate, partnership,
     association, company or corporation.
                                                 [IRC 7701(a)(1)]

Unfortunately, the IRC does not define the term "individual", so,
without resorting to the regulations in the CFR, we must again
utilize a law dictionary like Black's Sixth Edition:


                        Page 12 - 4 of 16

                                                   Includes What?


     Individual. As a noun, this term denotes a single person as
     distinguished from a group or class, and also, very
     commonly, a private or natural person as distinguished from
     a partnership, corporation, or association ....

                                                 [emphasis added]

Therefore, "things" and "persons" must be distinguished from each
other, but the term "person" is not limited to human beings
because it shall be construed to mean and include an individual,
trust, estate, partnership, association, company or corporation.
So, are we justified in making the inference that individuals,
trusts, estates, partnerships, associations, companies and
corporations are excluded from "things" as that term is used in
Section 7701(c)? This author says YES. Notice also the strained
grammar that is found in the phrase "shall be construed to mean
and include". Why not use the simpler grammar found in the
phrase "means and includes"? The answer: because the term
"includes" is defined by IRC 7701(c) to be expansive, that's why!
But the term "include" is not mentioned in 7701(c); therefore,
it must be restrictive and is actually used as such in the IRC.
Accordingly, no individual, trust, estate, partnership,
association, company or corporation could otherwise fall within
the statutory meaning of a term explicitly defined by the IRC
because, being "persons", none of these is a "thing"! Logically,
then, "includes" and "including" are also restrictive when they
are used in IRC definitions of "persons". Utterly amazing, yes?

     Author Otto Skinner, as we already know from a previous
chapter, cites Section 7701(c) of the IRC as proof that we all
belong in the Expansive School of Language Science. Followers of
this school argue that "includes only" should be used, and is
actually used in the IRC, when a restrictive meaning is intended.
In other words, "includes" and "including" are always expansive.
An intent contrary to the expansive sense is evidenced by using
"includes only" whenever necessary. Fine. All in favor say AYE.
All opposed, jump ship. The debate is finished yes? Not so fast.
Cheerleaders, put down your pom-poms. The operative concepts
introduced by 7701(c) are those "things otherwise within the
meaning of the term defined". Now, the 64 million dollar
question is this:


     How does something join the class of things that are "within
     the meaning of the term defined", if that something is not
     enumerated in the definition?


We can obtain some help in answering this question by referring
to an older clarification of "includes" and "including" that was
published in the Code of Federal Regulations in the year 1961.
This clarification introduces the notion of "same general class".
(So, you might be in the right school, but you may be in the
wrong class. Detention after school!) This clarification reads:


                        Page 12 - 5 of 16

                                                The Federal Zone:


     170.59 Includes and including.

     "Includes" and "including" shall not be deemed to exclude
     things other than those enumerated which are in the same
     general class.

                   [26 CFR 170.59, revised as of January 1, 1961]

     In an earlier chapter, a double negative was detected in the
"clarification" found at IRC 7701(c), namely, the terms "not ...
exclude" are equivalent to saying "include" ("not-ex" = "in").
Two negatives make a positive. Apply this same finding to
regulation 170.59 above, and you get the following:


     "Includes" and "including" shall be deemed to include things
     other than those enumerated which are in the same general
     class.


     What are those things which are "in the same general class",
if they have not been enumerated in the definition? This is one
of the many possible variations of the 64 million dollar question
asked above. Are we any closer to an answer? yes? no? maybe?
(Is this astronomy class, or basket weaving?) If a person, place
or thing is not enumerated in the statutory definition of a term,
is it not a violation of the rules of statutory construction to
join such a person, place or thing to that definition? One of
these rules is a canon called the "ejusdem generis" rule, defined
in Black's Law Dictionary, Sixth Edition, as follows:


     Under "ejusdem generis" canon of statutory construction,
     where general words follow the enumeration of particular
     classes of things, the general words will be construed as
     applying only to things of the same general class as those
     enumerated.
                                                 [emphasis added]

Here the term "same general class" is used once again. One of
the major points of this book is to distinguish the 50 States
from the federal zone, by using the principle of territorial
heterogeneity. The 50 States are in one class, because of the
constitutional restraints under which Congress must operate
inside those 50 States. The areas within the federal zone are in
a different class, because these same constitutional restraints
simply do not limit Congress inside that zone. This may sound
totally correct, in theory, but the IRC is totally mum on this
issue of "general class" (because it has none). Yes, this is all
the more reason why the IRC is null and void for vagueness.

     This conclusion is supported by two other rules of statutory
construction. The first of these is noscitur a sociis, in Latin.
Black's defines this rule as follows:


                        Page 12 - 6 of 16

                                                   Includes What?


     Noscitur a sociis. It is known from its associates. The
     meaning of a word is or may be known from the accompanying
     words. Under the doctrine of "noscitur a sociis", the
     meaning of questionable or doubtful words or phrases in a
     statute may be ascertained by reference to the meaning of
     other words or phrases associated with it.

                                                 [emphasis added]

In this context, the 50 States are associated with each other by
sharing their membership in the Union under the Constitution.
The land areas within the federal zone are associated with each
other by sharing their inclusion within the zone over which
Congress has exclusive legislative jurisdiction. The areas
inside and outside the zone are therefore dissociated from each
other because of this key difference, i.e., the Union, in or out.

     The second rule is inclusio unius est exclusio alterius, in
Latin. Black's defines this rule as follows:

     Inclusio unius est exclusio alterius. The inclusion of one
     is the exclusion of another. The certain designation of one
     person is an absolute exclusion of all others. ... This
     doctrine decrees that where law expressly describes [a]
     particular situation to which it shall apply, an irrefutable
     inference must be drawn that what is omitted or excluded was
     intended to be omitted or excluded.
                                                 [emphasis added]

Are we, or are we not, therefore, justified in drawing the
following irrefutable inferences?

     Places omitted from the statutory definitions of "State",
     "States" and "United States" were intended to be omitted
     (like California, Maine, Florida and Oregon).

     "Include" is omitted from the definition of "includes" and
     "including" because  the latter terms were intended to be
     expansive, while the former was intended to be restrictive.


Let's dive back into the Code in order to find any help we can
get on this issue. In Subtitle F, the Code contains a formal
definition of "other terms" as follows:


     Other terms. -- Any term used in this subtitle with respect
     to the application of, or in connection with, the provisions
     of any other subtitle of this title shall have the same
     meaning as in such provisions.
                                                [IRC 7701(a)(28)]

Let's use the rules of grammar to decompose this definition of
"other terms" into two separate definitions, as follows:


                        Page 12 - 7 of 16

                                                The Federal Zone:


     Any term used in Subtitle F with respect to the application
     of the provisions of any other subtitle shall have the same
     meaning as in such provisions.

     -or-

     Any term used in Subtitle F in connection with the
     provisions of any other subtitle shall have the same meaning
     as in such provisions.


Now, therefore, does IRC 7701(a)(28) clarify anything? For
example, if there is a different definition of "State" in the
provisions of some other subtitle, do we now know enough to
decide whether or not:


     (1) that different definition should be expanded with
          things that are within the meaning as defined at
          7701(a)(10)? Yes or No?

     (2) the definition at 7701(a)(10) should be expanded with
          things that are within the meaning of that different
          definition? Yes or No?

     (3) all of the above are correct?

     (4) none of the above is correct?


If you are having difficulty answering these questions, don't
blame yourself. With all this evidence staring you in the face,
it is not difficult to argue that the confusion which you are
experiencing is inherent in the statute and therefore deliberate.

     To confuse our separate cheering squads even more, the word
"shall" means "may". Squad leaders, let's see those pom-poms.
Since this may be most difficult for many of you to swallow
without convincing proof, the following court decisions leave no
doubt about the legal meaning of "shall". In the decision of
Cairo & Fulton R.R. Co. vs Hecht, 95 U.S. 170, the U.S. Supreme
Court stated:

     As against the government the word "shall" when used in
     statutes, is to be construed as "may," unless a contrary
     intention is manifest.
                                                 [emphasis added]

Does the IRC manifest a contrary intent? In the decision of
George Williams College vs Village of Williams Bay, 7 N.W.2d 891,
the Supreme Court of Wisconsin stated:

     "Shall" in a statute may be construed to mean "may" in order
     to avoid constitutional doubt.


                        Page 12 - 8 of 16

                                                   Includes What?


In the decision of Gow vs Consolidated Coppermines Corp., 165
Atlantic 136, that court stated:


     If necessary to avoid unconstitutionality of a statute,
     "shall" will be deemed equivalent to "may" ....


     Maybe we can shed some light on the overall situation by
treating the terms "State" and "States" as completely different
words. After all, the definition of "United States" uses the
plural form twice, and there is no definition of "States" as
such. Note carefully the following:


     The term "State" shall be construed to include the District
     of Columbia, where such construction is necessary to carry
     out provisions of this title.
                                                [IRC 7701(a)(10)]


     The term "United States" when used in a geographical sense
     includes only the States and the District of Columbia.

                                                 [IRC 7701(a)(9)]

     So, can we assume that the singular form of words
necessarily has a meaning that is different from the plural form
of words? This might help us to distinguish the two terms
"include" and "includes", since one is the singular form of the
verb, while the other can be the plural form of the verb. For
example, the sentence "It includes ..." has a singular subject
and a singular predicate. The sentence "They include ..." has a
plural subject and a plural predicate, but the sentence "I
include ..." has a singular subject and predicate. What if
"include" is used as an infinitive, rather than a predicate?
Recall that the "clarification" at IRC 7701(c) contains explicit
references to "includes" and "including", but not to the word
"include". Does this therefore provide us with a definitive
reason for deciding that the term "include" is restrictive, while
the terms "includes" and "including" are expansive? Some people,
including this author, are completely satisfied that it does (but
not all people are so satisfied). What if these latter terms are
used in the restrictive sense of "includes only" or "including
only"? Are you getting even more confused now? Welcome to the
state of confusion (surely a gaseous state). Recall once again
the definition of "State" at 7701(a)(10):


     The term "State" shall be construed to include the District
     of Columbia, where such construction is necessary to carry
     out provisions of this title.
                                                [IRC 7701(a)(10)]


                        Page 12 - 9 of 16

                                                The Federal Zone:


Now recall the definition of "United States" at 7701(a)(9):

     The term "United States" when used in a geographical sense
     includes only the States and the District of Columbia.

                                                 [IRC 7701(a)(9)]

Title 1 and the Code of Federal Regulations come to the rescue.
Plural forms and singular forms are interchangeable:

     170.60 Inclusive language.

     Words in the plural form shall include the singular and vice
     versa, and words in the masculine gender shall include the
     feminine as well as trusts, estates, partnerships,
     associations, companies, and corporations.

                   [26 CFR 170.60, revised as of January 1, 1961]

     Now, doesn't that really clarify everything? If "includes"
is singular and "include" is plural, using the above rule for
"inclusive language", the term "include" includes "includes".
Wait, didn't we already make this remarkable discovery in a
previous chapter? Answer: No, in that chapter, we discovered
that "includes" includes "include". But, now we have conflicting
results. Didn't we just prove that one is restrictive and the
other is expansive? What gives? Remember, also, that "shall"
means "may". Therefore, our rule for "inclusive language" from
the CFR can now be rewritten to say that "words in the plural
form MAY include the singular" (and may NOT, depending on whether
it is a week from Tuesday). If this is Tuesday, then we must be
in Belgium. At least one major mystery is now solved.

     Does the Code of Federal Regulations clarify any of the
definitions found in section 7701 of the Internal Revenue Code?
The following table lists the headings of corresponding sections
from the CFR, beginning at 26 CFR 301.7701-1:

                           Definitions

     301.7701-1 Classification of organizations for tax
                    purposes
     301.7701-2 Associations
     301.7701-3 Partnerships
     301.7701-4 Trusts
     301.7701-5 Domestic, foreign, resident, and nonresident
                    persons
     301.7701-6 Fiduciary
     301.7701-7 Fiduciary distinguished from agent
     301.7701-8 Military or naval forces and Armed Forces of
                    the United States
     301.7701-9 Secretary or his delegate
     301.7701-10 District director
     301.7701-11 Social security number


                       Page 12 - 10 of 16

                                                   Includes What?


                     Definitions (continued)

     301.7701-12 Employer identification number
     301.7701-13 Pre-1970 domestic building and loan
                    association
     301.7701-13A Post-1970 domestic building and loan
                    association
     301.7701-14 Cooperative bank
     301.7701-15 Income tax return preparer
     301.7701-16 Other terms
     301.7701-17T Collective-bargaining plans and agreements
                    (temporary)

                                [26 CFR 301.7701-1 thru 7701-17T]

This list contains such essential topics as trusts, associations,
cooperative banks, and pre- and post-1970 domestic building and
loan associations. In fact, there are numerous pages dedicated
to these building and loan associations. However, the reader
reaches the end of the list without finding any reference to
"State" or "United States". Instead, the following regulation is
found near the end of the list:

     301.7701-16 Other terms.

     For a definition of the term "withholding agent" see section
     1.1441-7(a). Any other terms that are defined in section
     7701 and that are not defined in sections 301.7701-1 to
     301.7701-15, inclusive, shall, when used in this chapter,
     have the meanings assigned to them in section 7701.

                                             [26 CFR 301.7701-16]

Like it or not, we are right back where we started, in IRC
Section 7701, the "definitions" section of that Code, where
"other terms" are defined differently. You may pass "GO" again,
but do not collect 200 dollars. You must pay the bank instead!
(Try changing that rule the next time you play Monopoly. The
Monopoly bank will, of course, end up owning everything in
sight.) You are also free to search some 6,000 pages of
additional regulations to determine if the fluctuating
definitions of the terms "State" and "United States" are
clarified anywhere else in the Code of Federal Regulations.
Happy hunting!

     The only way out of this swamp is to rely on something other
than the murky gyrations of conflicting, mutually destructive
semantic mishmash. That something is The Fundamental Law:
Congress can only tax the Citizens of foreign States under
special and limited circumstances. Congress can only levy a
direct tax on Citizens of the 50 States if that tax is duly
apportioned. Congress can only levy an indirect tax on Citizens
of the 50 States if that tax is uniform. These are the chains of
the Constitution. Read Thomas Jefferson.


                       Page 12 - 11 of 16

                                                The Federal Zone:


     The historical record documents undeniable proof that the
confusion, ambiguity and jurisdictional deceptions now built into
the IRC were deliberate. This historical record provides the
"smoking gun" that proves the real intentwas deception. The
first Internal Revenue Code was Title 35 of the Revised Statutes
of June 22, 1874. On December 5, 1898, Mr. Justice Cox of the
Supreme Court of the District of Columbia delivered an address
before the Columbia Historical Society. In this address, he
discussed the history of the District of Columbia as follows:

          In June 1866, an act was passed authorizing the
     President to appoint three commissioners to revise and bring
     together all the statutes .... [T]he act does not seem, in
     terms, to allude to the District of Columbia, or even to
     embrace it .... Without having any express authority to do
     so, they made a separate revision and collection of the acts
     of Congress relating to the District, besides the collection
     of general statutes relating to the whole United States.
     Each collection was reported to Congress, to be approved and
     enacted into law .... [T]he whole is enacted into law as
     the body of the statute law of the United States, under the
     title of Revised Statutes as of 22 June 1874. ...

          [T]he general collection might perhaps be considered,
     in a limited sense as a code for the United States, as it
     embraced all the laws affecting the whole United States
     within the constitutional legislative jurisdiction of
     Congress, but there could be no complete code for the entire
     United States, because the subjects which would be proper to
     be regulated by a code in the States are entirely outside
     the legislative authority of Congress.

                  [District of Columbia Code, Historical Section]
                                                 [emphasis added]

     More than half a century later, the deliberate confusion and
ambiguity were problems that not only persisted; they were
getting worse by the minute. In the year 1944, during Roosevelt's
administration, Senator Barkley made a speech from the floor of
the House of Representatives in which he complained:

     Congress is to blame for these complexities to the extent,
     and only to the extent, to which it has accepted the advice,
     the recommendations, and the language of the Treasury
     Department, through its so-called experts who have sat in on
     the passage of every tax measure since I can remember.
     Every member of the House Ways and Means Committee and
     member of the Senate Finance Committee knows that every time
     we have undertaken to write a new tax bill in the last 10
     years we have started out with the universal desire to
     simplify the tax laws and the forms through which taxes are
     collected. We have attempted to adopt policies which would

                                                  [continued ...]


                       Page 12 - 12 of 16

                                                   Includes What?


     simplify them. When we have agreed upon a policy, we have
     submitted that policy to the Treasury Department to write
     the appropriate language to carry out that policy; and
     frequently the Treasury Department, through its experts, has
     brought back language so complicated and circumambient that
     neither Solomon nor all the wise men of the East could
     understand it or interpret it.

               [Congressional Record, 78th Congress, 2nd Session]
               [Vol. 90, Part 2, February 23, 1944, pages 1964-5]
                                                 [emphasis added]

     You have, no doubt, heard that ignorance of the law is no
excuse for violating the law. This principle is explicitly
stated in the case law which defines the legal force and effect
of administrative regulations. But, ambiguity and deception in
the law are an excuse, and the ambiguity in the IRC is a major
cause of our ignorance. Moreover, this principle applies as well
to ambiguity and deception in the case law. Lack of specificity
leads to uncertainty, which leads in turn to court decisions
which are also void for vagueness. The 6th Amendment guarantees
our right to ignore vague and ambiguous laws, and this must be
extended to vague and ambiguous case law. In light of their
enormous influence in laying the foundations for territorial
heterogeneity and a legislative democracy for the federal zone,
The Insular Cases have been justly criticized, by peers, for
lacking the minimum judicial precision required in such cases:


          The Absence of Judicial Precision. -- Whether the
     decisions in the Insular Cases are considered correct or
     incorrect, it seems generally admitted that the opinions
     rendered are deficient in clearness and in precision,
     elements most essential in cases of such importance.
     Elaborate discussions and irreconcilable differences upon
     general principles, and upon fascinating and fundamental
     problems suggested by equally indiscriminating dicta in
     other cases, complicate, where they do not hide, the points
     at issue. It is extremely difficult to determine exactly
     what has been decided; the position of the court in similar
     cases arising in the future, or still pending, is entirely a
      matter of conjecture. ...

          It is still more to be regretted that the defects in
     the decision under discussion are by no means exceptional.
     From our system of allowing judges to express opinion upon
     general principles and of following judicial precedent, two
     evils almost inevitably result: our books are overcrowded
     with dicta, while dictum is frequently taken for decision.
     Since the questions involved are both fundamental and
     political, in constitutional cases more than in any others
     the temptation to digress, necessarily strong, is seldom

                                                  [continued ...]


                       Page 12 - 13 of 16

                                                The Federal Zone:


     resisted; at the same time it is strikingly difficult, in
     these cases, to distinguish between decision, ratio
     decidendi, and dictum. Yet because the questions involved
     are both extensive and political, and because the evils of a
     dictum or of an ill-considered decision are of corresponding
     importance, a precise analysis, with a thorough
     consideration of the questions raised, and of those
     questions only, is imperative. The continued absence of
     judicial precision may possibly become a matter of political
     importance; for opinions such as those rendered cannot be
     allowed a permanent place in our system of government.

                                      [15 Harvard Law Review 220]
                                                      [anonymous]

     The average American cannot be expected to have the skill
required to navigate the journey we just took through the verbal
swamp that is the Internal Revenue Code, nor does the average
American have the time required to make such a journey.
Chicanery does not make good law. The rules of statutory
construction fully support this unavoidable conclusion:

     ... [I]f it is intended that regulations will be of a
     specific and definitive nature then it will be clear that
     the only safe method of interpretation will be one that
     "shall suppress the mischief, and advance the remedy, and to
     suppress subtle inventions and evasions for the continuance
     of the mischief ...."

       [Statutes and Statutory Construction, by J. G. Sutherland]
           [3rd Edition, Volume 2, Section 4007, page 280 (1943)]

The Supreme Court has also agreed, in no uncertain terms, as
follows:

     ... [K]eeping 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.

                         [Spreckels Sugar Refining Co. vs McLain]
                            [192 U.S. 397 (1903), emphasis added]

     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.

                     [United States vs Wigglesworth, 2 Story 369]
                                                 [emphasis added]


                       Page 12 - 14 of 16

                                                   Includes What?


     On what basis, then, should the Internal Revenue Service be
allowed to extend the provisions of the IRC beyond the clear
import of the language used? On what basis can the IRS act when
that language has no clear import? On what basis is the IRS
justified in enlarging their operations so as to embrace matters
not specifically pointed out? The answer is tyranny. The
"golden" retriever has broken his leash and is now tearing up the
neighborhood to fetch the gold. What a service!

     Consider for a moment the sheer size of the class of people
now affected by the fraudulent 16th Amendment. First of all,
take into account all those Americans who have passed away, but
who paid taxes into the Treasury after the year 1913. How many
of those correctly understood all the rules, when people like
Frank R. Brushaber were confused as early as 1914? Add to that
number all those Americans who are still alive today and who have
paid taxes to the IRS because they thought there was a law, and
they thought that law was the 16th Amendment. After all, they
were told as much by numerous federal officials and possibly also
their parents, friends, relatives, school teachers, scout masters
and colleagues. Don't high school civics classes now spend a lot
of time teaching students how to complete IRS 1040 forms and
schedules, instead of teaching the Constitution?

     Donald C. Alexander, when he was Commissioner of Internal
Revenue, published an official statement in the Federal Register
that the 16th Amendment was the federal government's general
authority to tax the incomes of individuals and corporations (see
Chapter 1 and Appendix J). Sorry, Donald, you were wrong. At
this point in time, it is impossible for us to determine whether
you were lying, or whether you too were a victim of the fraud.
Just how many people are in the same general class of those
affected by the fraudulent 16th Amendment? Is it 200 million?
Is it 300 million? Whatever it is, it just boggles the
imagination. It certainly does involve a very large number of
federal employees who went to work for Uncle Sam in good faith.

     It is clear, there is a huge difference between the area
covered by the federal zone, and the area covered by the 50
States. Money is a powerful motivation for all of us. Congress
had literally trillions of dollars to gain by convincing most
Americans they were inside its revenue base when, in fact, most
Americans were outside its revenue base, and remain outside even
today. This is deception on a grand scale, and the proof of this
deception is found in the statute itself. It is no wonder why
public relations "officials" of the IRS cringe in fear when
dedicated Patriots like Godfrey Lehman admit, out loud and in
person, that he has read the law. It is quite stunning how the
carefully crafted definitions of "United States" do appear to
unlock a statute that is horribly complex and deliberately so.
As fate would have it, these carefully crafted definitions also
expose perhaps the greatest fiscal fraud that has ever been
perpetrated upon any people at any time in the history of the
world. It is now time for a shift in the wind.


                       Page 12 - 15 of 16

                                                The Federal Zone:


Reader's Notes:


                       Page 12 - 16 of 16

                           Chapter 13:
                    Amendment 16 Post Mortem


     The documented failure of the 16th Amendment to be ratified
is a cause for motivating all of us to isolate the precise
effects of this failed ratification. In previous chapters, a
careful analysis of the relevant case law revealed two competing
groups of decisions. One group puts income taxes in the category
of direct taxes. Another group puts them in the category of
indirect taxes. One group argues that the 16th Amendment did
amend the Constitution by authorizing an unapportioned direct
tax, but only on income, leaving the apportionment rule intact
for all other direct taxes. Another group argues that the 16th
Amendment did not really amend the Constitution; it merely
clarified the taxing power of Congress by overturning the
"principle" on which the Pollock case was decided. By distilling
the cores of these two competing groups, we are thereby justified
in deciding that a ratified 16th Amendment produced one or both
of the following two effects:


     1. Inside the 50 States, it removed the apportionment
          restriction from taxes laid on income, but it left this
          restriction in place for all other direct taxes.

     2. It overturned the principle advanced in the Pollock
          case which held that a tax on income is, in legal
          effect, a tax on the source of the income.


     Federal courts did not hesitate to identify the effects of a
ratified 16th Amendment. Now that the evidence against its
ratification is so overwhelming and incontrovertible, the federal
courts are evidently unwilling to identify the effects of the
failed ratification. These courts have opted to call it a
"political" question, even though it wasn't a "political"
question in years immediately after Philander C. Knox declared it
ratified. It is difficult to believe that the federal courts are
now incapable of exercising the logic required to isolate the
legal effects of the failed ratification. Quite simply, if a
ratified 16th Amendment had effect X, then a failed ratification
proves that X did not happen. What is X? Their "political"
unwillingness to exercise basic logic means that the federal
courts have abdicated their main responsibility -- to uphold and
defend the Constitution -- and that we must now do it for them
instead (see Appendix W concerning "Direct Taxation and the 1990
Census"). At a minimum, the value of X is one or both of the two
effects itemized above.

     Some people continue to argue, even now, that the 16th
Amendment doesn't even matter at all. Soon after The Federal
Zone began to circulate among readers throughout America, the
flow of complimentary letters grew to become a steady phenomenon.


                        Page 13 - 1 of 8

                                                The Federal Zone:


As of this writing, no substantive criticisms have been received
of its two major theses, i.e., territorial heterogeneity and void
for vagueness. Occasional criticisms did occur, but most of them
were minor, lacking in substance, or lacking authority in law.
The following is exemplary of the most serious of these
criticisms:


     I fail to understand the harping on the invalid ratification
     of the 16th Amendment. It really doesn't matter whether the
     amendment was ratified or not -- Brushaber ruled "no new
     powers, no new subjects", and further went on to tell us
     that Congress always had the power to tax what the 16th
     Amendment said could be taxed.

                            [private communication, June 1, 1992]


     It does matter whether the amendment was ratified or not,
for several reasons. One obvious reason is that the Federal
Register contains at least one official statement that the 16th
Amendment is the federal government's general authority to tax
the incomes of individuals and corporations (see Chapter 1 and
Appendix J). If the amendment failed, then it cannot be the
government's general authority to tax the incomes of individuals
and corporations. There may be some other authority, but that
authority is definitely not the 16th Amendment. The official
statement in the Federal Register is further evidence of fraud
and misrepresentation, even if its author was totally innocent.

     Another reason is that, contrary to Brushaber, other
decisions of the Supreme Court, as well as lower federal courts,
have ruled that taxes on incomes are direct taxes, and the 16th
Amendment authorized an unapportioned direct tax on incomes.
Author Jeffrey Dickstein has done a very thorough job of
demonstrating how the Brushaber ruling stands in stark contrast
to the Pollock case before it, and to the Eisner case after it.
The Brushaber decision is an anomaly for this reason, and for
this reason alone. It ruled that income taxes are indirect
excise taxes (which necessarily must be uniform across the States
of the Union). However, the Brushaber court failed even to
mention "The Insular Cases" and the doctrine of territorial
heterogeneity that issued therefrom (see Appendix W).

     If the 16th Amendment authorized an unapportioned direct tax
on incomes, per Eisner, Peck, Shaffer and Richardson, then such a
tax is not required to be either uniform or apportioned.
Therefore, this group of decisions did interpret the 16th
Amendment differently from Brushaber; they conclude that it did
amend the Constitution and that it did create a new power,
namely, the power to impose an unapportioned direct tax.
Contrary to the private communication quoted above, Congress has
not always had the power to impose an unapportioned direct tax on
the States of the Union. In view of the evidence which now


                        Page 13 - 2 of 8

                                            Amendment Post Mortem


proves that the 16th Amendment was never ratified, it is correct
to say that Congress has never had the power to impose an
unapportioned direct tax on the States of the Union. The Pollock
decision now becomes a major hurdle standing in the government's
way, because the Pollock Court clearly found that all taxes on
income are direct taxes, and all direct taxes levied inside the
50 States must be apportioned. The Pollock decision is most
relevant to any direct tax which Congress might levy against the
incomes and property of State Citizens, as distinct from citizens
of the United States**. (Each has citizens of its own.)

     Put in the simplest of language, a ratified 16th Amendment
either changed the Constitution, or it did not change the
Constitution. If it changed the Constitution, one change that
did occur was to authorize an unapportioned direct tax on the
incomes of State Citizens. If it did not change the
Constitution, the apportionment restriction has always been
operative within the 50 States, even now. Either way, the failed
ratification proves that Congress must still apportion all direct
taxes which it levies upon the incomes and property of Citizens
of the 50 States.

     Corporations, on the other hand, are statutory creations,
whether they are domestic or foreign. As such, they enjoy the
privilege of limited liability. Congress is free to levy taxes
on the exercise of this privilege and to call them indirect
excises. Within the 50 States, such an excise must be uniform
for it to be constitutional; within the federal zone, such an
excise need not be uniform. In the context of statutory
privileges, the apportionment rule is completely irrelevant.
Therefore, the status of "United States** citizens" is also a
statutory privilege the exercise of which can be taxed with
indirect excises, regardless of where that privilege might be
exercised. The subject of such indirect taxes is the exercise of
a statutory privilege; the measure of such taxes is the amount
of income derived from exercising that privilege.

     Justice White did all of us a great disservice by writing a
ruling that is tortuously convoluted, in grammar and in logic.
If he had taken The Insular Cases explicitly into account, and if
he had distinguished Frank Brushaber's situs from the situs of
Brushaber's defendant, the principle of territorial heterogeneity
would have clarified the decision enormously. Specifically,
according to the doctrine established by Downes vs Bidwell in
1901, Congress is not required to apportion direct taxes within
the federal zone, nor is Congress required to levy uniform excise
taxes within the federal zone. However, within the 50 States of
the Union, all direct taxes must still be apportioned, and all
indirect excise taxes must still be uniform. Now that we know
the 16th Amendment never became law, these restrictions still
apply to any tax which Congress levies inside the 50 States.
Quite naturally, a problem arises when one party is inside the
federal zone, and the other party is outside the federal zone.
That was the case in Brushaber.


                        Page 13 - 3 of 8

                                                The Federal Zone:


     The Downes doctrine defined the "exclusive" authority of
1:8:17 in the Constitution to mean that Congress was not subject
to the uniformity restriction on excise taxes levied inside the
federal zone. By necessary implication, Congress is not subject
to the apportionment restriction on direct taxes levied inside
the federal zone. It is important to realize that the Union
Pacific Railroad Company was a domestic corporation, incorporated
by Congress, inside the federal zone. A tax on such a
corporation was a tax levied within the federal zone, where the
apportionment and uniformity restrictions simply did not exist.

     Instead of making this important territorial distinction,
Justice White launched into an exercise of questionable logic,
attributing statements to the Pollock court which the Pollock
court did not make, adding words to the 16th Amendment that were
not there, hoping his logic would persuade the rest of us that
the Pollock principle was now overturned. According to White,
the principle established in Pollock was that a tax on income was
a tax on the source of that income. In this context, White is
distinguishing income from source, in the same way that interest
is distinguished from principal. This same distinction was made
by a federal Circuit court in the Richardson case as late as the
year 1961. In light of the overriding importance of the Downes
doctrine, it is difficult and unnecessary to elevate the
importance of this distinction any higher; it is also important
to keep it in proper perspective. Within the federal zone,
Congress can tax interest and principal (income and source)
without any regard for apportionment or uniformity. Therefore,
within the federal zone, the distinction is academic.

     Whatever the merits of this distinction between income and
source, White was wrong to ignore the key Pollock holding that
income taxes are direct taxes. The Pollock decision investigated
the relevant history of direct taxes in depth. White was also
wrong to ignore the clear legislative history of the 16th
Amendment, the stated purpose of which was to eliminate the
apportionment  restriction which caused the Pollock court to
overturn an income tax Act in the first place. That Act was
found to be unconstitutional precisely because it levied a direct
tax on incomes without apportionment. Finally, White was wrong
to launch into his lengthy discussion of the 16th Amendment
without even mentioning The Insular Cases, when these cases were
recent authority for the proposition that Congress did not need
an amendment to impose taxes without apportionment or uniformity
inside the federal zone. This may be hindsight, but hindsight is
always 20/20.

     The relevance of the 16th Amendment to the tax on Frank
Brushaber's dividend is another matter. Two schools of thought
have emerged, with opposing views of that relevance. One school
relies heavily on the key precedents established by Pollock.
Specifically, the original investment is the "source" of
Brushaber's income. A tax on the source is a direct tax.
Pollock found that a tax on income is a tax on the source.


                        Page 13 - 4 of 8

                                            Amendment Post Mortem


Therefore, a tax on income is a direct tax. Without a ratified
16th Amendment, such a tax must be apportioned whenever it is
levied inside the 50 States. With a ratified 16th Amendment,
such a tax need not be apportioned whenever it is levied inside
the 50 States. This school argues that Brushaber's dividend was
taxable because the 16th Amendment removed the apportionment
requirement on such a tax. But, is the tax really levied "inside
the 50 States", if the activity which produced the income was
actually inside the federal zone? The importance of the Pollock
principle now comes to the fore.

     The competing school argues that a ratified 16th Amendment
was not strictly necessary for Congress to impose a direct tax on
Brushaber's dividend without apportionment. Granted, he was a
State Citizen who lived and worked within one of the States of
the Union. For this reason, the government found that he was a
"nonresident alien" under their own rules. If White's ruling did
anything else, it held that Brushaber's dividend was also taxable
without apportionment and without uniformity because its "source"
was inside the federal zone, and that "source" was a taxable
activity (profit generation by a domestic corporation). In this
context, it does make sense to jettison the Pollock "principle"
and to distinguish interest from principal, dividend from
original stock investment. Having done so, Justice White could
argue that the "source" of Brushaber's dividend was domestic
corporate activity and not Brushaber's original investment.
Unfortunately for all of us, however, Brushaber did not challenge
the constitutionality of the income tax as applied to his
dividend, so this question was not properly before the Supreme
Court; Brushaber did challenge the constitutionality of the
income tax as applied to his defendant.

     Unfortunately for Mr. Brushaber, he thought that the
defendant was a foreign corporation. The government was correct
to point out that the defendant was actually a domestic
corporation, chartered by Congress. As such, this corporation's
profits could be taxed by Congress without apportionment or
uniformity, and without an amendment authorizing such a tax. For
the same reasons, Brushaber's share of those same profits could
also be taxed without constitutional restrictions, and without an
amendment authorizing such a tax, even though he was outside the
federal zone and inside a State of the Union. In this context,
it is revealing that the Internal Revenue Code imposes a uniform
"flat tax" when such income is received by nonresident aliens,
giving it the appearance of a uniform indirect tax. However,
this "uniformity" is not the consequence of a constitutional
requirement; it is the consequence of decisions by Congress
acting in its capacity as a majority-ruled legislative democracy.

     Moreover, under the authority of the Downes doctrine,
Congress is empowered to define domestic corporate profits as
"profits before dividends are paid", and to penalize all domestic
corporations which attempt to avoid federal taxes by defining
their profits as "profits after dividends are paid." Within the


                        Page 13 - 5 of 8

                                                The Federal Zone:


federal zone, Congress has the power to assert a superior claim
to all profits of domestic corporations, and to define those
profits any way it chooses. By "superior claim" I mean that
Congress comes before stockholders inside the federal zone, even
if the stockholders are outside the federal zone, and even if the
money they used to purchase their stock came from a source that
was outside the federal zone. A ratified 16th Amendment would
have had no effect whatsoever on the power of Congress to levy a
tax without any restrictions on any of the assets of domestic
corporations. A ratified 16th Amendment would have empowered
Congress to tax, without apportionment, dividends paid to State
Citizens by foreign corporations when both were inside the 50
States, but a ratified 16th Amendment was not strictly necessary
for Congress to tax dividends paid to them by domestic
corporations. Neither was a ratified 16th Amendment necessary
for Congress to tax dividends paid by either type of corporation
to citizens of other nations like France, since the latter
citizens enjoy none of the protections guaranteed by the
Constitution for the United States of America. In this context,
it is important to make a careful distinction between dividends
and corporate profits.

     It is clear that the second of these two competing schools
of thought has now prevailed. Even though there are serious
logical and obvious grammatical problems with Justice White's
ruling, in retrospect he was right to question the Pollock
principle. The situs principle is easier to understand, if only
because it dovetails so squarely with the overriding principles
of territorial jurisdiction and territorial heterogeneity.
Moreover, it is entirely possible for the Pollock principle to
yield to the situs principle, even though the 16th Amendment was
never actually ratified. Remember that Justice White ruled in
Brushaber that the only effect of the 16th Amendment was to
overturn the Pollock principle. If the amendment failed, it
could thereby be argued that the Pollock principle has never been
overturned. Nevertheless, subsequent case law has confirmed the
superiority of the situs principle: the source of income is the
situs of the income-producing activity. Sources are either
inside or outside the federal zone.

     Finally, like "income", the term "source" is not in the
Constitution either, because the amendment failed to be ratified.
Recall the Eisner prohibition, whereby Congress was told it did
not have the power to define "income" by any definition it might
adopt (see Appendix J). That prohibition was predicated on a
ratified 16th Amendment, the text of which introduced the term
"income" to the Constitution for the first time. Although the
issue did not arise as such and there is no court precedent per
se, the exact same logic applies to the term "source". The
failed ratification means that Congress is now free to legislate
any definition it might adopt for the terms "income" and
"source", as long as the statutes containing those terms do not
otherwise violate the Constitution as lawfully amended. The
source of income is the situs of the income-producing activity.


                        Page 13 - 6 of 8

                                            Amendment Post Mortem


     The explicit recognition of territorial jurisdiction, and of
the status of the parties with respect to that territorial
jurisdiction, provides much additional clarification to the
Brushaber ruling. Such a clarification was definitely needed
because the almost incomprehensible grammar of the Brushaber
ruling is actually responsible for much of the confusion and
controversy that continue to persist in this field, even today.
As Alan Stang puts it, Justice White turned himself into a
pretzel, and lots of other people got twisted up in the process.
A clear understanding of status and jurisdiction, and a proper
application of the principle of territorial heterogeneity,
together provide an elegant and sophisticated means to eliminate
much, if not all, of that confusion and controversy.


                             # # #


                        Page 13 - 7 of 8

                                                The Federal Zone:


Reader's Notes:


                        Page 13 - 8 of 8


                           Appendix A

                      Letter to John Knox:
                           1929 - 1992


                              -and-


                 Memorandum of Law by John Knox:

                 edited in honor of his passing

                       by Mitch Modeleski


                        Page A - 1 of 26

                                                The Federal Zone:


Reader's Notes:


                        Page A - 2 of 26

                                                       Appendix A


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   September 23, 1991
Mr. John Knox, Director
Texas Hill County Patriots
Kerrville, Texas Republic
Postal Code 78028/TDC

Dear John:

I am writing to thank you for the time you spent explaining to me
your in-depth understanding of federal jurisdiction at the recent
Denver Conference on tax and monetary reform.

By listening to you and Walt Myers debate the question in the
hotel lobby, I came to believe that you have done a great deal of
good research, John. I was very rewarded by my decision to stay
and pick your brains after Walt walked away.

I am also writing this letter to remind you of your offer to send
me copies of the legal briefs you mentioned during our conversa-
tion. Enclosed are 20 FRN's to this end.

I am slowly collecting substantive papers on the questions of
federal jurisdiction, the definitions of "United States", their
implications for Congressional taxing powers and statutes, and
their implications for the American economy in general.

It is most intriguing, for example, that Alaska became a State
when it was admitted to the Union, and yet the United States
Codes had to be changed because Alaska was defined in those Codes
as a "state" before admission to the Union, but not afterwards.
This apparent anomaly is perfectly clear once the legal and
deliberately misleading definition of "state" is understood.

Even though my own research has only scratched the surface of
this question, I now have ample reasons to believe that the
fluctuating definitions of "United States" in Title 26 are
likewise intentional and may constitute the essential core of a
system of deliberate legal deception that was fastened upon our
entire nation by the year 1913.

Notably, Mr. Brushaber was identified in his court documents as a
New York Citizen. The Union Pacific Railroad Company was
incorporated by Congress. Accordingly, Brushaber was a State
Citizen identified as a nonresident alien and taxed upon unearned
income that derived from a domestic corporation. He was alien to
the jurisdiction of the corporate United States, and nonresident
within that jurisdiction because he resided within New York
State. He derived income from a domestic corporation, because
the Union Pacific Railroad Company was incorporated by Congress,
i.e., in the District of Columbia.


                        Page A - 3 of 26

                                                The Federal Zone:


If the Union Pacific Railroad Company had not been incorporated
by Congress, it would have been a foreign corporation (i.e.,
foreign to the federal, corporate United States). If Brushaber
had resided in the District of Columbia or in some other federal
enclave or possession under exclusive jurisdiction of Congress,
he would have been a resident alien. If he had been born inside
this exclusive jurisdiction, or if he had been naturalized, he
would have been a United States citizen, not an alien, regardless
of where he resided. Note that I have been careful to
distinguish a "United States citizen" from a "Citizen of the
United States"; the former is a person under the jurisdiction of
Congress, while the latter is not.

It is quite stunning how the carefully crafted definitions of
"United States" do appear to unlock a horribly complex statute,
and also expose perhaps the greatest fiscal fraud that has ever
been perpetrated upon any people at any time in the history of
the world.

I will anxiously look forward to receiving the legal papers which
we discussed in Denver.

Thanks very much, John, for your significant contributions to our
important and difficult search for the truth in this matter.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


copies: interested colleagues


                        Page A - 4 of 26

                                                       Appendix A


John H. Knox
In Propria Persona
c/o 111 Stephanie Street
Kerrville, Texas Republic
Postal Code 78028/tdc


                UNITED STATES DISTRICT COURT FOR

                  THE WESTERN DISTRICT OF TEXAS

                       SAN ANTONIO, TEXAS


JOHN H. KNOX and LOIS C. KNOX )
                               )
                 Plaintiffs, )
                               ) Case No. SA-89-CA-1308
vs. ) (Consolidated with
                               ) SA-89-CA-0761)
THE UNITED STATES, )
HERMAN SILGUERO and )
DOROTHY SILGUERO, )
                               )
                 Defendants )


                MEMORANDUM IN SUPPORT OF REQUEST

          FOR THE DISTRICT COURT TO CONSIDER THE T.R.O.

             AND INJUNCTION DENIED BY THE MAGISTRATE


     Plaintiffs in the above entitled action are NONRESIDENT
ALIENS with respect to the "United States" as those terms are
defined in 26 U.S.C., and have had no income effectively
connected to a trade or business within the "United States".
They COME NOW to file this their Memorandum in Support of a
Request for the District Court to Consider the Temporary
Restraining Order and the Motion for Injunction and, in support,
to show the Court as follows:

     1. The issues as to whether there are different meanings
for the term "United States", and whether there are three
different "United States" operating within the same geographical
area, and one "United States" operating outside the Constitution
over its own territory (in which it has citizens belonging to
said "United States"), were settled in 1901 by the Supreme Court
in the cases of De Lima vs Bidwell, 182 U.S. 1 and Downes vs
Bidwell, 182 U.S. 244. In Downes supra, Justice Harlan  dissented
as follows:


                        Page A - 5 of 26

                                                The Federal Zone:


     The idea prevails with some -- indeed, it found expression
     in arguments at the bar -- that we have in this country
     substantially or practically two national governments; one,
     to be maintained under the Constitution, with all its
     restrictions; the other to be maintained by Congress
     outside and independently of that instrument, by exercising
     such powers as other nations of the earth are accustomed to
     exercise.
                         [Downes supra, page 380, emphasis added]

He went on to say, on page 382:

     It will be an evil day for American liberty if the theory of
     a government outside of the supreme law of the land finds
     lodgment in our constitutional jurisprudence. No higher
     duty rests upon this court than to exert its full authority
     to prevent all violation of the principles of the
     Constitution.
                         [Downes supra, page 382, emphasis added]

     2. This theory of a government operating outside the
Constitution over its own territory, with citizens of the "United
States" belonging thereto under Article 4, Section 3, Clause 2
(4:3:2) of the Constitution, was further confirmed in 1922 by the
Supreme Court in Balzac vs Porto Rico, 258 U.S. 298 (EXHIBIT #4),
wherein that Court affirmed, at page 305, that the Constitution
does not apply outside the limits of the 50 States of the Union,
quoting Downes supra and De Lima supra; that, under 4:3:2, the
"United States" was given exclusive power over the territories
and the citizens of the "United States" residing therein.

     3. The issue arose again in 1944, in the case of Hooven &
Allison Co. vs Evatt, Tax Commissioner of Ohio, 324 U.S. 652,
wherein the U.S. Supreme Court stated as follows at page 671-672
(EXHIBIT #8):

     The term "United States" may be used in any one of several
     senses. [1] It may be merely the name of a sovereign
     occupying the position analogous to that of other sovereigns
     in the family of nations. [2] It may designate the
     territory over which the sovereignty of the United States
     extends, [3] or it may be the collective name of the
     states which are united by and under the Constitution.1

                           [brackets, numbers and emphasis added]


____________________
1. See Langdell, "The Status of our New Territories," 12
     Harvard Law Review 365, 371; see also Thayer, "Our New
     Possessions," 12 Harvard Law Review 464; Thayer, "The
     Insular Tariff Cases in the Supreme Court," 15 Harvard Law
     Review 164; Littlefield, "The Insular Cases," 15 Harvard
     Law Review 169, 281.


                        Page A - 6 of 26

                                                       Appendix A


Quoting Fourteen Diamond Rings vs United States, 183 U.S. 176;
cf. De Lima vs Bidwell, 182 U.S. 1; Dooley vs United States, 182
U.S. 222; Faber vs United States, 221 U.S. 649; cf. Huus vs New
York & P.R.S.S. Co., 182 U.S. 392; Gonzales vs Williams, 192
U.S. 1; West India Oil Co. vs Domenech, 311 U.S. 20.

The Court, in Hooven supra, indicated that this was the last time
it would address the issue; it would just be judicially noticed.


     4. The issue arose in Brushaber vs Union Pacific Railroad
Company, 240 U.S. 1. In that case, the high Court affirmed that
the "United States" could levy a tax on the income of a
nonresident alien when that income derived from sources WITHIN
the "United States" (i.e. its territorial jurisdiction).


     5. Based upon the decision in Brushaber supra, the
Commissioner of Internal Revenue, with the approval of the
Secretary of the Treasury, promulgated the Court's decision as
Treasury Decision 2313 (see EXHIBIT #1). T.D. 2313 declared that
Frank R. Brushaber was a NONRESIDENT ALIEN with respect to the
"United States". T.D. 2313 also declared that the Union Pacific
Railroad Company was a DOMESTIC CORPORATION with respect to the
"United States" (i.e. its territorial jurisdiction).


     6. The Complaint (EXHIBIT #2) filed by Mr. Brushaber shows
that he was a nonresident of the "United States", residing
instead in the State of New York, in the borough of Brooklyn, and
a Citizen thereof, with his principal place of business in the
borough of Manhattan. He owned stocks and bonds issued by the
Union Pacific Railroad Company, upon which a cash dividend was
declared to him by said company, a domestic corporation of the
"United States". Union Pacific was chartered by an Act of
Congress for the territory of the federal state of Utah, in order
to build a railroad and telegraph line and other purposes. It is
a matter of public record that the Union Pacific Railroad Company
was a domestic "United States" corporation, of the federal state
of Utah, residing in the District of Columbia, with its principal
place of business in Manhattan, New York. It was created by an
Act of the "United States" Senate and House of Representatives
(under their exclusive authority, granted by the Constitution for
the United States at 1:8:17) on July 1, 1862 by the 37th
Congress, 2nd Session, as recorded in the Statutes At Large,
December 5, 1859 to March 3, 1863 at Chapter CXX, page 489
(EXHIBIT #3). Considering the foregoing evidence of the
diversity of citizenship of the two parties, it is clear that Mr.
Brushaber was a "nonresident alien with respect to the United
States", who had income from sources within said "United States".
His income derived from the Union Pacific Railroad Company, a
corporate citizen created by Congress and residing WITHIN the
"United States" (i.e. the District of Columbia). (See EXHIBIT #3)


                        Page A - 7 of 26

                                                The Federal Zone:


     ... [A] domestic corporation is an artificial person whose
     residence or domicile is fixed by law within the territorial
     jurisdiction of the state which created it. That residence
     cannot be changed temporarily or permanently by the
     migrations of its officers or agents to other jurisdictions.
     So long as it is an existing corporation its residence,
     citizenship, domicile, or place of abode is within the state
     which created it. It cannot reside or have its domicile
     elsewhere; neither can it in legal contemplation be absent
     from the state of its creation.

               [Fowler vs Chillingworth, 113 So. 667, 669 (1927)]
                                                 [emphasis added]

     7. Related cases are Hylton vs United States, 3 U.S. (3
Dall.) 171 (1796): Hylton was a Congressman; his salary was
income from sources WITHIN the "United States". See also
Springer vs U.S., 102 U.S. 586 (1881): Springer, a Virginia
Citizen, operated a carriage business in the District of
Columbia.

     8. The first paragraph of the Secretary's Treasury
Decision (EXHIBIT #1) is quoted here as follows:

                            (T.D. 2313)
                           Income Tax

     Taxability of interest from bonds and dividends on stock of
     domestic2 corporations owned by nonresident aliens, and the
     liabilities of nonresident aliens under Section 2 of the act
     of October 3, 1913.

     To collectors of internal revenue:

          Under the decision of the Supreme Court of the United
     States in the case of Brushaber vs Union Pacific Railway
     [sic] Co., decided January 24, 1916, it is hereby held that
     income accruing to nonresident aliens in the form of
     interest from the bonds and dividends on the stock of
     domestic corporations is subject to the income tax imposed
     by the act of October 3, 1913.
                               [footnote and emphasis added]

     9. The above decision by the Secretary of the Treasury
determined that a tax on income derived from rents, sales of
property, wages, professions, or a trade or business WITHIN the
"United States", was applicable to such "income" when payable to
a nonresident alien, i.e. a Union State Citizen.

____________________
2. "Domestic" in the "United States" statutes means inside
     D.C., the possessions, territories, and enclaves of the
     "United States", i.e. federal states of which there are 14.
     (EXHIBIT #5)


                        Page A - 8 of 26

                                                       Appendix A


     10. All income tax provisions under 26 U.S.C., subtitle A
(an excise tax on "income"), are divided between sources WITHIN
and WITHOUT the "United States". They are imposed upon the
worldwide income of citizens of the "United States" and aliens
residing therein, and upon nonresident aliens (of all kinds)
receiving income from sources WITHIN said "United States" and
WITHIN the other parts of the American Empire which fall WITHIN
the exclusive legislative jurisdiction of the Congress of the
"United States", pursuant to 1:8:17 and 4:3:2.


          CONSTITUTIONAL AUTHORITY GRANTED TO CONGRESS

     11. The Constitution gives to Congress the power to act for
the 50 Union States as an international representative and to do
so without (outside) the boundaries of each of those 50 States.
These powers are expressed in Article 1, Section 8, Clauses 1
thru 16 (1:8:1-16).

     12. The Constitution gave to Congress a seat of government,
known as the District of Columbia. In time, Congress created a
government for the "District", and this "District" became a
federal state by definition. (For the other federal "states" of
the "United States", see EXHIBIT #5.) However, this "state"
(D.C.) is not "united" by or under the Constitution for the
United States of America. D.C. has never joined the Union.

     13. Furthermore, the Constitution granted to Congress the
authority to govern the "District", just as the Legislatures of
each of the several States of the Union govern their States
within the geographical limits of those States. As Congress
began to legislate for the "District", under authority of 1:8:17
and 1:8:18, the difference between the citizens of the "District"
and the Citizens3 of the Union became apparent, in that the
citizens of the "District" did not possess the right of suffrage
or other rights (see Balzac supra, De Lima supra, and Downes
supra) and therefore were not recognized as a part of the
Sovereignty of "We the People". The Constitution for the United
States of America provided no means of taxing these "District"
citizens of the "United States". A method of forming municipal
governments and of exercising taxing power over these citizens
within the territories of the "United States" was decided by The
Insular Cases (see the Bidwell cases, supra). "The Constitution
was made for States, not territories," wrote Daniel Webster.
"... [T]he Constitution of the United States as such does not
extend beyond the limits of the States which are united by and
under it ....", wrote author Langdell in "The Status of Our New
Territories", 12 Harvard Law Review 365, 371.


____________________
3. Please note that the U.S. Constitution always denoted
     Citizen and Person in capital letters until the 14th
     Amendment, wherein citizen and person were not capitalized.


                        Page A - 9 of 26

                                                The Federal Zone:


     14. The distinction between "citizens of the United States"
and "Union State Citizens" has been fully recognized by the
Congress and the Courts as follows:

     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 its own who owe it allegiance, and
     whose rights, within its jurisdiction, it must protect.

           [United States vs Cruikshank, 92 U.S. 588, 590 (1875)]
                                                 [emphasis added]

     The Federal Government is a "state".

                 [Enright vs U.S., D.C.N.Y., 437 F.Supp 580, 581]


     Foreign State. A foreign country or nation. The several
     United States are considered "foreign" to each other except
     as regards their relations as common members of the Union.

               [Black's Law Dictionary, Sixth Edition, page 1407]


     15. Congress identifies these citizens of the "District" as
"individuals" or citizens who reside in the "United States" and
who are subject to the direct control of Congress in its local
taxing and other municipal laws.

     16. In De Lima supra, the U.S. Attorney defined federal
taxes with the following words, at page 99-108:

     Federal taxation is either general or local. Local taxes
     are levied under Article 1, Section 8, Paragraph 1. Local
     taxes are for the support of territorial or non-state
     governments.

Congress imposed a federal excise tax on the "income" of these
citizens or "individuals" at 26 U.S.C., Section 1, as a local
tax:

     Such taxes are not for the common welfare of the United
     States, but are to defray the expense of the government of
     the locality, and in the dual position which Congress
     occupies in our system, as Federal Government and as local
     government for the territory of the United States not ceded
     into States of the Union, it has the power to tax for local
     purposes.
                                         [De Lima supra, page 99]


                        Page A - 10 of 26

                                                       Appendix A


Hence the term "from sources WITHIN the United States".

     General taxes are of two kinds, direct; and what, for
     brevity may be called indirect, meaning thereby duties,
     imposts, and excises. Direct taxes must be laid on all the
     States alike.
                                        [De Lima supra, page 100]


     17. A Citizen of one of the 50 States, residing therein, is
a nonresident alien with respect to this local taxing power of
Congress (see Brushaber supra). Outside the geographical area of
the "United States" (as that term is defined at 26 C.F.R.
1.911-2(g)), Congress lacks power to support the local government
by imposing a tax on the incomes of nonresident aliens (ones
outside the locality, i.e. Citizens of the 50 States) UNLESS they
reside within that jurisdiction by residence, or UNLESS the
source of their income is situated WITHIN that geographical
territory. Any income arising from sources therein must be
withheld at the source by the "withholding agent" (see T.D. 2313,
26 C.F.R. 871, and 26 U.S.C. 1461), unless the recipient is
engaged in a trade or business therein. For a full discussion of
this local taxation, see pages 55 and 99-108 of De Lima supra.
For confirmation of the domestic municipal jurisdiction of the
"United States", see Downes supra at pages 383-388.

     18. Congress has control of these "individuals", whether
they "reside" WITHIN the "United States" (i.e. territorial
states, see EXHIBIT #5) or WITHOUT the "United States". These
"individuals" (i.e. born within the jurisdiction of Congress,
such as a citizen born in the District of Columbia or in one of
the territories), whether they reside within "United States"
territories, without the "United States" in the "foreign
countries" (as defined at 26 C.F.R. 1.911-2(h)), or abroad, are
still liable for the federal income tax unless they abrogate that
citizenship by naturalization or otherwise. (See 26 C.F.R.
871-5, -6 and -12 and 1.932-1). However, at 26 U.S.C. 911(a)(1),
Congress has exempted from taxation all "foreign earned income"
of these citizen individuals, except for Puerto Ricans (see 26
C.F.R. 1.932-1(b), IRS Form 2555).

     19. Another type of nonresident aliens are those citizens
of contiguous countries such as Mexico, Canada and other foreign
countries. These foreigners, residents or nonresidents (as the
case may be), are subject to the tax on incomes received from any
place in the American Empire, i.e. in these united States and in
the "United States". A Union State Citizen, previously
nonresident, may lose his nonresident status by residing within
the territorial sovereignty of the "United States" for 183 days
(26 C.F.R. 1.871-7(d)(2)) and thereby becomes subject to the
local tax on incomes received from sources within and without the
"United States" (i.e. worldwide income).


                        Page A - 11 of 26

                                                The Federal Zone:


                  THE INCOME TAX IS A LOCAL TAX

               IMPOSED WITHIN THE "UNITED STATES".

           PLAINTIFFS ARE STRANGERS TO THIS LOCALITY.


                  THE DEFINITIONS IN 26 U.S.C.:

                    THE INTERNAL REVENUE CODE


     20. The definitions used in 26 U.S.C. are very clear in
defining "State" and "United States". In every definition that
uses the word "include", only the words that follow are defining
the term. For example:

     21. 26 U.S.C. 3121(e)(1) State. -- The term "State"
includes the District of Columbia, the Commonwealth of Puerto
Rico, the Virgin Islands, Guam, and American Samoa.

     22. 26 U.S.C. 7701(a)(9) United States. -- The term
"United States" when used in a geographical sense includes only
the States and the District of Columbia.

     23. The federal government has used these definitions
correctly, but IRS agents seem to assume that they mean the 50
States of the Union (America) when they look at the word "States"
in 26 U.S.C. 7701(a)(9). You cannot use the common, everyday
meaning of the terms "United States" or "State" when talking
about the tax laws and many other laws that are enacted under the
local, municipal authority of the "United States" government.

     24. Another example is the Omnibus Acts at 86th Congress,
1st Session, Volume 73, 1959, and 2nd Session, Volume 74, 1960,
Public Laws 86-70 and 86-624. These Acts reveal the crafty way
in which the federal government uses correct English and how
Congress changes the meanings of words by using its own
definitions. For example, all the United States Code definitions
had to be changed to allow Alaska and Hawaii to join the Union of
States united under the Constitution. When Alaska joined the
Union, Congress added a new definition of "States of the United
States". This definition had never appeared before, to wit:


     Sec. 48. Whenever the phrase "continental United States" is
     used in any law of the United States enacted after the date
     of enactment of this Act, it shall mean the 49 States on the
     North American Continent and the District of Columbia,
     unless otherwise expressly provided.

                              [cf. 1 USCS 1, "Other provisions:"]
                                                 [emphasis added]


                        Page A - 12 of 26

                                                       Appendix A


Where is it otherwise expressly provided? Answer:

     Sec. 22. (a) Section 2202 of the Internal Revenue Code of
     1954 (relating to missionaries in foreign service), and
     sections 3121(e)(1), 3306(j), 4221(d)(4), and 4233(b) of
     such code (each relating to a special definition of "State")
     are amended by striking out "Alaska,".

     (b) Section 4262(c)(1) of the Internal Revenue Code of 1954
     (definition of "continental United States") is amended to
     read as follows: "(1) Continental United States. -- The
     term 'continental United States' means the District of
     Columbia and the States other than Alaska."

When Hawaii was admitted to the Union, Congress again changed the
above definition, to wit:

     Sec. 18. (a) Section 4262(c)(1) of the Internal Revenue
     Code of 1954 (relating to the definition of "continental
     United States" for purposes of the tax on transportation of
     persons) is amended to read as follows: "(1) Continental
     United States. -- The term 'continental United States' means
     the District of Columbia and the States other than Alaska
     and Hawaii."


        WHAT ARE THE STATES OTHER THAN ALASKA AND HAWAII?

     25. They certainly cannot be the other 48 States united by
and under the Constitution, because Alaska and Hawaii just joined
them, RIGHT? The same definitions apply to the Social Security
Acts. So, what is left? Answer: the District of Columbia,
Puerto Rico, Guam, Virgin Islands, etc. These are the States OF
(i.e. belonging to) the "United States" and which are under its
sovereignty. Do not confuse this term with States of the Union,
because the word "of" means "belonging to" in this context.

     26. Congress can also change the definition of "United
States" for two sentences and then revert back to the definition
it used before these two sentences. This is proven in Public Law
86-624, page 414, under School Operation Assistance in Federally
Affected Areas, section (d)(2):

     The fourth sentence of such subsection is amended by
     striking out "in the continental United States (including
     Alaska)" and inserting in lieu thereof "(other than Puerto
     Rico, Wake Island, Guam, or the Virgin Islands)" and by
     striking out "continental United States" in clause (ii) of
     such sentence and inserting in lieu thereof "United States
     (which for purposes of this sentence and the next sentence
     means the fifty States and the District of Columbia)". The
     fifth sentence of such subsection is amended by striking out
     "continental" before "United States" each time it appears
     therein and by striking out "(including Alaska)".


                        Page A - 13 of 26

                                                The Federal Zone:


     27. This one section, all by itself, contains all the
evidence you need, by words of construction, to prove that the
term "United States" on either side of these sentences did not
mean the 50 States united by and under the Constitution. If that
is not conclusive to you, then see the following:


     26 C.F.R. 31.3121(e)-1 State, United States, and citizen.

     (a) When used in the regulations in this subpart, the term
     "State" includes [in its restrictive form] the District of
     Columbia, the Commonwealth of Puerto Rico, the Virgin
     Islands, the Territories of Alaska and Hawaii before their
     admission as States, and (when used with respect to services
     performed after 1960) Guam and American Samoa.

     (b) When used in the regulations in this subpart, the term
     "United States", when used in a geographical sense, means
     the several states, (including the Territories of Alaska and
     Hawaii before their admission as States), the District of
     Columbia, the Commonwealth of Puerto Rico, and the Virgin
     Islands. When used in the regulations in this subpart with
     respect to services performed after 1960, the term "United
     States" also includes [in its expansive form] Guam and
     American Samoa when the term is used in a geographical
     sense. The term "citizen of the United States" includes [in
     its restrictive form] a citizen of the Commonwealth of
     Puerto Rico or the Virgin Islands, and, effective January 1,
     1961, a citizen of Guam or American Samoa.

                                                 [emphasis added]

Please note the bolded terms. In paragraph (a), Alaska and
Hawaii only fit the definition of "State" before joining the
Union. That means the definition of "State" was never meant to
be the 48 now 50 States of the Union unless distinctly expressed.
If paragraph (b) confuses you, the following is submitted:

     28. The word "geographical" was never used in tax law until
Alaska and Hawaii joined the Union, and it is not defined in the
Internal Revenue Code. So, we must use the definition found in
the Standard Random House Dictionary:


     ge.o.graph.i.cal 1. of or pertaining to geography 2. of
     or pertaining to the natural features, population,
     industries, etc., of a region or regions


     29. Were you born in the "United States"? The preposition
"in" shows that the "United States" in this question is a place,
a geographical place named "United States". It is singular, even
though it ends in "s". It also can be plural when referring to
the Union States which are places which exist by agreement.


                        Page A - 14 of 26

                                                       Appendix A


Every human in a nation is a natural Citizen of a place called a
nation, if he was born in that nation. Those same people must be
naturalized (born again) if they want to become a citizen of
another nation. Original citizenship exists because of places,
not agreements. This is jus soli, the law of the place of one's
birth (see Black's Law Dictionary, Sixth Edition).

     30. Here are two questions, your own answers to which will
solve the dilemma. In a geographical sense, where is the State
of Texas located on the continent? In a geographical sense,
where is the "United States" (Congress) located on the continent?

     31. Now, since typewriters were purchased from the areas
that just joined the Union, namely Alaska and Hawaii, according
to Title 1, Congress had to use a term that is NOT used in the
Internal Revenue Code, in order to buy the same typewriters from
the same geographical area:

     Sec. 45. Title I of the Independent Offices Appropriation
     Act, 1960, is amended by striking out the words "for the
     purchase within the continental limits of the United States
     of any typewriting machines" and inserting in lieu thereof
     "for the purchase within the STATES OF THE UNION AND THE
     DISTRICT OF COLUMBIA OF ANY TYPEWRITING MACHINES".

                                                 [emphasis added]

And, for declarations made under the penalties of perjury, the
statute at 28 U.S.C. 1746 separately defines declarations made
WITHIN and WITHOUT the "United States" as follows:


     If executed WITHOUT the United States: I declare ... under
     the laws of the United States of America that the foregoing
     is true and correct.

     If executed WITHIN the United States, its territories,
     possessions, or commonwealths: I declare ... that the
     foregoing is true and correct.
                                                 [emphasis added]

The latter clause above is the penalty clause that is found on
IRS Form 1040 and similar IRS forms.

And, 28 U.S.C. 1603(a)(3) states as follows:


     (3) which is neither a citizen of a State of the United
     States as defined in section 1332(c) and (d) of this title
     ....

     Section 1332(d). The word "States", as used in this section,
     includes the Territories, the District of Columbia, and the
     Commonwealth of Puerto Rico.


                        Page A - 15 of 26

                                                The Federal Zone:


                   Examples of Two Definitions
            of the term "United States" in 26 U.S.C.


                        First Definition

     32. 26 U.S.C. 7701(a)(9):

     (9) United States. -- The term "United States" when used in
     a geographical sense includes only the States and the
     District of Columbia.


                        Second Definition

     33. 26 U.S.C. 4612(a)(4)(A):

     (A) In general. -- The term "United States" means the 50
     States, the District of Columbia, the Commonwealth of Puerto
     Rico, any possession of the United States, the Commonwealth
     of the Northern Mariana Islands, and the Trust Territory of
     the Pacific Islands.
                                                 [emphasis added]


     34. The Supreme Court stated in Hepburn & Dundas vs Ellsey,
6 U.S. 445, 2 Cranch 445, 2 L.Ed 332, that the District of
Columbia is not a "State" within the meaning of the Constitution.
Therefore, it is apparent that the meaning of the term "States"
in the first definition above can only mean the territories and
possessions belonging to the "United States", because of the
specific mention of the District of Columbia and the specific
absence of the 50 States (inclusio unius est exclusio alterius).
The District of Columbia is not a "State" within the meaning of
the Constitution (see Hepburn supra). Therefore, the 50 States
are specifically excluded from this first definition of the term
"United States".


     35. Congress has no problem naming the "50 States" when it
is legislating for them, so, in the second definition of the term
"United States" above, Congress expressly mentions them, and
there is no misunderstanding. If a statute in 26 U.S.C. does not
have a special "word of art" definition for the term "United
States", then the First Definition of the term "United States" is
always used (see above) because of the general nature of that
term as defined by Congress.


     36. When citizens or residents of the first "United States"
are without the geographical area of this first "United States",
their "compensation for personal services actually rendered" is
defined as "foreign earned income" in 26 U.S.C., Section 911(b)
and 911(d)(2), as follows:


                        Page A - 16 of 26

                                                       Appendix A


     911(b) Foreign Earned Income. -- ...

     (d)(2) Earned Income. --

     (A) In general. -- The term "earned income" means wages,
     salaries, or professional fees, and other amounts received
     as compensation for personal services actually rendered, but
     does not include that part of the compensation derived by
     the taxpayer for personal services rendered by him to a
     corporation which represents a distribution of earnings or
     profits rather than a reasonable allowance as compensation
     for the personal services actually rendered.

     37. A citizen or resident of the first "United States" does
not pay a tax on his "compensation for personal services actually
rendered" while residing outside of the first "United States",
because Congress has exempted all such compensation from taxation
under 26 U.S.C., Section 911(a)(1), which reads as follows:

     911(a) Exclusion from Gross Income. -- ... [T]here shall be
     excluded from the gross income of such individual, and
     exempt from taxation ... (1) the foreign earned income of
     such individual ....

     38. When residing without (outside) this "United States",
the citizen or resident of this "United States" pays no tax on
"foreign earned income", but is required to file a return,
claiming the exemption (see IRS Form 2555).

     39. 26 C.F.R., Section 871-13(c) allows this citizen to
abandon his citizenship or residence in the "United States" by
residing elsewhere.

     40. 26 C.F.R., Section 1.911-2(g) defines the term "United
States" as follows:

     (g) United States. The term "United States" when used in a
     geographical sense includes any territory under the
     sovereignty of the United States. It includes the states4,
     [Puerto Rico, Guam, Mariana Islands, etc.] the District of
     Columbia, the possessions and territories of the United
     States, the territorial waters of the United States, the air
     space over the United States, and the seabed and subsoil of
     those submarine areas which are adjacent to the territorial
     waters of the United States and over which the United States
     has exclusive rights, in accordance with international law
     ....

____________________
4. This term "state" evidently does not embrace one of the 50
     States (where I am a free inhabitant), united by the
     Constitution, because they are separate governments or
     foreign states with respect to the "United States" (i.e.
     D.C., its territories, possessions and enclaves).


                        Page A - 17 of 26

                                                The Federal Zone:


None of the 50 united States comes under the sovereignty of the
"United States", and subsection (h) defines the 50 States united
by the Constitution as "foreign countries":


     (h) Foreign country. The term "foreign country" when used
     in a geographical sense includes any territory under the
     sovereignty of a government other than that of the United
     States.
                                           [26 C.F.R. 1.911-2(h)]

All of the 50 States are foreign with respect to each other and
are under the sovereignty of their respective Legislatures,
except where a power has been expressly delegated to Congress.
The Citizens of each Union State are foreigners and aliens with
respect to another Union State, unless they establish a residence
therein under the laws of that Union State. Otherwise, they are
nonresident aliens with respect to all the other Union States.

     41. The regulations at 26 C.F.R., Section 1.1-1(a) state,
in pertinent part:


     (a) General Rule. (1) Section 1 of the Code imposes an
     income tax on the income of every individual who is a
     citizen or resident of the United States and, to the extent
     provided by Section 871(b) or 877(b), on the income of a
     nonresident alien individual.


26 U.S.C., Section 1 imposes a tax on "taxable income" as
follows, in pertinent part:


     There is hereby imposed on the taxable income of ... every
     married individual ... who makes a single return jointly
     with his spouse under section 6013 ....


     42. The regulations promulgated to explain 26 U.S.C.,
Section 1 are found in 26 C.F.R., Section 1.1-1, and state in
pertinent part:


     (a) General Rule. (1) Section 1 of the Code imposes an
     income tax on the income of every individual who is a
     citizen or resident of the United States and, to the extent
     provided by Section 871(b) or 877(b), on the income of a
     nonresident alien individual.


Please note that the term "taxable income" is not used as such in
the above statute because the "income" of those classes of
individuals mentioned is taxable as "taxable income".


                        Page A - 18 of 26

                                                       Appendix A


     Section 1.871 Classification and manner of taxing alien
     individuals

     (a) Classes of aliens. For purposes of the income tax,
     alien individuals are divided generally into two classes,
     namely, resident aliens and nonresident aliens. ...

     (b) Classes of nonresident aliens. --

     (1) In general. For purposes of the income tax,
     nonresident alien individuals are divided into the following
     three classes:

     (i) Nonresident alien individuals who at no time during the
          taxable year are engaged in a trade or business in the
          United States,

     (ii) Nonresident alien individuals who at any time during
          the taxable year are, or are deemed under Section
          1.871-9 to be, engaged in a trade or business in the
          United States, and

     (iii) NOT APPLICABLE (concerns residents of Puerto Rico)


     43. 26 C.F.R., Section 871-13 states as follows:

     (a) In general. (1) An individual who is a citizen or
     resident of the United States at the beginning of the
     taxable year but a nonresident alien at the end of the
     taxable year, or a nonresident alien at the beginning of the
     taxable year but a citizen or resident of the United States
     at the end of the taxable year, is taxable for such year as
     though his taxable year were comprised of two separate
     periods, one consisting of the time during which he is a
     citizen or resident of the United States and the other
     consisting of the time during which he is not a citizen or
     resident of the United States.

It sounds complicated, doesn't it?


                        NONRESIDENT ALIEN


     44. The federal income tax is a local tax for the "United
States" to support local government and, in order to become
liable to this tax, a State Citizen must be a resident therein
(i.e. a resident alien), or receive income from sources therein,
or be engaged in a trade or business therein.

     45. In 26 U.S.C., Section 7701(b)(1)(A) & (B), Congress
defined the statutory difference between "resident alien" and
"nonresident alien" as follows:


                        Page A - 19 of 26

                                                The Federal Zone:


     (b) Definitions of Resident Alien and Nonresident Alien. --

     (1) In general. -- For purposes of this title ...

     (A) Resident Alien. -- An alien individual shall be treated
          as a resident of the United States with respect to any
          calendar year if (and only if) such individual meets
          the requirements of clause (i), (ii), or (iii):

          (i) Lawfully admitted for permanent residence. -- Such
               individual is a lawful permanent resident of the
               United States at any time during such calendar
               year.

          (ii) Substantial presence. -- Such individual meets the
               substantial presence test of paragraph (3).

          (iii) First year election. -- Such individual makes the
               election provided in subparagraph (4).

     (B) Nonresident Alien. -- An individual is a nonresident
          alien if such individual is neither a citizen of the
          United States nor a resident of the United States
          (within the meaning of subparagraph (A)).

     46. Plaintiffs are not "residents" (as that term is defined
in the above statutes) nor are they citizens of this "United
States". They are nonresident aliens as that term is defined in
subsections (B) and (A)(i), (ii), and (iii), and they have the
same status as the Plaintiff in Brushaber supra.


         INDIVIDUALS REQUIRED TO MAKE RETURNS OF INCOME


     47. The following individuals are required to make returns
of income:

     26 C.F.R., Section 1.6012-1. Individuals required to make
     returns of income.

     (a) Individual citizen or resident. --

     (1) In general. ... an income tax return must be filed by
          every individual ... if such individual is ...

          (i) A citizen of the United States, whether residing
               at home or abroad,

          (ii) A resident of the United States even though not a
               citizen thereof, or

      (iii) An alien bona fide resident of Puerto Rico during
               the entire taxable year.


                        Page A - 20 of 26

                                                       Appendix A


     48. John and Lois Knox clearly are not defined in the above
statutes, but they are defined in the following statute as ones
who are not required to make a return.

     49. 26 C.F.R., Section 1.6013-1 states:

     (b) Nonresident Alien. A joint return shall not be made if
     either the husband or wife at any time during the taxable
     year is a nonresident alien.


Mr. John H. Knox and Mrs. Lois C. Knox are nonresident aliens
with respect to the "United States", with no income derived from
sources within the "United States", except for John's Military
Retirement pay, which is exempt from taxation.

     50. 26 C.F.R., Section 871-7 states, in pertinent part, as
follows:

     Except as otherwise provided in Section 1.871-12, a
     nonresident alien individual to whom this section applies is
     not subject to the tax imposed by section 1 or section
     1201(b)5 but, pursuant to the provision of section 871(a),
     is liable to a flat tax of 30 percent upon the aggregate of
     the amounts determined under paragraphs (b), (c), and (d) of
     this section which are received during the taxable year from
     sources within the United States.
                                                 [emphasis added]

     51. Please note 26 C.F.R., Section 1.871-4(b), Proof of
residence of aliens, which establishes a key legal presumption:

     (b) Nonresidence presumed. An alien by reason of this
     alienage, is presumed to be a nonresident alien.


     52. Further facts are illustrated by the definition of
"withholding agent" at 26 U.S.C., Section 7701(a)(16):

     Withholding agent. -- The term "withholding agent" means any
     person required to deduct and withhold any tax under the
     provisions of section 1441, 1442, 1443, or 1461.


     53. 26 U.S.C., Section 1441 refers to nonresident aliens
who receive income from sources within the "United States", as
set forth in Section 871(a)(1). The other sections do not apply
to the Plaintiffs.

     54. Your attention is invited to 26 C.F.R., Section
31.3401(a)(6)-1(b), which states as follows:

____________________
5. Capital gains tax.


                        Page A - 21 of 26

                                                The Federal Zone:


     Remuneration for services performed outside the United
     States. Remuneration paid to a nonresident alien individual
     ... for services performed outside the United States is
     excepted from wages and hence is NOT SUBJECT TO WITHHOLDING.
     [emphasis added]


     55. As a rule, Military Retirement Pay of a nonresident
alien individual is exempted from the income tax at 26 C.F.R.,
Section 31.3401(a)-1(b)(1)(ii), with the following exception:

     Where such retirement pay or disability annuity ... is paid
     to a nonresident alien individual, withholding is required
     only in the case of such amounts paid to a nonresident alien
     individual who is a resident of Puerto Rico.


and at 26 C.F.R., Section 935-1(a)(3):

     ... [F]or special rules for determining the residence for
     tax purposes of individuals under military or naval orders,
     see section 514 of the Soldiers' and Sailors' Civil Relief
     Act of 19406, 50 App. U.S.C. 574. The residence of an
     individual, and, therefore, the jurisdiction with which he
     is required to file an income tax return under paragraph (b)
     of this section, may change from year to year.


Section 574(1) of The Soldiers' and Sailors' Relief Act states
that:

     For the purposes of taxation in respect of the personal
     property, income, or gross income of any such person by any
     State, Territory, possession, or political subdivision of
     any of the foregoing, or the District of Columbia, of which
     such person is not a resident or in which he is not
     domiciled ... personal property shall not be deemed to be
     located or present in or to have a situs for taxation in
     such State, Territory, possession or political subdivision,
     or district.
                                                 [emphasis added]


           EXTRAORDINARY AND EXCEPTIONAL CIRCUMSTANCES

     56. Plaintiffs herein are at an advanced age of 62 and both
are in ill health, unable to work or to pay the tax or to sue for
a refund. Lois has only one kidney which does not function
properly; complicating this is a lung disease which prevents her
from breathing. She has been totally disabled since 1981, with
no earned income from any source since that time. John has
emphysema and has difficulty breathing upon exercise. They are
____________________
6. See Exhibit #6 attached hereto and made a part hereof.


                        Page A - 22 of 26

                                                       Appendix A


unable to pay the tax and sue for refund without the complete
destruction of their home, which is combined with their business.
The property which is the subject of this case is a one-of-a-kind
property which is, or would be, irreplaceable years down the
road, if a refund suit was won. The property has a value of
$100,0007 and was allegedly sold for the sum of $16,000.00, which
is all that could be recovered in a refund suit as pertains to
said property. This creates an irreparable situation for
Plaintiffs. The tax with penalties and interest claimed by the
government against both Plaintiffs for 1982 is around $19,000.00
and, without the sale of the business property and home, it will
be many years before a tax in this amount can be paid in full.
Plaintiffs will not live long enough to prosecute such a suit.
Equity and justice require some relief in such a situation.


         AUTHORITY FOR THE COURT TO ISSUE THE INJUNCTION


     57. In Botta vs Scanlon, 288 F.2d 504 (2nd Circuit, 1961),
the Court set forth the general exceptions to the bar at 26
U.S.C., Section 7421, stating (see EXHIBIT #7):

     "... [I]t has long been settled that this general
     prohibition is subject to exception in the case of an
     individual taxpayer against a particular collector where the
     tax is clearly illegal or other special circumstances of an
     unusual character make an appeal to equitable remedies
     appropriate." National Foundry Co. of N.Y. vs Director of
     Int. Rev., 2 Cir. 1956, 229 F.2d 149, 151.

The Court then gave a number of examples, as follows:

          "(a) Suits to enjoin collection of taxes which are not
     due from the plaintiff but, in fact, are due from others.
     For example, see Raffaele vs Granger, 3 Cir. 1952, 196 F.2d
     620, 622 ....

          "(b) Cases in which plaintiff definitely showed that
     the taxes sought to be collected were "probably" not validly
     due. For example, Midwest Haulers, Inc. vs Brady, 6 Cir.
     1942, 128 F.2d 496, and John M. Hirst & Co. vs Gentsch, 6
     Cir. 1943, 133 F.2d 247.

          "(c) Cases in which a penalty was involved. For
     example, Hill vs Wallace, 259 U.S. 44, 42 S.Ct 453, 66 L.Ed
     822; Lipke vs Lederer, 259 U.S. 557, 42 S.Ct. 549, 66 L.Ed.
     1061; Regal Drug Corporation vs Wardell, 260 U.S. 386, 43
     S.Ct 152, 67 L.Ed 318; Allen vs Regents of the University
     System of Georgia, 304 U.S. 439, 58 S.Ct 980, 82 L.Ed 1448.

____________________
7. The property had a value of $125,000 two years ago, when the
     IRS allegedly sold it.


                        Page A - 23 of 26

                                                The Federal Zone:


          "(d) Cases in which it was definitely demonstrated that
     it was not proper to levythe tax on the commodity in
     question, such as Miller vs Standard Nut Margarine Company
     of Florida, 284 U.S. 498, 52 S.Ct. 260, 76 L.Ed 422.

          "(e) Cases based upon tax assessment fraudulently
     obtained by the tax collector by coercion. For example,
     Mitsukiyo Yoshimura vs Alsup, 9 Cir. 1948, 167 F.2d 104"
     (141 F.Supp. at page 338).

     [4] In the present case, if any of the plaintiffs are not
     subject to any tax liability, such plaintiff might well be
     within the exception stated in 9 Mertens, Law of Federal
     Income Taxation, Section 49.213, Chapter 49, page 226, as
     follows: ...

     "[2] It is equally well setted [sic] that the Revenue laws
     relate only to taxpayers. No procedure is prescribed for a
     nontaxpayer where the Government seeks to levy on property
     belonging to him for  the collection of another's tax, and no
     attempt has been made to annul the ordinary rights or
     remedies of a non-taxpayer in such cases. If the Government
     sought to levy on the property of A for a tax liability
     owing to B, A could not and would not be required to pay the
     tax under protest and then institute an action to recover
     the amount so paid. His remedy would be to go into a court
     of competent jurisdiction and enjoin the Government from
     proceeding against his property." In Tomlinson vs Smith, 7
     Cir. 1942, 128 F.2d 808 ... the Court affirmed an order
     granting interlocutory injunction and noted the "distinction
     between suits instituted by taxpayers and non-taxpayers" (at
     page 811).

                           CONCLUSION

     Plaintiffs are in no way subjected to any derivative
liability. The procedures set forth in 26 C.F.R. do not
authorize the Secretary or his delegate to manufacture income and
tax it where a Person is without the taxable class. 26 C.F.R.,
Section 871 is unclouded in that, where there is no income from
sources within the "United States" by a nonresident alien, the
choice is delegated to that Person by Congress as to whether a
return is to be filed or not (see 26 C.F.R. 1.871-8). Where the
Secretary determines the existence of taxable income when there
has been no return, he should sign the substitute return and
assume the responsibility for the determination as required by 26
U.S.C. 6020(b)(1). Treasury Decision 2313 explains that the
withholding agent is responsible for withholding the tax from
sources within the "United States", for filing a Form 1040NR and
for paying over the tax withheld from said nonresident alien.
(See Treasury Decision 2313 and 26 C.F.R. 1.1461-3). Therefore,
no penalties should accrue to the Plaintiffs. Lois K. Knox has
no community property interest in John's Military Retirement Pay
and, therefore, no taxable income accrues therefrom.


                        Page A - 24 of 26

                                                       Appendix A


     The fact that the Knoxs were not aware of the above
information from the early years of their lives and they reported
the "earned income" from their labor in the foreign States of the
Union as a local tax of the "United States", does not change
their status as Citizens of the Republic of Union States. Nor
does it change their status from nonresidents aliens to the
"individuals" defined in 26 C.F.R., Section 1.1-1. Nor does it
justify the Secretary's actions taken when he has been repeatedly
informed by the Knoxs of their true status. The Secretary is
required to know the law he is administering, and to do so with
justice and equity within the parameters set forth by Congress.
Arbitrary actions are discouraged by the Executive, the Congress
and the Courts.


                             PRAYER


     WHEREFORE, PREMISES CONSIDERED, Plaintiffs pray that this
Court grant a temporary and permanent injunction against the IRS,
its employees, agents, Commissioner and Attorneys by ordering a
cessation of the levies and seizures against all forms of
property owned by Plaintiffs; that the Court order a return of
property seized in the past, declare the sale of such property
voidable or void, and order a release of all liens filed against
the Plaintiffs. In the alternative, Plaintiffs request that this
case be remanded back to the Administrative Agency for resolution
and arbitration. Plaintiffs further request the Court to grant
such other and further relief in law or in equity as Plaintiffs
may be entitled.


     I declare under penalty of perjury, under the laws of the
United States of America, that the foregoing is true and correct,
to the best of my knowledge and belief, per 28 U.S.C. 1746(1).


     Executed on this 5th day of September, 1991.


                                        Respectfully submitted,

                                        /s/ John H. Knox


                        Page A - 25 of 26

                                                The Federal Zone:


                    [addendum to Knox brief]


                              CASES

                      ARGUED AND DETERMINED

                             in the

                   SUPREME COURT OF JUDICATURE

                             of the

                        STATE OF INDIANA

              at Indianapolis, November Term, 1878,
              in the Sixty-Third Year of the State.


                           -----+-----


       Daly et al. vs The National Life Insurance Company
                of the United States of America.
                         [cite omitted]


"Foreign Corporation" Defined. -- The statutes of this State
define a foreign corporation to be "a corporation created by or
under the laws of any other state, government, or country," or
one "not incorporated or organized in this State".

Same. -- Insurance Company Created by Act of Congress. -- An
insurance company created by an act of Congress is a foreign
corporation subject to the requirements of the statute of this
State approved June 17th, 1852, "respecting foreign corporations
and their agents in this State." 1 R.S. 1876, p. 373.

Same. -- Congress as a Local Legislature. -- Constitutional Law.
-- An act of Congress creating a private corporation is the act
of Congress as the local Legislature of the District of Columbia;
as Congress can not, under the federal constitution, as the
Congress of the United States, create a private corporation.


                             # # #


                        Page A - 26 of 26


                           Appendix B

                          Omnibus Acts


                         Page B - 1 of 6

                                                The Federal Zone:


Reader's Notes:


                         Page B - 2 of 6

                                                       Appendix B


                       ALASKA OMNIBUS ACT
                 PUBLIC LAW 86-70; 73 STAT. 141
                           [H.R. 7120]
                86th Congress -- First Session
                              1959
        An Act to amend certain laws of the United States
in light of the admission of the State of Alaska into the Union,
                     and for other purposes.

                        INTERNAL REVENUE
Sec. 22

(a) Section 2202 of the Internal Revenue Code of 1954 (relating
     to missionaries in foreign service),98 and sections
     3121(e)(1), 3306(j), 4221(d)(4), and 4233(b) of such Code
     (each relating to a special definition of "State")99 are
     amended by striking out "Alaska,".

(b) Section 4262(c)(1) of the Internal Revenue Code of 1954
     (definition of "continental United States")1 is amended to
     read as follows:

     "(1) Continental United States. -- The term `continental
          United States' means the District of Columbia and the
          States other than Alaska."

(c) Section 4502(5) of the Internal Revenue Code of 1954
     (relating to definition of "United States")2 is amended by
     striking out "the Territories of Hawaii and Alaska" and by
     inserting in lieu thereof "the Territory of Hawaii".

(d) Section 4774 of the Internal Revenue Code of 1954, (relating
     to territorial extent of law)3 is amended by striking out
     "the Territory of Alaska."

(e) Section 7621(b) of the Internal Revenue Code of 1954
     (relating to boundaries of internal revenue districts)4 is
     amended to read as follows:

     "(b) Boundaries. -- For the purpose mentioned in subsection
          (a), the President may subdivide any State, Territory,
          or the District of Columbia, or may unite into one
          district two or more States or a Territory and one or
          more States."


____________________
98. 26 U.S.C.A. (I.R.C. 1954) Section 2202.
99. 26 U.S.C.A. (I.R.C. 1954) Sections 3121(e)(1), 3306(j),
                                         4221(d)(4), 4233(b).
1. 26 U.S.C.A. (I.R.C. 1954) Section 4262(c)(1).
2. 26 U.S.C.A. (I.R.C. 1954) Section 4502(5).
3. 26 U.S.C.A. (I.R.C. 1954) Section 4774.
4. 26 U.S.C.A. (I.R.C. 1954) Section 7621(b).


                         Page B - 3 of 6

                                                The Federal Zone:


(f) Section 7653(d) of the Internal Revenue Code of 19545 is
     amended by striking out "its Territories or possessions" and
     inserting in lieu thereof "its possessions on the Territory
     of Hawaii".

(g) Section 7701(a)(9) of the Internal Revenue Code of 1954
     (relating to definition of "United States")6 is amended by
     striking out "the Territories of Alaska and Hawaii" and
     inserting in lieu thereof "the Territory of Hawaii".

(h) Section 7701(a)(10) of the Internal Revenue Code of 1954
     (relating to definition of State)7 is amended by striking
     out "Territories" and inserting in lieu thereof "Territory
     of Hawaii".

(i) The amendments contained in subsections (a) through (h) of
     this section shall be effective as of January 3, 1959.


____________________
5. 26 U.S.C.A. (I.R.C. 1954) Section 7653(d).
6. 26 U.S.C.A. (I.R.C. 1954) Section 7701(a)(9).
7. 26 U.S.C.A. (I.R.C. 1954) Section 7701(a)(10).


                         Page B - 4 of 6

                                                       Appendix B


                       HAWAII OMNIBUS ACT
                PUBLIC LAW 86-624; 74 STAT. 411
                          [H.R. 11602]
                86th Congress -- Second Session
                              1960
        An Act to amend certain laws of the United States
in light of the admission of the State of Hawaii into the Union,
                     and for other purposes.

                        INTERNAL REVENUE
Sec. 18.

(a) Section 4262(c)(1) of the Internal Revenue Code of 1954
     (relating to the definition of "continental United States"
     for purposes of the tax on transportation of persons)52 is
     amended to read as follows:

     "(1) Continental United States. -- The term `continental
          United States' means the District of Columbia and the
          States other than Alaska and Hawaii."

(b) Section 2202 of the Internal Revenue Code of 1954 (relating
     to missionaries in foreign service)53 is amended by striking
     out "the State, the District of Columbia, or Hawaii" and
     inserting in lieu thereof "the State or the District of
     Columbia".

(c) Section 3121(e)(1) of the Internal Revenue Code of 1954
     (relating to a special definition of "State")54 is amended
     by striking out "Hawaii,".

(d) Sections 3306(j) and 4233(b) of the Internal Revenue Code of
     1954 (each relating to a special definition of "State")55
     are amended by striking out "Hawaii, and".

(e) Section 4221(d)(4) of the Internal Revenue Code of 1954
     (relating to a special definition of "State or local
     government")56 is amended to read as follows:

     "(4) State or local government. -- The term `State or local
          government' means any State, any political subdivision
          thereof, or the District of Columbia."

(f) Section 4502(5) of the Internal Revenue Code of 1954
     (relating to definition of "United States")57 is amended by
     striking out "the Territory of Hawaii,".

____________________
52. 26 U.S.C.A. (I.R.C. 1954) Section 4262(c)(1).
53. 26 U.S.C.A. (I.R.C. 1954) Section 2202.
54. 26 U.S.C.A. (I.R.C. 1954) Section 3121(e)(1).
55. 26 U.S.C.A. (I.R.C. 1954) Sections 3306(j) and 4233(b).
56. 26 U.S.C.A. (I.R.C. 1954) Section 4221(d)(4).


                         Page B - 5 of 6

                                                The Federal Zone:


(g) Section 4774 of the Internal Revenue Code of 1954 (relating
     to territorial extent of law)58 is amended by striking out
     "the Territory of Hawaii,".

(h) Section 7653(d) of the Internal Revenue Code of 1954
     (relating to shipments from the United States)59 is amended
     by striking out ", its possessions or the Territory of
     Hawaii" and inserting in lieu thereof "or its possessions".

(i) Section 7701(a)(9) of the Internal Revenue Code of 1954
     (relating to definition of "United States")60 is amended by
     striking out ", the Territory of Hawaii,".

(j) Section 7701(a)(10) of the Internal Revenue Code of 1954
     (relating to definition of "State")61 is amended by striking
     out "the Territory of Hawaii and".

(k) The amendments contained in subsections (a) through (j) of
     this section shall be effective as of August 21, 1959.


____________________________________________________________
57. 26 U.S.C.A. (I.R.C. 1954) Section 4502(5).
58. 26 U.S.C.A. (I.R.C. 1954) Section 4774.
59. 26 U.S.C.A. (I.R.C. 1954) Section 7653(d).
60. 26 U.S.C.A. (I.R.C. 1954) Section 7701(a)(9).
61. 26 U.S.C.A. (I.R.C. 1954) Section 7701(a)(10).


                         Page B - 6 of 6


                           Appendix C

                     Treasury Decision 2313


                         Page C - 1 of 6

                                                The Federal Zone:


Reader's Notes:


                         Page C - 2 of 6

                                                       Appendix C


                       Treasury Decisions


                   Under Internal Revenue Laws
                      of the United States


                             Vol. 18


                      January-December 1916


                    W. G. McAdoo
                    Secretary of the Treasury


                           Washington
                   Government Printing Office
                              1917


                         Page C - 3 of 6

                                                The Federal Zone:


                           (T.D. 2313)
                           Income Tax

Taxability of interest from bonds and dividends on stock of
domestic corporations owned by nonresident aliens, and the
liabilities of nonresident aliens under section 2 of the act of
October 3, 1913.

                                              Treasury Department
                       Office of Commissioner of Internal Revenue
                                  Washington D.C., March 21, 1916


To collectors of internal revenue:

     Under the decision of the Supreme Court of the United States
in the case of Brushaber v. Union Pacific Railway [sic] Co.,
decided January 24, 1916, it is hereby held that income accruing
to nonresident aliens in the form of interest from the bonds and
dividends on the stock of domestic corporations is subject to the
income tax imposed by the act of October 3, 1913.

     Nonresident aliens are not entitled to the specific
exemption designated in paragraph C of the income-tax law, but
are liable for the normal and additional tax upon the entire net
income "from all property owned, and of every business, trade, or
profession carried on in the United States," computed upon the
basis prescribed in the law.

     The responsible heads, agents, or representatives of
nonresident aliens, who are in charge of the property owned or
business carried on within the United States, shall make a full
and complete return of the income therefrom on Form 1040,
revised, and shall pay any and all tax, normal and additional,
assessed upon the income received by them in behalf of their
nonresident alien principals.

     The person, firm, company, copartnership, corporation,
joint-stock company, or association, and insurance company in the
United States, citizen or resident alien, in whatever capacity
acting, having the control, receipt, disposal, or payment of
fixed or determinable annual or periodic gains, profits, and
income of whatever kind, to a nonresident alien, under any
contract or otherwise, which payment shall represent income of a
nonresident alien from the exercise of any trade or profession
within the United States, shall deduct and withhold from such
annual or periodic gains, profits, and income, regardless of
amount, and pay to the officer of the United States Government
authorized to receive the same such sum as will be sufficient to
pay the normal tax of 1 per cent imposed by law, and shall make
an annual return on Form 1042.

     The normal tax shall be withheld at the source from income
accrued to nonresident aliens from corporate obligations and


                         Page C - 4 of 6

                                                       Appendix C


shall be returned and paid to the Government by debtor
corporations and withholding agents as in the case of citizens
and resident aliens, but without benefit of the specific
exemption designated in paragraph C of the law.

     Form 1008, revised, claiming the benefit of such deductions
as may be applicable to income arising within the United States
and for refund of excess tax withheld, as provided by paragraphs
B and P of the income-tax law, may be filed by nonresident
aliens, their agents or representatives, with the debtor
corporation, withholding agent, or collector of internal revenue
for the district in which the withholding return is required to
be made.

     That part of paragraph E of the law which provides that "if
such person * * * is absent from the United States, * * * the
return and application may be made for him or her by the person
required to withhold and pay the tax * * *" is held to be
applicable to the return and application on Form 1008, revised,
of nonresident aliens.

     A fiduciary acting in the capacity of trustee, executor, or
administrator, when there is only one beneficiary and that
beneficiary a nonresident alien, shall render a return on Form
1040, revised; but when there are two or more beneficiaries, one
or all of whom are nonresident aliens, the fiduciary shall render
a return on Form 1041, revised, and a personal return on Form
1040, revised, for each nonresident alien beneficiary.

     The liability, under the provisions of the law, to render
personal returns, on or before March 1 next succeeding the tax
year, of annual net income accrued to them from sources within
the United States during the preceding calendar year, attaches to
nonresident aliens as in the case of returns required from
citizens and resident aliens. Therefore, a return on Form 1040,
revised, is required except in cases where the total tax
liability has been or is to be satisfied at the source by
withholding or has been or is to be satisfied by personal return
on Form 1040, revised, rendered in their behalf. Returns shall
be rendered to the collector of internal revenue for the district
in which a nonresident aliens carries on his principal business
within the United States or, in the absence of a principal
business within the United States and in all cases of doubt, the
collector of internal revenue at Baltimore, Md., in whose
district Washington is situated.

     Nonresident aliens are held to be subject to the liabilities
and requirements of all administrative, special, and general
provisions of law in relation to the assessment, remission,
collection, and refund of the income tax imposed by the act of
October 3, 1913, and collectors of internal revenue will make
collection of the tax by distraint, garnishment, execution, or
other appropriate process provided by law.


                         Page C - 5 of 6

                                                The Federal Zone:


     So much of T.D. 1976 as relates to ownership certificate
1004, T.D. 1977 (certificate Form 1060), 1988 (certificate Form
1060), T.D. 2017 (nontaxability of interest from bonds and
dividends on stock), T.D. 2030 (certificate Form 1071), T.D. 2162
(nontaxability of interest from bonds and dividends on stock) and
all rulings heretofore made which are in conflict herewith are
hereby superseded and repealed.

     This decision will be held effective as of January 1, 1916.


                                                     W. H. Osborn
                                 Commissioner of Internal Revenue


Approved, March 30, 1916:

Byron R. Newton,
Acting Secretary of the Treasury


                           __________


                         Page C - 6 of 6


                           Appendix D

                   Form 1040 for the Year 1913


                        Page D - 1 of 10

                                                The Federal Zone:


Author's Note:

     The federal government wasted no time in levying income
taxes after Secretary of State Philander C. Knox declared that
the so-called 16th Amendment had been ratified. His fraudulent
declaration was made on February 25, 1913. The first Form 1040
was printed to cover the period of March 1 to December 31, 1913.
This form was entitled "Return of Annual Net Income of
Individuals (As provided by Act of Congress, approved October 3,
1913.)"

     A most revealing part of this Form 1040 is found in the
"Instructions", which are reproduced verbatim on the following
pages. In the first paragraph of these instructions, there is
valuable evidence which substantiates the validity of The Matrix
discussed throughout this book. This paragraph is repeated as
follows, in order to highlight key phrases:


     This return shall be made by every citizen of the United
     States, whether residing at home or abroad, and by every
     person residing in the United States, though not a citizen
     thereof, having a net income of $3,000 or over for the
     taxable year, and also by every nonresident alien deriving
     income from property owned and business, trade, or
     profession carried on in the United States by him.


                                    [Form 1040 for the Year 1913]
                                   [From March 1, to December 31]
                                      [Instructions, Paragraph 1]


                        Page D - 2 of 10

                                                       Appendix D


                          INSTRUCTIONS


1. This return shall be made by every citizen of the United
     States, whether residing at home or abroad, and by every
     person residing in the United States, though not a citizen
     thereof, having a net income of $3,000 or over for the
     taxable year, and also by every nonresident alien deriving
     income from property owned and business, trade, or
     profession carried on in the United States by him.

2. When an individual by reason of minority, sickness or other
     disability, or absence from the United States, is unable to
     make his own return, it may be made for him by his duly
     authorized representative.

3. The normal tax of 1 per cent shall be assessed on the total
     net income less the specific exemption of $3,000 or $4,000
     as the case may be. (For the year 1913, the specific
     exemption allowable is $2,500 or $3,333.33, as the case may
     be.) If, however, the normal tax has been deducted and
     withheld on any part of the income at the source, or if any
     part of the income is received as dividends upon the stock
     or from the net earnings of any corporation, etc., which is
     taxable upon its net income, such income shall be deducted
     from the individual's total net income for the purpose of
     calculating the amount of income on which the individual is
     liable for the normal tax of 1 per cent by virtue of this
     return. (See page 1, line 7.)

4. The additional or super tax shall be calculated as stated on
     page 1.

5. This return shall be filed with the Collector of Internal
     Revenue for the district in which the individual resides if
     he has no other place of business, otherwise in the district
     in which he has his principal place of business; or in case
     the person resides a foreign country, then with the
     collector for the district in which his principal business
     is carried on in the United States.

6. This return must be filed on or before the first day of
     March succeeding the close of the calendar year for which
     return is made.

7. The penalty for failure to file the return within the time
     specified by law is $20 to $1,000. In case of refusal or
     neglect to render the return within the required time
     (except in cases of sickness or absence), 50 percent shall
     be added to amount of tax assessed. In case of false or
     fraudulent return, 100 percent shall be added to such tax,
     and any person required by law to make, render, sign, or
     verify any return who makes any false or fraudulent return
     or statement with intent to defeat or evade the assessment


                        Page D - 3 of 10

                                                The Federal Zone:


     required by this section to be made shall be guilty of a
     misdemeanor, and shall be fined not exceeding $2,000 or be
     imprisoned not exceeding one year, or both, at the
     discretion of the court, with the costs of prosecution.

8. When the return is not filed within the required time by
     reason of sickness or absence of the individual, an
     extension of time, not exceeding 30 days from March 1,
     within which to file such return, may be granted by the
     collector, provided an application therefor is made by the
     individual within the period for which such extension is
     required.

9. This return properly filled out must be made under oath or
     affirmation. Affidavits may be made before any officer
     authorized by law to administer oaths. If before a justice
     of the peace or magistrate, not using a seal, a certificate
     of the clerk of the court as to the authority of such
     officer to administer oaths should be attached to the
     return.

10. Expense for medical attendance, store accounts, family
     supplies, wages of domestic servants, cost of board, room,
     or house rent for family or personal use, are not expenses
     that can be deducted from gross income. In case an
     individual owns his own residence he can not deduct the
     estimated value of his rent, neither shall he be required to
     include such estimated rental of his home as income.

11. The farmer, in computing the net income from his farm for
     his annual return, shall include all moneys received for
     produce and animals sold, and for the wool and hides of
     animals slaughtered, provided such wool and hides are sold,
     and he shall deduct therefrom the sums actually paid as
     purchase money for the animals sold or slaughtered during
     the year.

     When animals were raised by the owner and sold or
     slaughtered he shall not deduct their value as expenses or
     loss. He may deduct the amount of money actually paid as
     expense for producing any farm products, live stock, etc.
     In deducting expenses for repairs on farm property the
     amount deducted must not exceed the amount actually expended
     for such repairs during the year for which the return is
     made. (See page 3, item 6.) The cost of replacing tools or
     machinery is a deductible expense to the extent that the
     cost of the new articles does not exceed the value of the
     old.

12. In calculating losses, only such losses as shall have been
     actually sustained and the amount of which has been
     definitely ascertained during the year covered by the return
     can be deducted.


                        Page D - 4 of 10

                                                       Appendix D


13. Persons receiving fees or emoluments for professional or
     other services, as in the case of physicians or lawyers,
     should include all actual receipts for services rendered in
     the year for which return is made, together with all unpaid
     accounts, charges for services, or contingent income due for
     that year, if good and collectible.

14. Debts which were contracted during the year for which return
     is made, but found in said year to be worthless, may be
     deducted from gross income for said year, but such debts can
     not be regarded as worthless until after legal proceedings
     to recover the same have proved fruitless, or it clearly
     appears that the debtor is insolvent. If debts contracted
     prior to the year for which return is made were included as
     income in return for year in which said debts were
     contracted, and such debts shall subsequently prove to be
     worthless, they may be deducted under the head of losses in
     the return for the year in which such debts were charged off
     as worthless.

15. Amounts due or accrued to the individual members of a
     partnership from the net earnings of the partnership,
     whether apportioned and distributed or not, shall be
     included in the annual return of the individual.

16. United States pensions shall be included as income.

17. Estimated advance in value of real estate is not required to
     be reported as income, unless the increased value is taken
     up on the books of the individual as an increase of assets.

18. Costs of suits and other legal proceedings arising from
     ordinary business may be treated as an expense of such
     business, and may be deducted from gross income for the year
     in which such costs were paid.

19. An unmarried individual or a married individual not living
     with wife or husband shall be allowed an exemption of
     $3,000. When husband and wife live together they shall be
     allowed jointly a total exemption of only $4,000 on their
     aggregate income. They may make a joint return, both
     subscribing thereto, or if they have separate incomes, they
     may make separate returns; but in no case shall they
     jointly claim more than $4,000 exemption on their aggregate
     income.

20. In computing net income there shall be excluded the
     compensation of all officers and employees of a State or any
     political subdivision thereof, except when such compensation
     is paid by the United States Government.

                                                          c2-7357


                        Page D - 5 of 10

                                                The Federal Zone:


                        Page D - 6 of 10

                                                       Appendix D


                        Page D - 7 of 10

                                                The Federal Zone:


                        Page D - 8 of 10

                                                       Appendix D


                        Page D - 9 of 10

                                                The Federal Zone:


                        Page D - 10 of 10


                           Appendix E

                        Viacom Transcript


                        Page E - 1 of 12

                                                The Federal Zone:


Reader's Notes:


                        Page E - 2 of 12

                                                       Appendix E


                     "Federal Income Taxes,

                           The IRS and

                      The Federal Reserve"


                               by


                    Mitch Modeleski, Founder
                 Account for Better Citizenship
                    c/o Post Office Box 6189
                 San Rafael, California Republic
                   Postal Zone 94903-0189/TDC


                  A Transcript of the Videotape
                Pre-Recorded on December 10, 1991
                 in the Professional Studios of:

                       Viacom Cablevision
                       1111 Andersen Drive
                 San Rafael, California Republic
                      Postal Zone 94901/TDC


                        Page E - 3 of 12

                                                The Federal Zone:


Hello, ladies and gentlemen.

My  name is Mitch Modeleski.

I am the founder of the Account for Better Citizenship.

For the next 30 minutes, I will be talking to you about federal
income taxes, the IRS, and the federal reserve system.

If you have a VCR, you might want to insert a blank tape and
record the next half-hour. You are going to hear some things
that you might want to hear again, or to replay later on for your
family, friends, and neighbors.

If you don't have a VCR, at the end of this program we will tell
you how to obtain a transcript of this program.

Let me first introduce myself. Before founding the Account for
Better Citizenship, I studied to be a Catholic priest for almost
6 years.

I have a Bachelor's degree from UCLA in Political Science.

I have a Master's degree in Public Administration from the
University of California at Irvine.

I have also completed 5 of the required 7 courses for a Master's
degree in the Program in Social Ecology, also at the University
of California at Irvine.

I have more than 20 years of professional experience in public
policy, environmental planning, and computer systems development.

Now, before you get the wrong idea, I want you to understand that
I have always had to work for a living.

When I graduated from college, I was over $6,000 in debt to banks
for student loans and other financial aid.

I have always paid the taxes I owed. I have obeyed the law. And
I have never been arrested.

During those 20 years of experience, I came to tolerate the
normal shenanigans I witnessed in American politics ...

... until June of 1990, when I was presented with real material
evidence that the 16th Amendment to the U.S. Constitution was
never ratified.

You may already know that the 16th Amendment is the so-called
"income tax" amendment.


                        Page E - 4 of 12

                                                       Appendix E


I investigated and found that some 17,000 State-certified
documents have been assembled to prove that the 16th Amendment is
really a fraud.

The U.S. Secretary of State in the year 1913, a man by the name
of Philander Knox, simply "declared" it ratified, in the face of
serious problems which he knew existed with the ratification in
several of the States.

You should know that it takes three-fourths (3/4) of the States
to ratify an amendment to the Constitution for the United States.

Let me give you just a few examples of the obstacles which this
amendment encountered in some of the States.

In the State of Illinois, a State court ruled that "it never
became a law, and was as much a nullity as if it had been the
act, or declaration, of an unauthorized assemblage of
individuals."

In the State of Arkansas, the Governor vetoed the proposed
amendment and the State Legislature never overrode his veto. You
should know that the Arkansas Constitution does not exempt
amendments from requiring a Governor's signature.

In Kentucky, the Senate Journal contains a clear statement that 9
Kentucky Senators voted FOR the amendment, and 22 voted AGAINST
the amendment. And yet, Philander Knox declared that the State
of Kentucky ratified the 16th Amendment.

This is obviously a serious matter, because we now have evidence
that one or more federal officials have actually tampered with
the supreme law of the land, contrary to their own sworn oaths of
office.

The year was 19131, an ominous year in the history of America.

In that same year, the Federal Reserve was established.

Look in your wallet for a moment, and pull out a Federal Reserve
Note. Already, you have a big problem in your hands.

First of all, the Federal Reserve is not "federal". It is no
more federal than Federal Express, or Federated Hardware Stores.
There is no government copyright or trademark on using the word
"federal".

Secondly, there is no "reserve". If we have time, we will
explain what is meant by "fractional reserve banking".


____________________
1. On the pre-recorded video tape, Mr. Modeleski erred by
     stating that the year was 1916. The correct year was 1913.


                        Page E - 5 of 12

                                                The Federal Zone:


Thirdly, Federal Reserve Notes are not real promissory notes,
because they do not promise to pay anything, like gold, or
silver, or any real substance.

The Federal Reserve System was conceived by a conspiracy of
bankers and politicians who met secretly off the coast of Georgia
to create the Federal Reserve Act.

This Act of Congress was designed to remove the Constitution as a
constraint on the financial operations of the U.S. government.

It created a private credit monopoly which Congressman Louis T.
McFadden once called "one of the most corrupt institutions the
world has ever known". Congressman McFadden was Chairman of the
House Banking and Currency Committee from 1920 to 1933.

The operations of the Federal Reserve are complicated and
secretive. For example, this huge syndicate of private banks has
never been publicly audited.

I will do my best to simplify the operations of the Federal
Reserve for you.

The Federal Reserve System is set up to encourage Congress to
spend money it doesn't have -- lots of it.

Rather than honestly taxing Americans for all the money it wants
to spend, Congress runs up a huge deficit which it covers by
printing ink on paper and calling it bonds, or Treasury Bills.

Some of these T-bills are purchased by hard-working Americans
like you and me, with money that we obtained from real labor,
something that has real value.

But the deficits have become so huge, the wage earners do not
have enough money to purchase all these bonds every year.

So, Congress walks across the street, and offers these bonds to
the Federal Reserve. The FED says, "Sure, we'll buy those bonds.
Your interest rate is 8.25, or 9 and a half. Take it or leave
it."

Congress always takes it, because there's nobody else with that
kind of money. Remember, the Federal Reserve is a private credit
MONOPOLY.

Now, what does the FED use to purchase those bonds?

They CREATE money OUT OF THIN AIR, using bookkeeping entries to
manufacture credit out of nothing. They used to use pen and ink,
then typewriters, now computers do the job.


                        Page E - 6 of 12

                                                       Appendix E


This artificial money would normally create very rapid inflation.
This happened in Germany just prior to World War II, when Louis
McFadden was a Congressman. It eventually took a wheel barrow
full of Deutsche marks to buy one loaf of bread. Can you imagine
that?

The bankers realized that a mechanism was needed to withdraw this
artificial money out of circulation as quickly as it was put into
circulation.

Enter the Internal Revenue Service.

The IRS is really a collection agency for the Federal Reserve.

The FED pumps money into the economy, and the IRS sucks it out of
the economy.

This has the effect of artificially maintaining the purchasing
power of this "fiat money", as it is called by monetary experts.

This is one of the PRIMARY PURPOSES of the income tax.

We know this to be true, because a man named Beardsley Ruml
explained it clearly in an essay he published in 1946. Beardsley
Ruml was chairman of the Federal Reserve Bank of New York, so he
was in a position to know.

The shocking fact is that Federal income taxes do not pay for any
government services; they are used to make interest payments on
the federal debt. These interest payments are now approaching 40
percent of the federal budget.

Now, the Federal Reserve Act is unconstitutional for many
reasons, foremost among which is that Congress delegated to a
private corporation a power which Congress never had, that is, to
counterfeit money.

It is unlawful for Congress to exercise a power which is not
authorized to it by the Constitution. The People (you and I) and
the States reserve ALL powers not expressly delegated to the
federal government.

Congress got hooked on this sweetheart deal and started spending
money so fast, it quickly bankrupted the Federal Government.

This may also come as a shock to many of you. And you might feel
that what we are about to say is paranoid or crazy. We felt this
way too when we first discovered it. We couldn't believe it. So
we investigated.

Our research discovered that the bankers foreclosed on the United
States Treasury no later than the year 1933. They called the
loans and confiscated all the gold then held by the U.S.
Treasury.


                        Page E - 7 of 12

                                                The Federal Zone:


An Act of Congress caused all that gold to be transferred to the
Federal Reserve banks. Remember, those are private banks. And
the Treasury Department is NOT the U.S. Treasury Department.

To secure the rest of their debt, Congress then liened, in
effect, on the future property and earnings of all the American
people, through Social Security taxes, payroll withholding taxes,
inheritance taxes, and the like.

Congress mortgaged the American people, using our labor and our
property as collateral.

What Congress did was analogous to this: I walk into a large
department store and see a new toaster I want. I tell the sales
person to ship it to my home tomorrow, and to send the bill to
Willie Brown.

Now, when Willie Brown gets the bill for this toaster, he's going
to be pretty mad, and rightly so. He didn't order the toaster;
he doesn't own the toaster; he wasn't a party to the transaction.
In fact, he didn't even know about it. And yet, I am holding
him responsible to pay for the toaster.

In this example, I am Congress; the department store is the
Federal Reserve; and Willie Brown represents the American
people.

This is fraud, because Congress did not openly and freely
disclose the real reasons for its actions.

Lack of full disclosure is grounds for fraud in any contract.
The Uniform Commercial Code says so.

And yet, all Americans are being unlawfully enslaved by this
fraud, to help discharge the debt which Congress has tried to
impose upon all of us.


Now, at this point, we will show you how to contact us to obtain
more information about this fraud. If you're not recording this
program, get a pencil and write down our mailing address:


                 Account for Better Citizenship
                  c/o USPS Post Office Box 6189
                 San Rafael, California Republic
                   Postal Code 94903-0189/TDC


If you will send us a stamped, self-addressed envelope, we will
be happy to send you a free reading list, and also a list of
organizations which you can contact to obtain more information
and to get yourself more involved.


                        Page E - 8 of 12

                                                       Appendix E


We will also send you a list of other documents which you can
purchase directly from us.

For example, we have already filed several formal complaints with
the Congress of the United States concerning the 16th Amendment
fraud. These complaints include a request for a Grand Jury
Investigation right here in Marin County.

Another document is a formal letter to all the Governors of the
50 States, putting them on notice of the great fraud and
deception under which the American people now suffer. This
letter includes a series of attachments which fully document the
fraud and deception.


Now, I want to talk a little bit about the law itself, the
Internal Revenue Code, and the IRS administration of that law.

The law and its administration are two completely different
things.

Under the Constitution, federal direct taxes on private property
must be apportioned. Your wages are private property.
Apportionment means that California pays 10 percent of the bill,
if California has 10 percent of the nation's population. This is
one of the reasons why we have a census every decade.

In its administration of the internal revenue laws, the IRS is
now imposing income taxes as direct taxes without apportionment,
and cites the 16th Amendment for its authority to do so. Well,
you now know that the 16th Amendment never happened.


Another big problem is the legal definition of "income". Believe
it or not, the term "income" is not defined anywhere in the
Internal Revenue Code. All by itself, this renders the law null
and void for vagueness.

On numerous occasions, the U.S. Supreme Court has already decided
that "income" means profit or gain, and wages are not income. In
one of the most famous of cases to decide this question, the case
of Eisner versus Macomber, the Supreme Court said:


     ... it is essential to distinguish between what is and what
     is not income, and to apply that distinction according to
     truth and substance, without regard to form.


And, in what must have been one of its finest hours, that same
Court also said:


                        Page E - 9 of 12

                                                The Federal Zone:


     Congress cannot by any definition it may adopt conclude the
     matter [of defining income], since it cannot by legislation
     alter the Constitution, from which alone it derives its
     power to legislate, and within whose limitations alone that
     power can be lawfully exercised.


Now, the law is something entirely different from the IRS
administration of that law. In order to understand the law
itself, we have consulted with legal investigators, attorneys,
professors, and paralegals. With their expert help, we have come
to conclude the following:

The citizens and residents of the United States are required to
pay income taxes. But what is meant by the term "United States"
in the Internal Revenue Code?

Well, this term has three different meanings, depending on the
context. First, it may mean the name of a sovereign nation
occupying the position of other sovereigns in the family of
nations.

Secondly, it may mean the collective name for the 50 States which
are united by and under the Constitution.

Thirdly, it can also mean the territory over which the federal
government has exclusive jurisdiction. This territory includes
only the District of Columbia, and the limited territories and
possessions which belong to the Congress of the United States.
These are places like Guam, Midway, and the Virgin Islands; they
do NOT include the 50 States of the Union. Congress does not own
California, for example.

When the law states that citizens and residents of the United
States are required to pay income taxes, the law is using the
term "United States" in this third sense.

The law says that if you're not a "United States citizen", then
you're an "alien". Also, the law says that if you're not a
"resident of the United States", then you're a non-resident.

Accordingly, most American Citizens, born free in one of the 50
States, living and working in one of the 50 States, are therefore
NONRESIDENT ALIENS according to the Internal Revenue Code.

I know it sounds strange, but the law is not referring to
creatures from outer space. The law is referring to the
creations of lawyers. You are "alien" with respect to the
federal government's areas of exclusive jurisdiction, if you were
born outside those areas.


                        Page E - 10 of 12

                                                       Appendix E


You are a "citizen" of the federal government if you were born in
the District of Columbia or in one of these limited other areas,
or if you elected to become a "citizen" through a process known
as naturalization.

There are only 2 reasons why NONRESIDENT ALIENS must pay federal
income taxes:


     (1) They either have income that is effectively connected
          with a trade or business inside the United States
          (using the third, limited definition of the United
          States), and/or

     (2) They have income from a source inside the United States
          (again, using this third, limited definition).


Aside from these exceptions, nonresident aliens pay no taxes on
their earnings.

So, talk with your CPA or tax attorney, and be sure to clarify
your status. You may want to consider filing IRS Form 1040NR
next April 15. If you have no income which falls into these two
categories, then you can put ZERO on line 23, the income total.

Be careful about attaching any W-2 or 1099 forms. Section 6065
of the Internal Revenue Code requires that such documents be
certified. If they are not certified, they are not valid.

Now, if you have ever filed one or more 1040 forms in the past,
the government is entitled to presume that you are a person who
is required to file a return and to pay federal income taxes.

This is called the "law of presumption", and your 1040 forms can
be used as evidence to prove that you are required to pay, even
when you are not. So, you may need to reverse this presumption
on their part, to prevent this from happening.

Thus, you should consider setting the record straight by sending
a formal AFFIDAVIT to the Secretary of the Treasury, which will
clarify your actual status and leave no doubt about their lack of
jurisdiction over you.

On the list of organizations we will send to you, there are
several groups around the country who can assist you in preparing
and executing this affidavit.

Enough of these details for now.

To summarize, chances are, you have been volunteering federal
income taxes in the past, and there is actually no legal
requirement for you to continue doing so in the future.


                        Page E - 11 of 12

                                                The Federal Zone:


If you would like me to speak with your CPA or tax attorney, I
will be happy to share the results of our research with them.

In the meantime, get yourself involved, and study the
Constitution. Find out how interesting and exciting it can be.

You have often heard that we get the government we deserve.
Let's do everything we can to deserve the very best government
that any nation has ever had.

I say these things because I hold these truths to be self-
evident:

That all of us are created equal;

That we are endowed by our Creator with certain unalienable
rights;

That among these, are the rights to life, liberty, and the
pursuit of happiness;

That, to secure these rights, governments are instituted among
us, deriving their just powers from our consent;

And that, whenever any form of government becomes destructive of
these ends, it is our right to alter or abolish it, and to
institute a new government, laying its foundation on such
principles, and organizing its powers in such form, as to us
shall seem most likely to effect our safety and our happiness.

And to this end, I dedicate my life, my fortune, and my sacred
honor.

Thank you very much.


                             # # #


                        Page E - 12 of 12


                           Appendix F

                     Affidavit of Rescission


                        Page F - 1 of 20

                                                The Federal Zone:


Reader's Notes:


                        Page F - 2 of 20

                                                       Appendix F


Certified Mail Number: __________________________________________

                 Date: __________________________________________

John Q. Doe
c/o USPS Post Office Box [##]
Marin County
San Rafael, California Republic
united States of America
zip code exempt (DMM 122.32)


                NUNC PRO TUNC ESTOPPEL AT LAW AND

               PUBLIC NOTICE RESCISSION AFFIDAVIT

                         OF JOHN Q. DOE


CALIFORNIA STATE/REPUBLIC )
                            ) Subscribed, Sworn and Sealed
MARIN COUNTY )

                            PREAMBLE

     I, State Citizen John Q. Doe, being a free Sovereign adult,
natural born in Massachusetts, living and working as a State
Citizen domiciled in the California Republic since 1952 and I, as
such status, hereby make this Special Appearance, by Affidavit,
in Propria Persona, proceeding Sui Juris, At Law, in Common Law,
with Assistance, Special, neither conferring nor consenting to
any foreign jurisdiction, except to the judicial power of
California and/or America, and as such I willfully enforce all
Constitutional limitations respectively on all government
agencies when dealing with them. Wherefore, the undersigned
Affiant, named herein and above, upon affirmation declares and
evidences the following:

     I, John Q. Doe, am of lawful age and competent. I am a
Sovereign natural born free State Citizen domiciled in the
California Republic (see 2:1:5 in the U.S. Constitution), and
thereby in the united States of America, in fact, by right of
heritage, a Sovereign State Citizen inhabiting and domiciled in
the California Republic, protected via hereditary succession by
my predecessors' previous contracts with government as found in
the Northwest Ordinance of 1787, the Organic Act of 1849 (the
original Constitution of California), the Articles of
Confederation of 1777, the Constitution for the united States of
America (1787) including its Preamble, and the Bill of Rights
(1791) including its Preamble; and, as such, I retain all my
unalienable rights granted by God in positive law, embodied in
the Declaration of Independence (1776) and binding rights upon
myself and my parentage, on this day and for all time now and
hereafter. And further,


                        Page F - 3 of 20

                                                The Federal Zone:


     I, John Q. Doe, a Sovereign natural born free State Citizen,
in Propria Persona, proceeding Sui Juris, At Law, with
Assistance, Special, receiving mail c/o USPS Post Office Box
[##], San Rafael, California Republic, zip code exempt (DMM
122.32), being duly sworn and affixing my signature to this
document, do hereby make the following statement of fact and
affirm: the so-called "Social Security" number 123-45-6789 is
rescinded in application, in body and in signature, for I affirm
that this agreement was imposed upon me by usage of threat,
coercion, withholding of material facts, and uninformed consent,
and that I was not at age of majority; therefore, this
aforementioned government action constitutes constructive fraud
and placed me under duress of mind and therefore deprived me of
giving any meaningful consent to the original "Social Security"
application and agreement. This agreement is null and void, ab
initio (from its inception), due to the aforementioned fraud.
And further,

              AFFIDAVIT AMENDMENT PROTECTION CLAUSE

     I, the undersigned, in order to protect my unalienable
rights to life, liberty and property, inclusive of my right to
the proper in rem and in personam State Citizenship status, have
been forced to amend certain legal documents and statements, due
to the continued revelation and increased discovery of the
continuous acts of fraud upon me by the de facto governments,
both State and Federal, and therefore I declare that I am now and
fully intend to remain free to amend any and all such documents
and statements, as a matter of substantive right, for I cannot be
held liable for either the acts or the omissions by governments
which are out of my control, which acts and omissions constitute
fraud in one form or another. Therefore, I proceed at all times
"WITH EXPLICIT RESERVATION OF ALL MY UNALIENABLE RIGHTS AND
WITHOUT PREJUDICE TO ANY OF MY UNALIENABLE RIGHTS", inclusive of
my personal right to substantive and procedural due process
proceedings under the Judicial Power of both my State and my
Nation. And further,


     I, John Q. Doe, do state and affirm the following:

     1. That material facts were withheld, such as Title 28,
U.S.C., Section 1746, Subsections 1 & 2 (being without or within
the "United States", respectively), which caused me to be unaware
that a completed, signed and submitted "Form 1040" or "income tax
return" and other Internal Revenue Service and State Franchise
Tax Board forms and documents are voluntarily executed
instruments which could be used as prima facie evidence against
me in criminal trials and civil proceedings to show that I had
voluntarily waived my Constitutionally secured rights and that I
had voluntarily subjected myself to the federal income/excise
tax, to the provisions of the Internal Revenue Code (hereinafter
referred to as the IRC), to the authority of the State Franchise
Tax Board (hereinafter referred to as the FTB) and to the


                        Page F - 4 of 20

                                                       Appendix F


authority of the Internal Revenue Service (hereinafter referred
to as the IRS) by signing and thereby affirming, under penalty of
perjury (within the "United States"), that I was, in effect, a
"person" subject to the tax; that the above induced and/or
forced action, via State and Federal governments, clearly
indicates a violation of Article 1, Section 9, Clause 3 (1:9:3),
to wit: "No Bill of Attainder or ex post facto Law shall be
passed" and also Article 1, Section 9, Clause 4 (1:9:4), to wit:
"No Capitation, or other direct, Tax shall be laid, unless in
Proportion to the Census or Enumeration hereinbefore directed to
be taken" in the United States Constitution. These above same
injunctions are found in the Northwest Ordinance and in the
California Constitution. And further,

     2. That material facts were withheld, which caused me to
be unaware of the legal effects of signing and filing income tax
returns, as shown by the decision of the United States Court of
Appeals for the 9th Circuit in the 1974 ruling in the case of
Morse vs U.S., 494 F.2d 876, 880, wherein the Court explained how
a State Citizen became a "taxpayer" by stating: "Accordingly,
when returns were filed in Mrs. Morse's name declaring income to
her for 1944 and 1945, making her potentially liable for the tax
due on that income, she became a taxpayer within the meaning of
the Internal Revenue Code." [emphasis added] And further,

     3. That material facts were withheld, which caused me to
be unaware that the signing and filing of an income tax return
and other IRS forms are acts of voluntary compliance for a
Sovereign natural born free State  Citizen inhabiting the united
States of America, when executed and submitted by said Sovereign
living and working within the States of the Union; that I was
unaware that, in a legislative court such as a United States
District Court, the completed IRS documents can become prima
facie evidence, sufficient to sustain a legal conclusion by a
judge, that the signer has voluntarily changed his lawful
status/state FROM that of a Sovereign natural born free State
Citizen who is not subject to any federal income tax and who
possesses all of his God-given, Constitutionally secured rights
when dealing with government, TO the legal status of a "taxpayer"
(any individual, trust, estate, partnership, association, company
or corporation subject to federal excise tax), that is, a
"person" who is subject to the federal excise tax and is,
therefore, subject to the authority, jurisdiction and control of
the federal government under the IRC, to the statutes governing
federal taxation and to the regulations of the IRS, thereby
imposing the tax on himself, waiving his God-given
Constitutionally secured rights to property and labor in respect
to the federal income/excise tax statutes and their
administration by the IRS, and establishing himself as one who
has privileges only, but no rights, in dealings with the IRS, the
same as a corporation; that it is my understanding that the
change of status/state resulting from the signed IRS documents is
very similar to the change of status that occurs when one enlists
in the military service and voluntarily takes an oath that


                        Page F - 5 of 20

                                                The Federal Zone:


subjects him to the authority, jurisdiction and control of the
federal government under Title 10 of the United States Code
(i.e., the statutes governing the armed forces and the
regulations of the military service), thereby waiving his
Constitutionally guaranteed rights in relation to dealings with
the military services. And further,

     4. That I, as a Sovereign natural born free State Citizen
and inhabitant in the united States of America, domiciled in the
California Republic, and as a Free Man, am endowed by my Creator
with numerous unalienable/inalienable rights which include but
are not limited to my rights to "life, liberty and the pursuit of
happiness (property)", which rights are specifically identified
in the Magna Carta (1215) and the Declaration of Independence
(1776), and protected and secured by the Constitution for the
united States of America (1789) and the subsequent Bill of
Rights, Articles in Amendment 1 thru 10 (1791); that my
birthright to the "life, liberty and the pursuit of happiness"
has been interpreted by both the Framers of the Constitution and
by the U.S. Supreme Court to include my unalienable right to
contract, to acquire, to deal in, to sell, rent, and exchange
properties of various kinds, real and personal, without
requesting or exercising any privilege or franchise from
government; that I have learned that these unalienable property
rights also include my right to contract for the exchange of my
labor-property for other properties and remuneration, such as
wages, salaries, and other earnings; that I have never
knowingly, intentionally or voluntarily waived any of these
unalienable rights, nor can I, John Q. Doe, be forced to waive
any of these rights granted to me by God the Father, my Creator
(see Brady vs U.S., 397 U.S. 742 at 748 (1970)), because I am
endowed with these rights by my Creator and by nobody else and
nothing else. And further,

     5. That I understand that, if the exercise of my rights
were subjected to taxation, these same rights could be destroyed
by increasing the tax rates to unaffordable levels; therefore,
courts have repeatedly ruled that government has no power
whatsoever to tax or otherwise "lien" against the exercise of any
rights, particularly the rights of Sovereign State Citizens, as
shown by the United States Supreme Court in the case of Murdock
vs Pennsylvania, 319 U.S. 105 (1943), which stated: "A state may
not impose a charge for the enjoyment of a right granted by the
Federal Constitution."; that unalienable rights are rights
against which no lien can be established precisely because they
are un-a-lien-able; that America's founding documents enumerate
some of my unalienable rights, none of which rights I have ever
waived knowingly, voluntarily and intentionally; that I freely
choose to obey all American Law and to pay all Lawful taxes in
jurisdictions which are applicable to me for the common good;
that I stand in Propria Persona with Assistance, Special; that
my status and unalienable rights, as stated hereinafter and in
the foregoing, are not negotiable. And further,


                        Page F - 6 of 20

                                                       Appendix F


     6. That, for years past and at least since the year 1964,
I have been influenced by numerous cases of people going to jail
and being punished, and also by numerous and repeated public
warnings made by the FTB and by the IRS, via radio, television,
the printed press and other forms of public communication media,
warning of the "deadline" for filing State and Federal forms,
such as a "Form 1040 Income Tax Return" and/or other IRS forms
and documents; this therefore caused me to file said forms under
threat, duress and coercion. And further,

     7. That, in addition to the aforesaid warnings, I have
also been influenced by the misleading and deceptive wording of
IRS publications and IRS-generated news articles, by the pressure
of widespread rumors and misinformed public opinion, and by the
advice and assurances of lawyers, C.P.A.'s and income tax
preparers which misled me to believe incorrectly that the 16th
Amendment to the Constitution for the united States of America
abolished the Fifth Amendment of that same Constitution and
authorized Congress to impose a direct tax on me, my property, my
exchanges of property and/or property received as a result of
exercising my Constitutionally secured right to contract; that I
was further misled into believing that I had a legal duty and
obligation to file a "Form 1040 Income Tax Return" and other IRS
and State tax forms, schedules and documents, and that I was
unaware of 28 U.S.C. 1746, wherein there are two perjury clauses:
(1) one stating that you are without the "United States" and also
(2) the other stating that you are within the "United States",
respectively. The perjury clauses on both State and Federal tax
forms stipulate, under penalty of perjury, that I was stating
unknowingly, involuntarily and unintentionally that I was within
the "United States". This is an act of fraud by both State and
Federal taxing agencies. And further,

     8. That I have also been further influenced, misled and
alarmed by rumors, by misinformed public opinion and by the
advice and assurances of lawyers, C.P.A.'s and income tax
preparers to the effect that "the IRS and the FTB will get you",
and that it would be a crime punishable by fines and/or
imprisonment if I did not fill out, sign and file with the IRS a
"Form 1040"; that, in point of fact, the only person actually
named within the IRC as a person required to collect an income
tax, to file an income tax return and to pay an income tax is a
"Withholding Agent"; and that, to the best of my knowledge, I am
not now, nor have I ever been a "Withholding Agent". And
further,

     9. That, in addition to all of the reasons stated in
paragraphs 6, 7 and 8 above, I was influenced by the common and
widespread practice of employers who, either knowingly or
unknowingly, without Power of Attorney, misled me and their
employees to believe that they and I must have a Social Security
Number and that all are subject to the withholding of "income
taxes" from their earnings, either with or without their
permission, based upon the employers' possibly mistaken


                        Page F - 7 of 20

                                                The Federal Zone:


assumption that they, as employers, are required by law to
withhold "income taxes" from the paychecks of their employees,
which is contrary to the Sections 3402(n), 7343 and 7701(a)(16)
of the IRC, absent a voluntary execution of Form W-4, the
"Employee's Withholding Allowance Certificate". And further,

     10. That I have also been mistakenly influenced and
mistakenly impressed by annual public displays and indiscriminate
public offerings by the IRS and the FTB of large quantities of
the Forms 1040 and 540 in banks, in post offices and through the
U.S. mail, which public displays and indiscriminate public
offerings also had the effect of reminding me of, and inducing me
to respond mistakenly by filling out, signing and sending "Form
1040" to the IRS and "Form 540" to the FTB. And further,

     11. That said "Forms 1040" contained no reference to any
law or laws which would explain just exactly who is and who is
not subject to, or liable for, the income tax, State or Federal,
nor did it contain any notice or warning to anyone that merely
sending said completed "Form 1040" to the IRS would waive my
right to privacy, as secured by the 4th Amendment in the U.S.
Constitution, and also waive my right to not be a witness against
myself, as secured by the 5th Amendment in the U.S. Constitution,
and that a completed "Form 1040" would, in itself, constitute
legal evidence, admissible in a court of law, that the filer is
subject to and liable for the income/excise tax, even though and
regardless of the fact that I, as a Sovereign natural born free
State Citizen, am actually and legally not subject to the
statutory jurisdiction of the IRC, nor liable for any
income/excise tax, and regardless of the fact that, to the best
of my knowledge, I have no legal duty or obligation whatsoever to
complete and file any "Form 1040" or State income tax forms, nor
did they ever evidence 28 U.S.C. 1746. And further,

     12. That at no time was I ever notified or informed by the
IRS or by the State of California, nor by any of their agents or
employees, nor by any lawyer, C.P.A., or tax preparer, of the
fact that the so-called 16th Amendment in the U.S. Constitution,
as correctly interpreted by the U.S. Supreme Court in such cases
as Brushaber vs Union Pacific Railroad Co., 240 U.S. 1 (1916) and
Stanton vs Baltic Mining Co., 240 U.S. 103 (1916), identified the
income tax as an indirect excise tax in accordance with Article
1, Section 8, Clause 1 (1:8:1) of the United States Constitution;
that the so-called 16th Amendment to the U.S. Constitution, as
correctly interpreted by the U.S. Supreme Court, does not
authorize a tax on all individuals but is applicable to
nonresident aliens (e.g., Frank R. Brushaber) who involve
themselves in activities, events or occupations which come under,
or are within, the taxing authority of the "United States", as
explained in Treasury Decision 2313, dated March 21, 1916; that
the so-called 16th Amendment was never actually ratified nor
could it have been enacted into positive law because the
requisite number of States (i.e., 36) did not meet the lawful
requirements for amending the Constitution at that time; and


                        Page F - 8 of 20

                                                       Appendix F


that a mass of incontrovertible material evidence available since
the year 1985 proves that the act of "declaring" the so-called
16th Amendment "ratified" was an act of outright fraud by
Philander C. Knox in the year 1913. And further,

     13. That at no time was I ever notified or informed by the
FTB nor by the IRS, their agents or employees, nor by any lawyer,
C.P.A. or tax preparer, of the fact that, because of various
rulings of the U.S. Supreme Court in such cases as Flint vs Stone
Tracy Co., 220 U.S. 107 (1911), and Pollock vs Farmer's Loan and
Trust Co., 157 U.S. 492 (1895), the indirect excise tax on
incomes identified by the so-called 16th Amendment is also a tax
upon corporate privileges granted by government, which tax is
measured by the amount of corporate income (see Corporations Tax
Act, Statutes at Large, 1909, vol. XXXVI, section 38, page 112);
that this indirect excise tax is also imposed on the taxable
income of foreign corporations, and on the taxable income of
nonresident aliens to the extent this (latter) income is either
effectively connected with the conduct of a trade or business
within the corporate jurisdiction of the "United States", or
derived from sources within the corporate jurisdiction of the
"United States" although not effectively connected with the
conduct of trade or business within the corporate jurisdiction of
the "United States", according to Sections 871 and 872 of the
IRC. And further,

     14. That my attention has been called to Report No. 80-19A,
entitled "Some Constitutional Questions Regarding the Federal
Income Tax Laws" published by the American Law Division of the
Congressional Research Service of the Library of Congress,
updated January 17, 1980; that this publication describes the
tax on "income" identified in the so-called 16th Amendment to the
U.S. Constitution as an indirect excise tax; that this report
stated: "The Supreme Court, in a decision written by Chief
Justice White, first noted that the 16th Amendment did not
authorize any new type of tax, nor did it repeal or revoke the
tax clauses of Article I of the United States Constitution,
quoted above."; and this report further stated: "Therefore, it
can clearly be determined from the decisions of the United States
Supreme Court that the income tax is an indirect tax, generally
in the nature of an excise tax ....", thus proving in my mind
that the "income tax" is not a tax on me as a Sovereign natural
born free State Citizen, but is, rather, an indirect excise tax
as described by the U.S. Supreme Court in the case of Flint vs
Stone Tracy Co., 220 U.S. 107 (1911), wherein the high Court
defined excise taxes as "... taxes laid upon the manufacture,
sale, or consumption of commodities within the country, upon
licenses to pursue certain occupations, and upon corporate
privileges ....", none of which aforesaid classifications apply
to me. And further,

     15. That I was unaware of the truth of the rarely
publicized statement by the IRS that the "income" tax system is
based upon "voluntary compliance with the law and self-assessment


                        Page F - 9 of 20

                                                The Federal Zone:


of tax"; that I was unaware before June of 1990 of a posted
notice in the main lobby of the Federal Building in San
Francisco, California, outside the offices of the IRS, which
notice reads, in pertinent part, "The purpose of the Internal
Revenue Service is to ... encourage and achieve the highest
degree of voluntary compliance in accordance with the tax laws
and regulations."; that I was unaware before June of 1990 that
Mr. Roger M. Olsen, Assistant Attorney General, Tax Division,
Department of Justice, Washington, D.C., made the following
statement to an assemblage of tax lawyers on May 9, 1987: "We
encourage voluntary compliance by scaring the heck out of you.";
that it has never been either my intention nor my desire to
voluntarily self-assess an excise tax upon myself, nor to give up
my right to property, nor to voluntarily subject myself to such
an excise tax; that I had always thought that compliance was
required by law. And further,

     16. That I have examined Sections 871 thru 878, 1441, 1442,
1443, 3401(c), 6001, 6011, 6012(a), 6331(a), 7203, 7205 and 7343
of the IRC, and I am entirely convinced and completely satisfied
that I am not now, nor was I ever, any such "person" or
individual referred to by these sections. And further,

     17. That, after careful study of the IRC, and after
consultations on the provisions of that Code with informed
lawyers, tax accountants and tax preparers concerning the
provisions of the IRC, I have never found or been shown any
sections of the IRC that imposed any requirement on me as a
Sovereign natural born free State Citizen and unprivileged
inhabitant, living and working within a County within a State of
the Union, to file a "Form 1040 Income Tax Return" or any other
State income tax form, or that imposed a requirement upon me to
pay a tax on "income", or that would classify me as a "person
liable", as a "person made liable", or as a "taxpayer" as the
term "taxpayer" is defined in IRC Section 7701(a)(14), which
states: "The term 'taxpayer' means any person subject to any
internal revenue tax." And further,

     18. That, after the study and consultations mentioned in
paragraph 17, the only mention of any possible requirement upon
me, as an individual, to pay a tax on "income", that I could
find, or was shown in the IRC, was the title of Part I under
Subtitle A, Chapter 1, Subchapter A (which is deceptively titled
"Tax on Individuals") and Section 6012(a), Subtitle F, Chapter
61-A, Part II-B, Subpart B, and the California Tax Statutes;
that a careful study and earnest examination of these parts of
the IRC revealed that the "individuals" to whom these sections
refer are, in fact, either individuals who work within a foreign
nation like France and are taxed according to a tax treaty, or
they are nonresident aliens who receive income which is either
effectively connected with the conduct of a trade or business
within the corporate jurisdiction of the "United States", or
derived from sources within the corporate jurisdiction of the
"United States", although not effectively connected with the


                        Page F - 10 of 20

                                                       Appendix F


conduct of trade or business within the corporate jurisdiction of
the "United States", according to Sections 871 and 872 of the
IRC; and that, to the best of my knowledge, I have never
conducted any trade or business within the corporate jurisdiction
of the "United States", nor have I ever derived income from
sources within the corporate jurisdiction of the "United States".
And further,

     19. That, after the study and consultations mentioned in
paragraph 17 above, my attention was called to the IRC, Chapter
21, entitled "Federal Insurance Contributions Act" (Social
Security), and my attention was also called to Subchapter A of
Chapter 21 entitled "Tax on Employees", which includes Section
3101, wherein the Social Security tax is identified as a tax on
"income", not as an "Insurance Contribution", not as a "Tax on
Employees", and not as a tax on wages or earnings; that my
attention was further called to these facts: there is no
provision in the IRC that imposes the tax on employees or
requires them to pay the tax; a voluntarily signed and completed
Form W-4, "Employee's Withholding Allowance Certificate", allows
an employer to withhold money from a worker's pay for Social
Security "income" tax, even though the worker has claimed on that
form to be "exempt" from the graduated "income" tax; and an
employer has no authority to withhold money from a worker's pay
for the Social Security "income" tax, for the graduated "income"
tax, nor for any IRS-imposed penalty or assessment, if there is
no voluntarily signed "Form W-4" in force and no "Form 2678" in
force Granting Power of Attorney. And further,

     20. That, after the study and consultations described in
paragraph 17 above, my attention was called to Section 61(a) of
the IRC, which lists items that are sources of "income", and to
the following facts: that IRS Collections Summons Form 6638 (12-
82) confirms that these items are sources, not "income", by
stating that the following items are "sources": "wages,
salaries, tips, fees, commissions, interest, rents, royalties,
alimony, state or local tax refunds, pensions, business income,
gains from dealings in property, and any other compensations for
services (including receipt of property other than money).";
that sources are not "income", but sources become "income" if
they are entered as "income" on a signed "Form 1040", because the
signer affirms, under penalty of perjury (within the "United
States"), that the items entered in the "income" section of the
"Form 1040" are "income" to the signer; that Section 61(b)
clearly indicates which sections of the IRC identify and list
items that are included in "income" by stating: "For items
specifically included in gross income, see Part II (sec. 71 and
following)". And further,

     21. That my attention was then called to the said Part II
entitled: "Items Specifically Included in Gross Income"; that I
studied sections 71 thru 87 and noticed that wages, salaries,
commissions, tips, interest, dividends, pensions, rents,
royalties, etc., are not listed as being included in "income" in


                        Page F - 11 of 20

                                                The Federal Zone:


those Sections of the IRC; and that, in fact, those items are
not mentioned anywhere in any of these sections of the IRC. And
further,

     22. That, after further diligent study, it appears entirely
clear to me that the only way that property received by me as a
Sovereign natural born free State Citizen, living and working
within the States of the Union, in the form of wages, salaries,
commissions, tips, interest, dividends, rents, royalties and/or
pensions could be, or could have been legally considered to be
"income", is if I voluntarily completed and signed a "Form 1040
Income Tax Return", thereby affirming, under penalty of perjury
(within the "United States"), that the information on such "Form
1040" was true and correct, and that any amounts listed on the
"Form 1040" in the "income" block were "income", and thereby
acknowledging under oath or affirmation, that I am, or was, a
taxpayer subject to the tax and have, or had, a duty to file a
"Form 1040 Income Tax Return" and/or other IRS forms, documents
and schedules, none of which instruments I have ever signed with
the understanding that I signed them knowingly, voluntarily and
intentionally and by means of knowingly intelligent acts done
with sufficient awareness of all the relevant circumstances and
consequences (see Brady vs United States, 397 U.S. 742 at 748
(1970)); and that, when I have sent in State and Federal tax
forms purposely not signed, they were returned to me with a
letter instructing and stipulating that I must sign the forms
under the penalty of perjury, thereby claiming that I was a
"United States citizen" due to the wording of the perjury clause
(see 28 U.S.C. 1746(2)). And further,

     23. That, with good faith, with an honest reliance upon the
aforementioned U.S. Supreme Court rulings and with reliance upon
my constitutionally protected Natural Common Law Bill of Rights,
Amendments 1 thru 10 (1791), to lawfully contract, to lawfully
work and to lawfully acquire and possess property, I am convinced
and satisfied that I am not now, nor was I ever subject to,
liable for, or required to pay an income/excise tax; that I am
not now, nor have I ever been a "taxpayer", and there has never
been a Judicial Power proceeding in which it was ruled that I was
a "taxpayer" as that term is defined and used in the IRC; and
that I have never had any legal duties or obligations whatsoever
to file any "Form 1040" or to make any "income tax return", or to
sign or submit any other IRS "individual" forms or documents or
schedules, to pay any "individual" income tax, to keep any
personal financial records, or to supply any personal information
to the IRS. And further,

     24. That the U.S. Congress, the International Monetary
Fund, the Federal Reserve Banks and the Internal Revenue Service,
by means of vague, deceptive and misleading words and statements
in the IRC, in the Code of Federal Regulations (CFR), in official
statements by IRS Commissioners in the Federal Register, in IRS
publications and in IRS-generated news articles, committed
constructive fraud and misrepresentation by misleading and


                        Page F - 12 of 20

                                                       Appendix F


deceiving me, as well as the general public, into believing that
I was required to file "Form 1040 Income Tax Returns" and other
IRS forms, documents and schedules and that I was also required
to keep records, to supply information and to pay income taxes.
And further,

     25. That, by reason of the aforementioned facts, I do
hereby exercise my rights as a Sovereign natural born free State
Citizen, upheld by various court decisions, to rescind, to cancel
and to render null and void, Nunc Pro Tunc, both currently and
retroactively to the time of signing, based upon the constructive
fraud and misrepresentation perpetrated upon me by the Federal
government, the U.S. Congress, the IRS, the "State of
California", and the FTB, all IRS and FTB forms, statements,
documents, returns, schedules, contracts, licenses, applications,
articles, certificates and/or commercial agreements ever signed
and/or submitted by me, or on my behalf by third parties
(including but not limited to Forms 1040 and attached schedules,
Forms W-2, Forms W-4, and Forms 1099) on the accounts bearing the
account numbers 123-45-6789, and 98-7654321 and all my signatures
on any and all of the aforementioned items, including the
original "Social Security" application, which caused the account
bearing the account number 123-45-6789 to be established; that
this notice of rescission is based upon my rights with respect to
constructive fraud and misrepresentation as established in, but
not limited to, the cases of Tyler vs Secretary of State, 184
F.2d 101 (1962) and also El Paso Natural Gas Co. vs Kysar
Insurance Co., 605 Pacific 2d 240 (1979), which stated:
"Constructive fraud as well as actual fraud may be the basis of
cancellation of an instrument." And further,

     26. That I do hereby declare that I am not and never was a
"taxpayer" as that term is defined in the IRC, a "person liable"
for any internal revenue tax, or a "person" subject to the
provisions of the IRC, and I do hereby declare that I am, and
have always been, a "nontaxpayer"; that courts have recognized
and acknowledged that individuals can be nontaxpayers, "... for
with them Congress does not assume to deal and they are neither
the subject nor the object of revenue laws ....", as stated in
the cases of Long vs Rasmussen, 281 F. 236 (1922), De Lima vs
Bidwell, 182 U.S. 176, 179, and Gerth vs United States, 132 F.
Supp. 894 (1955). And further,

     27. That evidence now available to me proves that the
Internal Revenue Service has to date failed to comply with the
clear and unambiguous requirements imposed on all federal
government agencies by the following Congressional statutes: the
Federal Register Act (44 U.S.C. 1501 et seq.), the Administrative
Procedures Act (5 U.S.C. 551 et seq.), and the Paperwork
Reduction Act (44 U.S.C. 3501 et seq.); that the IRS failure to
comply with the requirements of these statutes constitutes
further constructive fraud, breach of fiduciary trust between
Sovereign State Citizens and public servants, and violations of
the solemn oaths of office required of federal government


                        Page F - 13 of 20

                                                The Federal Zone:


officials, thereby relieving me of any and all legal duties which
could or might otherwise exist for me to file any returns,
schedules, or other documents with the IRS; and that, after
having read these three statutes and summaries of related case
law, I thereby conclude that there is no reason why the IRS would
be exempt from any of the clear and unambiguous requirements
imposed upon federal government agencies by these three statutes,
notwithstanding any and all allegations to the contrary that
heretofore may have been published by the IRS or the Treasury
Department in the Federal Register without also citing the proper
legal authorities, if any, for such allegations. And further,

     28. That recent diligent studies have convinced me of the
above, and that as such I am not "subject to" the territorially
limited "exclusive legislation" nor to the foreign jurisdiction
mandated for the District of Columbia, federal enclaves, federal
territories, and federal possessions by Article 1, Section 8,
Clauses 17 and 18 and Article 4, Section 3, Clause 2 of the U.S.
Constitution, including its "internal" governmental organizations
therein (hereinafter referred to as the "Federal Legislative
Democracy" and elsewhere referred to in this Affidavit as the
"corporate jurisdiction of the United States"); that I am not
"subject to" this foreign jurisdiction by reason of any valid
contract or any valid commercial agreement resulting in adhesion
thereto across America, nor are millions of other Sovereign State
Citizens, unless they have provided "waivers of rights guaranteed
by the Constitution" by means of "knowingly intelligent acts",
such as contracts or commercial agreements with such
government(s) "with sufficient awareness of the relevant
circumstances and likely consequences", as ruled by the U.S.
Supreme Court in Brady vs. U.S., 397 U.S. 742 at 748 (1970); and
that I myself have given no such "waivers". And further,

     29. That these same diligent studies have also proved to me
that misrepresentation and a shrewd and criminal constructive
fraud have been perpetrated upon Sovereign State Citizens by
government, under counterfeit "color of law", through the
apparent entrapments of "certain activities (monopoly
occupations) and privileges (other benefits)" allowed by
statutory acts or otherwise; that, by reason of American Law
which has never been repealed, such sources of past and present
criminal element in and behind government should be brought to
justice in a Constitutional Court of Law for aiding and abetting
this misrepresentation and constructive fraud as willing
accomplices; that it is for such a Court, with a 12-member jury
of peers, to decide who is and who is not guilty among personnel
of government, media, schools, lawyers, accountants, clergy and
other purveyors of misinformation and other mind-set propaganda,
in this and related regards. And further,

     30. That, due to such shrewd entrapments over many years, I
have unwittingly signed many related documents, contracts and
commercial agreements, some even under the "perjury" jurat
(within the "United States") as was supposedly required; with


                        Page F - 14 of 20

                                                       Appendix F


American Law on my side, I hereby rescind and cancel any and all
such signatures and render them null and void, nunc pro tunc,
except for those which I may choose to have considered as being
under "TDC" (Threat, Duress and/or Coercion), past and present;
that this is also my lawful notice that all such signatures of
mine in the future on instruments of government or other
entities,including banks, which might otherwise result in
contract adhesion, are to be considered as being under "TDC",
whether appearing therewith or otherwise; that my Constitutional
"Privileges and Immunities" (per Article 4, Section 2) are apart
from those mandated for the Federal Legislative Democracy by
Article 1, Section 8, Clauses 17 and 18 and by Article 4, Section
3, Clause 2, and shall not by Law be violated ever; and that my
status, in accord, is stated for all to see and know in 2:1:5,
1:2:3, 4:2:1 and 3:2:1 of the Constitution for the united States
of America. And further,

     31. That, with this accurate knowledge and with "the
supreme Law of the Land" (Article 6, Section 2) again on my side,
I do Lawfully and "squarely challenge" the fraudulent, usurping,
octopus-like authority and jurisdiction cited above in paragraph
28, which authority and jurisdiction do not apply to me (see
Hagans vs. Lavine, 415 U.S. 528 at 533); it is, therefore, now
mandatory for any personnel of the Federal Legislative Democracy
or its agents to FIRST PROVE its "jurisdiction", if any, over me
before any further procedures can take place in my regard, per
Title 5, United States Code, "Government Organization and
Employees", Section 556(d), specifically by disclosing in writing
any and all contracts or other commercial agreements whereby the
Federal Legislative Democracy and its agents claim to have
obtained controlling interest in me such that my specific
performance to any third party debt or obligation can be
compelled; OR ELSE any of its personnel and accomplices who
willfully violate this statute can and shall be personally
charged as citizens under Title 18, United States Criminal Code,
Sections 241, 242, 1001 and/or otherwise; and, in fairness, it
must be added that, to my knowledge, IRS agents have NO written
lawful "Delegation of Authority" within the 50 States of the
Union and their so-called "Form 1040" appears to be a bogus and
bootleg document on its face. And further,

     32. That, with all of the above in mind, it appears that
this Sovereign natural born free State Citizen is, by Law, as
"foreign" and as much a NONRESIDENT ALIEN with respect to the
Federal Legislative Democracy as he is to France, and thus shall
be free to use related Forms of the Federal Legislative Democracy
if and when they might be needed, required and/or appropriate at
various future times and places yet to be determined (see
paragraphs 12, 13 and 18 above), including but not limited to
Form W-8 ("Certificate of Foreign Status") or its equivalent for
banks and/or other financial institutions, Forms 1040X ("Amended
U.S. Individual Income Tax Return") and 1040NR ("U.S. Nonresident
Alien Income Tax Return") for refunds and for correcting the


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administrative record, and IRC Section 3402(n) which authorizes
certificates of exemption from withholding. And further,

     33. That, since my date of birth on June 21, 1948, I have
always been a NONRESIDENT ALIEN with respect to the Federal
Legislative Democracy of the "United States", never having
resided, worked, nor having any income, to the best of my
recollection, from any sources within the District of Columbia,
Puerto Rico, Virgin Islands, Guam, American Samoa, Northern
Mariana Islands, the Trust Territory of the Pacific Islands or
any other territory or possession within the "United States",
which entity obtains its exclusive legislative authority and
jurisdiction from Article 1, Section 8, Clauses 17 and 18 and
Article 4, Section 3, Clause 2 of the U.S. Constitution; that I
have always been a non-taxpayer outside the venue and
jurisdiction of the IRC; that, to the best of my knowledge, I
have never had any "U.S. trade or business" as defined in the
IRC, in 26 C.F.R. or in 27 C.F.R.; that, to the best of my
knowledge, I have never had any "gross income" from any U.S.
sources, as the term "gross income" is defined in IRC Section
872(a). And further,

     34. That my use of IRS Forms 1040X and 1040NR shall be
presumed to mean that they were filed solely to correct the
administrative record permanently, retroactively to June 21,
1948, so as to claim any lawful refunds that may be due, to rebut
any erroneous presumptions and/or terminate any erroneous
elections of U.S. "residence" which may have been established in
error by the filing of any prior IRS forms, schedules and other
statements by mistakes resulting in part from the demonstrable
vagueness that is evident in the IRC and its regulations, and by
mistakes resulting also from the constructive fraud and
misrepresentation mentioned throughout this Affidavit; that I
was neither born nor naturalized in the "United States", I have
never been subject to its jurisdiction, and I have never been a
"United States citizen" as defined in 26 C.F.R. 1.1-1(c) and as
defined in the so-called 14th Amendment to the U.S. Constitution.
And further,

     35. That the federal government has committed fraud, duress
and coercion, exercised undue influence, and evidenced unlawful
menace against the American people by representing the so-called
14th Amendment as a lawfully ratified amendment in the U.S.
Constitution, when contrary proof, published court authorities
and other competent legal scholars have now established that it
was NOT lawfully ratified. (See State vs Phillips, 540 P.2d 936
(1975); Dyett vs Turner, 439 P.2d 266 (1968); 28 Tulane Law
Review 22; 11 South Carolina Law Quarterly 484.) And further,

     36. That I am not now, nor have I ever knowingly,
intentionally and voluntarily, with informed consent, entered
into any personal, internal, public or private agreement,
contract, stipulation, account or similar contrivance with the
"United States", the "Federal Government" or the "District of


                        Page F - 16 of 20

                                                       Appendix F


Columbia", its territories, its agencies or other property
appurtenant thereto, which would have altered or waived my de
jure, Sui Juris status, or my unalienable God-given natural
rights; that any such agreements or contracts, expressed or
implied, such as a Social Security number and application, or
Driver's License, or Bank Signature Card, or the use of Federal
Reserve Notes (which are not lawful Specie) etc., have all been
hereby rescinded ab initio, due to the fraudulent withholding of
material facts, which became a snare and a trap and, as such, are
a Bill of Attainder on this Sovereign natural born free State
Citizen and inhabitant in the united States of America, for I
cannot become a nexus by the effect of a fraudulent nexum,
because my status and unalienable natural rights are not
negotiable, and the government, both State and Federal,  has not
proved that they ever had jurisdiction to change my status, as
required by Title 5 U.S.C. Section 556(d), or as defined and set
out as a Constitutional requirement in Hagans vs Lavine, 415 U.S.
528, 533 (see also Brady vs United States, 397 U.S. 742 at 748
(1970)); that any change of status would lawfully have to take
place in a Common Law (judicial power) court under the due
process clause of the 5th Amendment to the U.S. Constitution.
And further,

     37. That this is to certify that I, John Q. Doe, am a
Sovereign natural born free State Citizen and inhabitant in the
united States of America, domiciled in the California Republic,
living and working in Marin County, living under the Common Law,
having assumed, among the powers of the Earth, the Separate and
Equal Station to which the Laws of Nature and Nature's God
entitles me, in order to secure the Blessings of Liberty to
Myself and my Posterity, and in order to re-acquire the
Birthright that was taken from me by fraud, do hereby asseverate
nunc pro tunc and rescind, ab initio, all feudatory contracts
with the Federal government and its agencies, and with the
corporate State of California and its agencies; for I, John Q.
Doe, being of sound mind and body, do not choose, nor have I ever
chosen, to give up, relinquish or otherwise waive any of my
God-given, natural, fundamental, Constitutionally secured rights.
And further,

     38. That my use of the phrase "WITH EXPLICIT RESERVATION OF
ALL MY RIGHTS AND WITHOUT PREJUDICE UCC 1-207 (UCCA 1207)" above
my signature on this document indicates: (1) that I explicitly
reject any and all benefits of the Uniform Commercial Code,
absent a valid commercial agreement which is in force and to
which I am a party, and cite its provisions herein only to serve
notice upon ALL agencies of government, whether international,
national, state or local, that they, and not I, are subject to,
and bound by, all of its provisions, whether cited herein or not;
(2) that my explicit reservation of rights has served notice upon
ALL agencies of government of the "Remedy" they must provide for
me under Article 1, Section 207 of the Uniform Commercial Code,
whereby I have explicitly reserved my Common Law right not to be
compelled to perform under any contract or commercial agreement,


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                                                The Federal Zone:


that I have not entered into knowingly, voluntarily, and
intentionally; (3) that my explicit reservation of rights has
served notice upon ALL agencies of government that they are ALL
limited to proceeding against me only in harmony with the Common
Law and that I do not, and will not accept the liability
associated with the "compelled" benefit of any unrevealed
commercial agreements; and (4) that my valid reservation of
rights has preserved all my rights and prevented the loss of any
such rights by application of the concepts of waiver or estoppel.
And further,

     39. That I reserve my unalienable right to amend this
Affidavit at times and places of my own choosing, according as
new facts and revelations are made available to me at various
future times and places as yet unknown, and as yet to be
determined, given the massive fiscal fraud which has now been
sufficiently revealed to me by means of material and other
reliable evidence which constitutes satisfactory and
incontrovertible proof of the fraud to which I refer in this
paragraph and elsewhere in this Affidavit. And further,

     40. That I affirm, under penalty of perjury, under the
Common Law of America, without the "United States", that the
foregoing is true and correct, to the best of my current
information, knowledge and belief, per 28 U.S.C. 1746(1); and


Further This Affiant saith not.


Subscribed and affirmed to Nunc Pro Tunc on the date of my
majority, which day was June 21, 1969.


Subscribed, sealed and affirmed to this ________________ day of

___________________________, 1993.


I now affix my own signature to all of the above affirmations
WITH EXPLICIT RESERVATION OF ALL MY RIGHTS AND WITHOUT PREJUDICE
UCC 1-207 (UCCA 1207) (see paragraph 38 above):


_________________________________________________________________
John Q. Doe, State Citizen and Principal, by special Appearance,
in Propria Persona, proceeding Sui Juris, with Assistance,
Special, with explicit reservation of all my unalienable rights
and without prejudice to any of my unalienable rights

                           John Q. Doe
                  c/o USPS Post Office Box [##]
                 San Rafael, California Republic
                  zip code exempt (DMM 122.32)


                        Page F - 18 of 20

                                                       Appendix F


             California All-Purpose Acknowledgement

CALIFORNIA STATE/REPUBLIC )
                                )
COUNTY OF MARIN )

     On the ________ day of ____________, 199_ Anno Domini,
before me personally appeared John Q. Doe, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
Person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in His authorized
capacity, and that by His signature on this instrument the
Person, or the entity upon behalf of which the Person acted,
executed the instrument. Purpose of Notary Public is for
identification only, and not for entrance into any foreign
jurisdiction.

WITNESS my hand and official seal.


_____________________________________
Notary Public


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Reader's Notes:


                        Page F - 20 of 20


                           Appendix G

                    Deceptive IRS Code Words


                        Page G - 1 of 12

                                                The Federal Zone:


Reader's Notes:


                        Page G - 2 of 12

                                                       Appendix G


                    Deceptive IRS Code Words:


       "Income", "Person", "Taxpayer", "Shall", and "Must"


Learn to Decipher the Internal Revenue Code and IRS Publications


     The Internal Revenue Code (IRC) is a masterpiece of
deception designed to mislead Citizens into believing that
individuals are subject to federal income tax. The Code was
written by attorneys for the Internal Revenue Service (IRS), and
contains a series of directory statutes using the word "shall",
with provisions that are requirements for corporations, but not
for individuals. Even members of Congress are generally unaware
of the deceptive legal meanings of certain terms that are
consistently used in the IRC. These terms have legal
definitions for use in the IRC that are very different from the
general understanding of the meaning of the words.

     Lack of knowledge of these legal definitions causes
misunderstanding by uninformed Citizens who are confused as to
the correct interpretation of both the IRC and the true meaning
of the tricky wording in IRS instructional publications and news
articles. However, when you understand the legal definitions of
these terms, the deception is easily recognized and the limited
application of the Code becomes clear. This understanding will
help you to see that filing income tax forms and paying income
taxes must be voluntary acts for most Americans because the
United States Constitution forbids the federal government to
impose any tax directly upon individuals.


                            "INCOME"

     Most people mistakenly believe all moneys they receive, such
as wages, salaries, and tips, are "income". However, for years,
IRS publication #525, entitled "Taxable and Nontaxable Income",
has acknowledged that wages and salaries are NOT "income".
Publication #525 states: "Wages and salaries are the main SOURCE
of income for most people." In the court decision of Graves  vs
People of the State of New York ex rel O'Keefe, 59 S.Ct. 595
(1939), the United States Supreme Court ruled that a source of
income is not income, and the source is not subject to income
tax. In that decision, the Court stated: "A tax on income is
not economically or legally a tax on its source." However,
wages, salaries, commissions, and tips (sources) are considered
to be "income" for an individual when he lists them as "income"
on an IRS tax return form. When he signs the tax form under
penalty of perjury, he has made a voluntary oath that his wages,
salary, commissions, and tips listed on the return are "income"
and that he is subject to the tax.


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     In the still standing decision of Brushaber vs Union Pacific
Railroad Company, 240 U.S. 1, the United States Supreme Court
ruled that the federal income tax is an excise tax under the
Sixteenth Amendment (the income tax amendment). The Court
explained that THE INCOME TAX CANNOT BE IMPOSED AS A DIRECT TAX
(A TAX ON INDIVIDUALS OR ON PROPERTY) because the United States
Constitution still requires that all direct taxes must be
apportioned among the States. "Apportioned" means that a direct
tax is laid upon the State governments in proportion to each
State's population. The Court ruled that income tax can be
constitutional only as an indirect (excise) tax -- that is, a tax
on profits earned by corporations or privileges granted by
government. In other words, said the Supreme Court, in order for
there to be "income", there MUST be profits or gains received in
the exercise of a privilege granted by government. As an
example, a lawyer is granted the government privilege of being an
officer of the government court when he represents clients in
litigation.

     At law, labor is property. In fact, the Supreme Court has
identified labor as man's most precious property. Therefore, the
exchange of one's labor for wages or salary (which are also
property) is considered by law to be an exchange of properties of
equal value in which there is NO gain or profit. Such a property
exchange of equal value cannot be taxed because there is no
profit or gain. Also, one who works in an ordinary occupation is
not a recipient of any privilege granted by government, because
he is merely exercising his constitutionally guaranteed right to
work and earn an living. Courts have repeatedly ruled that no
tax may be placed upon the exercise of rights. Their reasoning
was sensible. If the exercise of rights could be taxed,
government could destroy them by excessive rates of taxation.

     Items that the law includes in "income" are described in
Code sections listed under the title of "Items Specifically
Included in Gross Income", which covers Sections 71 through 86.
Nowhere in these sections and nowhere else in the Code is there
any mention of wages, salaries, commissions, or tips as being
"income". For example, to deceive and intimidate waitresses into
declaring their tips to be income is a double fraud. First, tips
are gifts, not wages. According to the IRC, gifts are not
subject to income tax. In fact, even if tips were considered to
be wages, they would still not be "income" and would not be
subject to an income (excise) tax unless one enters them as
"income" on a tax return form.


                            "PERSON"

     People generally consider the term "person" to mean an
individual only. But, IRC Section 7701, entitled "Definitions",
includes a corporation, a trust, an estate, a partnership, an
association, or company as being a "person". All of these legal
entities are "persons" at law, so it is legally correct but very


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                                                       Appendix G


misleading when the federal income (excise) tax on corporations
is described by the deceptive title of "Personal Income Tax".
This misleading description leads most people to believe that it
means a tax on individuals.

     The legal term "person" has an even more restricted
definition when used in IRC Chapter 75, which contains all the
criminal penalties in the Code. In Section 7343 of that Chapter,
a "person" subject to criminal penalties is defined as:


     ... [A]n officer or employee of a corporation, or a member
     or employee of a partnership, who, as such officer, employee
     or member, is under a duty to perform the act in respect of
     which the violation occurs.


An individual who is not in such a capacity is not defined as a
"person" subject to criminal penalties. Unprivileged
individuals, who do not impose the income (excise) tax upon
themselves by filing returns, are not subject to the tax and they
are not "persons" who can lawfully be subjected to criminal
charges for not filing a return or not paying income tax.

     Sections of the Code relating to the requirements for filing
returns, keeping records, and disclosing information state that
those sections apply to "every person liable" or "any person made
liable". These descriptions mean "any person who is liable for
the tax". They do not state or mean that all persons are liable.
The only persons liable are those "persons" (legal entities such
as corporations) who owe an income (excise) tax, and are
therefore subject to the requirements of the IRC. If you
substitute the word "corporation" for the term "person" (a
corporation is a person at law) when reading the Code or other
articles and publications relating to income tax, the true
meaning of the Code becomes more apparent.


                 A TAX PAYER IS NOT A "TAXPAYER"

     The deceptive term "taxpayer" is a legal term created by
combining the words "tax" and "payer". The general understanding
of the term's meaning is different from its legal definition in
the IRC. Section 7701(a)(14) gives the legal definition of the
term "taxpayer" in relation to income tax. It states: "The term
'taxpayer' means any person subject to any internal revenue tax."
(All internal revenue taxes are excise taxes.) Note that the
section does not say that all persons are "taxpayers" subject to
internal revenue tax. Corporations are "taxpayers", for they are
"persons" subject to an internal revenue (excise) tax.


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                                                The Federal Zone:


     The term "taxpayer" is used extensively throughout the IRC,
in IRS publications, news articles, and instructional literature
as a verbal trap to make uninformed Citizens believe that all
individuals are subject to federal income tax and to the
requirements of the IRC. These materials state that "taxpayers"
are required to file returns, keep records, supply information,
etc. Such statements are technically correct, because
"taxpayers" are those legal "persons" previously described that
are subject to an excise tax, but unprivileged individuals are
not "taxpayers" within the meaning of the IRC.

     The confusion about the meaning of the term leads most
people to mistakenly assume that they are "taxpayers" because
they pay other taxes such as sales taxes and real estate taxes.
Those people are tax payers, not "taxpayers" as defined in the
IRC. When they read articles and publications related to income
tax, describing the legal requirements for "taxpayers", they
erroneously believe that the term applies to them as individuals.
It is very important to understand that the IRC requirements
apply to IRC-defined "taxpayers" only, and not to unprivileged
individuals. Corporations and other government-privileged legal
entities are "taxpayers under the Internal Revenue Code";
unprivileged individuals are not, unless they voluntarily file
income tax returns showing they owe taxes, thus legally  placing
themselves in the classification of "taxpayers". Because of its
legal definition, the term "taxpayer" should never be used in
relation to income tax, except to describe those legal entities
subject to a federal excise tax.


                       "SHALL" means "MAY"

     In general use, the word "shall" is a word of command with a
mandatory meaning. In the IRC, "shall" is a directory word that
has a mandatory meaning when applied to corporations. The IRC
contains a series of directory statutes using the word "shall" in
describing the actions called for in those sections of the law.
The provisions of these directory statutes are requirements for
corporations, because corporations are created by government and,
consequently, are subject to government direction and control.
Since corporations are granted the privilege to exist and operate
by government-issued charters, they do not have the
constitutionally guaranteed rights of individuals. This
government-granted privilege legally obligates corporations to
make a "return" of profits and gains earned in the exercise of
their privileged operations when directed to do so by law. This
is why the tax form is called a "return".

     However, directory words in the Code merely imply that
individuals are required to perform certain acts, but directory
words are not requirements for individuals when a mandatory
interpretation of the directory words would conflict with the
constitutionally guaranteed rights of individuals. Courts have
repeatedly ruled that in statutes, when a mandatory meaning of


                        Page G - 6 of 12

                                                       Appendix G


the word "shall" would create a constitutional conflict, "shall"
must be defined as meaning "may". The following are quotes from
a few of these decisions. In the decision of Cairo & Fulton R.R.
Co. vs Hecht, 95 U.S. 170, the U.S. Supreme Court stated:


     As against the government the word "shall" when used in
     statutes, is to be construed as "may," unless a contrary
     intention is manifest.


In the decision of George Williams College vs Village of Williams
Bay, 7 N.W.2d 891, the Supreme Court of Wisconsin stated:


     "Shall" in a statute may be construed to mean "may" in order
     to avoid constitutional doubt.


In the decision of Gow vs Consolidated Coppermines Corp., 165
Atlantic 136, the court stated:


     If necessary to avoid unconstitutionality of a statute,
     "shall" will be deemed equivalent to "may" ....


     Sections 6001 and 6011 of the IRC are cited in the Privacy
Act notice in the IRS 1040 instruction booklet in order to lead
individuals to believe they are required to perform services for
tax collectors. Note the use of the word "shall" in the
following sections of the Code:


Section 6001 states:


     Every person liable for any tax imposed by this title, or
     for the collection thereof, shall keep such records, render
     such statements, make such returns, and comply with such
     rules and requirements as the Secretary may from time to
     time prescribe.


Section 6011 states:


     When required by regulations prescribed by the Secretary any
     person made liable for any tax imposed by this title, or
     for the collection thereof, shall make a return or statement
     according to the forms and regulations prescribed by the
     Secretary.


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                                                The Federal Zone:


     Note that Sections 6001 and 6011 apply to "every person
liable" and "any person made liable", but not to "individuals".
However, THERE IS NO SECTION IN THE IRC THAT MAKES INDIVIDUALS
LIABLE FOR PAYMENT OF INCOME TAX because any law imposing a
federal tax on individuals would be unconstitutional, for it
would violate the taxing limitations in the U.S. Constitution
which prohibit direct taxation of individuals by the federal
government. People are often confused when reading the Code
because, under Subtitle A, Chapter 1, which covers income taxes,
Part 1 of Subchapter A has the misleading title of "Tax on
Individuals". The title is misleading because Part 1 imposes the
tax on "income", but contains no requirement for individuals to
pay it. But an individual becomes a "person liable" for the tax
when he files an income tax form, thereby swearing that he is
liable for (owes) the tax.

     The Privacy Act notice in the instruction booklet for IRS
Form 1040 also shows that disclosure of information by
individuals is not required. The notice states:


     Our legal right to ask for information is Internal Revenue
     Code sections 6001 and 6011 and their regulations.


The IRS does not say that those sections require individuals to
submit the information; those sections only give the IRS the
authority to ask for it.


Section 6012 states:

     Returns with respect to income taxes under Subtitle A shall
     be made by the following: (1)(A) Every individual having
     for the taxable year gross which equals or exceeds the
     exemption amount ...."


Subsections (2) through (6) list corporations, estates, trusts,
partnerships, and certain political organizations as also being
subject to this section.

     Any requirements compelling unprivileged individuals to keep
records, make returns and statements, or to involuntarily perform
any other services for tax collectors, would be violations of
constitutionally guaranteed rights.

     The Thirteenth Amendment to the United States Constitution
forbids compelling individuals to perform services involuntarily.
The Amendment states:


                        Page G - 8 of 12

                                                       Appendix G


     Neither slavery nor involuntary servitude, except as
     punishment for crimes whereof the party shall have been duly
     convicted, shall exist within the United States, or any
     place subject to their jurisdiction.


     The Fourth Amendment in the Bill of Rights of the United
States Constitution states that the people's right to privacy of
their papers shall not be violated by government. To compel
individuals to disclose information taken from their papers would
violate this right.

     The Fifth Amendment in the Bill of Rights protects the right
of individuals not to be required to be witnesses against
themselves. To compel individuals to disclose information by
submitting statements or information on a tax return form, all of
which could be used against them in criminal prosecutions, would
violate their Fifth Amendment right.

     These examples show some constitutional conflicts that would
result from defining the word "shall" as meaning "is required
to". Thus, "shall" in the above mentioned statutes must be
interpreted as meaning "may". Consequently, for individuals,
keeping records, making statements, and making returns are
clearly voluntary actions that are not required by law.


                         "HAVING" INCOME

     According to the wording of Section 6012 previously
discussed, it is a directory statute which pertains to the filing
of income tax returns, and applies only to those individuals
"having income". Since the word "having" has no deceptive legal
definition in the Code, its legal meaning is the same as its
customary meaning in general use. Although dictionaries define
the word "have" as meaning "possess" or "hold in one's
possession", the IRS fraudulently misinterprets "having income"
as meaning "receiving gross receipts" when applying Section 6012
to individuals.

     To better understand the meaning of "having income",
consider this example: If during one year a corporation receives
ten million dollars (gross receipts) from the sales of its
products, and has expense items of nine million dollars, the
corporation has a profit (income) of one million dollars. When
tax liabilities are determined at the end of the year, the
corporation has (possesses) an increase in its assets (a gain) of
one million dollars. But, if the corporation's expenses equalled
its gross receipts, it would then have (possess) no profit or
gain (income) and it would owe no income tax.


                        Page G - 9 of 12

                                                The Federal Zone:


     Now, consider another example: If during one year an
individual receives fifteen thousand dollars in wages (gross
receipts) from the sale of his labor, and has expenses of fifteen
thousand dollars to sustain himself and his family, he then has
(possesses) no increase in assets. Although he has (possesses)
nothing more than he had at the beginning of the year, IRS agents
consider him as "having income" of fifteen thousand dollars. IRS
agents ignore the fact that his wages were not income according
to their own publications!


                       "MUST" means "MAY"

     Most people have never studied the IRC and their
understanding of the law is generally based on hearsay, newspaper
articles and IRS instructional materials. These instructions
make frequent use of the deceptive word "must" in describing the
things that the IRS wants you to do, because "must" is a forceful
word that people mistakenly believe to mean "are required". Very
few people realize that "must" is a directory word similar to
"shall" and that, in IRS instructions to the public, it means
"may", the same as the word "shall".

     In the legal definition of the word "must" in Black's Law
Dictionary, it states:


     ... [I]t is often used in a merely directory sense, and
     consequently is a synonym for the word "may" not only in the
     permissive sense of that word, but also in the mandatory
     sense which it sometimes has.


     Because of the constitutional conflicts explained earlier in
this article, the word "must", similar to the word "shall",
cannot have a mandatory meaning for individuals. It therefore
means "may" when used in IRS instruction publications.

     The IRS instructions for Form 1040 state that you "must"
file a return if you have certain amounts of income. IRS
withholding instructions state that employers "must" withhold
money from paychecks for income tax, "must" withhold social
security tax (an income tax also), and "must" send to the IRS any
W-4 withholding statement claiming exemption from withholding, if
the wages are expected to usually exceed $200 per week. An
understanding of the legal meaning of the word "must" exposes the
deception by the IRS and makes it clear that the actions called
for are voluntary actions for individuals that are not required
by law. If these actions were required by law, the instructions
would not use the word "must", but would say that the actions
were "required".


                        Page G - 10 of 12

                                                       Appendix G


                     FREE SOVEREIGN CITIZENS

     Prior to the American Revolution, the American colonists
were subjects of the English Kings and were subject to their
orders and edicts. But, according to the Declaration of
Independence and the United States Constitution, the Citizens of
our country are free sovereign individuals. They are not
subjects of government, nor are they subject to mandatory
direction or control by the federal government. Except for
duties such as military draft and jury duty, the federal
government has no authority to require unprivileged individuals
to perform services for government.

     There is no section in the IRC requiring individuals to pay
income tax or file income tax returns, because the federal
government has no constitutional authority to impose any tax
directly upon individuals or to require them involuntarily to
keep records, make statements, make returns, or perform any acts
for the convenience of federal tax collectors. But, if an
individual files a return, his voluntary action of signing the
form, thereby swearing under penalty of perjury that he owes the
tax, is an acknowledgement under oath that he is subject to the
tax (a "taxpayer") and is therefore subject to the directory
statutes of the IRC.

     The reader should remember the legal definitions of the
various terms and the information about the rights of Citizens
presented in this article whenever he reads the IRC and other
materials relating to income tax in order to better understand
the correct meaning of whatever they read.


                 _______________________________

                 INFORM PEOPLE OF THEIR RIGHTS.
                   SHOW THIS TO YOUR FRIENDS!
             REPRINT THIS ARTICLE AND DISTRIBUTE IT.
                 YOU MAY PRINT YOUR GROUP'S NAME
                       AND MESSAGE BELOW.


                To obtain additional information,
        send a large self-addressed stamped envelope to:


                   FREE STATE CONSTITUTIONISTS
                    c/o Post Office Box 3281
                       Baltimore, Maryland
                      Postal Code 21228/TDC


                        Page G - 11 of 12

                                                The Federal Zone:


Reader's Notes:


                        Page G - 12 of 12


                           Appendix H

                    Analysis of U.S. vs Hicks


                        Page H - 1 of 10

                                                The Federal Zone:


Reader's Notes:


                        Page H - 2 of 10

                                                       Appendix H


MEMO

TO: Interested Colleagues

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: October 25, 1991

SUBJECT: 9th Circuit Wrongly Decides
          U.S. vs Hicks and U.S. vs Bentson


     The Ninth Circuit Court of Appeals has based its two recent
income tax rulings on blatantly wrong premises. In upholding
convictions for willful failure to file income tax returns, the
Court rejected appeals by both defendants to the clear and
unambiguous provisions of the Paperwork Reduction Act (PRA) and
the Administrative Procedure Act (APA). A simple yet careful
analysis of these rulings is sufficient to expose the faulty
premises upon which both rulings are based. As the Holy Bible
says, "Only the fool builds his house upon sand" (or words to
that effect).


U.S. vs Hicks

     The case of U.S. vs Hicks is the more important of the two
because it was decided first, it contains more "analysis", and
sets a precedent to which the second case refers. Beginning with
the PRA, the Court admits that the IRS must comply with the PRA
and "... in particular, must display OMB control numbers on its
tax return forms and on its regulations." Nevertheless, despite
a clear and unambiguous public protection clause, the Court ruled
that the IRS failure to comply with the PRA does not prevent the
defendant from being penalized and that the PRA constitutes no
defense to prosecution under 26 U.S.C. 7203:


     "But even assuming without deciding that the IRS failed to
     comply with the PRA here, its failure does not prevent Hicks
     from being penalized."


     The Court's "analysis" justifies its ruling on the basis of
a careful distinction it draws between agency regulations and
Congressional statutes. Specifically, in the absence of an
"express prior mandate" from Congress, a citizen may escape
penalties for failing to comply with an agency information
collection request that is issued via regulation, but without
displaying an OMB control number. It is the existence of an
"explicit statutory requirement" which makes all the difference,
according to the 9th Circuit. The Court refers to its own
precedents as follows:


                        Page H - 3 of 10

                                                The Federal Zone:


     "The legislative history of the PRA and its structure as a
     whole lead us to conclude that it was aimed at reining in
     agency activity. ... Where an agency fails to follow the PRA
     in regard to an information collection request that the
     agency promulgates via regulation, at its own discretion,
     and without express prior mandate from Congress, a citizen
     may indeed escape penalties for failing to comply with the
     agency's request. See e.g. United States v. Hatch, 919 F.2d
     1394 (9th Cir. 1990); United States v. Smith, 866 F.2d 1092
     (9th Cir. 1989). But where Congress sets forth an explicit
     statutory requirement that the citizen provide information,
     and provides statutory criminal penalties for failure to
     comply with the request, that is another matter. This is a
     legislative command, not an administrative request. The PRA
     was not meant to provide criminals with an all-purpose
     escape hatch. [emphasis added]


     What exactly is this legislative command, this "explicit
statutory requirement", this "express prior mandate" upon which
the Court places so much emphasis? We search in vain amidst the
Court's analysis of the PRA. Instead, we are told that the tax
code predates the PRA by over 25 years and that Congress never
intended the PRA to create a loophole in that tax code:


     Moreover, the provision of the tax code under which Hicks
     was convicted predates the PRA by over 25 years. If, in
     enacting the PRA, Congress had intended to repeal 26 U.S.C.
     7203, it could have done so explicitly. Repeals by
     implication are not favored. ... Congress enacted the PRA to
     keep agencies, including the IRS, from deluging the public
     with needless paperwork. It did not do so to create a
     loophole in the tax code.


     We hold that the public protection provision of the PRA, 44
     U.S.C. 3512, constitutes no defense to prosecution under 26
     U.S.C. 7203. To hold otherwise -- to interpret the PRA
     without reference to Congress' purpose -- would be to
     elevate form over substance. [emphasis added]


     Evidently, the Court is ready and willing to elevate
legislative commands over administrative requests, "explicit
statutory requirements" over agency regulations. However, it is
not willing to be explicit itself about the exact statutory
requirement that is so elevated, at least not in its analysis of
the PRA. It is not until the Court analyzes the Administrative
Procedure Act (APA) that we finally discover a pivotal reference
to the exact statutory requirement which the Court considers so
sacred. But this pivotal reference is a foundation of sand.


                        Page H - 4 of 10

                                                       Appendix H


Administrative Procedure Act

     Having made such an important distinction between statutes
and regulations, the Court then proceeds to reiterate the same
distinction in rejecting a defense based upon the APA. Even
though the IRS has failed to publish Form 1040 in the Federal
Register, and even though the IRS has failed to promulgate Form
1040 according to the APA notice and comment procedures, the
Court maintains that the defendant still had a legal duty to file
a tax return. According to the Court, it is entirely "meritless"
to argue that the IRS's failure to publish its form eliminated
any legal duty that might have required the defendant to file
income tax returns:

     Hicks's argument is meritless. It confuses law with
     regulations with respect to such law. It is the tax code
     itself, without reference to regulations, that imposes the
     duty to file a tax return. ... However, even if we suppose
     that the duty to file tax returns can be understood only
     with reference to regulations, the IRS has duly promulgated
     sufficient regulations, e.g. 26 CFR 1.6011-1, 1.6012-1, to
     make that duty clear. The meaning of "willful failure to
     make a tax return" is apparent without reference to the
     contents of Form 1040 or its instructions. Hicks cannot
     complain that he did not know what was expected of him. He
     had a duty to make a tax return, and chose to ignore that
     duty.

     Notice, in particular, that the Court has still not
mentioned the exact statutory requirement which it considers so
decisive. Instead, we are told that the tax code imposes the
duty to file a tax return, that the IRS has promulgated
"sufficient regulations" to make that duty clear, and that Form
1040 and its instructions are not needed to know that duty.
Evidently, the Court judges the statute to be crystal clear and
the regulations to be duly promulgated and "sufficient", even if
we suppose that the statute is not crystal clear. What exactly
is the controlling statutory requirement, and is the "duty to
file" as apparent in that statute as the Court would have us
believe? In answer to the first question, the Court finally
plays its hand:

     Hicks's reliance on United States v. Reinis, 794 F.2d 506
     (9th Cir. 1986) is misplaced. As the Fourth Circuit noted
     in Bowers, Reinis involved unpublished rules (specifically,
     instructions for a Currency Transaction Report Form) that
     imposed "substantive obligations beyond those created by the
     statute itself." ... Only by publication could this
     obligation become known. The 1040 form, by contrast, did
     not add to Hicks's basic substantive obligation. That
     obligation is to comply with the applicable provisions of
     the Internal Revenue Code. The code requires that persons
     such as Hicks make a return. 26 U.S.C. 6012. [emphasis
     added]


                        Page H - 5 of 10

                                                The Federal Zone:


     At long last, we finally discover the exact statutory
requirement which the Court considers so decisive. But is the
"duty to file" as "apparent", as obvious and as crystal clear in
this exact citation as the Court would have us believe? Let us
now quote the operant phrases from a subset of Title 26, Section
6012:


     (a) GENERAL RULE: Returns with respect to income taxes
     under subtitle A shall be made by the following:

          (1)(A) Every individual having for the taxable year
          gross income which equals or exceeds the exemption
          amount .... except that ... nonresident alien
          individuals subject to the tax imposed by section 871
          and foreign corporations subject to the tax imposed by
          section 881 may be exempted from the requirement of
          making returns under this section. [emphasis added]


     Admittedly, Section 6012 contains a lot more verbiage which
covers a lot more exceptions to the general rule, e.g., those not
married, heads of households, surviving spouses, joint returns,
estates, trusts, political organizations and homeowners
associations, and so on ad nauseam. Likewise, the meaning of
"nonresident alien individuals" and "foreign corporations" is an
entirely separate and complex subject which will divert us too
far from the path at hand. The important point here is that the
general rule specifies a threshold, namely, the duty to file is
imposed by law on every individual having "gross income which
equals or exceeds the exemption amount". Is this law
sufficiently clear, explicit, and unambiguous? Apparently the
Ninth Circuit thinks so. But is it really? Let's be honest and
objective about this, because the issues here are important and
even crucial to the future of our country.


What is a Widget?

     In order to answer these questions, let us first reason by
analogy. Because you are now reading a law which I have enacted
for you, you are hereby informed that you have a duty to send me
a birthday card, and a pair of free tickets to the World Series,
if and when I reach the age of 50 widgets. Your immediate
response is obvious: what's a widget? You would be happy to
comply with the duty if I would only define what a "widget" is,
in terms you understand. Absent such a definition, you cannot
comply because my law is vague, and hence void. Once you know
what a widget is, you are confident you will be able to determine
when my age passes the threshold number of widgets, at which
point you will be happy to satisfy your "known legal duty".
Without a doubt, my definition of "widget" is crucial and
decisive for you to satisfy your duty.


                        Page H - 6 of 10

                                                       Appendix H


     This same logic applies directly to the statutory threshold
established for "gross income". At the risk of repeating a
mountain of published analysis on this very same issue, we are
forced once again to quote the statutory definition of "gross
income" as follows:


     SEC. 61. GROSS INCOME DEFINED

     (a) GENERAL DEFINITION. Except as otherwise provided in
     this subtitle, gross income means all income from whatever
     source derived, including (but not limited to) the following
     items ... [list follows].


     Even though the statute has defined "gross income", it still
has not defined "income". What the statute does say is
comparable to saying, "Gross widgets means all widgets from
whatever source derived." (Or, as Godfrey Lehman says, "Gross
gobbledygook is gobbledygook from whatever source derived.") But
we still have not defined "widgets" (or gobbledygook) and the
definition of "gross widgets" is necessarily vague for this
reason and for this reason alone. The statutory definition of
"gross income" is a tautology, because it uses a term it is
defining in the definition of the term defined. From a purely
grammatical point of view, the only thing accomplished by this
statutory definition of "gross income" is to qualify the meaning
of "gross"; it accomplishes nothing else.

     Furthermore, close examination of Title 26, the Internal
Revenue Code (IRC), reveals that the meaning of "income" is
simply not defined, period! There is an important reason in law
why this is the case. At a time when the Supreme Court did not
enjoy the benefit of 17,000 State-certified documents which prove
it was never ratified, that Court assumed that the 16th Amendment
was the supreme law of the land. In what is arguably one of the
most important rulings on the definition of "income", the Supreme
Court of the United States has clearly instructed Congress that
it is essential to distinguish between what is and what is not
"income", and to apply that distinction according to truth and
substance, without regard to form. In that instruction, the high
Court has told Congress that it has absolutely no power to define
"income" because that term was considered by the Court to be a
part of the U.S. Constitution:


     Congress cannot by any definition it may adopt conclude the
     matter, since it cannot by legislation alter the
     Constitution, from which alone it derives its power to
     legislate, and within whose limitations alone that power can
     be lawfully exercised. [Eisner vs Macomber, 252 US 189]
     [emphasis added]


                        Page H - 7 of 10

                                                The Federal Zone:


     Clearly, the Internal Revenue Code has not distinguished
between what is and what is not income because to do so would be
an exercise of power which Congress does not have. This is a
Catch-22 from which the Congress cannot escape. It either
defines income by statute and thereby exercises a power which it
does not have, or it fails to define income, thereby rendering
whole chunks of the Internal Revenue Code null and void for
vagueness.


     The well documented failure of the 16th Amendment to be
ratified raises a host of other issues too complex to analyze
here. One could argue, for example, that the term "income" is
really not a part of the Constitution after all, because it is
found only in the text of the failed amendment. Suffice it to
say that Congress has never had the power to lien on the private
property of sovereign Citizens of the 50 States, with or without
the 16th Amendment, unless the lien results from a statute
authorizing a direct tax which satisfies the apportionment rule
in the Constitution (1:2:3 and 1:9:4).


     Income is private property. Absent a direct tax, or some
commercial agreement to the contrary, the federal government is
not empowered to obtain a controlling interest in, or otherwise
lien on private property so as to compel a private Citizen's
performance to any third-party debt or obligation. Moreover, it
is a well established principle in law that government cannot tax
a sovereign Citizen for freely exercising a right guaranteed by
the U.S. Constitution. The acquisition and exchange of private
property is such a right.


     Numerous other rulings of the Supreme Court have all defined
"income" in the same exact terms, namely, income is a "profit" or
a "gain". (See attached formal petition to Rep. Barbara Boxer
for all relevant citations.) Remember, these are not the
writings of some extremist or radical constitutional libertarian.
We are relying here upon the words of the Supreme Court of the
United States, in cases wherein the official definition of
"income" was decisive. Try to find a principle that is better
settled:


     Remember that our source is not some "tax protest" group.
     Just about everything we are telling you comes from the U.S.
     Supreme Court. It would be difficult, and perhaps
     impossible, in our system of jurisprudence, to find a
     principle better settled than the one we have been citing.

     [from Tax Scam by Alan Stang, Mt. Sinai Press, POB 1220,
     Alta Loma, CA 91701, 1988]


                        Page H - 8 of 10

                                                       Appendix H


     Whatever arguments one may choose to make from this point
forward, those arguments would certainly benefit from a knowledge
of the relevant case law in this area. I mean, if we're talking
gasoline taxes, then we know the subject of the tax is gasoline;
if we're talking tobacco taxes, then we know the subject is
tobacco. Why should a tax on "income" be any different? Just
because the Congressional Research Service chooses to differ with
the Supreme Court? Just because the IRS uses police power to
enforce a different definition? Just because the Federal Reserve
needs a powerful agency to collect interest payments for its
syndicated monopoly on private credit?


Is the Code Sufficient?

     The Ninth Circuit tips its hand in another, albeit subtle
way when it discusses so-called makeshift returns. Simply
stated, you don't need a Form 1040 or its instructions to make
and file a return; the statute and the regulations are enough:


     While it is true that the regulations state that filing a
     Form 1040 is the preferred manner of making a return, it is
     by no means the only manner of filing. 26 C.F.R. 1.6012-
     1(a)(6). Knowing the code and the regulations, and no more,
     is enough to enable Hicks to attempt to comply with the
     obligation to file a return. He did not need to consult a
     1040 form or its instructions. See also 26 C.F.R. 1.6011-
     1(b) (taxpayer is not penalized for filing a makeshift
     return pending the filing of a proper return). It follows
     that Form 1040 is not a "rule" subject to the complicated
     publication, notice, and comment requirements of the APA.

                                                 [emphasis added]


     Notice, in particular, that the Court has ruled that
"knowing the code and the regulations, and no more, is enough
...." The Court has not ruled that "knowing the code is enough".
This is an important, and telling admission on the part of the
Ninth Circuit. By their own previous precedents in Hatch and
Smith, this Court ruled that OMB control numbers and expiration
dates are required to be displayed in the Code of Federal
Regulations. We already know that the IRC does not define
"income". If the regulations also fail to contain a satisfactory
definition of "income", and if those same regulations fail to
display currently valid OMB control numbers, the conscientious
citizen is faced with a double whammy. The regulations are not
only null and void for vagueness, they can also be ignored as
"bootleg requests" because they do not display OMB approval. If
the Code cannot be understood without those regulations, the Code
is not sufficient. Last but not least, Congress' lack of power
to legislate a statutory definition of "income" is also equally
true of the regulations which promulgate statutes. Were the


                        Page H - 9 of 10

                                                The Federal Zone:


regulations which implement Section 6012 to contain a definition
of "income", the very existence of that definition in a
regulation (which has the force of law) would evidence the
exercise of a power which Congress has been told, in clear and
certain terms, it simply does not have.


U.S. vs Bentson

     Having established its precedents in U.S. vs Hicks, the
Ninth Circuit proceeds to make summary hay of similar issues
raised by defendant Stephen W. Bentson. The Court observed that
Bentson's PRA argument was essentially the same as the argument
it rejected in Hicks, and they found no merit in it:


     Bentson points to dicta in United States v. Collins ... that
     suggest that persons charged with criminal violations of the
     Internal Revenue Code might in some circumstances
     legitimately raise a PRA defense. For reasons given in
     Hicks, we believe that the PRA was not intended to provide
     such a defense, and therefore we disagree with the Collins
     court's dicta.


     The Court's disposal of the APA argument is even less
enlightening:


     The district court denied Bentson's motion for dismissal
     based on the APA as untimely. Whether or not it was
     untimely, the legal theory on which the motion was based has
     no merit. Hicks, supra.


     So much for the APA. Since the Bentson case contains no
additional analysis and relies upon the precedent(s) set by the
Hicks case, it would be fair to fault the Bentson ruling for the
same reasons that the Hicks ruling is faulty.


                             # # #


                        Page H - 10 of 10


                           Appendix I

                     Notice to 50 Governors


                        Page I - 1 of 14

                                                The Federal Zone:


Reader's Notes:


                        Page I - 2 of 14

                                                       Appendix I


MEMO

TO: Friends, Neighbors, Colleagues
          and all interested parties

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: September 10, 1991

SUBJECT: Enclosed Letter to 50 State Governors

     Enclosed please find a copy of our letter and attachments to
the 50 Governors of the sovereign States of the Union.

     With this letter, we place these 50 Governors on notice that
a great fraud and deception have been fastened upon the American
people.

     This fraud and deception are the result of a private credit
monopoly (the Federal Reserve System) and a repressive and
confiscatory taxing syndicate (the Internal Revenue Service) that
have been imposed upon us without our consent.

     We petition the Governors to understand that heavy
government borrowing and excessive taxation go hand-in-hand, that
a foreign jurisdiction has obtained control of money and credit
in America, and that the situation is now so serious, it
threatens systematically to corrupt and destroy the very
foundations of our modern civilization.

     Help us to assist the Governors to understand that Congress
has seized vast powers from the States for the federal government
by means of gross deficit spending, heavy government borrowing,
and unlawful delegation of monetary powers to a private banking
cartel.

     Help us to abolish the specter of modern slavery which now
threatens to destroy the essential rights and freedoms which made
this a great nation and the envy of others around the world.

     Please join us in demanding the 50 Governors to act
decisively in accordance with their solemn oath of office: to
uphold and defend the Constitution of the United States from all
enemies, both foreign and domestic.

     Help us to restore a government which has drifted so far off
course, it hardly resembles the constitutional republic it was
designed to be.

Account for Better Citizenship
c/o USPS P. O. Box 6189
San Rafael, California Republic
Postal Code 94903-0189/TDC


                        Page I - 3 of 14

                                                The Federal Zone:


                 Account for Better Citizenship
                  c/o USPS Post Office Box 6189
                 San Rafael, California Republic
                   Postal Code 94903-0189/TDC


Governor [date]
Office of the Governor
State Capitol
City, State

Dear Governor :

     We are writing in order to notify you formally that a great
fraud and deception have been fastened upon the people of your
State. In so doing, we place you on notice of this fraud and
deception, and request that you exercise your solemn oath of
office to uphold and defend the Constitution of the United States
and the rights of the people.

     Our forefathers waged the War of Independence, suffered
enormous sacrifices, and even gave their lives to sever our
nation from an unlawful jurisdiction imposed on them by the King
of England. This jurisdiction is known as Admiralty Law. Its
primary beneficiary is the Federal Reserve System, a private
credit monopoly once described by Congressman Louis T. McFadden
as "one of the most corrupt institutions the world has ever
known". Congressman McFadden was Chairman of the House Banking
and Currency Committee from 1927 to 1933.

     By utter deceit and a failure to abide by the mandates of
the U.S. Constitution, our lawmakers have imposed this same
unlawful jurisdiction back upon the people. This was done
through the chicanery and great pressure applied by the
international banking community, whose aim has always been to
control the issuance of money and credit. Foremost among these
bankers was Mayer Amschel Rothschild who stated,


     "Permit me to issue and control the money of a nation, and I
     care not who makes the laws."


     We are now in an undeclared economic war, and the enemy is
winning!

     If the people of this nation had not been raped by the great
banking cartels, we would have no poor or homeless in our nation;
to quote an editorial in the London Times in 1865, we would by
now have become:


     "... prosperous beyond precedent in the history of the
     civilized governments of the world."


                        Page I - 4 of 14

                                                       Appendix I


     This same editorial went on to predict that our nation would
pay off its debts and be without a debt. It would have all the
money necessary to carry on its commerce. The brains and wealth
of all countries would go to North America. For these reasons,
the London Times urged that our government be destroyed, or it
would destroy every monarchy on the globe!

     American history reveals that Benjamin Franklin traveled to
England as a representative of the Colonies. The British
officials there asked how it was the Colonies managed to collect
enough taxes to build poor houses, and how they handled this
terrible burden of caring for the poor. Franklin's reply was
simple and direct:

     "We have no poor houses in the Colonies, and if we had, we
     would have no one to put in them, as in the Colonies there
     is not a single unemployed man, no poor and no vagabonds."


He went on to explain the underlying reason for this:

     "It is because in the Colonies we issue our own paper money.
     We call it Colonial Script, and we issue only enough to move
     all goods freely from the producers to the Consumers; and
     as we create our money, we control the purchasing power of
     money, and have no interest to pay."


     As Franklin knew so well, this system guarantees honest
money. There would be no need for inflation or deflation, as
long as the money supply was kept equal to the value of goods to
be moved.

     Contrast this condition to that of England: all her money
was borrowed from banks, and repressive taxes were laid upon the
people. Banks usurped the government's right to create and
regulate money. Banks created money or credit "out of thin air",
by mere bookkeeping entries, with no labor or wealth involved or
exchanged.

     Today, we suffer from the same debt money system here in
America. As a result, the nation's wealth is being
systematically transferred from a nation of producers to a
syndicate of lenders, who have done nothing in any way to earn it
or warrant it.

     Why should the people pay tribute to a private credit
monopoly for the benefit of using their own money? The people
retain an unalienable right to create their own medium of
exchange, through their elected representatives in the Congress
of the United States, as mandated by the Constitution. When this
right was challenged by the British, the Colonists went to war.
Benjamin Franklin identified this as the real reason for the War
of Independence:


                        Page I - 5 of 14

                                                The Federal Zone:


     "The Colonies would gladly have borne the little tax on tea
     and other matters, had it not been that England took away
     from the Colonies their money, which created unemployment
     and dissatisfaction."


     We believe that President Abraham Lincoln was assassinated
for his creation of "United States Notes", and for his refusal to
borrow debt money from banks. Lincoln was quoted to say:

     "The people can and will be furnished with a currency as
     safe as their own Government. Money will cease to be master
     and become the servant of humanity. Democracy will rise
     superior to the money power."

Governor, with your help, and with the grace of God, this can
still happen.

     Governor, we expect you to understand that debt money and
excessive taxes go hand-in-hand. Today, Americans pay over
10,000 PERCENT more in taxes than did Colonial Americans.
Federal income taxes are confiscated under duress, even though
they are voluntary under law, and apply only to persons in
federal enclaves or possessions.

     The framers made it plain that "No money shall be drawn from
the Treasury but in consequence of appropriations made by Law"
(Article I, Section 9, Clause 7). Nevertheless, a philosophy of
"tax, tax; spend, spend; elect, elect" began in the Roosevelt
era when the U.S. Supreme Court relaxed traditional restrictions
on the Federal Government in the Butler case (297 US 1, 1936).

     In this case, the Court interpreted the "general welfare"
clause as a general grant of power to Congress to tax and spend
for anything it felt was in the interest of the nation's welfare.
This ruling opened the U.S. Treasury to unlimited looting by
politicians who saw this as a golden opportunity to increase
taxes and buy votes with federally funded projects in their
respective States. A massive share of this funding is now done
through heavy government borrowing!

     Governor, if this situation is not changed, the destiny of
our nation is literally in the hands of international bankers and
their cohorts. As German statesman and soldier Bismarck
predicted:

     "The death of Lincoln was a disaster for Christendom .... I
     fear that foreign bankers with their craftiness and tortuous
     tricks will entirely control the exuberant riches of America
     and use them systematically to corrupt modern civilization.
     They will not hesitate to plunge the whole of Christendom
     into wars and chaos in order that the earth shall become
     their inheritance."


                        Page I - 6 of 14

                                                       Appendix I


     For our own sake, and for the sake of our posterity, we pray
that you will be earnest in your endeavor to help set our nation
aright. Honor your oath of office, so that your constituents and
our Creator may properly show you respect, and that you too may
proclaim, with Benjamin Franklin:


     "I can appear cheerfully before God fearing nothing from His
     justice in this particular."


     Governor, join us to help restore the laws and liberties
that our founding fathers fought so hard to win and leave to us,
their posterity.

     Please take the time necessary to study personally the
material enclosed with this letter. It summarizes the fraud we
now suffer, from a private credit monopoly and a confiscatory
taxing syndicate imposed upon us without our consent.

     Then, honor us by acting decisively in accordance with your
solemn oath of office: to uphold and defend the Constitution of
the United States from all enemies, both foreign and domestic, so
help you God.


Yours for liberty and justice,


/s/ Mitch Modeleski, Founder /s/ Leigh Waddell
Account for Better Citizenship Secretary


                        Page I - 7 of 14

                                                The Federal Zone:


attachments:

      Graph of U.S. National Debt
     "Why, Pilgrim, Don't You Act?"
     "Promises Made, Promises Broken"
     "How It All Began"
     "The Rothschild-Hamilton Money and Banking System"
     "The Lost Document"
     "What You Should Know About the Federal Reserve System"
      Letter to 60 Minutes, by Mitch Modeleski, 5/29/91
      Letter to 60 Minutes, by Godfrey Lehman, 5/21/91
      Letter to Prof. Louis Roseman, by Mitch Modeleski, 5/2/91
     "The Two United States and the Law," by Howard Freeman
     "$10,000 Reward"
      Selected Bibliography


enclosure:

     A Moderate Proposal for Restoring Prosperity
     Individual and National, by Jean Carpenter


                        Page I - 8 of 14

                                                       Appendix I


                  Why, Pilgrim, Don't You Act?


an excerpt from the book Tax Scam, by Alan Stang:


"As you know, the Constitution reserves the power over money to
the Congress, which power Congress is forbidden to delegate. How
would you respond, were Congress illegally to give its power to a
private corporation, like Ford or Xerox, or Occidental Petroleum
or IBM, or a new corporation organized for the purpose? Suppose
Congress confiscated your gold and gave it to that private
corporation. Suppose that private corporation issued currency
the government forced you to use, and on which it forced you to
pay interest. Suppose that private corporation extended credit
('cheap money') and then called the loans; did so time after
time, creating endless boom and bust; thereby farming the farmer
and bringing the people to their knees -- protesting all the
while in a blizzard of propaganda that it was fighting these
things.

"How would you respond? Do we exaggerate when we speculate that
you would call it the biggest scandal of all time? Are we far
afield when we guess that you would demand a special prosecutor,
complete with hearings, to expose the conspiracy; seizure of the
corporation's assets and abolition of the corporation; long
prison terms for the perpetrators, in government and out; and
restoration to Congress of the money power, in obedience to the
Constitution?

"Pilgrim, if that is close to what you would demand, may we ask
respectfully why you have not demanded it -- because the
private corporation we have been talking about is the Federal
Reserve System.


[Alan Stang, Tax Scam, Research Publications, P. O. Box 84902,
Phoenix, Arizona 85071, 1988, pages 228-229]


                        Page I - 9 of 14

                                                The Federal Zone:


                 Promises Made, Promises Broken


In promoting passage of the Federal Reserve Act of 1913, its
sponsors, and those working to see it passed, made ten promises:

 1. To operate entirely under the direction and control of the
     President and his appointees to the Board of Governors.

 2. To pay interest to the government for the privilege of
     printing Federal Reserve Notes as the nation's currency.

 3. To perform many banking services for the government free of
     charge.

 4. To manage the nation's money supply so as to stabilize the
     dollar which, in turn, would stabilize prices.

 5. To remove the United States from the control of Wall Street.

 6. To prevent depressions and eliminate "boom and bust" cycles.

 7. To be a friend and helper to farmers and to the monetary
     needs of small businesses.

 8. To create a system that would remain forever decentralized,
     so each Federal Reserve Bank would have as much influence in
     monetary policies as the one in New York City.

 9. To protect American interests against foreign monetary
     assaults.

10. To supervise and inspect local banks and provide funds when
     they were pressed by unexpected demands.


Contrary to promises, the effects of the Federal Reserve Act have
been disastrous:


1. Judged by the promises at the time the act was passed,
     including a stable currency and elimination of boom and bust
     cycles, the Fed must be rated, at best, a colossal failure.

2. The Federal Reserve action of curtailing the nation's money
     supply by a third in 1929 converted a serious recession into
     a disastrous depression, destroying one-third of the
     nation's banks in the process.

3. Judged on the basis of the U.S. Constitution and by the
     intent of its framers, the Federal Reserve Act and
     amendments are clearly unconstitutional.


                        Page I - 10 of 14

                                                       Appendix I


4. The present system, requiring people and businesses to pay
     interest to the banks on every Federal Reserve dollar in
     circulation, is a devastating and needless burden, adding to
     bankruptcies in a recession and severely hampering recovery.
     An Honest Money System, based on debt-free money, is
     essential to the economic well-being of the people all
     across the U.S.

5. An unstable national money supply is a debilitating handicap
     at best and, at worst, not only causes but worsens "boom or
     bust" business cycles so destructive of the people's best
     interests.

6. The people of America now suffer from needless recessions
     brought on by the cumulative effects of inflation and
     interest-bearing debt financing encouraged by the Federal
     Reserve System.


                        Page I - 11 of 14

                                                The Federal Zone:


                        How It All Began


an excerpt from the book A Writ for Martyrs, by Eustace Mullins:


"The income tax amendment and the Federal Reserve Act were passed
in the same year, 1913, because they function as an essential
team, and were planned to do so. The Federal Reserve districts
and the Internal Revenue Districts are "new states," which have
been established within the jurisdictions of legal states of the
Union. But why were they so established, and why are they co-
functional? The Internal Revenue Service has the duty of
collecting large amounts of taxes from employed Americans, solely
as an agent of the Federal Reserve System. It was not
accidental, nor was it coincidental, that these acts coincided
with the preparations of World War I. The necessity for income
tax "collections" did not become obvious for some years. The
U.S. Congress had awarded the Federal Reserve System the power to
issue money, despite the fact that the Federal Reserve bank stock
was entirely owned by private stockholders. The Federal Reserve
System then began to issue large amounts of profitable interest-
bearing "U.S. dollars," without control from any government
agency. It became apparent that the Federal Reserve System must
set up its own system of controls, which it did through the
Internal Revenue Service. Here again, the "Service" was not a
service to the U.S. Government, nor a service to the American
people. It was a service to the Federal Reserve System. The IRS
performed the necessary task of "sopping up" the enormous amounts
of money issued by the private stockholders of the Federal
Reserve System to finance their systematic acquisition of all the
property of the people of the United States.


"If these billions of paper instruments remained in continuous
circulation, they would become mere assignats, not worth a
Continental. The money is controlled by confiscatory taxation
through the agency of the Internal Revenue Service. The system
was laid down by David Ricardo, son of Abraham Israel, an
Amsterdam stock manipulator who moved to England and made a
fortune with the Rothschilds in the Waterloo speculations.
Ricardo developed the technique of controlling the people through
taxation. His direct descendant, Rita Ricardo Campbell, now
advises President Reagan on Social Security.


"As the largely worthless paper assignats are forcibly removed
from circulation by the zealous activities of the Internal
Revenue Service, the Federal Reserve System can then issue more
billions of paper currency to the public. The constant flow of
"new money" deceives the public into thinking these assignats
have real value.


                        Page I - 12 of 14

                                                       Appendix I


"The IRS also fulfills Ricardo's dictum that the worker must
never be allowed to enjoy more than a bare subsistence wage.
Income tax, withholding tax, Social Security tax and other taxes
fulfill Ricardo's dictum. With no money beyond bare subsistence,
the workers are effectively prevented from engaging in political
activity. In effect, the IRS functions as the slave overseer of
the great American plantation, plying the lash freely in order to
keep the workers bent to their tasks. However, neither the
function of sopping up paper money for the Federal Reserve System
nor the controlling of the workers by robbing them of their wages
is a proper function of the United States Government."


[Eustace Mullins, A Writ for Martyrs, published by O.T.U. Christ
Church, P. O. Box 1105, Staunton, VA 24401, 1985, pages 190-191]


                        Page I - 13 of 14

                                                The Federal Zone:


Reader's Notes:


                        Page I - 14 of 14


                           Appendix J

                      Petitions to Congress


                        Page J - 1 of 56

                                                The Federal Zone:


Reader's Notes:


                        Page J - 2 of 56

                                                       Appendix J


                   Text of Prepared Statement

                 Read Aloud at Community Meeting

            Sponsored by Representative Barbara Boxer


                               by


                    Mitch Modeleski, Founder
                 Account for Better Citizenship


                         August 22, 1990


                          Dance Palace
                  Pt. Reyes Station, California


Good Evening, Representative Boxer. My name is Mitch Modeleski.
I want to thank you for inviting us to this gathering, and for
your statement to us here tonight. I have listened with
undivided attention to what you have said. I have come here
tonight to ask that you now give me your undivided attention, and
that you answer honestly, yes or no, the simple question I will
put to you at the end of my brief statement. Representative
Boxer, I formally present to you substantive evidence that the
16th Amendment to the Constitution of the United States was never
lawfully ratified. I present to you substantive evidence that a
massive fiscal fraud has been perpetrated by the federal
government upon the people of this land, a massive fiscal fraud
that began in the year 1913 and continues until today. And so, I
will put to you this simple question.  Please honor my question
by answering YES or NO. Do you, or do you not, support the
abolition of federal taxes on personal income sources?


                        Page J - 3 of 56

                                                The Federal Zone:


MEMO

TO: Friends, Neighbors, Colleagues
          and all interested parties

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: January 1, 1991

SUBJECT: Enclosed Letter to Rep. Barbara Boxer


I am writing to share with you a copy of my recent long letter to
Congresswoman Barbara Boxer, my representative in the Congress of
the United States. If you will please find the time to read the
entire letter, I am confident you will agree that it documents
numerous reasons for coming to the following conclusions about
our federal government:


     1. Wages are not taxable income, as the term is defined by
          several key decisions of the U.S. Supreme Court that
          remain in force today.

     2. The U.S. Constitution authorizes Congress to levy
          "direct taxes" on private property, but only if those
          taxes are apportioned across the 50 States.

     3. The IRS now enforces the collection of "income taxes"
          as direct taxes without apportionment, and cites the
          16th Amendment for its authority to do so.

     4. The 16th Amendment, the "income tax" amendment, was
          never lawfully ratified by the required 36 States, but
          was declared ratified by the U.S. Secretary of State.

     5. The 16th Amendment could never have done away with the
          apportionment rule for any direct taxes if it never
          became a law in the first place.


Please feel free to duplicate this memo and the attached letter
to Representative Barbara Boxer, in any quantity you wish.

If you wish to write to me, please use the address found on the
first page of my letter to Rep. Boxer.

Thank you for your consideration.


                        Page J - 4 of 56

                                                       Appendix J


REGISTERED U.S. MAIL: c/o P. O. Box 6189
Return Receipt Requested San Rafael, California
                                        Postal Zone 94903-0189

                                        December 24, 1990

Rep. Barbara Boxer
House of Representatives
United States Congress
Washington, D.C. 20515

Dear Representative Boxer:

With this letter, I formally petition you for redress of a major
legal grievance which I now have with the federal government of
the United States of America. At your community meeting in Pt.
Reyes Station last fall, you agreed publicly, in front of several
hundred witnesses, to examine the evidence against the 16th
Amendment to the U.S. Constitution. Since I have not heard from
your office on this matter, I am writing this letter to remind
you of your promise, and to remind you also of your oath of
office, by which you swore to uphold and defend the Constitution
of the United States of America, so help you God.

I do understand how the crisis in Iraq has succeeded in changing
your priorities and distracting you, your staff, and your
colleagues from other pressing national issues. At your recent
community meeting at the College of Marin, you chose to limit
public discussion to the reasons for and against a Congressional
declaration of war against Iraq. I must admit, to the extent
President Bush sought to preempt the front page with his
offensive military maneuvers, he has been almost entirely
successful in that endeavor. Barbara, you must understand that
the problems with the 16th Amendment, and they are many, will not
go away simply because the President, the Courts, or the Congress
wish them away.

A terribly confusing and fearful situation has arisen out of the
fact that the Supreme Court has, on several occasions, clearly
defined what constitutes "taxable income", whereas Federal
District and Appellate Courts have, for at least the last ten
years, chosen to ignore the relevant Supreme Court decisions and
to include wages in their definition of taxable income. As a
result of decisions by these lower courts, people have been
imprisoned and their homes and other assets have been forcibly
taken from them. Moreover, the Federal courts have consistently
refused to admit into evidence any of the 17,000 State-certified
documents which have been assembled against the 16th Amendment.

These same lower courts cite the case of Brushaber vs Union
Pacific Railroad, among others, in support of their conclusion
that the 16th Amendment has been declared constitutional by the
U.S. Supreme Court. To add to the confusion, federal tax experts
like Irwin Schiff and Otto Skinner cite this same Supreme Court


                        Page J - 5 of 56

                                                The Federal Zone:


in support of their conclusion that the 16th Amendment did not
change any of the taxing powers already found in the U.S.
Constitution. For example, Schiff has written the following:


     Another fallacy promoted by the government and the legal
     establishment is that the Sixteenth Amendment amended the
     Constitution. The Brushaber Court, however, clearly
     explained that, in reality, the Sixteenth Amendment did not
     alter the taxing clauses of the Constitution. ...

     Here the Court pointed out that any belief that the 16th
     Amendment gave the government a new, direct taxing power
     (not limited by either apportionment or the rule of
     uniformity) would "cause one provision of the Constitution
     to destroy another", and "if acceded to ... would create
     radical and destructive changes in our constitutional
     system."

     [from The Great Income Tax Hoax, Hamden, 1984, Freedom
     Books, pages 182-183, emphasis added]


Author Otto Skinner relies, in part, on the Supreme Court
decision in Stanton vs Baltic Mining Company which reads:


     ... the provisions of the Sixteenth Amendment conferred no
     new power of taxation[,] but simply prohibited the previous
     complete and plenary power of income taxation[,] possessed
     by Congress from the beginning[,] from being taken out of
     the category of indirect taxation[,] to which it inherently
     belonged[,] and being placed in the category of direct
     taxation subject to apportionment.

     [quoted in The Best Kept Secret, San Pedro, Calif., 1986,
     Otto U. Skinner, emphasis and commas added for clarify]


Contrast these cases with the following statement published in
the Federal Register, Vol. 39, No. 62, March 29, 1974, in the
section entitled "Department of the Treasury, Internal Revenue
Service, Organization and Functions", which reads as follows:


     (2) Since 1862, the Internal Revenue Service has undergone
     a period of steady growth as the means for financing
     Government operations shifted from the levying of import
     duties to internal taxation. Its expansion received
     considerable impetus in 1913 with the ratification of the
     Sixteenth Amendment to the Constitution under which Congress
     received constitutional authority to levy taxes on the
     income of individuals and corporations. [emphasis added]


                        Page J - 6 of 56

                                                       Appendix J


I have several serious problems with this statement, which was
published in the Federal Register by Donald C. Alexander,
Commissioner of Internal Revenue at that time. First of all, the
IRS now defines "income" to include wages. Using the above
quote, the IRS cites the 16th Amendment for its authority to levy
taxes on wages. Nevertheless, this definition of income flatly
contradicts the definition of income found in several key Supreme
Court decisions. Specifically, the Brushaber court wrote the
following in their decision to uphold the constitutionality of
the 16th Amendment:


     Moreover in addition the conclusions reached in the Pollock
     Case did not in any degree involve holding that income taxes
     generically and necessarily came within the class of direct
     taxes on property, but on the contrary, recognized the fact
     that taxation on income was in its nature an excise entitled
     to be enforced as such ....

     [Brushaber vs Union Pacific Railroad 240 U.S. 1, emphasis
     added]


Can there be any doubt that taxes on wages are "direct taxes on
property"? District and Appellate courts have repeatedly sided
with the IRS by ruling that "income" is anything that "comes in".
In doing so, these same courts flatly contradict earlier Supreme
Court decisions on the very same subject. Take the case of
Southern Pacific Company vs John Z. Lowe, Jr., 247 U.S. 330,
which decided as follows:


     We must reject in this case ... the broad contention
     submitted in behalf of the Government that all receipts --
     everything that comes in -- are income within the proper
     definition of "gross income" ....


Another Supreme Court decision which defined what constitutes
"taxable income" is Emanuel J. Doyle vs Mitchell Brothers
Company, 247 U.S. 179. In defining "income", this decision
stated that:


     ... it imports, as used here, something entirely distinct
     from principal 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.


Another Supreme Court case, Stratton's Independence vs Howbert,
231 U.S. 406, issued yet another official definition of "income"
as follows:


                        Page J - 7 of 56

                                                The Federal Zone:


     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 population as prescribed by the Constitution ... for
     "income" may be defined as the gain derived from capital,
     from labor, or from both combined ....


Without question, the most significant Supreme Court case to
define "income" was Mark Eisner vs Myrtle H. Macomber, 252 U.S.
189, commonly known as Eisner vs Macomber. In the following long
passage, pay particular attention to the explicit intent of the
Supreme Court in wording its decision the way it did:


     In order, therefore, that the clauses cited above from
     Article I of the Constitution may have proper force and
     effect ... it becomes essential to distinguish between what
     is and what is not "income," as the term is there used; and
     to apply the distinction, as cases arise, according to truth
     and substance, without regard to form. Congress cannot by
     any definition it may adopt conclude the matter, since it
     cannot by legislation alter the Constitution, from which
     alone it derives its power to legislate, and within whose
     limitations alone that power can be lawfully exercised.

     ... Here we have the essential matter -- not a gain
     accruing to capital, not a growth or increment of value in
     the investment; but 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.

     ... A proper regard for its genesis, as well as its very
     clear language, requires also that this [16th] Amendment
     shall not be extended by loose construction, so as to repeal
     or modify, except as applied to income, those provisions of
     the Constitution that require an apportionment according to
     population for direct taxes upon property real and personal.
     This limitation still has an appropriate and important
     function, and is not to be overridden by Congress or
     disregarded by the courts. [emphasis added]


In another Supreme Court case, Merchant's Loan & Trust Company vs
Smietanka, 255 U.S. 509, note in particular that the definition
of "income" was considered to be "definitely settled" as follows:


                        Page J - 8 of 56

                                                       Appendix J


     ... with the addition that it should include "profit gained
     through a sale or conversion of capital assets," there would
     seem to be no room to doubt that the word must be given the
     same meaning in all of the Income Tax Acts of Congress that
     was given to it in the Corporation Excise Tax Act and that
     what that meaning is has now become definitely settled by
     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 believed 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. ...


     Notwithstanding the full argument heard in this case and in
     the series of cases now under consideration, we continue
     entirely satisfied with that definition, and, since the fund
     here taxed was the amount realized from the sale of the
     stock in 1917, less the capital investment as determined by
     the trustee as of March 1, 1913, it is palpable that it was
     a "gain or profit" "produced by" or "derived from" that
     investment, and that it "proceeded," and was "severed" or
     rendered severable, from, by the sale for cash, and thereby
     became that "realized gain" which has been repeatedly
     declared to be taxable income within the meaning of the
     constitutional amendment and the acts of Congress.


Accordingly, after reviewing all the relevant federal court
decisions for the past 80 years, constitutional tax expert and
author Jeffrey A. Dickstein has written the following to
summarize his findings:


     Income has been defined by the United States Supreme Court
     to be a profit or gain derived from various sources, such as
     labor and capital. A tax directly on the source is a direct
     tax, and must still be apportioned. A tax on the income
     derived from the source need not be apportioned. Labor, the
     labor contract, and the right to sell labor have all been
     held by the Supreme Court to constitute property. The
     procedure to determine if there is a gain derived from the
     sale of property has been set forth by Congress. Gain is
     derived only if one receives over and above the fair market
     value of the cost of the property. These basic principles
     are simple to state and simple to apply. They also lead to
     one inescapable conclusion:

                 WAGES DO NOT CONSTITUTE INCOME.


                        Page J - 9 of 56

                                                The Federal Zone:


     ... You must be cautioned that not filing a return with the
     Internal Revenue Service could result in the imposition of
     civil penalties and/or the recommendation for criminal
     prosecution. This illegal conduct on the part of our
     Executive Department of government is yet but another in a
     long line of abuses, similar to those which resulted in the
     Declaration of Independence. It is nonetheless my
     contention that provisions contained in the United States
     Constitution, together with decisions of the United States
     Supreme Court, fully support the legal conclusion that wages
     do not constitute income as shown in previous chapters, and
     reinforce the position that the Internal Revenue Service is
     violating the law in its administration of the personal
     federal income tax, with the full consent of the federal
     judiciary.

     [from Judicial Tyranny and Your Income Tax, Missoula, Custom
     Prints, 1990, pages 277- 280, emphasis added]


Return now to the statement by IRS Commissioner Donald C.
Alexander in the Federal Register in 1974. Under the 16th
Amendment, "Congress received constitutional authority to levy
taxes on the income of individuals and corporations." Even if
the 16th Amendment had been properly ratified by three-fourths of
the 48 States in 1913, the Supreme Court has repeatedly defined
"taxable income" to be a "gain or profit", not wages or fair
compensation for labor. The Supreme Court has never included
wages in its several definitions of "taxable income" nor in its
interpretations of the 16th Amendment. If that had ever been the
intent of the 16th Amendment, or of the Framers of the original
Constitution, don't you think the Supreme Court would have said
so by now? The Supreme Court has certainly had plenty of
opportunities to do so, and they have not done so. Wages for
labor were not invented yesterday.

Consider now the situation that arises from a 16th Amendment that
was never properly ratified. I am not going to bother here with
spelling errors, or with differences in the capitalization of the
word "State", that occurred in various resolutions presented to
the state legislatures. I am referring, instead, to important,
official acts which directly affect the legality of the 16th
Amendment, including the vetoes of governors and a State court
decision which struck down the Resolution. Note the situation
that obtained in Illinois, as quoted from The Law that Never Was,
by Bill Benson and M. J. 'Red' Beckman:


     In Ryan v. Lynch, 68 Ill. 160, a certificate of the
     Secretary of State purporting to give full and true copies
     of the journals of the senate and house relating to the
     passage of the bill was in evidence and did not show that
     the bill was read three times on three different days nor
     passed on a vote of the ayes and noes, as required by the


                        Page J - 10 of 56

                                                       Appendix J


     constitution, and the court said that the bill never became
     a law and was as completely a nullity as if it had been the
     act or declaration of an unauthorized assemblage of
     individuals.

     In People v. Knopf, 198 Ill. 340, the court again stated the
     rule that if the facts essential to the passage of a law are
     not set forth in the journal the conclusion is that they did
     not transpire, and if the journal fails to show that an act
     was passed in the mode prescribed by the constitution the
     act must fail. [page 52]


Nevertheless, U.S. Secretary of State Philander Knox declared
Illinois to be one of the States which ratified the 16th
Amendment.

In Arkansas, Governor George W. Donaghey vetoed Senate Joint
Resolution No. 7, the proposed 16th Amendment, and the Arkansas
Legislature failed to override his veto. According to the
provisions of Article VI, Section 16 of the Arkansas State
Constitution:


     Every order or resolution in which the concurrence of both
     houses of the General Assembly may be necessary, except on
     questions of adjournment, shall be presented to the
     Governor, and before it shall take effect, be approved by
     him; or being disapproved, shall be repassed by both
     houses, according to the rules and limitations prescribed in
     the case of a bill.


When confronted with this serious matter, namely, a governor's
veto and the failure of a state legislature to override his veto,
the Solicitor of the Department of State wrote the following:

     Ratification by Arkansas. Power of the governor to veto.
     It will be observed from the above record that the Governor
     of the State of Arkansas vetoed the resolution passed by the
     legislature of that State. It is submitted, however, that
     this does not in any way invalidate the action of the
     legislature or nullify the effect on the resolution, as it
     is believed that the approval of the Governor is not
     necessary and that he has not the power to veto in such
     cases.

     [quoted in The Law that Never Was, page 22]


"It is believed that the approval of the Governor is not
necessary and that he has not the power to veto in such cases."
Note, in particular, who is making this statement. It is not a


                        Page J - 11 of 56

                                                The Federal Zone:


judge; it is not a law maker; and it is not a law. The person
is a staff lawyer in the Department of State, an organization
with no authority whatsoever to make laws or to render official
interpretations of law. Making federal law is a power reserved
for the Congress of the United States. Rendering final, official
interpretations of law is a power reserved for the Supreme Court
of the United States. Here, we have the case of a ministerial
agent rendering a highly important legal opinion, and a wrong one
at that, in a matter affecting the Constitution of the United
States, the supreme law of the land. And his opinion was allowed
to stand. This is an abomination!

I do not pretend to have any power to foresee the future,
particularly in matters affecting the politics of legal
interpretation. Nevertheless, with that said, the IRS and the
federal government in general face a number of difficult
political and legal problems, should the ratification of the 16th
Amendment ever be overturned. Quite obviously, the IRS will no
longer be able to cite this Amendment as the means "under which
Congress received constitutional authority to levy taxes on the
income of individuals and corporations." It will need to find,
or create, some other authority to levy taxes on the "income" of
individuals and corporations. But this is a lot easier said,
than done.

With or without a 16th Amendment, the IRS must deal with a long
series of Supreme Court decisions which consistently define
"taxable income" to be something quite other than wages. More to
the point, the Supreme Court has also ruled that "Congress cannot
by any definition it may adopt conclude the matter, since it
cannot by legislation alter the Constitution." This means that
neither the IRS nor Congress have the authority to define
"income" any old way they want. This applies to you too, Barbara
Boxer, as an elected member of the House of Representatives and
as a private citizen. Under the Constitution of the United
States, the IRS has never been empowered to make any laws in this
area. Those seeking to re-define "income" to include wages will
need to persuade the Supreme Court to overturn all previous
decisions to the contrary, including decisions which investigated
in depth the relevant issues and history of direct taxes,
indirect taxes, and defining income.

Assuming for the moment that it was properly ratified, there
remains a serious debate, both inside and outside the federal
judiciary, as to whether the 16th Amendment authorized an
unapportioned direct tax on "income", or whether it authorized an
excise entitled to be enforced as an indirect tax. The Pollock
Case supports the idea that federal income taxes are direct
taxes. The Brushaber Case supports the idea that federal income
taxes are indirect taxes. Contrary to Supreme Court rulings, the
IRS defines income to include wages, and cites the 16th Amendment
as its authority for imposing direct taxes on wages without
apportionment. Accordingly, some legal scholars conclude that
the 16th Amendment did amend the Constitution, while others


                        Page J - 12 of 56

                                                       Appendix J


conclude that it did not. A properly pleaded Supreme Court
decision would hopefully settle the several issues in this
particular debate; it would serve to determine which rule
applies to "federal income taxes" -- apportionment for direct
taxes, uniformity for indirect taxes, or neither -- and to
provide a credible justification for this determination.

To illustrate the range of disagreement on such a fundamental
constitutional issue, consider the conclusion of legal scholar
Vern Holland:


     It results, therefore: ...

     4. That the Sixteenth Amendment did not amend the
     Constitution. The United States Supreme Court by unanimous
     decisions determined that the amendment did not grant any
     new powers of taxation; that a direct tax cannot be
     relieved from the constitutional mandate of apportionment;
     and the only effect of the amendment was to overturn the
     theory advanced in the Pollock case which held that a tax on
     income, was in legal effect, a tax on the sources of the
     income.

     [The Law that Always Was, Tulsa, 1987, F.E.A. Books, p. 220]

Now consider an opposing view. After much research and much
litigation, author and attorney Jeffrey A. Dickstein offers the
following clarification:

     A tax imposed on all of a person's annual gross receipts is
     a direct tax on personal property that must be apportioned.
     A tax imposed on the "income" derived from those gross
     receipts is also a direct tax on property, but as a result
     of the Sixteenth Amendment, Congress no longer has to enact
     legislation calling for the apportionment of a tax on that
     income. [ibid., pages 60-61, emphasis added]


We must be careful not to put the cart before the horse, however.
Like it or not, this debate cannot proceed any further without
squarely facing 17,000 State-certified documents impugning the
entire ratification process of the 16th Amendment. This means
that citizens and lawmakers together must confront our current
situation "as if the bill never became a law and was as
completely a nullity as if it had been the act or declaration of
an unauthorized assemblage of individuals." Chicanery is not
synonymous with good law. Specifically, even if this were its
specific intent, the 16th Amendment could never have done away
with the apportionment requirement on any direct taxes if it
never became a law in the first place. Without question, the IRS
is now enforcing the collection of income taxes as direct taxes
without apportionment, and cites the 16th Amendment as its
authority to do so.


                        Page J - 13 of 56

                                                The Federal Zone:


Without the 16th Amendment, Congress does retain its original
authority to levy two great categories of taxes -- direct taxes
and indirect taxes -- an authority it always had. Without the
16th Amendment, direct taxes are constitutional, and therefore
legal, if and only if they are apportioned across the several
States. Taxes on wages, or on all of a person's gross receipts,
are direct taxes on personal property which must be apportioned,
and are illegal and unconstitutional if they are not. Moreover,
failing the 16th Amendment and using Dickstein's logic as a
guide, taxes on the "income" derived from those gross receipts
are also direct taxes on property, and must also be apportioned.
Without the 16th Amendment, indirect taxes are constitutional,
and therefore legal, if and only if they are uniform across the
several States. To the extent that the IRS, and any other
branches of the federal government, should violate these rules,
they are violating the supreme law of the land and thus violating
individual rights which that supreme law was explicitly
established to guarantee.

One way out of this dilemma for the federal government is to
begin immediately to apportion taxes levied on wages and other
gross receipts of individuals, and to demonstrate to the Supreme
Court that the totals obtained from the various States are
proportional to their respective populations. Irwin Schiff
describes in simple language how this could be done. Another way
out of this dilemma is to begin immediately to impose income
taxes as "excise taxes" on corporate profits, and to demonstrate
to the satisfaction of the Supreme Court that the resulting tax
rates are uniform across the States. For example, it is entirely
within the power of Congress to impose an "income tax" on the
profits of the Federal Reserve Corporation, since that
corporation is not an agency of the federal government, and is
currently exempted from income taxes by an act of Congress.

By themselves, neither of these are very likely to happen, or be
very easy to enforce if they do happen, should the 16th Amendment
be overturned, and should its overturning receive the widespread
publicity it is likely to receive. If the 16th Amendment is
overturned, the people will, for better or for worse, rejoice
that "income taxes" have been declared unconstitutional and, as
currently administered by the IRS, they would be right.

To resolve any lingering doubts, the Supreme Court should be
presented with an opportunity to determine squarely the
constitutionality of a general tax on gross receipts without
apportionment. According to scholar Vern Holland, a properly
pleaded case has never been brought before the high Court.
Holland asserts that the bulk of historical evidence allows for
only one conclusion:

     The Court cannot ignore the weight of evidence that proves
     that a General Tax on Income levied upon one of the Citizens
     of the several States, has always been a direct tax and must
     be apportioned. [ibid., page 220]


                        Page J - 14 of 56

                                                       Appendix J


The best alternatives available to the federal government are to
abandon direct taxes on wages entirely, to shift instead to a
greater reliance on excise taxes, and to reverse its policy of
debt financing. The machinery for administering excise taxes is
already in place for taxing the sale of commodities like
gasoline. Abolishing withholding taxes will eliminate a huge,
involuntary burden on the vast working classes of America, and
restore incentive to a working place badly in need of all the
motivation it can muster. It will also put the lie to the IRS
claim that federal "income" taxes are voluntary, all the while
employers are forced to withhold the wages of employees who are
told repeatedly they have no choice in the matter.

Moreover, there is much evidence to suggest that lowering taxes
would have the effect of stimulating the economy in a
disproportionate, economically "elastic" way. For example, see
"Higher Taxes Aren't the Answer -- History Proves it," by
Stephen Moore, Reason Foundation, Santa Monica, CA, October 1990.
By abolishing "wage taxes" and relying instead on excise taxes
levied upon commercial transactions, the government raises more
money as the economy improves, and raises less money as the
economy declines, giving government a strong incentive to "tune"
its excise taxes accordingly. I am prepared to share with you
some excellent proposals for financing the federal government
entirely thru a national sales tax.

This is a far cry from our present situation, in which the
federal government is fast approaching total bankruptcy, and
cannot balance its budget without simultaneously raising taxes
further still and reducing spending even more so. Because it
employs so many people at present, and buys so many goods and
services, the federal government is central to the American
economy. Thru the vehicle of debt financing, the federal
government now grows at the expense of the economy, plunging
future generations into ever higher debt, and ever larger
interest payments. At the rate we are going, it is only a matter
of months before the interest payments alone on the national debt
will exceed the entire annual tax revenues to the U.S. Treasury.

It is becoming increasingly difficult to hide a trillion dollar
savings and loan scandal. The Federal Savings and Loan Insurance
Corporation (FSLIC) is basically broke. The Federal Deposit
Insurance Corporation (FDIC) now has only $4 billion to cover
some $2 trillion in bank deposits. Thus, the federal insurance
fund covers only one-fifth of one percent of total deposits (i.e.
4 / 2000). The FDIC will fail when only a small number of banks
collapse. Call these the "first wave". Lacking any federal
insurance at that point, a second wave of bank failures will
cause millions of Americans to lose their bank deposits forever,
and possibly also lose the millions of home mortgages on which
those deposits are leveraged. By itself, isn't this enough to
convince you how serious is our national fiscal crisis?


                        Page J - 15 of 56

                                                The Federal Zone:


Representative Barbara Boxer, I implore you to exercise your
powers as an elected official in the Congress of the United
States, to examine carefully the mountain of evidence against the
16th Amendment, to investigate the many consequences of declaring
it null and void, and to study the many alternative ways of
financing the federal government without direct taxes on the
gross receipts of individuals. You have a number of legal
options available to you, including the power to subpoena
documents and witnesses before Congressional committees. You
have it within your power to authorize such committees to
investigate charges of fraud and other illegal tampering with the
procedures for amending the Constitution of the United States,
the supreme law of our land. You have it within your power to
examine all the actions of federal government officials involved
in declaring the 16th Amendment "ratified" in the year 1913,
because there is no statute of limitations on fraud. And you
have it within your power to include the American public in a
process of open hearings, public education and free discussion on
this subject, as you did so wonderfully at the College of Marin
to discuss a declaration of war.

Representative Barbara Boxer, I stand ready, willing, and able to
help you in any way I can to investigate further the charge of
felony fraud which I now make to you:


      THE SIXTEENTH AMENDMENT WAS NEVER LAWFULLY RATIFIED.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


enclosures: computer analysis of evidence
             against the 16th Amendment


                        Page J - 16 of 56


                                                                Appendix J

                   Failures to Ratify the 16th Amendment
                 to the Constitution of the United States:
                         A Status Summary by State


                See Error Error Error Error Error Error Error Error Error
 State Notes #1 #2 #3 #4 #5 #6 #7 #8 #9
 ------------- ----- ----- ----- ----- ----- ----- ----- ----- ----- -----
 Alabama YES YES
 Arizona YES YES YES
 Arkansas YES YES YES YES
 California YES YES YES
 Colorado YES YES
 Connecticut (10) YES
 Delaware YES YES
 Florida (11) YES
 Georgia YES YES YES YES YES
 Idaho YES YES YES YES
 Illinois YES YES YES
 Indiana YES YES YES
 Iowa YES YES YES
 Kansas YES YES YES YES YES
 Kentucky YES YES YES YES YES
 Louisiana YES YES YES
 Maine YES YES YES YES
 Maryland YES YES YES YES
 Massachusetts YES YES YES
 Michigan YES YES
 Minnesota YES YES YES
 Mississippi YES YES  YES
 Missouri YES YES YES
 Montana YES YES YES
 Nebraska YES YES YES
 Nevada YES YES YES
 New Hampshire YES YES
 New Jersey YES YES YES
 New Mexico YES
 New York YES YES YES YES YES
 North Carolina YES YES YES
 North Dakota YES YES YES
 Ohio YES YES YES YES
 Oklahoma YES YES YES
 Oregon YES YES YES
 Pennsylvania (12) YES
 Rhode Island (13) YES
 South Carolina YES YES YES
 South Dakota YES YES YES
 Tennessee YES YES YES YES
 Texas YES YES YES
 Utah (14) YES
 Vermont YES YES YES YES
 Virginia (15) YES
 Washington YES YES YES
 West Virginia YES YES YES YES
 Wisconsin YES YES
 Wyoming YES YES YES

                        Page J - 17 of 56

                                                The Federal Zone:


Description of Errors:

1. Failure to concur in U. S. Senate Joint Resolution No. 40 in
     that various changes were made to the text of the official
     Joint Resolution of the U.S. Congress.

2. Failure to follow the guidelines for the return of a
     certified copy of the ratification action, as contained in
     Congressional Concurrent Resolution No. 6, and as required
     by Section 205 of the Revised Statutes of 1878.

3. Governor vetoed the resolution and the State Legislature
     failed to override the veto.

4. Resolution was not submitted to the Governor for approval.

5. State Senate failed to pass the resolution by a required 2/3
     majority.

6. State Assembly or House failed to pass the resolution by a
     required 2/3 majority.

7. State Senate failed to pass the resolution.

8. State Assembly or House failed to pass the resolution.

9. Other State constitutional violations not mentioned above.


(Source: The Law That Never Was -- The Fraud of the 16th
Amendment and Personal Income Tax, by Bill Benson and M. J. 'Red'
Beckman, published by Constitutional Research Assoc., Box 550,
South Holland, IL 60473, April 1985)


Notes:

(10) The Senate rejected the minority report of the committee on
     judiciary and federal relations recommending ratification of
     this amendment on June 23, 1911, by a vote of 6 to 19.
     (Connecticut Senate Journal, 1911, pp. 1346-1348)

(11) Florida House passed H.J. Res. 192, ratifying this amendment
     on May 21, 1913, by a vote of 59 to 0. (Florida House
     Journal, 1913, p. 1686.) The Senate committee on
     constitution recommended that the resolution do not pass.
     May 27, 1913. (Florida Senate Journal, 1913, p. 1745.)

(12) The House passed a joint resolution ratifying the sixteenth
     amendment on May 10, 1911, by a vote of 139 to 4.
     (Pennsylvania House Journal, 1911, pp. 2690-2691.) The
     Senate referred the joint resolution to the committee on
     judiciary special, where it lay. (Pennsylvania Senate
     Journal, 1911, p. 2162.)


                        Page J - 18 of 56

                                                       Appendix J


(13) Senate resolution refusing to ratify this amendment was
     concurred in by House April 29, 1910. (Rhode Island House
     Journal, April 29, 1910.)

(14) The House rejected this amendment on March 9, 1911, by a
     vote of 31 to 10. (Utah House Journal, 1911, pp. 606-607.)
     The Senate passed the resolution ratifying the amendment by
     a vote of 12 to 2 on February 17, 1911. (Utah Senate
     Journal, 1911, p. 256.)

(15) The Senate ratified this amendment by a vote of 19 to 5 on
     March 9, 1910. (Virginia Senate Journal, 1910, pp. 651-
     652.) The House Journal, 1910, does not show that this
     resolution ratifying the amendment ever came to a vote.


(Notes 10-15 from U.S. Senate Document No. 240, 71st Congress,
"Ratification of the Constitution and Amendments by the States")


                        Page J - 19 of 56

                                                The Federal Zone:

Defense Strategy 1:
States Made Changes to the Text of the Resolution

     state error1
     --------------- ------
 1 Alabama YES
 2 Arizona YES
 3 Arkansas YES
 4 California YES
 5 Colorado YES
 6 Delaware YES
 7 Georgia YES
 8 Idaho YES
 9 Illinois YES
10 Indiana YES
11 Iowa YES
12 Kansas YES
13 Kentucky YES [number needed to defeat Amendment]
----------------------------------------------------------------------
14 Louisiana YES
15 Maine YES
16 Maryland YES
17 Massachusetts YES
18 Michigan YES
19 Minnesota YES
20 Mississippi YES
21 Missouri YES
22 Montana YES
23 Nebraska YES
24 Nevada YES
25 New Hampshire YES
26 New Jersey YES
27 New York YES
28 North Carolina YES
29 North Dakota YES
30 Ohio YES
31 Oklahoma YES
32 Oregon YES
33 South Carolina YES
34 South Dakota YES
35 Tennessee YES
36 Texas YES
37 Vermont YES
38 Washington YES
39 West Virginia YES
40 Wisconsin YES
41 Wyoming YES [number available to defeat Amendment]
----------------------------------------------------------------------
42 Connecticut
43 Florida
44 New Mexico
45 Pennsylvania
46 Rhode Island
47 Utah
48 Virginia


                        Page J - 20 of 56


                                                       Appendix J

Defense Strategy 2:
Various Violations of State Constitutions

     state error9
     --------------- ------
 1 Arizona YES
 2 Arkansas YES
 3 California YES
 4 Colorado YES
 5 Georgia YES
 6 Idaho YES
 7 Illinois YES
 8 Indiana YES
 9 Iowa YES
10 Kansas YES
11 Kentucky YES
12 Louisiana YES
13 Maine YES [number needed to defeat Amendment]
----------------------------------------------------------------------
14 Maryland YES
15 Massachusetts YES
16 Michigan YES
17 Minnesota YES
18 Mississippi YES
19 Missouri YES
20 Montana YES
21 Nebraska YES
22 Nevada YES
23 New Mexico YES
24 New York YES
25 North Carolina YES
26 North Dakota YES
27 Ohio YES
28 Oklahoma YES
29 Oregon YES
30 South Carolina YES
31 Tennessee YES
32 Texas YES
33 Vermont YES
34 Washington YES
35 West Virginia YES
36 Wyoming YES [number available to defeat Amendment]
----------------------------------------------------------------------
37 Alabama
38 Connecticut
39 Delaware
40 Florida
41 New Hampshire
42 New Jersey
43 Pennsylvania
44 Rhode Island
45 South Dakota
46 Utah
47 Virginia
48 Wisconsin


                        Page J - 21 of 56

                                                The Federal Zone:

Defense Strategy 3:
States Failed to Follow Guidelines for Certified Copy

     state error2
     --------------- ------
 1 Alabama YES
 2 Arizona YES
 3 Arkansas YES
 4 California YES
 5 Delaware YES
 6 Georgia YES
 7 Idaho YES
 8 Illinois YES
 9 Indiana YES
10 Iowa YES
11 Kansas YES
12 Kentucky YES
13 Louisiana YES [number needed to defeat Amendment]
----------------------------------------------------------------------
14 Maine YES
15 Maryland YES
16 Massachusetts YES
17 Minnesota YES
18 Mississippi YES
19 Montana YES
20 Nebraska YES
21 Nevada YES
22 New Hampshire YES
23 New Jersey YES
24 New York YES
25 North Carolina YES
26 North Dakota YES
27 Ohio YES
28 Oklahoma YES
29 Oregon YES
30 South Carolina YES
31 South Dakota YES
32 Tennessee YES
33 Texas YES
34 Vermont YES
35 West Virginia YES
36 Wisconsin YES
37 Wyoming YES [number available to defeat Amendment]
----------------------------------------------------------------------
38 Colorado
39 Connecticut
40 Florida
41 Michigan
42 Missouri
43 New Mexico
44 Pennsylvania
45 Rhode Island
46 Utah
47 Virginia
48 Washington


                        Page J - 22 of 56


                                                            Appendix J

Defense Strategy 4:
Confirmed Noes + Governor Vetoes + Errors 4 - 8

     state error10 error3 error4 error5 error6 error7 error8
     --------------- ------- ------ ------ ------ ------ ------ ------
 1 Virginia (15) YES
 2 Utah (14) YES
 3 Rhode Island (13) YES
 4 Pennsylvania (12) YES
 5 Florida (11) YES
 6 Connecticut (10) YES
 7 Kentucky YES YES
 8 Arkansas YES
 9 New York YES YES
10 Idaho YES
11 Maryland YES
12 Missouri YES
13 Ohio YES
----------------------------------------------------------------------
14 South Dakota YES
15 Washington YES
16 West Virginia YES
17 Kansas YES YES
18 Georgia YES YES
19 New Jersey YES
20 Vermont YES
21 Maine YES
22 Tennessee YES
----------------------------------------------------------------------
23 Alabama
24 Arizona
25 California
26 Colorado
27 Delaware
28 Illinois
29 Indiana
30 Iowa
31 Louisiana
32 Massachusetts
33 Michigan
34 Minnesota
35 Mississippi
36 Montana
37 Nebraska
38 Nevada
39 New Hampshire
40 New Mexico
41 North Carolina
42 North Dakota
43 Oklahoma
44 Oregon
45 South Carolina
46 Texas
47 Wisconsin
48 Wyoming


                        Page J - 23 of 56

                                                      The Federal Zone:

Defense Strategy 5:
Failed House/Senate + Failed 2/3 + Vetoes and not Submitted to Governor

     state error7 error8 error5 error6 error3 error4
     --------------- ------ ------ ------ ------ ------ ------
 1 Georgia YES YES
 2 Kentucky YES YES
 3 Connecticut YES
 4 Florida YES
 5 Maine YES
 6 Pennsylvania YES
 7 Rhode Island YES
 8 Tennessee YES
 9 Utah YES
10 Virginia YES
11 Kansas YES YES
12 New Jersey YES
13 Vermont YES
----------------------------------------------------------------------
14 New York YES YES
15 Arkansas YES
16 Idaho YES
17 Maryland YES
18 Missouri YES
19 Ohio YES
20 South Dakota YES
21 Washington YES
22 West Virginia YES
----------------------------------------------------------------------
23 Alabama
24 Arizona
25 California
26 Colorado
27 Delaware
28 Illinois
29 Indiana
30 Iowa
31 Louisiana
32 Massachusetts
33 Michigan
34 Minnesota
35 Mississippi
36 Montana
37 Nebraska
38 Nevada
39 New Hampshire
40 New Mexico
41 North Carolina
42 North Dakota
43 Oklahoma
44 Oregon
45 South Carolina
46 Texas
47 Wisconsin
48 Wyoming


                        Page J - 24 of 56

                                                            Appendix J

Defense Strategy 6:
Confirmed Noes + Governor Vetoes + Not Submitted to Governor

     state error10 error3 error4 error5 error6 error7 error8
     --------------- ------- ------ ------ ------ ------ ------ ------
 1 Virginia (15) YES
 2 Utah (14) YES
 3 Rhode Island (13) YES
 4 Pennsylvania (12) YES
 5 Florida (11) YES
 6 Connecticut (10) YES
 7 Kentucky YES YES
 8 Arkansas YES
 9 New York YES YES
10 Idaho YES
11 Maryland YES
12 Missouri YES
13 Ohio YES
----------------------------------------------------------------------
14 South Dakota YES
15 Washington YES
16 West Virginia YES
17 Kansas YES YES
18 Georgia YES YES
19 New Jersey YES
20 Vermont YES
21 Maine YES
22 Tennessee YES
----------------------------------------------------------------------
23 Alabama
24 Arizona
25 California
26 Colorado
27 Delaware
28 Illinois
29 Indiana
30 Iowa
31 Louisiana
32 Massachusetts
33 Michigan
34 Minnesota
35 Mississippi
36 Montana
37 Nebraska
38 Nevada
39 New Hampshire
40 New Mexico
41 North Carolina
42 North Dakota
43 Oklahoma
44 Oregon
45 South Carolina
46 Texas
47 Wisconsin
48 Wyoming


                        Page J - 25 of 56

                                                The Federal Zone:


                                        c/o P. O. Box 6189
                                        San Rafael, California
                                        Postal Zone 94903-0189

                                        March 11, 1991

Foreman
Marin County Grand Jury
Hall of Justice
Civic Center
San Rafael, California
Postal Zone 94903

Dear Foreman:

Enclosed with this letter please find our completed Request for
Investigation by the Marin County Grand Jury.

As stated in the summary section of our completed form, we hereby
request the Marin County Grand Jury to do the following:

(1) to investigate possible obstruction of justice and
     misprision of felony by Representative Barbara Boxer for her
     failure, against a spoken promise before hundreds of
     witnesses at Pt. Reyes Station on August 22, 1990, to
     examine the material evidence of felony fraud when U.S.
     Secretary of State Philander C. Knox declared the 16th
     Amendment ratified,

(2) to subpoena or otherwise require Representative Boxer to
     explain, under oath, why she and her staff have failed to
     answer our formal, written petition for redress of this
     major legal grievance with agents of the federal government,

(3) to review the material evidence against the so-called 16th
     Amendment which we have assembled and are prepared to submit
     in expert testimony, under oath, to the Marin County Grand
     Jury.

Attached please find a signed copy of the formal, written
petition which I have already sent to Rep. Boxer via registered
United States mail, return receipt requested and received. This
petition is dated December 24, 1990. A second copy of this
petition was sent at the same time via standard, first class mail
to her office in Washington, D.C, and a third copy was also sent
via first class mail to her office in San Rafael, California.

This petition seeks to state the problem as succinctly as
possible, to review the relevant decisions of the U.S. Supreme
Court, to analyze the legal and economic implications of
nullifying the so-called 16th Amendment, and to present a summary
of numerous State-certified documents which prove that felony
fraud was committed when this Amendment was "declared" ratified
in the year 1913 by then Secretary of State, Philander C. Knox.


                        Page J - 26 of 56

                                                       Appendix J


As the author of this petition and as an interested citizen who
is, above all, dedicated to preserving our constitutional
republic and the rule of law which the constitution was
explicitly established to guarantee, it is my earnest hope that
you will review these materials with the utmost care and
attention to detail which they deserve.

The story you are about to read would fill volumes of fascinating
historical fiction, were it not all true in every last detail.
Please consider me to be ready, willing, and able to assist you,
in any way I can, to review every relevant detail with honesty,
integrity, and an unflagging passion for the truth, the whole
truth, and nothing but the truth in this critical matter which
now affects the entire nation in so many ways.

Thank you very much for your consideration. I will look forward
to your prompt response to this Request.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


Attachments:

     Request for Grand Jury Investigation
     Memo dated 1/1/91 summarizing petition
     Formal petition dated 12/24/90
     Excerpts from U.S. criminal codes
     Text of statement read aloud to Rep. Boxer, 8/22/90
     How It All Began: a quote from Eustace Mullins
     Proof of registered mail sent and received


                        Page J - 27 of 56

                                                The Federal Zone:


Misprision of Felony, 18 U.S.C. 4 states:

     Whoever, having knowledge of the actual commission of a
     felony cognizable by a court of the United States, conceals
     and does not as soon as possible make known the same to some
     judge or other person in civil or military authority under
     the United States, shall be fined not more than $500 or
     imprisoned not more than three years, or both.

18 U.S.C. 1001 states:

     Whoever, in any matter within the jurisdiction of any
     department or agency of the United States knowingly and
     willfully falsifies, conceals, or covers up by any trick,
     scheme, or device a material fact, or makes any false,
     fictitious or fraudulent statement or representations, or
     makes or uses any false writing or document knowing the same
     to contain any false, fictitious or fraudulent statement or
     entry, shall be fined not more than $10,000 or imprisoned
     not more than five years, or both.

18 U.S.C. 1002 states:

     Whoever, knowingly and with intent to defraud the United
     States, or any agency thereof, possesses any false, altered,
     forged, or counterfeited writing or document for the purpose
     of enabling another to obtain from the United States, or
     from any agency, officer or agent thereof, any sum of money,
     shall be fined not more than $10,000 or imprisoned not more
     than five years, or both.

18 U.S.C. 1017 states:

     Whoever fraudulently or wrongfully affixes or impresses the
     seal of any department or agency of the United States, to or
     upon any certificate, instrument, commission, document, or
     paper or with knowledge of its fraudulent character, with
     wrongful or fraudulent intent, uses, buys, procures, sells,
     or transfers to another any such certificate, instrument,
     commission, document, or paper, to which or upon which said
     seal has been so fraudulently affixed or impressed, shall be
     fined not more than $5,000 or imprisoned not more than five
     years, or both.

18 U.S.C. 1018 states:

     Whoever, being a public officer or other person authorized
     by any law of the United States to make or give a
     certificate or other writing, knowingly makes and delivers
     as true such a certificate or writing, containing any
     statement which he knows to be false, in a case where the
     punishment thereof is not elsewhere expressly provided by
     law, shall be fined not more than $500 or imprisoned not
     more than one year, or both.


                        Page J - 28 of 56

                                                       Appendix J


18 U.S.C. 3 states:

     Whoever, knowing that an offense against the United States
     has been committed, receives, comforts or assists the
     offender in order to hinder or prevent his apprehension,
     trial or punishment, is an accessory after the fact.

     Except as otherwise expressly provided by an Act of
     Congress, an accessory after the fact shall be imprisoned
     not more than one-half the maximum term of imprisonment or
     fined not more than one-half the maximum fine prescribed for
     the punishment of the principal, or both; or if the
     principal is punishable by death, the accessory shall be
     imprisoned not more than ten years.


                        Page J - 29 of 56

                                                The Federal Zone:


                                        c/o P. O. Box 6189
                                        San Rafael, California
                                        Postal Zone 94903-0189

                                        April 15, 1991
Rep. Barbara Boxer
House of Representatives
United States Congress
Washington, D.C.
Postal Zone 20515

Dear Rep. Boxer:

Thank you very much for your brief letter to me, dated March 27,
1991. I appreciate your decision to refer my petition dated
December 24, 1990, to the House Ways and Means Committee, for
comments from that committee's counsel.

From prior contacts with other American citizens who have filed
similar petitions with their representatives in the Congress, I
know that a stock answer is to send to constituents a copy of the
so-called Ripy Report, "Ratification of the Sixteenth Amendment,"
by Thomas B. Ripy, Congressional Research Service, May 20, 1985
(see enclosed).

Before you or Committee counsel make the same mistake with me,
please understand that I already possess a copy of the Ripy
Report and find it entirely  unsatisfactory as to matters of fact.
Specifically, the Ripy Report does not attempt to challenge any
of the material facts presented by authors Benson and Beckman in
the book The Law That Never Was.

You will recall that my petition to you of December 24, 1990
included a computer-based summary of the evidence against the
16th Amendment. Once again, permit me to summarize only some of
these facts, as follows:


     * Eleven States amended the proposed resolution.

     * The Senate of the State of Kentucky rejected the
          proposed amendment by a vote of 9 for and 22 against
          ratification.

     * Five States failed to ratify the amendment by the
          required two-thirds majority in one of the chambers of
          their legislatures (Georgia, Kansas, New York, New
          Jersey, and Vermont).

     * Minnesota, California and Ohio never sent official
          notification of the action taken by their respective
          legislatures.


                        Page J - 30 of 56

                                                       Appendix J


     * Another six States did not record whatever action was
          taken by their respective legislatures in  the Journals
          of their General Assemblies.

     * Ten States never voted on the proposed amendment.

     * Nine States deleted the preamble to the joint
          resolution.

     * Twenty-six States changed the punctuation of the
          preamble.

     * Twenty-five States changed the punctuation of the
          resolution.

     * Twenty-four States changed the capitalization of
          certain words.

     * Nineteen States made grammatical changes.

     * An Illinois State Court ruled that "it never became a
          law and was as much a nullity as if it had been the act
          or declaration of an unauthorized assemblage of
          individuals." (Ryan vs Lynch, 68 Ill. 160)

     * The Governor of the State of Arkansas vetoed the
          resolution, the Arkansas Legislature never overrode his
          veto, and the Arkansas Constitution did not exempt
          Constitutional amendments from a governor's signature.

     * Oklahoma changed the proposal so as to require the
          laying of an income tax pursuant to a census or
          enumeration, the precise requirement the proposed
          amendment sought to alleviate.


On February 15, 1913, the Solicitor of the State Department
advised Secretary of State Philander C. Knox that:


       "... under provisions of the Constitution a legislature is
     not authorized to alter IN ANY WAY the amendment proposed by
     Congress, the function of the legislature consisting merely
     in the right to approve or disapprove the proposed
     amendment."

     ("Ratification of the 16th Amendment to the Constitution of
     the United States," Office of the Solicitor, emphasis added)


Accordingly, I find it necessary to agree entirely with the
following statement by attorney and litigator Andrew B. Spiegel,
from his publication which I have enclosed with this letter:


                        Page J - 31 of 56

                                                The Federal Zone:


     "The Ripy Report does not attempt to challenge any of the
     facts presented by William J. Benson .... Thus, for the
     purposes of this argument, those facts must be taken as
     conceded by the government. It is those facts which lead to
     the inescapable conclusion that the so-called income tax
     amendment is null and void."

     [from "Ratification of the Income Tax Amendment: Has the
     Federal Government Defrauded the American People? A Response
     to the Ripy Report," Constitutional Research Associates,
     September 15, 1986, p. 2, emphasis added]


Moreover, in your letter of March 27, 1991, referring to counsel
for the Ways and Means Committee, you state, "His views on the
matter are crucial." With all due respect, I must also disagree
with this statement. Although I would have to agree that his
views may be important, as far as written records are concerned,
they are certainly not crucial, not to me, not as I use that
term. The Constitution, laws that are consistent with the
Constitution, fully informed jury verdicts, and official rulings
of the U.S. Supreme Court are crucial to me, not the views of
hired lawyers who happen to enjoy staff positions on this or that
Congressional committee. I do expect you to appreciate the
difference between these two sources of "view".

I am sending a copy of this letter to Rep. Dan Rostenkowski with
the hope that it will prevent any fruitless attempt by his staff
to satisfy me with a copy of the Ripy Report, a report which
clearly fails to deal with crucial matters of fact.

Thank you again for your consideration in this matter which has,
by now, affected many millions of Americans since the year 1913,
the year in which the so-called 16th Amendment was "declared"
ratified, and the year in which the Federal Reserve Act was first
enacted into law.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


enclosure: "... Response to the Ripy Report,"
            by Andrew B. Spiegel

copies: Rep. Dan Rostenkowski
            interested citizens


                        Page J - 32 of 56

                                                       Appendix J


REGISTERED U.S. MAIL: c/o P. O. Box 6189
Return Receipt Requested San Rafael, California
                                        Postal Zone 94903-0189

                                        May 3, 1991
Rep. Barbara Boxer
House of Representatives
United States Congress
Washington, D.C.
Postal Zone 20515

Dear Rep. Boxer:

I am entirely unsatisfied with your letter dated April 12, 1991.
At various times during the past year, I have requested you in
person, and in writing, to examine the material evidence against
the 16th Amendment. At your community meeting in Pt. Reyes on
August 22, 1990, in front of several hundred witnesses, you
agreed to do so, and you have not done so. At no time between
then and now, have you demonstrated to me that you have, in fact,
examined any of the material evidence against the ratification of
the 16th Amendment.

Instead, you have referred my formal, written petition to the
Chairman of the House Committee on Ways and Means. Rep.
Rostenkowski responded to you with documents that included a
cover letter dated April 8, 1991, and a copy of "Part IX:
Frequently Asked Questions Concerning the Federal Income Tax,"
from CRS Report for Congress, 89-623 A, November 17, 1989. Your
letter of April 12, 1991 amounts to nothing more than another
cover letter, transmitting these documents to me.

To repeat, your response fails to demonstrate to me that you have
examined any of the material evidence against the 16th Amendment.

Moreover, I find a number of serious errors, omissions, and
deficiencies in the CRS Report from Rep. Rostenkowski. Permit me
to examine only those errors which I consider to be major ones,
in the interest of brevity.

First of all, the CRS Report attempts to answer this question:

         Was the Sixteenth Amendment properly ratified?

In answer to this question, however, the Report limits its scope
to answering only two subordinate questions:


     1. Did the President sign the resolution which became the
          Sixteenth Amendment.

     2. Do clerical errors in the ratifying resolutions of the
          various state legislatures negate the ratification of
          the Sixteenth Amendment?


                        Page J - 33 of 56

                                                The Federal Zone:


I agree with the Report's answer to the first subordinate
question, namely, that constitutional amendments need not be
submitted to the President. However, I cannot accept the limited
scope of the second question, nor the limited scope of the answer
provided. The CRS Report would have us believe that the problems
with the 16th Amendment are limited to "variations from the
resolution enacted by Congress in punctuation, capitalization,
and/or spelling" [page 310]. Barbara, I certainly hope you do
not expect me to believe that a Governor's veto is the same as a
"clerical error", or that the failure to satisfy the 2/3 majority
required by some State Constitutions is a "clerical error!"

The problems with the 16th Amendment are not limited to
variations in punctuation, capitalization, and/or spelling.
These problems include serious, official acts by Governors, State
Legislatures, and at least one State Court. For example, the
Governor of the State of Arkansas vetoed the resolution to amend
the Constitution. The Kentucky Senate Journal recorded a vote of
9 FOR and 22 AGAINST the resolution. An Illinois State court
ruled that "it never became a law, and was as much a nullity as
if it had been the act or declaration of an unauthorized
assemblage of individuals." My letter to you dated April 15,
1991, summarized the major problems. At the risk of repeating
myself, permit me to summarize once again some of these problems,
as follows:


     * Eleven States amended the proposed resolution.

     * The Senate of the State of Kentucky rejected the
          proposed amendment by a vote of 9 for and 22 against
          ratification.

     * Five States failed to ratify the amendment by the
          required two-thirds majority in one of the chambers of
          their legislatures (Georgia, Kansas, New York, New
          Jersey, and Vermont).

     * Minnesota, California and Ohio never sent official
          notification of the action taken by their respective
          legislatures.

     * Another six States did not record whatever action was
          taken by their respective legislatures in the Journals
          of their General Assemblies.

     * Ten States never voted on the proposed amendment.

     * Nine States deleted the preamble to the joint
          resolution.

     * Twenty-six States changed the punctuation of the
          preamble.


                        Page J - 34 of 56

                                                       Appendix J


     * Twenty-five States changed the punctuation of the
          resolution.

     * Twenty-four States changed the capitalization of
          certain words.

     * Nineteen States made grammatical changes.

     * An Illinois State Court ruled that "it never became a
          law and was as much a nullity as if it had been the act
          or declaration of an unauthorized assemblage of
          individuals." (Ryan vs Lynch, 68 Ill. 160)

     * The Governor of the State of Arkansas vetoed the
          resolution, the Arkansas Legislature never overrode his
          veto, and the Arkansas Constitution did not exempt
          Constitutional amendments from a governor's signature.

     * Oklahoma changed the proposal so as to require the
          laying of an income tax pursuant to a census or
          enumeration, the precise requirement the proposed
          amendment sought to alleviate.


On February 15, 1913, the Solicitor of the State Department
advised Secretary of State Philander C. Knox that:


       "... under provisions of the Constitution a legislature is
     not authorized to alter IN ANY WAY the amendment proposed by
     Congress, the function of the legislature consisting merely
     in the right to approve or disapprove the proposed
     amendment."

     ("Ratification of the 16th Amendment to the Constitution of
     the United States," Office of the Solicitor, emphasis added)


The CRS Report also errs by expecting readers to accept the
proposition that "the correctness of the Secretary's
certification is a political question and therefore his
certification is conclusive upon the courts" [emphasis added].
This is tantamount to saying that fraud is a "political question"
and cannot be adjudicated by any courts because it is fraud -- a
notion that is patently absurd. Moreover, the following criteria
are quoted to identify the existence of a political question in a
given case:


     * a lack of judicially discoverable and manageable
          standards for resolving it


                        Page J - 35 of 56

                                                The Federal Zone:


     * the impossibility of deciding without an initial policy
          determination of a kind clearly for nonjudicial
          discretion

     * the impossibility of a court's undertaking independent
          resolution without expressing lack of the respect due
          coordinate branches of government.


There is no lack of judicially discoverable and manageable
standards for resolving the factual problems with 16th Amendment.
In fact, there are plenty of such standards; they are called
rules of evidence, and they are so fundamental to jurisprudence
in this country, they are required reading for first-year law
students everywhere. The judiciary enjoys a well established
body of rules for discovering, admitting, and managing all
manners of material evidence.

The process for amending the Constitution is clearly written into
the Constitution itself. As such, there exists a clear "initial
policy determination", and this policy determination is clearly
not of a kind for nonjudicial discretion. The Constitution does
not authorize the Secretary of State to exercise any discretion
when certifying amendments thereto. Specifically, the Secretary
of State is not empowered to decide that "the approval of the
Governor is not necessary and that he has not the power to veto
in such cases," even if the Secretary sincerely believes, albeit
wrongly, that he does enjoy this power.

Courts can and have undertaken independent resolution of such
issues without expressing a lack of respect due to other branches
of government. An Illinois Court has already voided that State's
vote on the resolution to approve the 16th Amendment. The U.S.
Supreme Court has declared several acts of Congress to be
unconstitutional. If the Secretary of State fails to abide by
the official guidelines for amending the Constitution, it is he
who lacks respect due to the other branches of government. It is
he who has failed to abide by his solemn oath of office, namely,
to uphold and defend the Constitution of the United States. The
high Court is under no obligation to "express respect" for the
other branches of the federal government by allowing their
unconstitutional acts to remain intact and uncorrected. On the
contrary, the federal system of checks and balances has made this
corrective action an essential government institution.


The second major problem I have with the CRS Report has to do
with the following two questions:


     1. What is income?

     2. Are wages taxable as income?


                        Page J - 36 of 56

                                                       Appendix J


In answer to the first question, the Report summarizes the
definition of "income" as follows:


     Income has been defined as gain derived from capital, from
     labor, or from both combined. The operative word in this
     definition is gain. Gain, in the tax context, is the
     surplus when the basis of an item ... is subtracted from the
     item's fair market value.

     [CRS Report, page 316, emphasis added]


I have no dispute with this definition. However, in answer to
the second question, the Report uses the following example:


     ... if John Doe works 5 hours for $5.00 per hour, is the
     $25.00 he receives  taxable income to him? As we have seen
     in the above analysis, we must determine if there has been a
     gain which is realized and recognized.

     To see if there was a gain we do not look only to the fair
     market value of the labor, but rather we determine the
     difference between the fair market value and his basis
     (cost) in the labor. Generally one has a zero basis in
     one's own labor. Therefore, Doe's gain is $25.00 minus 0,
     or $25.00. This gain is realized when Doe is paid or has
     right to receive payment. [pages 316-317, emphasis added]


Unfortunately for the CRS Report, it cites absolutely no
authority for its empty assertion that "generally one has a zero
basis in one's own labor". This assertion is a fatal flaw. It
has been made without reference to the relevant decisions of the
U.S. Supreme Court, and without reference to the intent of the
framers of the 16th Amendment. As such, this assertion is
arbitrary; it is also ludicrous. Author Alan Stang explains why
it is ludicrous, and does so better than anyone else:

     We warned you that reading this book could be dangerous to
     people with heart conditions. Now that you have gotten off
     the floor, you may want to read that paragraph again. Yes,
     it does really say what you thought it says, doesn't it? It
     says that generally (not specifically?) you have a zero
     basis in your labor. In other words, it says your labor is
     worthless. Now you know. Why does your employer, who is
     presumably intelligent, buy something that is worthless?
     Notice that these government authors do admit you must have
     gain in order to have income, even if wages are your only
     receipts.

     [Alan Stang, Tax Scam, Alta Loma, CA, Mount Sinai Press,
     1988, page 78, emphasis added]


                        Page J - 37 of 56

                                                The Federal Zone:


Attached to this letter, please find numerous authoritative
definitions of "taxable income" as this phrase is clearly and
consistently defined by decisions of the U.S. Supreme Court and
lower courts which concur. These decisions remain in full force
today. Note, in particular, that the Supreme Court has already
instructed Congress that it is essential to distinguish between
what is and what is not "income", and to apply that distinction
according to truth and substance. In that instruction, the high
Court has told Congress that it has absolutely no power to be
arbitrary (or ludicrous) in its official definition of income:


     Congress cannot by any definition it may adopt conclude the
     matter, since it cannot by legislation alter the
     Constitution, from which alone it derives its power to
     legislate, and within whose limitations alone that power can
     be lawfully exercised. [Eisner vs Macomber, 252 US 189]


Remember, this is not the writing of some radical constitutional
libertarian. These are the words of the Supreme Court, in a case
which is one of the most famous and important rulings to render
official definitions of "income". Whatever arguments you choose
to make from this point forward, those arguments would certainly
benefit from a knowledge of the relevant case law in this area.
I mean, if we're talking gasoline taxes, then we know the subject
of the tax is gasoline; if we're talking tobacco taxes, then we
know the subject is tobacco. Why should a tax on "income" be any
different? Just because the Congressional Research Service
chooses to differ with the Supreme Court? Just because the IRS
uses police power to enforce a different definition? Just
because the Federal Reserve needs a powerful agency to collect
interest payments for its syndicated monopoly on private credit?

Here, I find it necessary to repeat the conclusions of a
recognized authority who has studied this issue in depth. After
reviewing all the relevant federal court decisions for the past
80 years, constitutional tax expert and author Jeffrey A.
Dickstein has written the following to summarize his findings:


     Income has been defined by the United States Supreme Court
     to be a profit or a gain derived from various sources, such
     as labor and capital. A tax directly on the source is a
     direct tax, and must still be apportioned. A tax on the
     income derived from the source need not be apportioned.
     Labor, the labor contract, and the right to sell labor have
     all been held by the Supreme Court to constitute property.
     The procedure to determine if there is a gain derived from
     the sale of property has been set forth by Congress. Gain
     is derived only if one receives over and above the fair
     market value of the cost of the property. These basic
     principles are simple to state and simple to apply. They
     also lead to one inescapable conclusion:


                        Page J - 38 of 56

                                                       Appendix J


                 WAGES DO NOT CONSTITUTE INCOME.

     [from Judicial Tyranny and Your Income Tax, Missoula, MT,
     Custom Prints, 1990, pages 277-280, emphasis added]


Representative Boxer, I must now go on record to state, clearly
and unequivocally, that you have failed me. You have failed me
because you have failed to keep the promise you made before
several hundred witnesses on August 22, 1990. You have failed me
because you have failed to uphold and defend the Constitution of
the United States. This Constitution is my explicit delegation
of power to you, an elected member of the Congress of the United
States.

You have failed me because, by shuffling papers back and forth,
you have deliberately refused to examine the material evidence
which impugns the entire ratification process of the 16th
Amendment. This material evidence proves that a massive fiscal
fraud has been perpetrated by the federal government upon the
people of this land, a massive fiscal fraud that began in the
year 1913 and continues until today.

Until and unless you demonstrate to me that you have examined
this material evidence, I am very sad to say I now have no choice
but to include you among the many persons who are responsible for
perpetrating this fraud upon our entire nation.

I want you to know that this matter is much too important to me,
and to millions of hard-working Americans, for me to be dissuaded
by some little paper war you prefer to wage.

Either do the job you were elected to do, or be mature enough to
accept the legal and political consequences.

Consider yourself warned.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

enclosures: "Defining Income: The Court Record"
             Text of first published advertisement
             Computer analysis of evidence
              against the 16th amendment

copy: Rep. Dan Rostenkowski


                        Page J - 39 of 56

                                                The Federal Zone:


               Defining Income: The Court Record

Repeat these words, out loud, at least three times a day:

                         WE, THE PEOPLE, CAN
                    ABOLISH THE ILLEGAL INCOME TAX

Please join us in teaching the American people to:

                         TAKE THE SECOND STEP

to educate each other with the relevant facts and authorities.

Wages are not "taxable income" as the term is clearly and
consistently defined by U.S. Supreme Court decisions that remain
in full force today.

We now cite verbatim the relevant decisions from the U.S. Supreme
Court and lower courts which concur:


Income is NOT everything that comes in:

     We must reject ... the broad contention submitted in behalf
     of the Government that all receipts -- everything that
     comes in -- are income within the proper definition of
     "gross income" ....

     [Southern Pacific Company vs John Z. Lowe, 247 US 330]


Corporate profits are "income":

     [Income] imports, as used here, something entirely distinct
     from principal 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.

     [Emanuel J. Doyle vs Mitchell Brothers Company, 247 US 179]

The Constitution PROHIBITS direct taxes without apportionment:

     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 population as prescribed by the Constitution ... for
     "income" may be defined as the gain derived from capital,
     from labor, or from both combined.

     [Stratton's Independence vs Howbert 231 US 406]


                        Page J - 40 of 56

                                                       Appendix J


Congress CANNOT change the Constitution:


     In order, therefore, that the clauses cited above from
     Article I of the Constitution may have proper force and
     effect ... it becomes essential to distinguish between what
     is and what is not "income," as the term is there used; and
     to apply the distinction ... according to truth and
     substance, without regard to form. Congress cannot by any
     definition it may adopt conclude the matter, since it cannot
     by legislation alter the Constitution, from which alone it
     derives its power to legislate, and within whose limitations
     alone that power can be lawfully exercised.

     [Mark Eisner vs Myrtle H. Macomber, 252 US 189]


Again, "income" is a gain, a profit:


     Here we have the essential matter -- not a gain accruing
     to capital, not a growth or increment of value in the
     investment; but 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.

     [Mark Eisner vs Myrtle H. Macomber, 252 US 189]


Supreme Court has REPEATEDLY ruled that wages are not "income":


     In determining the definition of the word "income" thus
     arrived at, this court has consistently refused to enter
     into the refinements of lexicographers and economists and
     has approved, in the definitions quoted, what it believed to
     be the commonly understood meaning of the term ....

     We continue entirely satisfied with that definition, and,
     since the fund here taxed was the amount realized from the
     sale of the stock in 1917, less the capital investment as
     determined by the trustee as of March 1, 1913, it is
     palpable that it was a "gain or profit" "produced by" or
     "derived from" that investment, and that it "proceeded," and
     was "severed" or rendered severable, from, by the sale for
     cash, and thereby became that "realized gain" which has been
     repeatedly declared to be taxable income ....

     [Merchant's Loan & Trust vs Smietanka, 255 US 509]


                        Page J - 41 of 56

                                                The Federal Zone:


"Income" has been legally and officially defined:

     And the definition of "income" approved by this Court is:
     "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. ...
     It is thus very plain that the statute imposes the income
     tax on the proceeds of the sale of personal property to the
     extent only that gains are derived therefrom by the vendor
     ....

     [Goodrich vs Edwards, 255 US 527]


You do NOT obtain "income" by charging for services rendered:

     The phraseology of form 1040 is somewhat obscure .... But
     it matters little what it does mean; the statute and the
     statute alone determines what is income to be taxed. It
     taxes only income "derived" from many different sources;
     one does not "derive income" by rendering services and
     charging for them.

     [Edwards vs Keith, Second Circuit Court of Appeals, 231
     F111]


"Income" means "gain" -- "gain" means "profit":

     Income" ... means "gain" "derived" from, and not accruing
     to, capital or labor or from both combined, including profit
     gained through the sale or conversion of capital, the gain
     not being taxable until realized, and, in such connection,
     "gain" means profit or something of exchangeable value, and
     "derived" means proceeding from property, severed from
     capital, however invested or employed, and coming in,
     received or drawn by taxpayer for his separate use, benefit,
     and disposal.

     [Staples vs U.S., District Court, E.D. Pennsylvania, 21 F.
     Supp. 737]


No gain, no income -- no income, no tax:

     Income is nothing more nor less than realized gain .... It
     is not synonymous with receipts .... Whatever may
     constitute income, therefore, must have the essential
     feature of gain to the recipient .... If there is no gain,
     there is no income.

     [Conner vs U.S., District Court, Houston Division, 303 F.
     Supp. 1187]


                        Page J - 42 of 56

                                                       Appendix J


Wages and profits are two DIFFERENT things:


     There is a clear distinction between "profit" and "wages" or
     compensation for labor. Compensation for labor cannot be
     regarded as profit within the meaning of the law.

     [Oliver vs Halstead, 196 Va. 992; 86 S.E. 2d 858]


Payment for labor is NOT profit:


     Reasonable compensation for labor or services rendered is
     not profit.

     [Laureldale Cemetery Assoc. vs Matthews, 345 Pa. 239; 47 A.
     2d 277, 280]


The meaning of "income" has been CONSISTENT in law:


     ... "Income" has been taken to mean the same thing as used
     in the Corporation Excise Tax Act of 1909, in the Sixteenth
     Amendment and in the various revenue acts subsequently
     passed ....

     [Bowers vs Kerbaugh-Empire Co., 271 US 174]


Again, "income" has had the SAME MEANING in law:


     ... and before the 1921 Act this Court had indicated ...
     what it later held, that "income," as used in the revenue
     acts taxing income, adopted since the 16th Amendment, has
     the same meaning that it had in the Act of 1909.

     [Burnet vs Harmel, 287 US 103]


"Income" is NOT the same as "gross receipts":


     Constitutionally the only thing that can be taxed by
     Congress is "income." And the tax actually imposed by
     Congress has been on net income as distinct from gross
     income. The tax is not, never has been and could not
     constitutionally be upon "gross receipts" ....

     [Anderson Oldsmobile, Inc. vs Hofferbert, U.S. District
     Court, Maryland, 102 Federal Supplement 902]


                        Page J - 43 of 56

                                                The Federal Zone:


Try to find a principle that is better settled:


     Remember that our source is not some "tax protest" group.
     Just about everything we are telling you comes from the U.S.
     Supreme Court. It would be difficult, and perhaps impos-
     sible, in our system of jurisprudence, to find a principle
     better settled than the one we have been citing.

     [Alan Stang, Tax Scam, Mt. Sinai Press, POB 1220, Alta Loma,
     California 91701, 1988]


Other cases not cited here say the SAME THING:


     In addition to the cases cited above, the following also
     support and affirm this definition of "income": ...United
     States vs Supplee-Biddle Hardware Co., 265 US 189; United
     States vs Phellis 257 US 156; Miles vs Safe Deposit & T.
     Co., 259 US 247; Irwin vs Gavit 268 US 161; Edwards vs
     Cuba R. Co., 268 US 628.

     [Irwin Schiff, The Great Income Tax Hoax, Freedom Books, POB
     5303, Hamden, Connecticut 06518, 1985, page 475]


Take these citations to your tax attorney or CPA, and demand a
response. Research assembled for you by:


                 Account for Better Citizenship
                      Post Office Box 6189
                 San Rafael, California Republic
                     Postal Zone 94903-0189


                        Page J - 44 of 56

                                                       Appendix J
             [Text of First Published Advertisement]

Repeat these words, out loud, at least three times a day:

                       WE, THE PEOPLE CAN
                       ABOLISH INCOME TAX

Please join us in demanding the United States Congress to

                       TAKE THE FIRST STEP

to authorize a full study to find other ways of funding the U.S.
government without direct taxes on personal income sources.

The I.R.S. has already conducted a limited study of several
alternatives and documented their findings at taxpayer expense.

We now want to condition all public servants to realize that
personal income taxes are a horrible scourge upon the economic
prosperity of all American citizens. These taxes must stop.

When we, the people have the power to abolish slavery, to abolish
prohibition, and to enact women's suffrage; when we, the people
can declare a national holiday to celebrate our Declaration of
Independence, then

     We, the people can refuse to elect Representatives who
     fail to advocate the abolition of  federal income taxes.

It is as simple as ABC. If you are a citizen and registered
voter, then know that you have this power. We, the people can
abolish an entire system of taxes expressly prohibited by the
U.S. Constitution itself (see Article 1, Section 9, Paragraph 4).

Your donation will be used to purchase full-page ads in major
newspapers throughout the country, advocating the abolition of
federal taxes on personal income. $1 from every citizen buys a
whole lot of advertising! To this end, we mutually pledge to
each other our Lives, our Fortunes and our sacred Honor.

Please send your donations, and any letters of support, to:

                 Account for Better Citizenship
                      Post Office Box 6189
                San Rafael, California 94903-0189

We will keep your name, address, and ALL other identification
completely confidential UNLESS you authorize us in writing to use
it in our advertising. We respect your right to privacy.

May you be prosperous beyond your wildest dreams!

Sincerely yours, P.S. The mailing address of Congress:

                                   Congress of the United States
                                   House of Representatives
                                   Washington, D.C. 20515
/s/ Mitch Modeleski
Founder United we stand and divided we fall.


                        Page J - 45 of 56

                                                         The Federal Zone:

                   Failures to Ratify the 16th Amendment
                 to the Constitution of the United States:
                         A Status Summary by State

                See Error Error Error Error Error Error Error Error Error
 State Notes #1 #2 #3 #4 #5 #6 #7 #8 #9
 ------------- ----- ----- ----- ----- ----- ----- ----- ----- ----- -----
 Alabama YES YES
 Arizona YES YES YES
 Arkansas YES YES YES YES
 California YES YES YES
 Colorado YES YES
 Connecticut (10) YES
 Delaware YES YES
 Florida (11) YES
 Georgia YES YES YES YES YES
 Idaho YES YES YES YES
 Illinois YES YES YES
 Indiana YES YES YES
 Iowa YES YES YES
 Kansas YES YES YES YES YES
 Kentucky YES YES YES YES YES
 Louisiana YES YES YES
 Maine YES YES YES YES
 Maryland YES YES YES YES
 Massachusetts YES YES YES
 Michigan YES YES
 Minnesota YES YES YES
 Mississippi YES YES YES
 Missouri YES YES YES
 Montana YES YES YES
 Nebraska YES YES YES
 Nevada YES YES YES
 New Hampshire YES YES
 New Jersey YES YES YES
 New Mexico YES
 New York YES YES YES YES YES
 North Carolina YES YES YES
 North Dakota YES YES YES
 Ohio YES YES YES YES
 Oklahoma YES YES YES
 Oregon YES YES YES
 Pennsylvania (12) YES
 Rhode Island (13) YES
 South Carolina YES YES YES
 South Dakota YES YES YES
 Tennessee YES YES YES YES
 Texas YES YES YES
 Utah (14) YES
 Vermont YES YES YES YES
 Virginia (15) YES
 Washington YES YES YES
 West Virginia YES YES YES YES
 Wisconsin YES YES
 Wyoming YES YES YES


                        Page J - 46 of 56

                                                       Appendix J


Description of Errors:

1. Failure to concur in U. S. Senate Joint Resolution No. 40 in
     that various changes were made to the text of the official
     Joint Resolution of the U.S. Congress.

2. Failure to follow the guidelines for the return of a
     certified copy of the ratification action, as contained in
     Congressional Concurrent Resolution No. 6, and as required
     by Section 205 of the Revised Statutes of 1878.

3. Governor vetoed the resolution and the State Legislature
     failed to override the veto.

4. Resolution was not submitted to the Governor for approval.

5. State Senate failed to pass the resolution by a required 2/3
     majority.

6. State Assembly or House failed to pass the resolution by a
     required 2/3 majority.

7. State Senate failed to pass the resolution.

8. State Assembly or House failed to pass the resolution.

9. Other State constitutional violations not mentioned above.


(Source: The Law That Never Was -- The Fraud of the 16th
Amendment and Personal Income Tax, by Bill Benson and M. J. 'Red'
Beckman, published by Constitutional Research Assoc., Box 550,
South Holland, IL 60473, April 1985)

Notes:

(10) The Senate rejected the minority report of the committee on
     judiciary and federal relations recommending ratification of
     this amendment on June 23, 1911, by a vote of 6 to 19.
     (Connecticut Senate Journal, 1911, pp. 1346-1348)

(11) Florida House passed H.J. Res. 192, ratifying this amendment
     on May 21, 1913, by a vote of 59 to 0. (Florida House
     Journal, 1913, p. 1686.) The Senate committee on
     constitution recommended that the resolution do not pass.
     May 27, 1913. (Florida Senate Journal, 1913, p. 1745.)

(12) The House passed a joint resolution ratifying the sixteenth
     amendment on May 10, 1911, by a vote of 139 to 4.
     (Pennsylvania House Journal, 1911, pp. 2690-2691.) The
     Senate referred the joint resolution to the committee on
     judiciary special, where it lay. (Pennsylvania Senate
     Journal, 1911, p. 2162.)


                        Page J - 47 of 56

                                                The Federal Zone:


(13) Senate resolution refusing to ratify this amendment was
     concurred in by House April 29, 1910. (Rhode Island House
     Journal, April 29, 1910.)

(14) The House rejected this amendment on March 9, 1911, by a
     vote of 31 to 10. (Utah House Journal, 1911, pp. 606-607.)
     The Senate passed the resolution ratifying the amendment by
     a vote of 12 to 2 on February 17, 1911. (Utah Senate
     Journal, 1911, p. 256.)

(15) The Senate ratified this amendment by a vote of 19 to 5 on
     March 9, 1910. (Virginia Senate Journal, 1910, pp. 651-
     652.) The House Journal, 1910, does not show that this
     resolution ratifying the amendment ever came to a vote.


(Notes 10-15 from U.S. Senate Document No. 240, 71st Congress,
"Ratification of the Constitution and Amendments by the States")


                        Page J - 48 of 56

                                                       Appendix J

Defense Strategy 1:
States Made Changes to the Text of the Resolution

     state error1
     --------------- ------
 1 Alabama YES
 2 Arizona YES
 3 Arkansas YES
 4 California YES
 5 Colorado YES
 6 Delaware YES
 7 Georgia YES
 8 Idaho YES
 9 Illinois YES
10 Indiana YES
11 Iowa YES
12 Kansas YES
13 Kentucky YES [number required to defeat Amendment]
----------------------------------------------------------------------
14 Louisiana YES
15 Maine YES
16 Maryland YES
17 Massachusetts YES
18 Michigan YES
19 Minnesota YES
20 Mississippi YES
21 Missouri YES
22 Montana YES
23 Nebraska YES
24 Nevada YES
25 New Hampshire YES
26 New Jersey YES
27 New York YES
28 North Carolina YES
29 North Dakota YES
30 Ohio YES
31 Oklahoma YES
32 Oregon YES
33 South Carolina YES
34 South Dakota YES
35 Tennessee YES
36 Texas YES
37 Vermont YES
38 Washington YES
39 West Virginia YES
40 Wisconsin YES
41 Wyoming YES [number available to defeat Amendment]
----------------------------------------------------------------------
42 Connecticut
43 Florida
44 New Mexico
45 Pennsylvania
46 Rhode Island
47 Utah
48 Virginia


                        Page J - 49 of 56

                                                The Federal Zone:

Defense Strategy 2:
Various Violations of State Constitutions

     state error9
     --------------- ------
 1 Arizona YES
 2 Arkansas YES
 3 California YES
 4 Colorado YES
 5 Georgia YES
 6 Idaho YES
 7 Illinois YES
 8 Indiana YES
 9 Iowa YES
10 Kansas YES
11 Kentucky YES
12 Louisiana YES
13 Maine YES [number required to defeat Amendment]
----------------------------------------------------------------------
14 Maryland YES
15 Massachusetts YES
16 Michigan YES
17 Minnesota YES
18 Mississippi YES
19 Missouri YES
20 Montana YES
21 Nebraska YES
22 Nevada YES
23 New Mexico YES
24 New York YES
25 North  Carolina YES
26 North Dakota YES
27 Ohio YES
28 Oklahoma YES
29 Oregon YES
30 South Carolina YES
31 Tennessee YES
32 Texas YES
33 Vermont YES
34 Washington YES
35 West Virginia YES
36 Wyoming YES [number available to defeat Amendment]
----------------------------------------------------------------------
37 Alabama
38 Connecticut
39 Delaware
40 Florida
41 New Hampshire
42 New Jersey
43 Pennsylvania
44 Rhode Island
45 South Dakota
46 Utah
47 Virginia
48 Wisconsin


                        Page J - 50 of 56

                                                       Appendix J

Defense Strategy 3:
States Failed to Follow Guidelines for Certified Copy

     state error2
     --------------- ------
 1 Alabama YES
 2 Arizona YES
 3 Arkansas YES
 4 California YES
 5 Delaware YES
 6 Georgia YES
 7 Idaho YES
 8 Illinois YES
 9 Indiana YES
10 Iowa YES
11 Kansas YES
12 Kentucky YES
13 Louisiana YES [number required to defeat Amendment]
----------------------------------------------------------------------
14 Maine YES
15 Maryland YES
16 Massachusetts YES
17 Minnesota YES
18 Mississippi YES
19 Montana YES
20 Nebraska YES
21 Nevada YES
22 New Hampshire YES
23 New Jersey YES
24 New York YES
25 North Carolina YES
26 North Dakota YES
27 Ohio YES
28 Oklahoma YES
29 Oregon YES
30 South Carolina YES
31 South Dakota YES
32 Tennessee YES
33 Texas YES
34 Vermont YES
35 West Virginia YES
36 Wisconsin YES
37 Wyoming YES [number available to defeat Amendment]
----------------------------------------------------------------------
38 Colorado
39 Connecticut
40 Florida
41 Michigan
42 Missouri
43 New Mexico
44 Pennsylvania
45 Rhode Island
46 Utah
47 Virginia
48 Washington


                        Page J - 51 of 56

                                                     The Federal Zone:

Defense Strategy 4:
Confirmed No's + Governor Vetoes + Errors 4 - 8

     state error10 error3 error4 error5 error6 error7 error8
     --------------- ------- ------ ------ ------ ------ ------ ------
 1 Virginia (15) YES
 2 Utah (14) YES
 3 Rhode Island (13) YES
 4 Pennsylvania (12) YES
 5 Florida (11) YES
 6 Connecticut (10) YES
 7 Kentucky YES YES
 8 Arkansas YES
 9 New York YES YES
10 Idaho YES
11 Maryland YES
12 Missouri YES
13 Ohio YES
                    [number required to defeat Amendment]
----------------------------------------------------------------------
14 South Dakota YES
15 Washington YES
16 West Virginia YES
17 Kansas YES YES
18 Georgia YES YES
19  New Jersey YES
20 Vermont YES
21 Maine YES
22 Tennessee YES
                    [number available to defeat Amendment]
----------------------------------------------------------------------
23 Alabama
24 Arizona
25 California
26 Colorado
27 Delaware
28 Illinois
29 Indiana
30 Iowa
31 Louisiana
32 Massachusetts
33 Michigan
34 Minnesota
35 Mississippi
36 Montana
37 Nebraska
38 Nevada
39 New Hampshire
40 New Mexico
41 North Carolina
42 North Dakota
43 Oklahoma
44 Oregon
45 South Carolina
46 Texas
47 Wisconsin
48 Wyoming
                        Page J - 52 of 56

                                                             Appendix J

Defense Strategy 5:
Failed House/Senate + Failed 2/3 + Vetoes and not Submitted to Governor

     state error7 error8 error5 error6 error3 error4
     --------------- ------ ------ ------ ------ ------ ------
 1 Georgia YES YES
 2 Kentucky YES YES
 3 Connecticut YES
 4 Florida YES
 5 Maine YES
 6 Pennsylvania YES
 7 Rhode Island YES
 8 Tennessee YES
 9 Utah YES
10 Virginia YES
11 Kansas YES YES
12 New Jersey YES
13 Vermont YES
                    [number required to defeat Amendment]
----------------------------------------------------------------------
14 New York YES YES
15 Arkansas YES
16 Idaho YES
17 Maryland YES
18 Missouri YES
19 Ohio YES
20 South Dakota YES
21 Washington YES
22 West Virginia YES
                    [number available to defeat Amendment]
----------------------------------------------------------------------
23 Alabama
24 Arizona
25 California
26 Colorado
27 Delaware
28 Illinois
29 Indiana
30 Iowa
31 Louisiana
32 Massachusetts
33 Michigan
34 Minnesota
35 Mississippi
36 Montana
37 Nebraska
38 Nevada
39 New Hampshire
40 New Mexico
41 North Carolina
42 North Dakota
43 Oklahoma
44 Oregon
45 South Carolina
46 Texas
47 Wisconsin
48 Wyoming
                        Page J - 53 of 56

                                                     The Federal Zone:

Defense Strategy 6:
Confirmed No's + Governor Vetoes + Not Submitted to Governor

     state error10 error3 error4 error5 error6 error7 error8
     --------------- ------- ------ ------ ------ ------ ------ ------
 1 Virginia (15) YES
 2 Utah (14) YES
 3 Rhode Island (13) YES
 4 Pennsylvania (12) YES
 5 Florida (11) YES
 6 Connecticut (10) YES
 7 Kentucky YES YES
 8 Arkansas YES
 9 New York YES YES
10 Idaho YES
11 Maryland YES
12 Missouri YES
13 Ohio YES
                    [number required to defeat Amendment]
----------------------------------------------------------------------
14 South Dakota YES
15 Washington YES
16 West Virginia YES
17 Kansas YES YES
18 Georgia YES YES
19 New Jersey YES
20 Vermont YES
21 Maine YES
22 Tennessee YES
                    [number available to defeat Amendment]
----------------------------------------------------------------------
23 Alabama
24 Arizona
25 California
26 Colorado
27 Delaware
28 Illinois
29 Indiana
30 Iowa
31 Louisiana
32 Massachusetts
33 Michigan
34 Minnesota
35 Mississippi
36 Montana
37 Nebraska
38 Nevada
39 New Hampshire
40 New Mexico
41 North Carolina
42 North Dakota
43 Oklahoma
44 Oregon
45 South Carolina
46 Texas
47 Wisconsin
48 Wyoming
                        Page J - 54 of 56

                                                       Appendix J


REGISTERED U.S. MAIL: c/o P. O. Box 6189
Return Receipt Requested San Rafael, California
                                        Postal Zone 94903-0189

                                        May 22, 1991
Rep. Dan Rostenkowski
Chairman
Committee on Ways and Means
U.S. House of Representatives
Washington, D.C.
Postal Zone 20515

Dear Rep. Rostenkowski:

With this letter I formally petition you for redress of a major
legal grievance which I now have with the federal government of
the United States of America.

As you must already know from copies of correspondence addressed
by me to Rep. Barbara Boxer and forwarded to you by me and also
by her office, the material evidence in my possession indicates
that the 16th Amendment, the so-called income tax amendment, was
never lawfully ratified. This evidence indicates that the act of
declaring the 16th Amendment "ratified" was an act of outright
fraud by Secretary of State Philander C. Knox in the year 1913.
I remind you that there is no statute of limitations on fraud.

My previous petitions to Rep. Barbara Boxer are dated December
24, 1990; April 15, 1991; and May 3, 1991. Copies of those
petitions are again enclosed and included by reference in this
formal petition to you.

Please understand that I take Rep. Boxer's referral to you of my
original petition to her, dated 12/24/90, as prima facie evidence
that you are, in fact, in the chain of government officials
responsible for administrative due process in this matter.

It is for this reason that I am taking all steps known to me, in
order to exhaust all known remedies for redress of this major
legal grievance with the federal government.

If you are not, in fact, a responsible official in the chain of
administrative due process in this matter, I will require from
you written evidence of the official(s) who do constitute this
chain of due process. This written evidence must be received by
me within forty-five (45) calendar days of today, which day is
Saturday, July 6, 1991. Absent any written evidence from you by
this deadline, I will therefore be forced to conclude that you do
sit at the end of this chain of administrative due process.

Thank you very much for your consideration in this important
matter, which by now has affected many millions of Americans in
so many ways.

                                                        more ...

                        Page J - 55 of 56

                                                The Federal Zone:


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


enclosures: copies of petitions to Rep. Boxer

copies: Rep. Barbara Boxer
         interested colleagues
         files


                        Page J - 56 of 56


                           Appendix K

                         IRS Form 1040NR


                         Page K - 1 of 8

                                                The Federal Zone:


Reader's Notes:


                         Page K - 2 of 8

                         Appendix K


                         Page K - 3 of 8

                                                The Federal Zone:


                         Page K - 4 of 8

                                                       Appendix K


                         Page K - 5 of 8

                                                The Federal Zone:


                         Page K - 6 of 8

                                                       Appendix K


                         Page K - 7 of 8

                                                The Federal Zone:


                         Page K - 8 of 8


                           Appendix L

                          IRS Form W-8:
                  Certificate of Foreign Status


                         Page L - 1 of 8

                                                The Federal Zone:


Reader's Notes:


                         Page L - 2 of 8

                                                       Appendix L


                         Page L - 3 of 8

                                                The Federal Zone:


                         Page L - 4 of 8

                                                       Appendix L


                 ASSEVERATION OF FOREIGN STATUS

                      [Substitute W-8 Form]

This document replaces/supersedes any/all previous declarations
of status by John Q. Doe and it is to be used as my NOTICE OF
RESCISSION OF ANY PREVIOUS SIGNATURE AND ANY POWER OF ATTORNEY,
ab initio, as it relates to any previous W-4, W-8, W-9, etc., as
well as Federal and State information forms or presentments.

California State/Republic )
                          ) ASSEVERATION OF STATUS
County of Marin )

I, John Q. Doe, state, of Right, my Status as follows:

1. That I am of lawful age and that I am competent to make this
     Asseveration of Status;

2. That I am a non-immigrant, non-naturalized, nonresident
     alien, non-taxpayer, natural born free American, Sovereign
     man and an inhabitant of a geographical area in a State of
     the American Union known as the California Republic;

3. That I am an American and nonresident alien with respect to
     the "United States" (i.e., the District of Columbia, Guam,
     American Samoa, Virgin Islands, Commonwealth of Puerto Rico,
     etc.) with no income effectively connected with a "trade or
     business" (IRC 7701(a)(26)) within the "United States"
     (Government);

4. That I have never knowingly, willingly, voluntarily and
     intentionally inhabited the state of the forum (Forum
     Contractus in Latin);

5. That I have never been involved in any taxable "trade or
     business" activity under 27 Code of Federal Regulations
     (CFR) pursuant to commerce in Alcohol, Tobacco Products and
     Firearms, State or Federal;

6. That this Asseveration is to be used in lieu of Form W-8, as
     suggested by that Form W-8, specifically: "Use Form W-8 or
     a substitute form containing a substantially similar
     statement to tell the payor ... that you are a nonresident
     alien individual, foreign entity, or exempt foreign person
     not subject to certain U.S. information return, reporting or
     backup withholding rules."

The following information is given in lieu of a Form W-8:

     Name: John Q. Doe
     Location: c/o USPS P. O. Box [##]
                    San Rafael, California Republic
                    zip code exempt (DMM 122.32)


                         Page L - 5 of 8

                                                The Federal Zone:


     Please note: I do not voluntarily use unqualified ZIP codes
     or other forms of Federal Identification, e.g., "CA", "TX",
     "FL", etc., because I do not reside inside Government (U.S.)
     Territory or any of its Federal Territories.

     U.S. taxpayer identification number: not applicable

     See Form W-8: "... foreign persons [sic] are not generally
     required to have a U.S. taxpayer identification number, nor
     are they subject to any backup withholding because they do
     not furnish such a number to a payer or broker." [Emphasis
     added for purposes of conspicuous notice.]

     You are hereby ordered to purge the "Social Security or
     Taxpayer I.D. Number" as shown on Your "Payer's Request for
     Taxpayer Identification Number" form, if any.

     Check the appropriate space(s) with an "X":

     ( ) For Interest Payments, I am not a "U.S. citizen"
               or "U.S. resident"; AND

     ( ) For Broker Transactions or Barter Exchanges, I am
               an exempt foreign Sovereign man.


THIS ASSEVERATION OF STATUS IS TO NOTIFY PAYERS, MIDDLEMEN,
BROKERS, AND BARTER EXCHANGES NOT TO WITHHOLD OR REPORT PAYMENTS
OF INTEREST, BROKER TRANSACTIONS, OR BARTER EXCHANGES.

The W-8 accompanying this ASSEVERATION OF STATUS should not and
cannot be attached to this ASSEVERATION OF STATUS but is enclosed
for information purposes only.


NUNC PRO TUNC, this _____ day of __________, 19____ Anno Domini,
for June 21, 1948 (date of birth),

with explicit reservation all of my unalienable rights
and without prejudice to any of my unalienable rights,


I, ______________________________________________________________
   (signature)

   ______________________________________________________________
   (printed name)


state that the foregoing is true in substance and in fact, to the
best of my knowledge and belief, and is made in good faith, and
that this asseveration could be used as evidence, and that I have
personal knowledge of the facts stated herein.


                         Page L - 6 of 8

                                                       Appendix L


             California All-Purpose Acknowledgement

CALIFORNIA STATE/REPUBLIC )
                                )
COUNTY OF MARIN )

     On the ________ day of ____________, 199_ Anno Domini,
before me personally appeared John Q. Doe, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
Person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in His authorized
capacity, and that by His signature on this instrument the
Person, or the entity upon behalf of which the Person acted,
executed the instrument. Purpose of Notary Public is for
identification only, and not for entrance into any foreign
jurisdiction.

WITNESS my hand and official seal.


_____________________________________
Notary Public


                         Page L - 7 of 8

                                                The Federal Zone:


Reader's Notes:


                         Page L - 8 of 8


                           Appendix M

                      List of Organizations


                        Page M - 1 of 16

                                                The Federal Zone:


Reader's Notes:


                        Page M - 2 of 16

                                                       Appendix M


                      List of Organizations


 1. National Commodity and Barter Association
      c/o P. O. Box 2255
     Longmont, Colorado 80502

 2. Free Enterprise Society
     300 West Shaw, Suite 205
     Clovis, California 93612

 3. Save-A-Patriot Fellowship
     c/o P. O. Box 91
     Westminster, Maryland 21157

 4. Freeman Education Association
     8141 East 31st Street, Suite "F"
     Tulsa, Oklahoma 74145

 5. National Citizen Education
     9205 S.E. Clackamas Road, Suite 435
     Clackamas, Oregon 97015

 6. The Liberty Amendment
     c/o P. O. Box 2386
     El Cajon, California 92021

 7. America's Bulletin
     c/o P. O. Box 935
     Medford, Oregon 97501

 8. Religious Technology Center
     6331 Hollywood Boulevard, Suite 1200
     Los Angeles, California 90028-6329

 9. Monetary Realist Society
     c/o P. O. Box 31044
     St. Louis, Missouri 63131

10. Citizens for an Alternative Tax System
     1015 Oneota Drive
     Los Angeles, California 90065

11. Fully Informed Jury Association
     P. O. Box 59
     Helmville, Montana 59843

12. Liberty Library
     300 Independence Avenue, S.E.
     Washington, D.C. 20003

13. American Constitutional Liberties Association
     1250 La Playa, Suite 304
     San Francisco, California 94122


                        Page M - 3 of 16

                                                The Federal Zone:


14. Constitutional Law Center
     631 Wilhagen Drive
     Sacramento, California 95816

15. U.S. Constitutional Liberties Association
     4671 Marshal Road, Suite "C"
     Garden Valley, California 95633

16. American Institute for the Republic
     80 East 100 North
     Provo, Utah 846006-3110

17. Center for Action
     Box 472, HCR - 31
     Sandy Valley, Nevada 89019-9998

18. Christian Patriot Association
     c/o P. O. Box 596
     Boring, Oregon 97009

19. Citizens for Just Taxation
     c/o P. O. Box 368
     Dolton, Illinois 60419

20. Continental Congress Organizing Committee
     c/o P. O. Box 1257
     Escondido, California 92033

21. Gregory-Forrester Group
     309 Water Oak Lane
     Matthews, North Carolina 28105

22. Informed Voters Alliance
     RR 2, Box 157-C
     Baldwin, Kansas 66006

23. Justice Symposium
     7033 North 13th Place
     Phoenix, Arizona 85020

24. The Moneychanger
     c/o P. O. Box 341753
     Memphis, Tennessee 38184

25. National Alliance for Constitutional Money
     13877 Napa Drive
     Independent Hill, Virginia 22111

26. Radio Amateur Freemen's Association
     5509 Washington Avenue
     Evansville, Indiana 47715


                        Page M - 4 of 16

                                                       Appendix M


27. School for the Last Days
     c/o P. O. Box 155
     Rayville, Missouri 64084

28. Sound Dollar Committee
     c/o P. O. Box 226
     Fort Lee, New Jersey 07024

29. Texas Hill County Patriots
     111 Stephanie Street
     Kerrville, Texas 78028

30. Truth in Taxes
     c/o 175 Booth Road, Apt. D-3
     Marietta, Georgia 30060-3238

31. American Statesmen's Assembly
     1009 E. Capitol Expressway, Suite 312
     San Jose, California 95121

32. Citizens Tax Council
     c/o P. O. Box 2197
     Orofino, Idaho 83544

33. The California Statesman
     8158 Palm Street
     Lemon Grove, California 91945

34. Friends of Patrick Henry
     c/o P. O. Box 1776
     Hanford, California 93232

35. American Liberties Association
     c/o 306 Turnberry Way
     Vallejo, California

36. National Liberty Alliance
     c/o P. O. Box 9002
     Spokane, Washington 99209-9002

37. Liberty Institute
     1400 Moline, #301
     Aurora, Colorado 80010

38. Common-Law Service Center HQ
     3rd Judicial District
     564 La Sierra Drive, Suite 187
     Sacramento, California Republic

39. Constitutional Research Associates
     c/o P. O. Box 550
     South Holland, Illinois 60473


                        Page M - 5 of 16

                                                The Federal Zone:


40. The Petitioner
     2219 West 32nd Avennue
     Denver, Colorado 80211

41. Christian Health Fellowship
     c/o 1291 East Vista Way, #136
     Vista, California

42. Mid-South Patriots
     3125 South Mendenhall, #379
     Memphis, Tennessee 38115

43. Pacific Information Network
     105 Serra Way, #213
     Milpitas, California 95035

44. Lion's Inn Educational Trust
     c/o P. O. Box 270676
     San Diego, California 92198

45. National League for the Separation of Church and State
     c/o Post Office Box 2832
     San Diego, California 92112

46. Financial Independence Network Trust
     c/o P. O. Box 122024
     Ft. Worth, Texas 76121

47. Tax Consultants of Idaho
     c/o P. O. Box 3507
     Boise, Idaho 83703-0507

48. Freedom Calendar
     704 Edgerton
     St. Paul, Minnesota 55101

49. NCE California
     35016 Rd. 112
     Visalia, California 93291

50. Action Institute
     161 Ottawa, N.W., Suite 405-K
     Grand Rapids, Michigan 49503

51. American Enterprises Institute
     1150 - 17th Street, N.W.
     Washington, D.C. 20036

52. American Legislative Exchange Council
     214 Massachusetts Avenue, N.E.
     Washington, D.C. 20002


                        Page M - 6 of 16

                                                       Appendix M


53. Cato Institute
     224 Second Street, S.E.
     Washington, D.C. 20003

54. Center for Strategic and International Studies
     1800 "K" Street, N.W., Suite 400
     Washington, D.C. 20006

55. Citizens Against Government Waste
     1301 N. Connecticut Avenue, N.W., Suite 400
     Washington, D.C. 20036

56. Citizens for a Sound Economy
     470 L'Enfant Plaza, S.W., Suite 7112
     Washington, D.C. 20024

57. Competitive Enterprises Institute
     233 Pennsylvania Avenue, S.E., Suite 100
     Washington, D.C. 20003

58. Fiscal Associates
     1515 S. Jefferson Davis Highway
     Arlington, Virginia 22202

59. The Freeman
     30 South Broadway
     Irvington, New York 10533

60. Heartland Institute
     634 South Wabash Avenue, 2nd Floor
     Chicago, Illinois 60605

61. Foundation
     1438 North Hollenbeck
     Covina, California Republic

62. Common Law Service Center HQ
     564 La Sierra Drive, #187
     Sacramento, California Republic

63. Institute for Policy Innovation
     250 South Stemmons, Suite 306
     Lewisville, Texas 75057

64. Institute for Research on Economics of Taxation
     1331 Pennsylvania Avenue, N.W., Suite 515
     Washington, D.C. 20004-1774

65. Manhattan Institute
     52 Vanderbilt Avenue
     New York, New York 10017


                        Page M - 7 of 16

                                                The Federal Zone:


66. National Center for Policy Analysis
     12655 North Central Expressway
     Dallas, Texas 75243

67. National Federation of Independent Businesses
     600 Maryland Avenue, S.W., Suite 700
     Washington, D.C. 20024

68. National Tax Limitation Committee
     151 North Sunrise Avenue, Suite 901
     Roseville, California 95661

69. National Taxpayers Union
     325 Pennsylvania Avenue, S.E.
     Washington, D.C. 20003

70. Tax Foundation
     470 L'Enfant Plaza, S.W., Suite 7400
     Washington, D.C. 20024

71. Washington Institute for Policy Studies
     223 - 105th Street, N.E., Suite 202
     Bellevue, Washington 98004

72. National Educator
     P.O. Box 333
     Fullerton, California 92632

73. Future of Freedom Foundation
     P.O. Box 9752
     Denver, Colorado 80209

74. The Foundation for Economic Education
     30 South Broadway
     Irvington-on-Hudson, New York 10533

75. Acres USA
     P.O. Box 9547
     Kansas City, Missouri 64133

76. Advocates for Better Government
     c/o P.O. Box 11653
     Montgomery, Alabama 36111-0653

77. Aid & Abet Newsletter
     P.O. Box 8787
     Phoenix, Arizona 85066

78. A.M.E.N., Inc.
     1500 Gulf City Road, #34
     Ruskin, Florida 33570


                        Page M - 8 of 16

                                                        Appendix M


79. American Coalition of Unregistered Churches
     P.O. Box 11
     Indianapolis, Indiana Republic 46206

80. American Independent Party
     P.O. Box 180
     Durham, California 95938

81. Americans for a Voice in Government, Inc.
     P.O. Box 878
     Valrico, Florida 33594

82. Americans for Ending Aid to Communist Countries
     1234 S.E. 22nd Avenue
     Ocala, Florida 32671

83. Americans to Limit Congress Terms
     900 N.E. Second Street, Suite 200
     Washington, D.C. 20002

84. Anti-Shyster
     P.O. Box 540786
     Dallas, Texas 75354-0786

85. APRA News
     P.O. Box USA
     Benton, Tennessee 37307

86. Barrister's Inn
     P.O. Box 9411
     Boise, Idaho 83707

87. Behold Newsletter
     729 Molalla Avenue, Suite 2
     Oregon City, Oregon

88. Bill Tolley's Congressional Watch
     4250 Pinewood Road
     Melbourne, Florida 32934

89. Christian Defense League
     P.O. Box 449
     Raleigh, North Carolina 27613

90. Citizen Alert
     1761 Bus Center Drive
     Reston, Virginia 22090

91. Citizens Committee to Clean Up the Courts
     9800 South Oglesby
     Chicago, Illinois 60617


                        Page M - 9 of 16

                                                The Federal Zone:


92. Concerned Citizens for the Constitution
     P.O. Box 44590
     Indianapolis, Indiana 46244

93. Citizens for a Debt Free America
     2550 South Sunny Slope Road
     New Berlin, Wisconsin 53151

94. Coalition to End the Permanent Congress
     P.O. Box 7309
     North Kansas City, Missouri 64116

95. Committee to Restore the Constitution
     P.O. Box 986
     Fort Collins, Colorado 80522

96. Common Law Court for the USA
     3537 Ambassador Caffery Parkway, Suite 32
     Lafayette, Louisiana, USA 70503

97. Conservative Caucus
     450 East Maple Avenue
     Vienna, Virginia 22180

98. Constitutional Revival
     P.O. Box 3182
     Enfield, Connecticut 06083

99. Council on Domestic Relations
     P.O. Box 3362
     Springfield, Illinois 62708

100. Criminal Politics
     300 North Zeeb Road
     Ann Arbor, Michigan 48106

101. Crusade Against Corruption
     P.O. Box 4063
     Marietta, Georgia 30061

102. Democracy Requires Attention
     P.O. Box 4163
     Honolulu, Hawaii 96813

103. Diminish the National Debt
     P.O. Box 3663
     Carbondale, Illinois 62903

104. Eight Is Enough
     P.O. Box 4888
     Orlando, Florida 32802-4888


                        Page M - 10 of 16

                                                       Appendix M


105. Family Rights Committee
     4303 Vineland Road, Suite F-16
     Orlando, Florida 32811

106. Farmer's and Consumer's Sun Time
     710 East Bowen Avenue
     Bismark, North Dakota 58504

107. Firearms Coalition
     P.O. Box 6537
     Silver Springs, Maryland 20906

108. For the People
     3 River Street
     White Springs, Florida 32096

109. Free Congress
     717 N.E. Second Street
     Washington, D.C. 20002

110. Freedom
     1301 North Catalina Street
     Los Angeles, California 90027

111. Freedom Law Center
     1902 West Kennedy Blvd.
     Tampa, Florida 33606

112. Golden Mean Machine
     P.O. Box 1247
     Condon, Montana 59826

113. Grass Roots Journal
     P.O. Box 8738
     Longboat Key, Florida 34228

114. HALT
     1319 "F" Street, N.W., Suite 300
     Washington, D.C. 20004

115. Justice Times
     P.O. Box 562
     Clinton, Arkansas 72031

116. Larry McDonald Foundation
     6240 CR 214
     St. Augustine, Florida 32092

117. L.A.W.
     15209 Lake Magdalene
     Tampa, Florida 34653


                        Page M - 11 of 16

                                                The Federal Zone:


118. Libertarian Party
     1528 Pennsylvania Avenue, S.E.
     Washington, D.C. 20003

119. L.I.M.I.T.S.
     1815 Seashore Drive
     Tacoma, Washington 98465

120. LINK
     P.O. Box 115
     Santa Rosa, California 95402

121. Louis F. Mlecka
     P.O. Box 908
     Brooksville, Florida 34605

122. McAlvany Intelligence Report
     P.O. Box 84904
     Phoenix, Arizona 85071

123. National Federal Lands Conference
     P.O. Box 847
     Bountiful, Utah 84011

124. National Forget Me Not Association
     6844 Parkside Drive
     New Port Richey, Florida 34653

125. National Tax Limitation Committee
     400 Rockingham Avenue
     Tavares, Florida 32778

126. New Nation USA (NNUSA)
     P.O. Box 441
     Morongo Valley, California 92256

127. Newswatch Magazine
     P.O. Box 1073
     St. Ann, Missouri 63071

128. N.Y. Taxpayers Education Network
     Route 9 N
     Upper Jay, New York 12987-9601

129. Patriot Network
     P.O. Box 2368
     Anderson, South Carolina 29622

130. Patriot Review
     P.O. Box 905
     Sandy, Oregon 97055


                        Page M - 12 of 16

                                                       Appendix M


131. Patriots for Liberty
     P.O. Box 334
     Rochester, Indiana 46975

132. Paul Revere Club
     P.O. Box 565
     Flora, Illinois 62830

133. Pilot Connection
     6223 Pacific Avenue, Suite 324
     Stockton, California 95207

134. Prevailing Winds Research
     P.O. Box 23511
     Santa Barbara, California 93121

135. Public Service Research Company
     1761 Business Center Drive
     Reston, Virginia 22090

136. Publius Press
     3100 South Philamena Place, Suite B
     Tucson, Arizona 85730

137. Republican Liberty Caucus
     1717 Apalachee Parkway, Suite 434
     Tallahassee, Florida 32301

138. Robeson Defence Committee
     P.O. Box 1389
     Pembroke, North Carolina 28372

139. Saving America
     P.O. Box 1205
     Middleburg, Florida 32050

140. School of Statesmanship
     1235 Newport Road
     Manheim, Pennsylvania 17545

141. Second Amendment Rev. Ed. Foundation
     801 Home Avenue
     Oak Park, Illinois 60304

142. SMART
     16661 S.E. Highway 42
     Weirsdale, Florida 32195

143. Sovereignty Resolution
     1154 West Logan Street
     Freeport, Illinois 61032


                        Page M - 13 of 16

                                                The Federal Zone:


144. State Citizen Service Center
     585-D Box Canyon Road
     Canoga Park, California Republic

145. The Strecker Group
     1501 Colorado Boulevard
     Eagle Rock, California 90041

146. Taxpayers Against Deficit/Debt
     5994 Saginaw Highway
     Grand Lodge, Missouri 48837

147. Thinking Americans for Better Government
     1047 Briarwood Loop
     Las Cruces, New Mexico 88005

148. Throw the Hypocritical Rascals Out
     4127 West Cypress Street
     Tampa, Florida 33607

149. T.R.I.M.
     2151 Cliffbrook Avenue
     Pensacola, Florida 32526

150. Truth At Last
     P.O. Box 1211
     Marietta, Georgia 30061

151. United States Bookstore
     3417 South Dale Mabry
     Tampa, Florida 33629

152. U.$. End
     242 Taragona Way
     Daytona Beach, Florida 32114

153. U.S. Federalist/The White Rose
     227 Edge Avenue
     Valparaiso, Florida 32580

154. U.S. Taxpayers Alliance
     5225 Nob Lane
     Indianapolis, Indiana 46226

155. Voter Outreach
     204 North El Camino Real, #719
     Encinitas, California 92024

156. Reason Foundation
     3415 S. Sepulveda Blvd., #400
     Los Angeles, California 90034


                        Page M - 14 of 16

                                                       Appendix M


List assembled and distributed by:


                 Account for Better Citizenship
                    c/o Post Office Box 6189
                 San Rafael, California Republic
                   Postal Zone 94903-0189/TDC


                        Page M - 15 of 16

                                                The Federal Zone:


Reader's Notes:


                        Page M - 16 of 16


                           Appendix N

                          Bibliography


                         Page N - 1 of 6

                                                The Federal Zone:


Reader's Notes:


                         Page N - 2 of 6

                                                       Appendix N


                     Selected Bibliography:

                  Federal Income Taxes, the IRS,
   and the Federal Reserve System


America's Coming Tax Revolt, by R. W. Mertz, Parrot Communi-
cations Int'l, Inc., 2917 N. Ontario Street, Burbank, California
91504, 1992 (14.95 plus 2.75 S&H)

Are You A Nonresident Alien?, by Jack Colson, c/o ABS, P. O. Box
935, Medford, Oregon 97501, 1990 (3.00 includes S&H)

Become a Nontaxpayer and Save, Revised Edition, by Floyd Wright,
c/o P. O. Box 323, Grass Valley, California 95945, 1992 (19.95
plus 2.00 S&H)

The Best Kept Secret, by Otto Skinner, P. O. Box 6609, San Pedro,
California 90734, 1986 (10.00 plus 2.00 S&H)

The Biggest Con: How the Government is Fleecing You, by Irwin A.
Schiff, Freedom Books, 60 Skiff St., Hamden, Connecticut 06517,
1976 (7.00)

Confidential IRS Tax Audit Guide, distributed by Common Sense
Press, P. O. Box 1544, Billings, Montana 59103 (15.00)

Documentation Packet with Court Briefs, by Jerry Richey, c/o ABS,
P. O. Box 935, Medford, Oregon 97501, 1990 (12.00 includes S&H)

Do Unto the IRS As They Would Do Unto You!, by M. J. "Red"
Beckman, Common Sense Press, P. O. Box 1544, Billings, Montana
59103, 1983 (5.00 includes S&H)

Economic Survival, by National Citizen Education, 9205 S.E.
Clackamas Road, Suite 435, Clackamas, Oregon 97015 (10.00
includes S&H)

The Federal Mafia, by Irwin A. Schiff, Freedom Books, 60 Skiff
Street, Hamden, Connecticut 06517, 1990 (19.95 plus S&H)

The Federal Zone: Cracking the Code of Internal Revenue, by Mitch
Modeleski, Founder, Account for Better Citizenship, c/o POB 6189,
San Rafael, California 94903-0189/tdc, 1992 (40.00 includes S&H)

Financial Survival, by National Citizen Education, 9205 S.E.
Clackamas Road, Suite 435, Clackamas, Oregon 97015 (10.00)

41 Ways to Lick the IRS with a Postage Stamp, by Daniel J. Pilla,
Winning Publications, 506 Kenny Road, Suite 120, St. Paul,
Minnesota 55101, 1990

Free at Last -- from the IRS, by Dr. N. A. Scott, 2649 Vista Way,
#8-137, Oceanside, California 92054/TDC, 1991 (40.00 + 3.00 S&H)


                         Page N - 3 of 6

                                                The Federal Zone:


Good-Bye April 15th!, by Boston T. Party, Javelin Press, c/o 504
West 24th Street, #73-P, Austin, Texas Republic, Postal Zone
78705/tdc, 1992 (40.00 includes S&H, 43.00 for two-day delivery)

The Great Income Tax Hoax, by Irwin A. Schiff, Freedom Books, 60
Skiff Street, Hamden, Connecticut 06517, 1985 (17.95)

The Great Internal Revenue Hoax Exposed, by R. J. "Ray" Stenson,
M-FACT Books, P. O. Box 8596 - S.C. Br., Independence, Missouri
64054, 1983 (6.00 + 1.00 S&H)

How An Economy Grows and Why It Doesn't, by Irwin A. Schiff,
Freedom Books, 60 Skiff Street, Hamden, Conn. 06517, 1985 (7.00)

How Anyone Can Stop Paying Income Taxes, by Irwin A. Schiff,
Freedom Books, 60 Skiff Street, Hamden, Conn. 06517, 1982 (11.50)

How to Cure Inflation, by Hyrum J. Amundsen, Jr., Free Enterprise
Society, 300 W. Shaw Avenue, Suite 205, Clovis, California 93612,
1978 (12.00 plus 1.50 S&H)

If You Are the Defendant, by Otto U. Skinner, P. O. Box 6609, San
Pedro, California 90734, 1989 (21.00 plus 2.00 S&H)

The Income Tax Amendment is Null and Void, Liberty Library, 300
Independence Avenue, S.E., Washington, D.C. 20003 (4.00)

The IRS and the Black Robed Cover-Up, by M. J. "Red" Beckman,
Common Sense Press, P. O. Box 15444, Billings, Montana 59103,
1983 (7.00 includes S&H)

The IRS and the Question of Jurisdiction, by Ernest Solivan, 4202
E. Cactus Rd., #8202, Phoenix, Arizona 85032 (29.95 includes S&H)

The IRS Conspiracy, by Henry J. Hohenstein, Nash Publishing
Corporation, 9255 Sunset Blvd., Los Angeles, Calif. 90069, 1974

The IRS, Federal Laws, Non-Resident Aliens, Etc., by Jerry
Richey, c/o ABS, P. O. Box 935, Medford, Oregon 97501, 1990
(10.00 includes S&H)

IRS Humbug, IRS Weapons of Enslavement, by Frank Kowalik,
Universalistic Publishers, P. O. Box 70486, Oakland Park, Florida
33307-0486, 1991 (29.95 plus 3.55 S&H)

IRS in Action, by Santo M. Presti, Sherwood Communications, P. O.
Box 535, Southampton, Penna. 18966, 1986 (9.95 plus 1.00 S&H)

Judicial Tyranny and Your Income Tax, by Jeffrey A. Dickstein,
PEGS Bookstore, P. O. Box 9337, Missoula, Montana 59807, 1990

The Law That Always Was, by Vern Holland, F.E.A. Books, 8141 E.
31st Street, Suite "F", Tulsa, Oklahoma 74145, 1987 (14.95)


                         Page N - 4 of 6

                                                       Appendix N


The Law That Never Was, Volume I, by M. J. "Red" Beckman and Bill
Benson, Constitutional Research Associates, POB 550, South
Holland, Illinois 60473, 1985 (25.00 plus 3.00 S&H)

The Law That Never Was, Volume II, by Bill Benson, Constitutional
Research Associates, POB 550, South Holland, Illinois 60473, 1986
(25.00 plus 3.00 S&H)

A Law Unto Itself: Power, Politics and the IRS, by David Burnham,
Random House, Inc., New York, New York 10022, 1989 (22.50)

A Moderate Proposal for Restoring Prosperity Individual and
National, by Jean Carpenter, PRS Nutshells, 5147 South Harvard
Ave., Suite 248, Tulsa, Oklahoma 74135, 1991 (7.50 includes S&H)

Money -- Bona Fide or Non-Bona Fide, by Dr. Edward E. Popp,
Wisconsin Education Fund, P. O. Box 321, Port Washington,
Wisconsin 53074, 1970 (0.50 each)

The Naked Truth, by Daniel J. Pilla, Winning Publications, 506
Kenny Road, Suite 120, St. Paul, Minnesota 55101, 1986

The Omnibus, by Ralph F. Whittington, c/o P. O. Box 91109,
Houston, Texas 77291-1172, 1987 (40.00 includes S&H)

Ratification of the Income Tax Amendment: Has the Federal
Government Defrauded the American People? A Response to the Ripy
Report, by Andrew B. Spiegel, Constitutional Research Associates,
P. O. Box 550, South Holland, Illinois 60473, September 15, 1986

Secrets of the Federal Reserve, by Eustace Mullins, P. O. Box
1105, Staunton, Virginia 24401, 1985

Secrets of the Temple: How the Federal Reserve Runs the Country,
by William Greider, Simon & Schuster, Rockefeller Center, 1230
Avenue of the Americas, New York, New York 10020, 1987

Secrets of the Tax Revolt, by James Ring Adams, Harcourt Brace
Jovanovich, 1250-6th Ave., San Diego, Calif. 92101, 1984 (16.95)

The Silver Bulletin, by Bill Medina, c/o P. O. Box 70400,
Sunnyvale, California 94086-0400 (25.00)

16th Amendment Reliance Package, by Bill Benson, Constitutional
Research Associates, P. O. Box 550, South Holland, Illinois 60473
($200.00 includes S&H)

The Social Security Swindle, by Irwin A. Schiff, Freedom Books,
60 Skiff Street, Hamden, Connecticut 06517, 1983 (12.95)

Super Gun, by Lori Jacques, c/o P. O. Box 1509, Bisbee, Arizona
85603-2509, 1992 (30.00 + 3.50 S&H)


                         Page N - 5 of 6

                                                The Federal Zone:


Tax Fraud & Evasion: The War Stories, by Donald W. MacPherson,
MacPherson & Sons Publishers, Ltd., 3404 West Cheryl Drive, A-
250, Phoenix, Arizona 85051, 1989 (17.95 plus 2.00 S&H)

Taxpayers' Ultimate Defense Manual, by Daniel J. Pilla, Winning
Publications, 506 Kenny Rd., #120, St. Paul, Minn. 55101, 1989

Tax Revolt, by Martin A. Larson, Devin-Adair Publishers, 6 North
Water Street, Greenwich, Connecticut 06830, 1985

Tax Scam, by Alan Stang, Research Publications, P. O. Box 84902,
Phoenix, Arizona 85071, 1988 (9.95 plus 1.50 S&H)

A Ticket to Liberty, by Lori Jacques, c/o P. O. Box 1509, Bisbee,
Arizona 85603-2509, November 1990 (33.00 includes S&H)

To Harass Our People, by Congressman George Hansen, Positive
Publications, P. O. Box 23560, Washington, D.C. 20024, 1984

United States Citizen versus National of the United States, by
Lori Jacques, c/o P. O. Box 1509, Bisbee, Arizona 85603-2509,
1989 (write author for price and availability)

Which One Are You? The American Nonresident Nontaxpayer -or-
United States Citizen Resident Taxpayer, by The Informer,
published by Who Are You, c/o 60-6 Roundtree Drive, Naugatuck,
Connecticut (55.00 includes S&H)

Who's Afraid of the IRS, by Miss Lynn Johnston, Laissez Faire
Books, 532 Broadway - 7th Floor, New York, New York 10012, 1983
(14.95 includes S&H)

You Can Rely on The Law That Never Was! Selections from the
Trial and Post-Trial Motions of William J. Benson, Constitutional
Research Associates, P. O. Box 550, South Holland, Illinois 60473
($35.00 plus 2.00 S&H)


Editor's note:

For those interested in doing additional research, many of the
above references contain their own excellent bibliographies.


                         Page N - 6 of 6


                           Appendix O

                 Constructive Notice and Demand


                        Page O - 1 of 22

                                                The Federal Zone:


Reader's Notes:


                        Page O - 2 of 22

                                                       Appendix O


Registered U.S. Mail c/o Street/P.O. Box
Return Receipt Requested City, State
Postal Serial # zip code exempt
                                              (DMM 122.32)

                                              Date
District Director
Internal Revenue Service
City, State
Postal Code:


Re: Constructive Notice, Demand, and Statement
     Regarding IRS Request for Form 1040 Tax Return


Dear Mr. Director:

     This correspondence addresses your agency's request that I
file a Form 1040 tax return and pay a tax for which I am not made
liable. Enclosed with your agency's request was IRS Notice 557,
entitled "Who Must File a Federal Income Tax Return". Because
you are in the initial stages of making a serious error with me
regarding your lawful jurisdiction and authority in this "1040"
matter, I hereby issue this constructive notice, demand and
statement.

     This constructive notice is to advise you of my lawful
status as a sovereign natural born free State Citizen under the
U.S. Constitution (see 2:1:5), that is, a "non-taxpayer" under
the law, and to demand that you comply with all due process
requirements of the law and permanently curtail any further
information collection requests and proceedings against my person
and my property.

     Be advised that I am not a "citizen of the United States"
and I am not a "resident of the United States". I am and have
always been a "nonresident alien" from birth (my legal status),
as that term is now defined in Title 26 and its regulations.
Among its other purposes, this letter now explicitly rebuts,
retroactively to my date of birth, any erroneous presumptions
and terminates any erroneous elections of "U.S. residence" which
were established as a consequence of demonstrable mistakes, by me
and others, which resulted in part from the vagueness that is
evident in Title 26 and its regulations, and in part from the
actual and constructive frauds which have been perpetrated upon
all Americans by the Congress and other federal officials at
least since the year 1913.

     To demonstrate the vagueness to which I refer, after an
honest and a diligent search which now stretches over several
years, I am still unable to find in Title 26 any statute which
defines the "intent" of that title (see 26 USC 7701(a) et seq.),
nor have I been able to find a statutory definition of the term


                        Page O - 3 of 22

                                                The Federal Zone:


"income" (even though "gross income" and "ordinary income" are
defined). My family obligations now demand that I stop searching
for definitions which evidently do not exist, and shift to you,
Mr. Director, the burden of finding and exhibiting these
definitions. I stand on my rights to substantive due process, as
guaranteed by the Bill of Rights, which nullify any and all
actions you and others in your agency may take under the presumed
"authority" of vague and arbitrary statutes and their associated
regulations.

     To demonstrate the fraud to which I refer, there are now
literally thousands of certified documents which constitute
material evidence proving, beyond any reasonable doubt, that the
so-called 16th Amendment was never ratified. Your agency can no
longer rely on it as law, as was done by Commissioner Donald C.
Alexander in The Federal Register of March 29, 1974, Volume 39,
No. 62, page 11572. At that time, Mr. Alexander published his
official statement about the IRS as follows:

     Since 1862, the Internal Revenue Service has undergone a
     period of steady growth as the means for financing
     Government operations shifted from the levying of import
     duties to internal taxation. Its expansion received
     considerable impetus in 1913 with the ratification of the
     Sixteenth Amendment to the Constitution under which Congress
     received constitutional authority to levy taxes on the
     income of individuals and corporations.
                                                 [emphasis added]

Contrast this statement with the ruling of an Illinois State
Court: "It is as much a nullity as if it had been the act or
declaration of an unauthorized assemblage of individuals," (Ryan
v. Lynch, 68 Ill. 160). Several District Courts of Appeal have
been presented with the question of whether or not the so-called
16th Amendment was properly ratified. See:

  Miller vs United States, 868 F.2d 236 (1989, 7th Circuit)
  U.S. vs Sitka, 845 F.2d 43 (1988, 2nd Circuit)
  Stubbs vs Commissioner, 797 F.2d 936 (1986, 11th Circuit)
  United States vs Stahl, 792 F.2d 1438 (1986, 9th Circuit)
  United States vs Ferguson, 793 F.2d 828 (1986, 7th Circuit)
  Sisk vs Commissioner, 791 F.2d 58 (1986, 6th Circuit)

     It has been well documented that Philander C. Knox knew that
the so-called 16th Amendment had not been properly ratified by
the 48 States in 1913, yet he certified its ratification anyway.
This is fraud. The courts, when presented with this overwhelming
problem, have decided that the fraud perpetrated upon the people
was in the nature of a "political" question and, therefore, not
proper for judicial review.

     Since the so-called 16th Amendment has now been declared a
"political" question, my "political" actions are deserving of the
protection guaranteed by the First Amendment to the Constitution


                        Page O - 4 of 22

                                                       Appendix O


for the United States of America. Boycotting the Internal
Revenue Service and the income tax, under the protection of the
First Amendment, is definitely a part of our democratic political
process, until such time as Congress (or the federal Courts)
decide to resolve this political question once and for all.

     Moreover, the federal government has committed further
fraud, duress and coercion, exercised undue influence, and
evidenced unlawful menace against the American people by
representing the so-called 14th Amendment as a lawfully ratified
amendment in the U.S. Constitution, when contrary proof,
published court authorities and other competent legal scholars
have now established that it was NOT lawfully ratified. (For
conclusive proof, see State vs Phillips, 540 P.2d 936 (1975);
Dyett vs Turner, 439 P.2d 266 (1968); 28 Tulane Law Review 22;
11 South Carolina Law Quarterly 484.)

     This constructive notice to you is based upon legal advice
which I have received from a number of attorneys, CPA's, income
tax professionals, and upon in-depth research into the Internal
Revenue Code, applicable regulations, court cases, the laws
concerning "Delegation of Authority" (i.e., the Federal Register
Act and the Administrative Procedure Act), the Privacy Act, and
the U.S. Constitution (the supreme  law of the land).

     One particularly revealing document (which I will emphasize
herein) that proves my legal position in this tax matter is the
Privacy Act Notice (Publication #609) which I obtained from the
IRS, and which is also published in the IRS Instructions for Form
1040.

     You are hereby advised that, as a sovereign natural born
free State Citizen under the U.S. Constitution (see 2:1:5), I
explicitly reserve all my rights and waive none. I demand that
you, in your capacities as a public servant and as an individual,
comply with the law and afford me substantive and procedural due
process at all times. In order for you to afford me all due
process in this matter, I now demand the following:


                 DELEGATION OF AUTHORITY ORDERS

     I hereby demand that you send me copies of the Delegations
of Authority from the Secretary of the Treasury, all the way down
to your position as District Director, which create and set forth
your full and complete authority to function and act in your
present capacity as an employee of the Internal Revenue Service.

     I also demand to receive copies of the Delegations of
Authority that have been handed down to any other case agent(s)
who have assisted you in issuing the above mentioned documents.
I also demand the full names of said agents.


                        Page O - 5 of 22

                                                The Federal Zone:


     Essentially, I demand to see the "chain" of authority
delegations above yours, to determine if they are properly set
forth and to determine if they have all been properly published
in the Federal Register as required by the law (the Act of July
26, 1935, 49 Stat. 500) which created the Federal Register, and
by the Administrative Procedure Act, Section 3.

     Section 3 of the Administrative Procedure Act clearly
commands that the following types of agency rules are to be
published in the Federal Register:


     Every agency shall separately state and currently publish in
     the Federal Register:

     (1) descriptions of its central and field organization
          including delegations by the agency of final authority
          and the established places at which, and the methods
          whereby the public may secure information or make
          submittals or requests;

     (2) statements of the general course and method by which
          its functions are channeled and determined, including
          the nature and requirements of all formal or informal
          procedures available as well as forms and instructions
          as to the scope and content of all papers, reports, or
          examinations; and

     (3) substantive rules adopted as authorized by law and
          statements of general policy or interpretations
          formulated and adopted by the agency for guidance of
          the public, but not rules addressed to and served upon
          named persons in accordance with law ....


Both Sections 3 and 9 of the Act protect the public from an
agency's failure to publish this required information:


     No person shall in any manner be required to resort to
     organization or procedure not so published. ...

     No sanction shall be imposed or substantive rule or order be
     issued except within jurisdiction delegated to the agency
     and as authorized by law.


Also, Section 7 of the Federal Register Act states:


     No document required under section 5(a) to be published in
     the Federal Register shall be valid as against any person
     who has not had actual knowledge thereof.


                        Page O - 6 of 22

                                                       Appendix O


     Mr. District Director, the point here is due process of law.
I demand full compliance. Do not send me any copies of
delegation orders unless you can satisfy the entire request. A
partial response by you will evidence your failure to satisfy
this request and will fail to prove your lawful authority by any
means.

     It has come to my attention that the Office of the Federal
Register has issued a statement indicating that Treasury
Department Orders 150-10 and 150-37 (regarding taxation) were not
published in the Federal Register. Evidently, there are no
published orders from the Secretary of the Treasury giving the
Commissioner of Internal Revenue the requisite authority to
enforce Title 26, the Internal Revenue Code, within the 50 States
of the Union. Furthermore, under Title 3, Section 103, the
President of the United States, by means of Presidential
Executive Order, has not delegated authority to enforce the
Internal Revenue Code within the 50 States of the Union.

     Very simply, Mr. District Director, you are required to
present proof that the above mentioned orders have been published
in the Federal Register prior to the date of your initial request
for information, and prior to the issuance of any unilateral
determinations, by you and/or your case agent(s), of my status as
a "taxpayer" or a "nontaxpayer".

     As proof that my request is valid and lawfully on point, I
refer you to the following statutes and authorities that make it
necessary for the Secretary of the Treasury to delegate authority
to the Commissioner of Internal Revenue. First, by authority of
the Internal Revenue Code, Section 7602, the Secretary is
authorized to issue a summons. This section must be read in
conjunction with Section 7701: "Definitions". Note, in
particular, definitions (11) and (12) in order to identify
individuals properly:


     Section 7602. Examination of books and witnesses.

     (a) Authority to Summon, Etc. -- For the purpose of
     ascertaining the correctness of any return, making a return
     where none has been made, determining the liability of any
     person for any internal revenue tax or the liability at law
     or in equity of any transferee or fiduciary of any person in
     respect of any internal revenue tax, or collecting any such
     liability, the Secretary is authorized ....


     Section 7701(11) Secretary of the Treasury and Secretary.

     (A) Secretary of the Treasury. The term "Secretary of the
     Treasury" means the Secretary of the Treasury, personally,
     and shall not include any delegate of his.


                        Page O - 7 of 22

                                                The Federal Zone:


     Section 7701(12) Delegate

     (A) In General. The term "or his delegate":

     (i) when used with reference to the Secretary of the
          Treasury, means any officer, employee, or agency of the
          Treasury Department duly authorized by the Secretary of
          the Treasury directly, or indirectly by one or more
          redelegations of authority, to perform the function
          mentioned or described in the context; and

     (ii) when used with reference to any other official of the
          United States, shall be similarly construed.

     (B) Performance of Certain Functions in Guam or American
          Samoa. The term "delegate," in relation to the
          performance of functions in Guam or American Samoa with
          respect to taxes imposed by Chapters 1, 2, and 21, also
          includes any officer or employee of any other
          department or agency of the United States, or of any
          possession thereof, duly authorized by the Secretary
          (directly, or indirectly by one or more redelegations
          of authority) to perform such functions.


Further, Treasury Department Order No. 150-10 can be found in CCH
Paragraph 6585 (unofficial publication). Section 5 reads as
follows:

     U.S. Territories and Insular Possessions. The Commissioner
     shall, to the extent of authority otherwise vestedin him,
     provide for the administration of the United States internal
     revenue laws in the U.S. Territories and insular possessions
     and other authorized areas of the world.


     Thus, the evidence available to me indicates that the only
authority delegated to the Internal Revenue Service is to enforce
tax treaties with foreign territories, U.S. territories and
possessions, and Puerto Rico. To be consistent with the law,
Treasury Department Orders, particularly TDO's 150-10 and 150-37,
were deemed necessary to be published in the Federal Register.
Thus, given the absence of published authority delegations within
the 50 States of the Union, the obvious conclusion is that the
various Treasury Department orders found in Internal Revenue
Manual 1229 have absolutely no legal bearing, force or effect on
sovereign Citizens of these 50 States, such as myself.

     Again, the Secretary of the Treasury delegates his authority
to the different department heads by Treasury Department Orders,
which require publication in the Federal Register pursuant to 44
USC 1501 et seq. Only when the Secretary of the Treasury
properly delegates authority to the Commissioner of Internal
Revenue, and said orders are duly published in the Federal


                        Page O - 8 of 22

                                                       Appendix O


Register, then and only then does the Commissioner have authority
to re-delegate authority to his subordinates by issuing
Commissioner's Delegation Orders, which become a part of Internal
Revenue Manual 1229.

     All orders affecting the rights and obligations of "United
States citizens" and "United States residents" must be published
in accordance with the proper authorities. Pursuant to 44 USC
1501 et seq., no one can be adversely affected or bound by an
unpublished order, and anyone may lawfully and safely ignore such
an order with impunity. Of course, no one anywhere in the world
can be affected if the proper and relevant delegation orders are
not duly published.

     Without lawful delegation of authority to issue, among other
things, your "Request for Tax Return", to determine correctness
of any return, to make a return where none has been made, to make
and issue determinations of deficiencies for any internal revenue
tax, and/or to file tax liens and institute levies, Mr. District
Director, you cannot proceed further against me in this matter,
particularly with your intent to collect information and,
ultimately, to collect taxes.

     Mr. District Director, if you are unable to comply with the
demands in this letter on or before [date exactly 30 days hence],
I will correctly conclude under law that you have absolutely no
delegated authority, that you are acting under a covert, secret
jurisdiction and, as such, that you are operating unlawfully
under color of law and cannot proceed further in this matter,
period. Moreover, after this deadline, your failure to comply
will mean that you are forever barred by the doctrine of estoppel
by acquiescence from proceeding any further against me in this
regard.

              JURISDICTION IS REQUIRED TO BE PROVEN

     Your delegated authority must include, but not be limited to
Constitutional, Statutory, Contract and/or Merchant Law(s),
including treaties if any. If you claim the jurisdiction of
statutory law as your authority, I demand that you disclose to
me, in writing, how and in what precise manner I became the
subject and/or the object of said statute.

     If you claim the jurisdiction of contract and/or merchant
law as your authority, I demand that you disclose to me, in
writing, what contract or commercial agreement granted this
jurisdiction to you, including but not limited to the title,
date, witnesses thereto, and all parties thereto, whereby I have
knowingly, intentionally, and voluntarily entered into a contract
or commercial agreement which provides the legal basis for any
such alleged jurisdiction. In equity, you can be compelled by a
court of law to disclose fully, under oath, what contract or
commercial agreement granted this jurisdiction to you.


                        Page O - 9 of 22

                                                The Federal Zone:


     Mr. District Director, the issue of whether I, as a
sovereign natural born free State Citizen under the Constitution
(see 2:1:5), am liable by statute to file a 1040 Form and to pay
a tax under some alleged "blanket tax law" is secondary to the
issue of jurisdiction, because you must first prove that you have
lawful jurisdiction over me. I am not aware of any facts on
record upon which you could have made a valid determination that
I am a "taxpayer/subject" pursuant to Title 26 USC Section
7701(a)(14), or to any other laws cited above, or that I have
granted you jurisdiction. I submit that there are no conclusive
facts nor any conclusive presumptions on the administrative
record which have conferred jurisdiction to you upon myself or
the subject matter.

     Therefore, and pursuant to Title 26 USC Section 6110, you
are hereby required to furnish me copies of the all documents
upon which you have based your presumptive determination that I
am a "taxpayer/subject" who is in a particular "taxable class"
that lawfully authorizes you to issue your "Request(s) for a 1040
Tax Return" to me and to institute collection efforts against me.

     There are numerous cases that speak to the status of a
"nontaxpayer" as opposed to the status of a "taxpayer". The
following are just a few relevant citations (see also Exhibit A
for other relevant cases):


     The term "taxpayer" in this opinion is used in the strict or
     narrow sense contemplated by the Internal Revenue Code and
     means a person who pays, overpays, or is subject to pay his
     own personal income tax. (See Section 7701(a)(14) of the
     Internal Revenue Code of 1954.) A "nontaxpayer" is a person
     who does not possess the foregoing requisites of a taxpayer.

                       [Economy Plumbing and Heating Co. vs U.S.]
                                    [470 F.2d 585, note 3 at 590]


     The revenue laws are a code or system in regulation of tax
     assessment and collection. They relate to taxpayers and not
     to nontaxpayers.

                       [Economy Plumbing and Heating Co. vs U.S.]
                                           [470 F.2d 585, at 589]


     Persons who are not taxpayers are not within the system and
     can obtain no benefit by following the procedures prescribed
     for taxpayers, such as the filing of claims or refunds.

                       [Economy Plumbing and Heating Co. vs U.S.]
                                           [470 F.2d 585, at 589]


                        Page O - 10 of 22

                                                       Appendix O


     The income tax is, therefore, 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
     which they produce. The income is not the subject of the
     tax: it is the basis for determining the amount of the tax.

            [House Congressional Record, March 27, 1943, at 2580]

     It is a principle of law that, once challenged, the person
asserting jurisdiction must prove that jurisdiction exists as a
matter of law. For judicial support of this principle, see in
particular the following cases:

     Griffin vs Matthews, 310 F.Supp. 341; 423 F.2d 272
     McNutt vs. G.M., 56 S.Ct. 780; 80 L.Ed 1135
     Basso vs. U.P.L., 495 F.2d 906
     Thomson vs Gaskiel, 62 S.Ct. 673; 873 L.Ed 111

     To deny me knowledge of jurisdiction and equal protection is
to deny me due process of law. Such is a violation by you of 42
USC 1983, and/or 18 USC 241 and 242, under which section I may
sue you, should you willfully deny me any right to due process
and unlawfully move forward to collect information, to assess, to
collect monies, and/or to institute a lien or levy action upon
any of my property. Mr. District Director, I do hope that you
understand the extreme liability and punishment that you face
under the law in the event of such violations.


                  NOTICE OF PERSONAL LIABILITY

     As you are aware, Mr. District Director, if you, as an
individual or as a government employee/public servant, act
outside your lawful capacity, with no delegated authority, you
can be held personally liable for each and every violation that
you commit. However, at this point, you need simply comply with
the law. The burden is now rightfully and lawfully upon you to
produce.

     However, be further advised that my possible future remedies
will include the filing of a complaint against you and your
superior(s) with a U.S. Magistrate and the Federal Bureau of
Investigation, and/or a formal complaint with a U.S. Magistrate
under Rule 3 of the Federal Rules of Criminal Procedure demanding
that a Summons be issued upon you to show cause why you should
not be formally charged with a violation of 26 USC 7214(a)(1),
(3), (6), and (7), for starters.

     There could be charges filed against you for unauthorized
and unlawful disclosure under the Internal Revenue Code (26 USC
6103) as well for your failure to provide due process. See, for
example, Husby vs United States, 672 F. Supp. 442, and Rorex vs
Traynor, 771 F.2d 383. Title 26 USC, Section 7431(a)(1) states
as follows:


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                                                The Federal Zone:


     Disclosure by Employee of the United States. If any officer
     or employee of the United States knowingly, or by reason of
     negligence, discloses any return or return information with
     respect to a taxpayer in violation of any provision of
     section 6103, such taxpayer may bring a civil action for
     damages against the United States in a district court of the
     United States.


Title 26 USC, Section 7431(c) provides for damages:


     Damages. In any action brought under subsection (a), upon a
     finding of liability on the part of the defendant, the
     defendant shall be liable to the plaintiff in an amount
     equal to the sum of ---

     (1) the greater of --

          (A) $1,000.00 for each act of unauthorized disclosure
               of a return or return information with respect to
               which such defendant is found liable, or

          (B) the sum of --

               (i) the actual damages sustained by the plaintiff
                    as a result of such unauthorized disclosure,
                    plus

               (ii) in the case of a willful disclosure or a
                    disclosure which is the result of gross
                    negligence, punitive damages, plus

     (2) the costs of the action.


A lawsuit for unlawful disclosure against you personally can be
extremely damaging and costly to you and your agency, because the
$1,000 fine can be multiplied a thousand-fold under certain
conditions.

     Other charges can include fraud, theft and criminal
conspiracy to deprive a Sovereign State Citizen of rights
guaranteed to him by the U.S. Constitution. Keep in mind that
you personally enjoy absolutely no personal immunity for acts
committed outside your capacity as a public servant.
Furthermore, the Anti-Injunction Act will not protect you as long
as there is no valid information request, no valid notice, or no
valid assessment with respect to me, in addition to your lack of
delegated authority.

     Please note well the ruling in the following court case,
particularly as it affects agents who are unaware of the
limitations upon their authority:


                        Page O - 12 of 22

                                                       Appendix O


     Whatever the form in which the Government functions, anyone
     entering into an arrangement with the Government takes the
     risk of having accurately ascertained that he who purports
     to act for the Government stays within the bounds of his
     authority ... and this is so even though as here, the agent
     himself may have been unaware of the limitations upon his
     authority.

               [Federal Crop Ins. Corp. vs Merrill, 332 U.S. 380]


                    LEGAL ADVICE RELIED UPON

     During the past years, I have conducted diligent research
and have received and relied upon legal advice from independent
tax professionals who all advised me in writing that the law does
not make me liable to file income tax returns, no matter how much
money I make. Some of my counsel also advised me of your
agency's violations with regard to Delegations of Authority, and
have pointed out and proven many other serious problems and
violations. Thus, in a prudent sense, I have every reason to
rely fully on the legal advice I have received from tax
professionals.

     Also, Article 1, Section 10 of the U. S. Constitution
secures my right to contract. Obviously, I enjoy the unalienable
right to free association through contract. My relationship with
all those with whom I choose to associate is by private contract
which cannot be impaired by you or anyone else. "Unalienable"
rights are rights that cannot be surrendered or transferred
without my consent. (See Exhibit A for relevant court cases.)


                 IRS PRIVACY ACT NOTICE SUPPORTS
                       MY NON-FILER STATUS

     Furthermore, the IRS Privacy Act Notice #609 which your
agency sent to me supports my legal position that I am not liable
for sending you information on a Form 1040. I am advised by
professionals that your Notice is deceptively written to trick
all individuals into believing that they are "liable", and
therefore it is a shameful and vicious fraud. Careful legal
analysis has brought forth the real explanation and proof. Your
Notice first refers to Title 26 USC, Section 6001, which states
in part:


     Whenever in the judgement of the Secretary it is necessary,
     he may require any person, by notice served upon such person
     or by regulations, to make such returns, render such
     statements, or keep such records, as the Secretary deems
     sufficient to show whether or not such person is liable for
     tax under this title.
                                                 [emphasis added]


                        Page O - 13 of 22

                                                The Federal Zone:


Your Notice 609 continues to Section 6011, which states in part:


     When required by regulations prescribed by the Secretary any
     person made liable for any tax imposed by this title, or
     with respect to the collection thereof, shall make a return
     or statement according to the forms and regulations
     prescribed by the Secretary.
                                                 [emphasis added]

     I am advised that to be "liable" for a tax means that one is
responsible to provide information relative to such taxes on the
appropriate "information collection request" form. Neither of
the above Code sections states that all individuals are liable to
make a return, and no specific forms are mentioned either. This
defect is in sharp contrast to other types of taxes enumerated in
the Code, all of which clearly have a Code section specifically
describing who is liable to fill out the return, to submit it and
to pay any tax that is owed. In this latter regard, the law is
crystal clear to me; but with regard to "income" taxes, the law
and its regulations are anything but crystal clear.

     I must first be an individual whois subject to, and made
liable for a particular type of tax under Title 26, the Internal
Revenue Code, i.e., income tax. Since I am neither subject to,
nor liable for, any particular type of tax under Title 26, there
is absolutely no requirement to comply with your request for
information, for the filing of a Form 1040, or even for payment
of any income tax.

     Finally, my tax professionals all advise me that Section
6012 of your Privacy Act Notice does not apply to me; it only
applies to those who are made liable or subject to, either by
statute or by having volunteered to be liable for, the filing of
your tax form.

     However, notwithstanding the facts that Sections 6001 and
6011 of your Privacy Act Notice do not make me liable for the
tax, and fail to even cross-reference a Code section in Subtitle
A that would make me liable to file, as a purely voluntary act on
my part and to prove my good faith in resolving this matter, here
is my "statement":

     In good faith, I have determined from written, reliable,
     legal advice from tax professionals and further research
     into the law, that I am not liable or subject to or for any
     tax under Title 26, and nothing I receive is subject to tax
     under Subtitle A. I am not a "taxpayer" as defined in
     Section 7701(a)(14), and as defined in Section 1313(b). Nor
     am I that "person" as defined in Section 7343. And, I am
     not engaged in any revenue taxable activity under Title 26,
     and I have no valid contracts with your agency, direct or
     quasi. Thus, you have no lawful jurisdiction to proceed
     further in this matter.


                        Page O - 14 of 22

                                                       Appendix O


     I have unalienable, God-given rights which I will not waive
     at any time, and you are prohibited from violating my
     absolute right to due process by instituting unlawful
     assessments, levies or seizures. Essentially, your "income
     tax" and Title 26 simply do not apply to me, as an
     individual with free sovereign natural born Citizen status.


     In addition, your Privacy Act Notice constitutes a "Miranda
Warning" to me, because it states that "the information may be
given to the Department of Justice and to other federal agencies,
as provided by law." The 5th Amendment protects me from
revealing any and all information which you may give to the
Justice Department and other federal agencies, because this
amendment provides that NO PERSON SHALL BE COMPELLED TO BE A
WITNESS AGAINST HIMSELF. Please be advised that this right of
mine is not negotiable under any circumstances. I have never
waived any of my rights knowingly, intentionally, or voluntarily.
I have never committed any knowingly intelligent acts which, to
my knowledge, could or would be construed as waiving any of my
rights.

     Again, Mr. District Director, you have asked me for
information, including a 1040 Income Tax Return, and it appears
impossible for me to give you any information whatsoever without
waiving one or more of my God-given unalienable rights, which
rights are explicitly guaranteed by the Constitution for the
United States of America. In further support of my right to
claim the protection of the 5th Amendment, I refer specifically
to your own IRS Special Agent's Handbook, Section 342.11(2),
which states as follows:


     The right to refuse to answer incriminating questions
     applies not only to court trials, but to all kinds of
     criminal or civil proceedings, including administrative
     investigations.
                           [George Smith vs U.S., 337 S.Ct. 1000]
                             [U.S. vs Harold Gross, 276 F.2d 816]
                                        [Councilman vs Hitchcock]
                                          [McCarthy vs Arndstein]

     Further, the 4th Amendment right is likewise relevant here,
because it follows that a violation of the 5th Amendment, and any
forcible extraction of information or property against my will,
constitute an illegal search and seizure. There is no "probable
cause", as required by the 4th Amendment, because jurisdiction
has not been proven.


     The famous case of Miranda vs Arizona sums up the relevant
strength of my rights as a Sovereign State Citizen, as follows:


                        Page O - 15 of 22

                                                The Federal Zone:


     Where rights secured by the Constitution are involved, there
     can be no rule making or legislation which would abrogate
     them.


     You also compound your fraud upon the inhabitants of the 50
States of the Union by implying that all individuals (without
exception) are required to file a tax return, when it is well
settled that federal income taxes are completely and totally
voluntary for nonresident aliens who live and work outside areas
of exclusive federal legislative jurisdiction, unless their
income derives from a source that is inside a federal area (see
authorities at 1:8:17 and 4:3:2 in the U.S. Constitution and
Treasury Decision 2313).

     Your ADP and IDRS document 6209 classifies the W-2 and W-4
in a number five (#5) tax class. This indicates that the form is
only for a gift tax. This also confirms that the tax is a
voluntary tax; when individuals fill out these forms, they are
voluntarily giving a gift. There is also a problem with your W-4
in that there must first be a tax imposed upon an individual
before that individual can incur a tax liability. For most
individuals, no section of the Code can be found which imposes an
income tax on them and therefore makes them liable, hence they
"incurred no liability for income tax imposed under subtitle A of
the Code ...."

     Another problem with the W-4 form is that it does not allow
you to claim exemptions, but only allowances. Therefore,
whenever you attempt to claim exemptions, you are automatically
falsifying the form. Yet another problem with the W-4 form is
its title. It does not purport to be an Employee's Withholding
Exemption Certificate. It purports to be an Employee's
Withholding Allowance Certificate.


     The end result of what the Internal Revenue Service has
accomplished is the promulgation of a plethora of regulations to
govern a form which simply does not exist (see 26 CFR
31.3402(f)(1)-1(e)(2), 3402(n), 31.3402(f)(5)-1(b)(1).)


     In summary, for a Sovereign State Citizen such as myself,
providing information and proceeding to pay taxes pursuant to a
1040 form is entirely voluntary. The voluntary nature of the tax
system is clearly proven by the following statement by the U.S.
Supreme Court:


     Our system of taxation is based on voluntary assessment and
     payment, not upon distraint.

                                    [U.S. vs Flora, 362 U.S. 176]
                                                 [emphasis added]


                        Page O - 16 of 22

                                                       Appendix O


                           CONCLUSIONS

     The above jurisdictional challenge and constructive notice
are made in good faith. My sincere intent is to uphold the
Supreme Law of the Land, the U.S. Constitution, and all relevant
laws that are consistent with the Constitution, and to simply
resolve this matter quickly by getting to the truth of the law
and the facts as outlined above for the record. And you, Mr.
District Director, in your capacity as a public servant and as an
individual as well, also have a clear obligation to uphold the
United States Constitution and the relevant laws as stated above.
I demand that you follow all the rules and afford me all due
process. In the case of Robinson vs U.S., 920 F.2d 1157, the
Appellate Court stated that this is an IRS game that is being
played and, therefore, the IRS must play according to the rules:

     The procedural provisions of the Code appear to be the
     creation of a scholastic, but whimsical mind. In general,
     however, the Courts take them literally; the game must be
     played according to the rules. In the factual situation
     here, the IRS broke the rules.

                [Johnson, An Inquiry into the Assessment Process]
                                 [35 Tax L. Rev. 285, 286 (1980)]

     The burden of proof is now entirely upon you, Mr. District
Director. As time is of the essence, do not ignore this notice
and demand. In regard to your decision to reply or not, please
bear in mind the following quote from the U.S. Court of Appeals:

     Silence can only be equated with fraud where there is a
     legal or moral duty to speak or where an inquiry left
     unanswered would be intentionally misleading. ... We cannot
     condone this shocking conduct by the IRS. Our revenue
     system is based upon the good faith of the taxpayers and the
     taxpayers should be able to expect the same from government
     in its enforcement and collection activities.... This sort
     of deception will not be tolerated and if this is the
     "routine" it should be corrected immediately.

       [U. S. vs Tweel, 550 F.2d 297, 299 (1977), emphasis added]
            [quoting U.S. vs Prudden, 424 F.2d 1021, 1032 (1970)]

     Silence is a species of conduct, and constitutes an implied
     representation of the existence of the state of facts in
     question, and the estoppel is accordingly a species of
     estoppel by misrepresentation. [cite omitted] When silence
     is of such a character and under such circumstances that it
     would become a fraud upon the other party to permit the
     party who has kept silent to deny what his silence has
     induced the other to believe and act upon, it will operate
     as an estoppel.

             [Carmine vs Bowen, 64 A. 932 (1906), emphasis added]


                        Page O - 17 of 22

                                                The Federal Zone:


     Obviously, Mr. District Director, your response must be in
writing. To be sure that I receive it, I require you to send it
via either Certified or Registered Mail, return receipt
requested. There is abundant case law that sets forth the
following axiom of law:


     When jurisdiction is challenged in writing, it must be
     answered in writing.
                                                 [emphasis added]

     I hereby demand that you comply with this constructive
notice and demand, and that you take corrective actions by simply
curtailing any and all "information collection actions" that you
currently have in process relative to me. Your failure to take
this action will prove bad faith, that is, a willful intent on
your part to violate the law.


     You have hereby been given my constructive notice and
demands under law. You now have full personal knowledge of my
lawful status as a Sovereign nontaxpayer. Therefore, Mr.
District Director, I expect to receive your written response on
or before [date exactly 30 days hence] to resolve and formally
terminate this case and to permanently close my file for lack of
agency jurisdiction and for rampant violations of the law.


     For your information, I am now obliged to forward copies of
this letter, with substantial documentation, including legal
opinions, to higher officials within your agency, including the
Secretary of the Treasury and the Commissioner of Internal
Revenue, as well as my Representatives in the House and Senate.
I will do this so as to exhaust all my administrative remedies.
Over the years, our community has become very interested in the
subject of IRS abuses and violations of due process, and I will
not hesitate to print cogent letters about these IRS abuses and
violations of due process in any and all publication media
available to me.


     Lastly, as mentioned above, I have legal opinions which have
advised me that I am not liable or subject to, or for, the
"income tax", and none of your Notices, including Notice 557,
applies to me. Again, Notice 557 applies only to those who are
subject to, or liable for, the tax. In order to "reduce paper",
I am not sending you copies of these legal opinions at this time,
since I believe it is unnecessary to do so. As I mentioned
above, this is a two-part matter. You must first satisfy the
issues of jurisdiction and delegation of authority.


     Thank you very much for your prompt attention to this
important matter.


                        Page O - 18 of 22

                                                       Appendix O


Sincerely yours,


/s/ John Q. Doe
All Rights Reserved Without Prejudice


enclosures: copy of IRS letter dated __/__/__

attachment: Exhibit A: Supreme Court decisions


             California All-Purpose Acknowledgement

CALIFORNIA STATE/REPUBLIC )
                                )
COUNTY OF MARIN )

     On the ________ day of ____________, 199_ Anno Domini,
before me personally appeared John Q. Doe, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
Person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in His authorized
capacity, and that by His signature on this instrument the
Person, or the entity upon behalf of which the Person acted,
executed the instrument. Purpose of Notary Public is for
identification only, and not for entrance into any foreign
jurisdiction.

WITNESS my hand and official seal.


_____________________________________
Notary Public


                        Page O - 19 of 22

                                                The Federal Zone:


                            Exhibit A

                 Decisions of the Supreme Court
                      of the United States


"There is a clear distinction in this particular case between an
individual and a corporation, and that the latter has no right to
refuse to submit its books and papers for an examination at the
suit of the State. The individual may stand upon his
constitutional right as a citizen. He is entitled to carry on
his private business in his own way. His power to contract is
unlimited. He owes no such duty to the State, since he receives
nothing therefrom, beyond the protection of his life and
property. His rights are such as existed by the law of the land
long antecedent to the organization of the State, and can only be
taken from him by due process of law, and in accordance with the
Constitution. Among his rights are refusal to incriminate
himself, and the immunity of himself and his property from arrest
or seizure except under a warrant of law. He owes nothing to the
public so long as he does not trespass upon their rights."

                                    [Hale vs Henkel, 201 U.S. 43]


"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 individual's rights to live and own property are natural
rights for the enjoyment of which an excise cannot be imposed."

                         [Redfield vs Fisher, 292 P. 813, at 819]


"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."
                 [Coppage vs Kansas, 236 U.S. 1, at 14]


"The common business and callings of life, the ordinary trades
and pursuits, which are innocuous in themselves, and which 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 nor hindrance,
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."

                        [Butchers Union Co. vs Crescent City Co.]


                        Page O - 20 of 22

                                                       Appendix O


NOTE: The above Supreme Court decisions have never been
overturned. Further, Kenneth W. Starr, Solicitor General, on
February 1, 1990, made the following statement in a letter to a
United States Senator:

     It is well established that the decisions of the United
     States Supreme Court interpreting federal law are binding on
     lower courts, both state and federal, until such time as the
     Supreme Court overrules its decision, or federal statutory
     provision in question is amended or repealed.

                      [See generally Cooper vs Aaron, 358 U.S. 1]


                        Page O - 21 of 22

                                                The Federal Zone:


Reader's Notes:


                        Page O - 22 of 22


                           Appendix P

                      Miscellaneous Letters


                        Page P - 1 of 98

                                                The Federal Zone:


Reader's Notes:


                        Page P - 2 of 98

                                                       Appendix P


MEMO

TO: Trusted Colleagues

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: November 4, 1992

SUBJECT: Trusts, Foreign and Domestic


     I have recently taken a keen interest in practical
applications of The Federal Zone to trust creation and
administration. In particular, I now believe I have enough
evidence to prove that the correct distinction between foreign
and domestic corporations is equally applicable to trusts. The
purpose of this memo is to share some of this evidence with you,
in order to challenge your thinking on this subject and possibly
to open new possibilities for trust creation and administration.


     Black's Law Dictionary, Sixth Edition, is a good place to
begin. In this dictionary, we find the following important
definitions:


     Foreign situs trust. A trust which owes its existence to
     foreign law. It is treated for tax purposes as a
     non-resident alien individual.
                                                 [emphasis added]

     Foreign trust. A trust created and administered under
     foreign law.


Black's Law Dictionary, Sixth Edition, defines "foreign state"
very clearly, as follows:


     The several United States*** are considered "foreign" to
     each other except as regards their relations as common
     members of the Union.
                                                 [emphasis added]


I have added three asterisks ("***") after "United States" in
order to emphasize that the "United States" in this context
refers to the 50 States of the Union.

     Now examine the definition of "foreign estate or trust" in
the definitions section of the Internal Revenue Code, as follows:


                        Page P - 3 of 98

                                                The Federal Zone:


     Foreign Estate or Trust. -- The terms "foreign estate" and
     "foreign trust" mean an estate or trust, as the case may be,
     the income of which, from sources without the United States
     which is not effectively connected with the conduct of a
     trade or business within the United States, is not
     includible in gross income under subtitle A.

                                          [26 U.S.C. 7701(a)(31)]


Do a bit of grammatical reconstruction, so as to eliminate the
references to "foreign estate", and you get the following:

     The term "foreign trust" means a trust, the income of which
     is not includible in gross income under subtitle A. The
     income of a foreign trust is not includible in gross income
     when it derives from sources which are without the "United
     States" and which are not effectively connected with the
     conduct of a trade or business within the "United States".


     Recall the definition of "foreign situs trust" from Black's
supra. Now compare the IRC definition of "foreign trust" with
the IRC definition of "gross income" for nonresident alien
individuals. Notice the component criteria of gross income for a
nonresident alien individual, and their close similarity to the
same criteria for foreign trusts:

     In the case of a nonresident alien individual, except where
     the context clearly indicates otherwise, gross income
     includes only --

     (1) gross income which is derived from sources within the
          United States and which is not effectively connected
          with the conduct of a trade or business within the
          United States, and

     (2) gross income which is effectively connected with the
          conduct of a trade or business within the United
          States.

                               [26 U.S.C. 872(a), emphasis added]


It is crucial to remember that the term "United States", as used
in these sections of the IRC, means the federal zone, i.e., the
territory over which Congress has exclusive legislative
authority. Income which is derived from sources without the
"United States" is not included in gross income for nonresident
aliens. Likewise, income which is effectively connected with the
conduct of a trade or business without the "United States" is not
included in gross income for nonresident aliens. Therefore, I
have proven that the following rule has identical application to
nonresident aliens and foreign trusts:


                        Page P - 4 of 98

                                                       Appendix P


     Income is excludible from the computation of "gross income"
     if it derives from sources which are without the "United
     States" and which are not effectively connected with the
     conduct of a trade or business within the "United States".

     Now, let's dig a little deeper in order to determine if this
finding is supported by other sections of the IRC. Find the
heading "foreign trusts" in the Topical Index of the IRC as
published by Commerce Clearing House. There you will find
references to "situs" at 402(c) and 404(a)(4). Read these
sections carefully:

     Taxability of Beneficiary of Certain Foreign Situs Trusts.
     -- For purposes of subsections (a) and (b), a stock bonus,
     pension, or profit-sharing trust which would qualify for
     exemption from tax under section 501(a) except for the fact
     that it is a trust created or organized outside the United
     States shall be treated as if it were a trust exempt from
     tax under section 501(a).

                               [26 U.S.C. 402(c), emphasis added]

     Trusts Created or Organized Outside the United States. --
     If a stock bonus, pension, or profit-sharing trust would
     qualify for exemption under section 501(a) except for the
     fact that it is  a trust created or organized outside the
     United States, contributions to such a trust by an employer
     which is a resident, or corporation, or other entity of the
     United States, shall be deductible under the preceding
     paragraphs.
                            [26 U.S.C. 404(a)(4), emphasis added]

It is a well established principle of law that the 50 States are
"foreign" with respect to each other, just as the federal zone is
"foreign" with respect to each of them (In re Merriam's Estate,
36 NE 505 (1894)). The status of being foreign is the same as
"belonging to" or being "attached to" another state or another
jurisdiction. The proper legal distinction between the terms
"foreign" and "domestic" is best seen in Black's definitions of
foreign and domestic corporations, as follows:


     Foreign corporation. A corporation doing business in one
     state though chartered or incorporated in another state is a
     foreign corporation as to the first state, and, as such, is
     required to consent to certain conditions and restrictions
     in order to do business in such first state.


     Domestic corporation. When a corporation is organized and
     chartered in a particular state, it is considered a domestic
     corporation of that state.

                                                 [emphasis added]


                        Page P - 5 of 98

                                                The Federal Zone:


     In light of all the above, I now contend that untold numbers
of trusts have been created on the basis of a belief that they
are domestic trusts when, in fact, they are foreign trusts, as
the terms "domestic" and "foreign" are defined in the IRC and in
the law dictionaries. The Internal Revenue Code was written
under authority granted to Congress for the exercise of exclusive
legislative jurisdiction over the federal zone. Accordingly, the
50 States and their respective laws are actually foreign with
respect to the federal zone. The 10th Amendment makes it very
clear that powers not specifically delegated to the United States
by the Constitution, nor prohibited to the States by the
Constitution, are reserved to the States or to the people. A
common-law trust situated in California exercises rights which
are reserved to the people, because California is a common-law
State and because the U.S. Constitution specifically reserves
such rights to the people.


                             # # #


                        Page P - 6 of 98

                                                       Appendix P


                                   c/o P. O. Box 6189
                                   San Rafael
                                   California Republic
                                   Postal Code 94903-0189/TDC

                                   February 15, 1993


Dagny Sharon
Attorney-at-Law
c/o 17332 Irvine Boulevard, #230
Tustin, California Republic
Postal Code 92680/tdc

Dear Dagny:

     I appreciated the opportunity to make your acquaintance at
the Libertarian Party Convention in Sunnyvale this past weekend.
I also regret that we didn't have a chance to spend more time
together. Your videotape is quite original and light-hearted; I
hope it brings you much success.

     Had we found a way to spend more time talking with each
other, there is one important matter which I would definitely
have wanted you to consider more carefully. During our
conversation in the bar, while I was eating lunch, you implied
that one of your goals is to work towards a "democracy" for
America. Whether you intended it this way or not, such a goal
directly contradicts Article 4, Section 4 of the Constitution for
the United States of America, to wit:


     Section 4. The United States shall guarantee to every State
     in this Union a Republican Form of Government ....


     What exactly is a "Republican Form" of government? It is
one in which the powers of sovereignty are vested in the people
and exercised by the people. Black's Law Dictionary, Sixth
Edition, makes this very clear:


     Republican government. One in which the powers of
     sovereignty are vested in the people and are exercised by
     the people, either directly, or through representatives
     chosen by the people, to whom those powers are specially
     delegated. In re Duncan, 139 U.S. 449, 11 S.Ct. 573, 35
     L.Ed. 219; Minor v. Happersett, 88 U.S. (21 Wall.) 162, 22
     L.Ed. 627.


     Both the California State Constitution and the U.S.
Constitution state that the latter shall be the supreme Law of
the land. In the U.S. Constitution, Article 6, Clause 2 states:


                        Page P - 7 of 98

                                                The Federal Zone:


     This Constitution, and the Laws of the United States which
     shall be made in Pursuance thereof; and all Treaties made,
     or which shall be made, under the Authority of the United
     States, shall be the supreme Law of the Land; and the
     Judges in every State shall be bound thereby, any Thing in
     the Constitution or Laws of any State to the Contrary
     notwithstanding.


     At the turn of the century, the U.S. Supreme Court issued a
series of controversial cases now known as The Insular Cases.
These cases were predicated, in part, on the principle that the
Constitution for the United States as such does not extend beyond
the boundaries of the States which are united by and under it.
Accordingly, this principle set a crucial precedent whereby
Congress was free to establish a legislative democracy within the
federal zone, instead of a constitutional republic.

     The federal zone is the area over which Congress exercises
exclusive legislative jurisdiction; it encompasses the District
of Columbia and such areas as Guam and the Virgin Islands. Even
more important is the fact that this exclusive legislative
jurisdiction extends to all persons who are subject to it,
regardless of where they may reside. As such, the status of
"citizen of the United States" (also known as "U.S. citizen")
causes one to be subject to the letter of all municipal statutes,
rules and regulations which Congress enacts under this exclusive
legislative authority. The constitutional definition of this
second class of citizens is alleged to be the so-called 14th
Amendment. However, two standing decisions of the Utah Supreme
Court have struck down the ratification of this amendment.
Coupled with all the evidence which that Court utilized to arrive
at these decisions, we have therein good cause to conclude that
the so-called 14th Amendment is null and void for fraud and
duress. My book The Federal Zone discusses the so-called 14th
Amendment as follows:

     Not only did this so-called "amendment" fail to specify
     which meaning of the term "United States" was being used;
     like the 16th Amendment, it also failed to be ratified, this
     time by 15 of the 37 States which existed in 1868. The
     House Congressional Record for June 13, 1967, contains all
     the documentation you need to prove that the so-called 14th
     Amendment was never ratified into law (see page 15641 et
     seq.). For example, it itemizes all States which voted
     against the proposed amendment, and the precise dates when
     their Legislatures did so. "I cannot believe that any
     court, in full possession of its faculties, could honestly
     hold that the amendment was properly approved and adopted."
     State vs Phillips, 540 P.2d. 936, 941 (1975). The Utah
     Supreme Court has detailed the shocking and sordid history
     of the 14th Amendment's "adoption" in the case of Dyett vs
     Turner, 439 P.2d 266, 272 (1968).


                        Page P - 8 of 98

                                                       Appendix P


     With this background knowledge firmly in hand, it is easy to
explain why the federal government would reiterate the theme of
"democracy" and "democratic institutions" over and over in its
media propaganda. It is now obvious that such programming has
been entirely successful; witness the large percentage of
"Libertarians" who make repeated reference to their political
goal of "democracy" for America. Perhaps without knowing it,
they are participating in the slow but steady demise of the
nation symbolized by the Stars and Stripes, "the Republic for
which it stands, one Nation, under God, indivisible, with liberty
and justice for all." The Insular Cases made it possible for
America to become divisible into a constitutional republic and a
legislative democracy. It is the strategy of "divide and
conquer", being applied once again with much success, this time
to our very own homeland.

     I hope I have given you a few things to think about.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

enclosures: People vs Boxer pleadings
             "Citizen is a Term of Municipal Law"

copy: Jerry Collette


                        Page P - 9 of 98

                                                The Federal Zone:


                                   c/o P. O. Box 6189
                                   San Rafael
                                   California Republic
                                   Postal Code 94903-0189/TDC

                                   February 7, 1993
John Voss, Director
N.C.B.A.
c/o P.O. Box 2255
Longmont, Colorado
Postal Code 80502/tdc

Dear John:

     Thanks so much for all the materials which you recently
sent, with a copy of your letter to Mitch Beals. Time
permitting, I do intend to do a thorough analysis of the written
opinions. I am very disappointed, but not surprised, that the
appellate decisions were "not for publication". I took all the
decisions to the law library yesterday, but simply ran out of
time. Enclosed are the preliminary results of that one afternoon
at the library. Nevertheless, a distinct pattern is emerging
already.


Item #1: 28 U.S.C. 297. Assignment of judges to courts of the
          freely associated compact states

     This statute was part of the comprehensive "Judicial
Improvements Act" submitted to Congress by Peter F. Rodino, Jr.,
Chairman, Committee on the Judiciary, House of Representatives.
It went into law on November 19, 1988 (P.L. 100-702, copy
attached). Notice that subsection (a) refers to "the freely
associated compact states" and to "the laws of the respective
compact state". In and of themselves, these references are
significant because I was unable to find any discussion of the
legislative history for this specific statute; the material
cited in U.S. Code Cong. and Adm. News skipped any mention of it.
The statute is also too recent for any case law to have
developed, and much too recent for the term "freely associated
compact states" to appear in Words and Phrases, C.J.S., or Am
Jur, although "compact" has several meanings in Black's Law
Dictionary.

     What makes this term even more significant is the reference
to it that is found in subsection (b), to wit:


     The Congress consents the acceptance and retention by any
     judge so authorized of reimbursement from the countries
     referred to in subsection (a) ....

                                                 [emphasis added]


                        Page P - 10 of 98

                                                       Appendix P


I am going on memory now, but I do seem to recall a key exception
to the definition of "state" once found in Title 28. The
exception was to another provision of Title 28 which utilized the
term "State court". I think this exception has since been
removed by subsequent amendment, but the pre-amendment version
clearly implied that the meaning of "state" as found in the
standard definition was different from the meaning of "state" as
intended by the term "State court" (hence the need for the
"exception" clause). Therefore, the standard definition implied
a federal state, not a Union State.

     In section 297 supra, we are faced with a choice between two
conflicting and mutually incompatible interpretations of the term
"freely associated compact states". If these states are Union
States, then the "compact" may well be the U.S. Constitution and
Congress has admitted openly that Union States are the "countries
referred to in subsection (a)". If these states are other
nations in the family of nations (e.g. China, Japan), then the
"countries" referred to in subsection (a) are these other
nations, and I can only speculate about the "compact" to which
Section 297 refers. Could it be the U.N. charter? If not, what
else could it be? some international treaty? I wonder if there
is a way to inquire of the House Judiciary Committee without
tipping our own hands and giving the Committee a reason to
obfuscate the real answer. Or, what about the Library of
Congress, or Congressional Research Service? I wouldn't put too
much faith into the CRS, in light of the hack job they continue
to do on "Frequently Asked Questions about Federal Income Taxes".

     This little tidbit is highly significant when placed in the
larger context of all the research now assembled into the
electronic version of The Federal Zone, third edition (disk
enclosed). In particular, my interpretation of the distinction
between "foreign" and "domestic" is amply supported by the
definitions in Black's Sixth Edition, and especially by the
Supreme Court decision to uphold the New York Court's decision of
In re Merriam's Estate, 36 NE 505 (1894). Black's definitions of
foreign and domestic corporations, in my opinion, leave little
room for doubt about the correct distinction here. Black's
defines "foreign state" very clearly, as follows:


     The several United States*** are considered "foreign" to
     each other except as regards their relations as common
     members of the Union. ... [O]ne state of the Union is
     foreign to another.
                                                 [emphasis added]

Item #2: U.S. Code Service, Lawyers Edition, Interpretive Notes

     In light of the pivotal importance of this distinction
between "foreign" and "domestic", it was revealing to discover
the nearly total absence of case law on this question in the
U.S.C.S. Lawyers Edition (where you would expect a plethora of


                        Page P - 11 of 98

                                                The Federal Zone:


citations). In the main body of U.S.C.S. dealing with the IRC
definitions in 7701, there is only one reference to "foreign
estate" (a revenue ruling) and there are only two references to
"domestic building and loan association" (a revenue ruling and a
district court ruling). What is even more revealing is the case
of U.S. vs Bardina, the one and only citation to the IRC
definition of "United States", to wit:


     Even though 26 USCS 7701(a)(9) defines "United States" as
     including only United States and District of Columbia,
     Puerto Rico is considered as being within United States for
     purposes of 6-year statute of limitations on tax crimes;
     ....
                                                 [emphasis added]


Notice the blatant tautology (again). Notice also that this
interpretation flatly contradicts the actual IRC definition:


     (9) United States. -- The term "United States" when used in
     a geographical sense includes only the States and the
     District of Columbia.
                           [26 U.S.C. 7701(a)(9), emphasis added]


The term "States" is very different from the term "United
States". And, of course, the corresponding definition of "State"
makes absolutely no mention of any Union States:


     (10) State. -- The term "State" shall be construed to
     include the District of Columbia, where such construction is
     necessary to carry out provisions of this title.

                                          [26 U.S.C. 7701(a)(10)]


     Moving on to the Cumulative Supplement for the U.S.C.S.
Lawyers Edition, we find a similar pattern. Here, we find one
revenue ruling concerning a "foreign estate", and four citations
to "resident and nonresident alien", two of which are "TC Memos",
one of which is a "Private Letter Ruling", and one of which is a
"Revenue Ruling". These are not exactly sterling authorities!
One of these citations concerned a former official of a foreign
government that was overthrown while he was in the "United
States" under diplomatic passport. Another concerned a "US
citizen who obtained a US passport before moving to a foreign
country". Another concerned a spouse's election to be treated as
a resident alien under IRC 7701(b). The last citation is worth
investigating:


                        Page P - 12 of 98

                                                       Appendix P


     Status of trust as foreign trust turns upon whether trust is
     comparable to nonresident alien individual; trust
     established and administered under laws of foreign country
     whose trustee is a foreign entity and whose corpus is
     located in a foreign country is nonforeign trust even though
     trust is grantor trust and its income is taxable to grantor
     who is United States citizen. Rev Rul 87-61, 1987-2 CB 219.

                                                 [emphasis added]

     It would be revealing to examine the details about the trust
in question, i.e., what was the "foreign country" under the laws
of which the trust was established and administered. If it was a
Union State, we have a bingo. Who or what was the "foreign
entity" trustee? Where exactly was the "corpus" located? Notice
the term "nonforeign"; I presume this means "domestic", based on
the IRC definition of "foreign" at 7701(a)(5) (i.e., not
domestic). Finally, notice that there is a "grantor" who is a
"United States citizen"; this status appears to be the only
mention of any nexus with the federal zone (if any).


Item #3: United States Code Annotated (U.S.C.A.)

     Again, an identical pattern is found in the annotated
version of the United States Codes. Here, we do find an
interesting exception to the general rule for the federal zone,
i.e., a Guam corporation is "foreign" for federal income tax
purposes:

     Guam is not a "territory" within meaning of this section
     defining domestic corporation as one created or organized in
     United States or under laws of United States or of any state
     or territory, and Guam is considered a possession so that
     its corporations are foreign for federal income tax
     purposes. Sayre & Co. vs Riddell, C.A. Guam, 1968, 395 F.2d
     407.


     Notice how carefully they skirt the general issue of
exclusive legislative jurisdiction by ruling that Guam is a
"possession", and "possessions" were not mentioned in the IRC's
definition of "domestic" at that time ("or Territory" was deleted
in 1977). In other words, in 1968 the definition of "domestic"
mentioned "United States", and "any State or Territory". Since
Guam was found to be a "possession" and not the "United States",
not a "State" and not a "Territory", it was not domestic and
therefore foreign. This is a fascinating little intricacy in
this semantic jungle.

     The only other citation of any interest is the 1944 case
which interpreted the meaning of "includes". I consider this
decision to be erroneous, for reasons which I explain in detail
in Chapter 12 of The Federal Zone, third edition. Specifically,


                        Page P - 13 of 98

                                                The Federal Zone:


in formal English, a noun is either a person, a place, or a
thing. The IRC specifically defines a trust to be a "person" as
opposed to a "place" or a "thing" (see IRC 7701(a)(1)). The
clarification of "includes" at IRC 7701(c) specifically states
that this term shall not be deemed to exclude other things
otherwise within the meaning of term defined; notice that
"persons" and "places" are conspicuously absent from this
clarification of "includes". Therefore, a "trust" cannot be a
thing otherwise within the definition of "transferee" because a
trust is a person, by definition, and a "transferee" is not a
person because it is not mentioned in the IRC definition of
"person". I know this may sound strained, but the IRC definition
of "person" clearly embraces only an individual, a trust, estate,
partnership, association, company or corporation; moreover,
there is ample evidence that the IRC does obey strictly the rules
of formal English grammar.


     That's it! Now, don't you get the feeling, as I do, that
they are trying their best to avoid these crucial distinctions
between "foreign" and "domestic"? In light of the clarity which
is found in Black's definitions of foreign and domestic
corporations, I would be hard pressed to demonstrate a clear and
consistent pattern among these sparse authorities, many of which
are not even courts. John, I am forced to conclude that some (if
not all) of these cases were contrived, and that a thorough set
of consistent Court authorities is very conspicuous for its
absence.


Item #4: McKinley vs United States of America, S.D. Ohio, 1992

     Time permitting, I will try my best to analyze the
unpublished cases which you generously provided to me. For now,
I will take a brief look at McKinley because it will be
published, and because there is so little in this decision which
is relevant to The Federal Zone, i.e.:


     The Court takes judicial notice that while Ohio is a
     sovereign state, it is nevertheless part of the United
     States and Ohio residents are also residents of the United
     States and are subject to taxation. The Court finds the
     plaintiffs to be residents of the United States and not non-
     resident aliens.
                                                 [emphasis added]

     I guess this Court failed to read Hooven or the
corresponding definitions of "United States" in Black's. More
importantly, this decision flatly contradicts the definition of
"United States" at IRC 7701(a)(9). Sure, Ohio is part of the
"United States" if "United States" means the several States of
the Union. However, the IRC says that "United States" (when used
in a geographical sense) includes only the District of Columbia


                        Page P - 14 of 98

                                                       Appendix P


and the States, and "State" shall be construed to include the
District of Columbia (and nothing else)! Since singular and
plural are interchangeable (per Title 1), since "include" is not
found in the clarification of "includes" and "including" at
7701(c), and since 7701(c) mentions only "things" and not
"persons" or "places", we are entirely justified in arguing that
the term "United States" at 7701(a)(9) omits any mention of the
Union States because they were intended to be omitted. The rules
of statutory construction support this inference, as do the
changes to 7701(a)(9) & (10) that resulted from the Alaska and
Hawaii Omnibus Acts: Alaska and Hawaii were removed from the IRC
definition of "State" when they joined the Union (of freely
associated compact states). So, as pro bono judge of the
Sovereign Electrical Circuit of Justice, I hereby reverse the
holding in McKinley vs United States of America and remand with
instructions to take explicit judicial notice of the legislative
history of IRC 7701(a)(9), in addition to the well established
rules of statutory construction (see Sutherland, for example).


Item #5: Notes on Decisions re: 1:6:2 and Null and Void Lloyd

     These cases are either favorable or neutral. Lloyd, you are
a sitting duck. Notice also the careful IRC distinction between
"Secretary of the Treasury" and "Secretary" at 7701(a)(11). At
first glance, this is bad news for our 7401 challenge, but closer
examination reveals the following:


     (A) In General. -- The term "or his delegate" --

     (i) when used with reference to the Secretary of the
          Treasury, means any officer, employee, or agency of the
          Treasury Department duly authorized by the Secretary of
          the Treasury directly, or indirectly by one or more
          redelegations of authority, to perform the function
          mentioned or described in the context;


     Even though IRC 7401 utilizes the term "Secretary", which
means the Secretary of the Treasury or his delegate, the term "or
his delegate" means an officer, employee or agency duly
authorized by the Secretary of the Treasury either directly, or
indirectly by one or more redelegations of authority. In other
words, Lloyd Bentsen must be in the loop, either directly, or
indirectly by one or more redelegations of authority. So, it
looks as if Null and Void Lloyd remains in a heap'a trouble; his
colorable acts will spread through the Treasury Department like a
computer virus, infecting everything they touch. We should get
an expert on delegation of authority to see what, if any,
redelegations originated from Nicholas Brady and whether they
remain valid and in force after Bentsen's reign began.


                        Page P - 15 of 98

                                                The Federal Zone:


     Enough for now. I know you have nothing else to do but read
these technicalities. The devil is always in the details.

Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

enclosures

copy: Mitchell Beals
       (great first name)


                        Page P - 16 of 98

                                                       Appendix P


                                   c/o P. O. Box 6189
                                   San Rafael
                                   California Republic
                                   Postal Code  94903-0189/TDC

                                   February 8, 1993
John Voss, Director
N.C.B.A.
c/o P.O. Box 2255
Longmont, Colorado
Postal Code 80502/tdc

Dear John:

     In my letter to you of February 7, my memory failed me when
I referred to Title 28; the correct reference was Title 8 (I got
one number right). I tracked it down today for you, because I am
convinced that one of the "unpublished" cases which you recently
sent to me is completely wrong for ruling that Union States are
not "foreign countries" for purposes of the IRC. Enclosed is
stunning proof of my position from American Jurisprudence. I
picked up the trail in Ballentine's Law Dictionary, Third
Edition, where it defines "sovereign state" as follows:

     In the United States, each state constitutes a discrete and
     independent sovereignty, and consequently the laws of one
     state do not operate of their own force in any other state.
     16 AmJur J2d, "Conflict of Laws", Section 4.

                     [Ballentine's Law Dictionary, Third Edition]

     I had to go hunting for the corresponding section in Am Jur,
because the reference to Section 4 is a typographical error. I
found what I was looking for at Section 2 instead. The key is to
understand that the IRC is a "municipal law" as far as income
taxation is concerned (see Conclusions in The Federal Zone):

     "... [T]he several states ... are otherwise, at least so far
     as private international law is concerned, in the same
     relation as foreign countries13. The great majority of
     questions of private international law are therefore subject
     to the same rules when they arise between two states of the
     Union as when they arise between two foreign countries, and

                                                  [continued ...]


____________________

Footnotes:

13. Hanley vs Donoghue, 116 U.S. 1, 29 L.Ed 535, 6 S.Ct 242
     Stewart vs Thomson, 97 Ky 575
     Emery vs Berry, 28 NH 473


                        Page P - 17 of 98

                                                The Federal Zone:


     in the ensuing pages the words "state," "nation," and
     "country" are used synonymously and interchangeably, there
     being no intention to distinguish between the several states
     of the Union and foreign countries by the use of varying
     terminology.

                    [16 Am Jur 2d, "Conflict of Laws", Section 2]

Notice, in particular, the comment in footnote 11:

     In the sense of public international law, the several states
     of the Union are neither foreign to the United States nor
     are they foreign to each other, but such is not the case in
     the field of private international law. Robinson vs Norato,
     71 RI 256, 43 A2d 467, 162 ALR 362.

Not to be outdone, Black's Sixth Edition chimed in with the
following similar message:

     The term "foreign state," as used in a statement of the rule
     that the laws of foreign nations should be proved in a
     certain manner, should be construed to mean all nations and
     states other than that in which the action is brought; and
     hence one state of the Union is foreign to another, in the
     sense of that rule.

                          [Black's Law Dictionary, Sixth Edition]

     Further stunning proof of The Federal Zone thesis is found
in the Immigration and Nationality Act (see attached), where
Congress slipped by including a key exception in its statutory
definition of "State" at 8 USC 1101(a)(36). Prior to an
amendment in 1987, this definition included the language "(except
as used in section 310(a) of title III [8 USCS Section
1421(a)])". At that time, Section 1421(a) of Title 8 referred to
courts "in any State" and "all courts of record in any State". I
failed to pull the current text of 1421(a), but the current
1101(a)(36) removed the exception clause! I would bet that
1421(a) now has a special definition for the term "State",
because 1421(a) must be talking about courts of the Union States.
For corroboration, I have enclosed a page from the California
State Constitution (1879), wherein California Superior Courts are
given clear original jurisdiction to naturalize and "to issue
papers therefor".

Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship
enclosures: photocopies of evidence


                        Page P - 18 of 98

                                                       Appendix P


                                   c/o P. O. Box 6189
                                   San Rafael
                                   California Republic
                                   Postal Code 94903-0189/TDC

                                   February 1, 1993
Rich Pralle, CFS
R D P & Associates
100 Brush Creek Road, #105
Santa Rosa, California Republic
Postal Code 95404/tdc

Dear Rich:

     I may have misunderstood something which you said about the
Internal Revenue Code. Am I correct in remembering you say that
IRC 6672 concerned "withholding agents"?  When I returned home, I
looked up this section:

     Section 6672. Failure to Collect and Pay Over Tax,
                    or Attempt to Evade or Defeat Tax

     (a) General Rule. -- Any person required to collect,
     truthfully account for, and pay over any tax imposed by this
     title who willfully fails to collect such tax, or truthfully
     account for and pay over such tax, or willfully attempts in
     any manner to evade or defeat any such tax or the payment
     thereof, shall, in addition to other penalties provided by
     law, be liable to a penalty equal to the total amount of the
     tax evaded, or not collected, or not accounted for and paid
     over. No penalty shall be imposed under section 6653 or
     part II of subchapter A of chapter 68 for any offense to
     which this section is applicable.

                                 [26 U.S.C. 6672, emphasis added]

As you can see, there is no explicit mention of "withholding
agents" in IRC 6672. The section to which I was referring in our
conversation was IRC 7701(a)(16):

     (16) Withholding Agent. -- The term "withholding agent"
     means any person required to deduct and withhold any tax
     under the provisions of section 1441, 1442, 1443, or 1461.

                          [26 U.S.C. 7701(a)(16), emphasis added]

     Sections 1441, 1442 and 1443 are too long to reproduce here.
Their headings provide some indication of their contents:

     Section 1441. Withholding of Tax on Nonresident Aliens

     Section 1442. Withholding of Tax on Foreign Corporations

     Section 1443. Foreign Tax-Exempt Organizations


                        Page P - 19 of 98

                                                The Federal Zone:


     The following is the entire text of IRC 1461. This section
is important because it specifically makes "withholding agents"
liable for the taxes they deduct and withhold:

     Section 1461. Liability for Withheld Tax

     Every person required to deduct and withhold any tax under
     this chapter is hereby made liable for such tax and is
     hereby indemnified against the claims and demands of any
     person for the amount of any payments made in accordance
     with the provisions of this chapter.

                                 [26 U.S.C. 1461, emphasis added]

     In other words, the persons from whom they withhold are not
liable for the taxes which they withhold. That is to say,
nonresident aliens are not liable for the taxes that are withheld
from the dividends they receive from stock issued by domestic
corporations (see Treasury Decision 2313).

     So, we can link 1461 and 6672 because withholding agents are
liable for the taxes they deduct and withhold, i.e., they are
required to collect and pay over the tax imposed by 1461
(combining the language of 6672 and 1461); if they don't pay the
taxes they deduct and withhold, then they would be liable to the
penalty defined in 6672.

     Our research  indicates that "withholding agents" are the
only ones who are specifically made liable by the IRC for the
payment of income taxes. If you can find another IRC section
which specifically makes anyone else liable for the payment of
income taxes, I would appreciate getting the exact citation from
you.

     On another subject, I have several serious problems with the
T.A.G. flyer entitled "Are You Really Liable?" One excerpt from
this flyer reads:

     Section 7701(a)(1) defines the term person as:

          "The term 'person' shall be construed to mean and
          include an individual, a trust, estate, partnership,
          association, company or corporation."

     Well now, that certainly seems easy enough and section
     7701(a)(1) makes no mention of the term "U.S. Individual".
     Now, look at section 7701(a)(30):

          "The term 'United States person' means -
          (A) a citizen or resident of the United States,
          (B) a domestic partnership,
          (C) a domestic corporation, and
          (D) any estate or trust ...."
                                                  [continued ...]


                        Page P - 20 of 98

                                                       Appendix P


     There is no mention of the term "U.S. Citizen";
     "Individual", or "U.S. Individual".

     ...

     Assuming the term "U.S." means United States, then the 1040
     would be for a "United States Individual", the 1120 for a
     "United States Corporation".


     In my opinion, this sequence of logic is misleading. The
flyer assumes that the term "U.S. means United States". Fair
enough. If it doesn't mean "United States", the flyer does not
tell us what else it might mean. So, for purposes of this
analysis, the term "U.S." means "United States".

     However, the flyer also states that there is no mention of
the term "U.S. Citizen". This is technically correct, because
the IRC never utilizes a capital "C" when it refers to "citizens
of the United States" or "United States citizens" (except when a
capital "C" is required in the first word of a sentence or
heading). This is misleading, because the same flyer quotes
section 7701(a)(30) which does mention "citizen or resident of
the United States", i.e., "citizen of the United States" or
"resident of the United States".

     The flyer also states that there is no mention of the term
"Individual" or "U.S. Individual". Again, this is technically
correct, because the IRC utilizes the lower-case "i" when it
refers to individuals. But, for similar reasons, the flyer is
misleading because "citizens of the United States" and "residents
of the United States" are among the "individuals" to whom the IRC
refers. This is so because "person" means and includes an
"individual"; it also means and includes a trust, estate,
partnership, association, company or corporation. Therefore, an
"individual" is a person in the same way that a horse is an
animal; moreover, using permissible substitution, the term
"United States person" means and includes a "U.S. individual".
The "U.S. individuals" to whom the IRC refers are the "citizens
of the United States" and "residents of the United States". This
can be confirmed at 26 CFR 1.1-1 et seq.

     For similar reasons, I also consider the following excerpt
of the flyer to be misleading and erroneous:


     At section 6011, when required by regulations prescribed by
     the Secretary any person made liable for any tax imposed by
     this title ... shall make a return. Did the Secretary
     prescribe by regulations that a citizen of the United States
     was liable for filing? No, of course not.

                                                 [emphasis added]


                        Page P - 21 of 98

                                                The Federal Zone:


Here's the corresponding section of the CFR:


     1.6011-1 General requirement of return, statement, or list.

     (a) General rule. Every person subject to any tax, or
     required to collect any tax, under Subtitle A of the Code,
     shall make such returns or statements as are required by the
     regulations in this chapter. The return or statement shall
     include therein the information required by the applicable
     regulations or forms.


Another important regulation is the following:


     1.6012-1 Individuals required to make returns of income.

     (a) Individual citizen or resident --

          (1) In general. Except as provided in subparagraph
          (2) of this paragraph, an income tax return must be
          filed by every individual ... for each taxable year
          beginning after December 31, 1972, during which he
          received $750 or more of gross income, if such
          individual is:

          (i) A citizen of the United States, whether  residing
               at home or abroad,
          (ii) A resident of the United States even though not a
               citizen thereof ....


     So, I think the T.A.G. flyer is entirely wrong when it
states that "of course" the Secretary has "not" prescribed by
regulations that a citizen of the United States was liable for
filing. I have just proven that the Secretary has prescribed
regulations which require a "citizen of the United States" to
make an income tax return, provided that his "gross income"
exceeds the specified dollar threshold. The computation of gross
income for nonresident aliens is defined at IRC 872(a); in most
situations, that computation results in a gross income of zero.
Frank Brushaber's "gross income" was not zero because he received
a dividend from a "U.S. corporation", namely, the Union Pacific
Railroad Company. It was a U.S. corporation because it was
incorporated by Congress.


     Finally, I realize that the California voter registration
form does say "For U.S. Citizens Only" in red letters across the
top of the form. However, the affidavit on that registration
form is the statement that matters:


                        Page P - 22 of 98

                                                       Appendix P


          READ THIS STATEMENT AND WARNING PRIOR TO SIGNING

     I am a citizen of the United States and will be at least 18
     years of age at the time of the next election. I am not
     imprisoned or on parole for the conviction of a felony. I
     certify under penalty of perjury under the laws of the State
     of California that the information on this affidavit is true
     and correct.

                             WARNING

     Perjury is punishable by imprisonment in state prison for
     two, three or four years. Section 126 Penal Code

                                           [emphasis in original]


     I contend that the "citizen of the United States" to which
this form refers is the same "citizen of the United States" to
which the Internal Revenue Code refers, to which the Code of
Federal Regulations refers, and to which the so-called Fourteenth
Amendment refers. If you are interested, we have now located two
Utah Supreme Court cases which struck down the so-called
Fourteenth Amendment. The language of Section 1 of that
amendment is almost identical to the definition of "citizen" that
is found in 26 CFR 1.1-1(c). Given that the so-called Fourteenth
Amendment was never properly approved and adopted, the earliest
definition of "citizen of the United States" that we have been
able to find in law is found in the 1866 Civil Rights Act.

     Thanks for your consideration.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


copy: Rleen Joy
       Don Fletcher


                        Page P - 23 of 98

                                                The Federal Zone:


                                   c/o P. O. Box 6189
                                   San Rafael, California
                                   Postal Zone 94903-0189/TDC

                                   December 22, 1992
Andrew Melechinsky
Constitutional Revival
P. O. Box 3182
Enfield, Connecticut
Postal Zone 06083/tdc

Dear Andy:

     Thanks very much for your unsigned note, postmarked December
16, 1992. In response to my previous question concerning 1:8:17
in the U.S. Constitution, you wrote the following:


     Answer. It is self evident that no state or any other
     governing body is authorized to make laws for the District
     of Columbia or other enclaves which belong to the United
     States. It should be obvious that this provision of the
     Constitution was designed to make Congress the equivalent to
     the Enfield Town Council or the Podunk Board of Selectmen
     for the purpose of governing those areas.
                                                    [my emphasis]


     I couldn't agree more with your answer. In fact, it is
uncanny how close our thinking is on this question. In my
research and writings, I often refer to Congress as "City Hall"
for the federal zone. In other words, if Congress wants to pass
a "dog leash" law for D.C., it is authorized to do so by 1:8:17
in the Constitution. This dog leash law would apply only inside
D.C., and nowhere else, right?

     Now, let's use a similar example, only this time let's
incorporate a tax in our example. Let's say that Congress wants
to tax the sale of dog leashes inside D.C. This is an excise
tax, right? Congress is empowered to levy excise taxes, right?
But, here's the rub: must the tax rate be uniform throughout the
50 States?

     Wait a minute, you ask, the question of uniformity only
applies to federal excises levied inside the 50 States. This tax
on the sale of dog leashes only applies inside the District of
Columbia. The 50 States are irrelevant to the application of
this tax and, therefore, the issue of uniformity is also
irrelevant, is it not? Such an excise tax need not be uniform
throughout the 50 States, because it has no application anywhere
inside the 50 States. It is a "municipal" tax. No State or any
other governing body is authorized to levy such a tax inside
D.C., just as Congress is not authorized to levy such a tax
outside D.C. and inside the 50 States.


                        Page P - 24 of 98

                                                       Appendix P


     The key court decision on this question is Downes vs
Bidwell, which is one of The Insular Cases, as they are called.
You might also read the several articles which appeared in the
Harvard Law Review on these cases. I have enclosed a memo which
I wrote some time ago on exclusive authority as applied to direct
taxes.

     You also wrote that "it takes a wild imagination to
visualize the District of Columbia as a second 'United States'.
Even if it was, it would still be subject to the constraints of
the Bill of Rights." Let's postpone correspondence on the Bill
of Rights until you and I can clarify our respective positions on
federal taxing authority, OK? In this context, the key question
is this: are federal municipal taxes subject to the uniformity
and apportionment rules found in the Constitution? My answer is
this: no, because those restrictions only apply to federal laws
which are levied inside the 50 States. One of the Supreme
Court's best statements on this dual or heterogeneous attribute
of federal laws is the following excerpt from the Hooven case:


     ... [T]he United States** may acquire territory by conquest
     or by treaty, and may govern it through the exercise of the
     power of Congress conferred by Section 3 of Article IV of
     the Constitution ....

     In exercising this power, Congress is not subject to the
     same constitutional limitations, as when it is legislating
     for the United States***. ... And in general the guaranties
     [sic] of the Constitution, save as they are limitations upon
     the exercise of executive and legislative power when exerted
     for or over our insular possessions, extend to them only as
     Congress, in the exercise of its legislative power over
     territory belonging to the United States**, has made those
     guaranties [sic] applicable.

             [Hooven & Allison Co. vs Evatt, 324 U.S. 652 (1945)]
                                                 [emphasis added]


     Now, let's imagine, just for the sake of argument, that the
income tax provisions in the Internal Revenue Code are municipal
statutes, which are "not subject to the same constitutional
limitations" which apply when Congress "is legislating for the
[50] United States" of America. You will notice that the IRC's
petroleum taxes are uniform throughout the 50 States, and in
those provisions the term "State" is defined to include the 50
States. However, when it comes to the graduated income tax, the
term "State" is defined to include only the District of Columbia
(and none of the 50 States). Isn't this odd? Not really, when
you realize that the graduated income tax is, indeed, a municipal
statute which is unaffected by the uniformity and apportionment
restrictions in the Constitution, for the reasons discussed
above.


                        Page P - 25 of 98

                                                The Federal Zone:


     Last but not least, we have in America a government of the
"United States" and a government of each of the several States;
each has citizens of its own. Therefore, we have State Citizens,
and we have federal citizens (also known as "citizens of the
United States"). See the Cruikshank case for the seminal
authority on this dual citizenship. Now, the exercise of State
Citizenship is an unalienable right, endowed by the Creator (see
the Declaration of Independence). But, and this is important,
even crucial to the issue of taxation, federal citizenship is a
statutory privilege, the exercise of which can be taxed with an
excise tax without uniformity throughout the 50 States. The term
"citizen of the United States" was first expressed in law by the
Civil Rights Act of 1866. Some people say that it was put into
the Constitution by the so-called 14th Amendment, but we have now
located two (2) Utah Supreme Court cases which held that the
Amendment was not properly ratified. Therefore, the status of
"United States citizen" is at best the creation of Congressional
legislation -- endowed by Congress and NOT by the Creator.

     So, think of federal citizens as citizens of the federal
zone. The taxation of their incomes is a municipal excise tax,
just like the tax on dog leashes discussed above. The "income"
is not the subject of the tax; the subject of the tax is the
exercise of the statutory privilege known as federal citizenship
(also known as "U.S. citizenship"). The "income" is simply the
measure of the tax.

     I hope I have made some sense out of the jungle of legal
jargon and double-talk which gets in the way of clear thinking on
this subject. Admittedly, the whole situation is made immensely
complicated by the deliberate vagueness and confusion which were
incorporated into Title 26 and its regulations in the CFR. But,
I am confident we have now proven that the graduated income tax
provisions of Title 26 are municipal statutes which apply only to
the federal zone (e.g. federal employees) and to the citizens of
that zone, no matter where they might "reside". In fact, to be a
"resident" of California, strictly speaking, means that one is a
federal citizen who resides outside the federal zone and inside
California. Technically speaking, a State Citizen does not
"reside" in the State of his domicile.

     I would appreciate getting your written comments on all the
above. In the meantime, thanks for your continuing work to
benefit the Freedom Movement in America today.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


                        Page P - 26 of 98

                                                       Appendix P


                                   c/o P. O. Box 6189
                                   San Rafael, California
                                   Postal Zone 94903-0189/TDC
                                   November 4, 1992
Karl Loren, Author
1831 North Bel Aire Drive
Burbank, California Republic
Postal Zone 91504/tdc

Dear Karl:

     Thank you for the complimentary copy of Verity, Volume 2,
Number 10, dated November 1, 1992. Although I do not care to get
embroiled in the trust controversy described in this issue of
Verity, your newsletter does contain the following paragraphs
which, in my humble opinion, contain serious errors. Numbers in
[brackets] are my paragraph numbers, for ease of reference:


[1] We in the United States tax U.S. Citizens on their
     income whether they live in the U.S. or in a foreign
     country. We tax those U.S. Citizens, regardless of
     residence, on their income whether they received it from
     within the United States or from outside the United States.

[2] We even go so far as to tax aliens who reside within
     the United States -- on their income from either within the
     U.S. or outside the U.S.

[3] A U.S. Supreme Court case [Cook v. Tait, 265 U.S. 47
     (1924)] requires the U.S. Citizen abroad to pay taxes in the
     U.S.

[4] The Supreme court ruled in this case that the United
     States has the power to tax its citizens on their worldwide
     income solely by reason of their citizenship.

[5] "No other major country in the world taxes its
     nonresident citizens on their foreign-source incomes at all"
     according to Marshall J. Langer, Professor of Law, Miami
     University, author of Practical International Tax Planning.
     There is even a tax law that makes it illegal to change your
     U.S. citizenship for the purpose of avoiding taxes! [citing
     IRC Section 877(a)]

[6] We even go so far as to tax nonresident aliens who
     reside outside the U.S., but who receive income FROM within
     the United States. [citing IRC Sections 871(a) and 871(b)]

[7] But, the IRS certainly does not try to collect income
     taxes from a nonresident alien who receives his ONLY income
     from sources without the United States.


                        Page P - 27 of 98

                                                The Federal Zone:


[8] It would be ludicrous to even pause to consider the
     possibility of the United States claiming tax jurisdiction
     over a nonresident alien earning income from a non-US
     Source!


     I am somewhat chagrinned to be writing this letter in the
first place, because you purchased The Federal Zone some months
ago, and your written communications to me seemed to imply that
you understood, and agreed with, the book. The above quoted
paragraphs from Verity, dated November 1, 1992, now leave me
wondering just how much of The Federal Zone you actually read and
understood. Let me proceed with an analysis of your statements,
paragraph-by-paragraph:


[1] The Internal Revenue Code (26 USC) and the regulations
     which promulgate that Code (26 CFR) do not impose federal
     income taxes on "U.S. Citizens". The regulations at 26 CFR
     1.1-1(b) and (c) state that income tax liability is imposed
     on the worldwide income of "citizens of the United States"
     and "residents of the United States". In English, there is
     a world of difference between a proper noun and a common
     noun. Proper nouns are capitalized; common nouns are not.
     If you think this distinction is irrelevant or merely
     academic, then it is now incumbent upon you to carry the
     burden of finding and demonstrating one single reference to
     "U.S. Citizens" in the IRC and its regulations. References
     to "Citizen" or "Citizens" in the first word of a sentence,
     or in paragraph headings, do not count, because formal
     English requires that terms in such grammatical positions be
     capitalized.

          Moreover, the Hooven case quoted and discussed in The
     Federal Zone proves that the term "United States" has at
     least three different meanings in law. This fact is
     supported by the same meanings which are found in Black's
     Law Dictionary, Sixth Edition. The late John Knox once
     confided to me that the Solicitor General in De Lima vs
     Bidwell actually argued that the term "United States" has at
     least five (5) different meanings in the Constitution. I am
     also told that James Madison anticipated the ambiguity found
     in the term "United States", and documented this ambiguity
     in his notes on the Constitutional Convention. These notes
     were reportedly published in 1840, but to date I have been
     unsuccessful in locating a copy of these notes. Your
     paragraph [1] is ambiguous for failing to define precisely
     which of these several meanings you are utilizing. This is
     crucial because you make the all-important distinction
     between income derived from sources within the "United
     States" and income derived from sources without the "United
     States". A precise definition of "United States" is
     therefore pivotal to any and all discussions of federal tax
     law.


                        Page P - 28 of 98

                                                       Appendix P


          Moreover, the 50 States are considered to be "foreign
     countries" with respect to the "United States", for purposes
     of federal taxation, because the regulations clearly define
     the "United States" to be the territory over which the
     federal government has exclusive rights. This is the very
     same term that is found in 1:8:17 in the Constitution and
     for this reason "exclusive" is also a pivotal term. The 50
     States of the Union retain all rights not reserved by the
     people and not explicitly enumerated for the federal
     government by the Constitution (see the 9th and 10th
     Amendments for proof).


[2] Again, this paragraph fails to provide a precise
     definition of "United States". Moreover, it makes reference
     to "aliens" who "reside within the United States". If you
     study IRC 7701(b)(1)(B) very carefully, you will discover
     that an "alien" is an individual who is not a "citizen of
     the United States" and a "nonresident" is an individual who
     is not a "resident of the United States (within the meaning
     of subparagraph (A)". IRC 7701(b)(1)(A) is important
     because it defines the three tests which distinguish
     "resident aliens" from "nonresident aliens". These three
     tests are the only ways in which an "alien" can be a
     "resident alien". Therefore, these three tests define
     "residence" for purposes of federal income taxation. See
     also IRS Publication 519: "For tax purposes, an alien is an
     individual who is not a U.S. citizen." Therefore, a State
     Citizen who is not also a federal citizen is an alien for
     federal tax purposes. Your paragraph [2] is vague and
     therefore void.

[3] Again, you make reference to a "U.S. Citizen". See
     discussion of paragraph [1] above.

[4] Now you make reference to the "United States", "its
     citizens" and "their citizenship". Oddly, this paragraph is
     grammatically and legally correct, because the Congress does
     have exclusive legislative jurisdiction over its own federal
     citizens, no matter where on planet Earth they may "reside".
     The enclosed materials go into great depth to explain the
     distinction between federal citizens and State Citizens, so
     I won't belabor this distinction here. It is important to
     realize that the distinction between these two classes of
     citizenship is as important and fundamental as the
     distinction between the State and federal governments. See
     the Cruikshank case, K. Tashiro vs Jordan, and Ex parte
     Knowles for proof. The Slaughter House Cases are the
     seminal decisions in this area. If you fail to educate
     yourself about this important legal history, you will
     continue to propagate the kind of confusion which is evident
     in Verity for November 1, 1992.


                        Page P - 29 of 98

                                                The Federal Zone:


[5] Here again you are back on track, but it is not clear
     whether you are back on track knowingly and intentionally,
     or not. Congress has authority to tax its own federal
     citizens, wherever they reside and wherever the source of
     their income. Therefore, "resident citizens" and
     "nonresident citizens" are treated the same in federal tax
     law because the worldwide income of both groups is taxed.
     Your paragraph [5] does make a grievous error, however, by
     stating that the tax law makes it illegal to change your
     "U.S. citizenship" for the purpose of avoiding taxes. Your
     paragraph [5] then cites IRC 877(a). This is not what
     Section 877(a) says, nor is expatriation made illegal by any
     subparagraphs of Section 877. Read them! IRC 877 merely
     discusses the rules which shall govern federal tax liability
     when expatriation occurs. It does not outlaw expatriation!

[6] This paragraph is also correct on its face, but it too
     suffers for lacking a precise definition of "United States"
     and "U.S." Sections 871(a) and 871(b) are governed by the
     statutory definition of "United States" that is found at IRC
     7701(a)(9). This definition, in turn, is governed by the
     statutory definition of "State" that is found at IRC
     7701(a)(10). IT IS VERY IMPORTANT TO TAKE CAREFUL NOTE OF
     THE EXACT WORDING OF 7701(a)(10):

          The term "State" shall be construed to include the
          District of Columbia, where such construction is
          necessary to carry out the provisions of this title.

                                                 [emphasis added]

          Now, it is true that the terms "includes" and
     "including" are qualified by IRC 7701(c), but notice that
     "include" is not qualified by IRC 7701(c). This may seem
     like nit-picking, but the published rules of statutory
     construction do apply here. Specifically, the rule of
     inclusio unius est exclusio alterius (the inclusion of one
     is the exclusion of others) states that an irrefutable
     inference must be drawn that what is omitted or excluded
     from a statutory definition was intended to be omitted or
     excluded. The term "include" is excluded from 7701(c). The
     term "California" is excluded from 7701(a)(10). Therefore,
     all by itself, this rule of statutory construction allows us
     to infer that "include" is not expansive and "California" is
     excluded from the statutory definition of "State" found at
     7701(a)(10).

          There are other rules of statutory construction which
     produce the same result, e.g., ejusdem generis (the federal
     zone and the 50 States are not in the same general class of
     entities because the 50 States are members of the Union,
     while the areas within the federal zone are not). Now the
     burden is upon you to prove otherwise. Don't forget that
     any doubt must be resolved in favor of those upon whom the


                        Page P - 30 of 98

                                                       Appendix P


     tax is sought to be laid; the Supreme Court has said so,
     more than once!

[7] The IRS most certainly does try to collect income taxes
     from nonresident aliens who receive their ONLY income from
     sources without the "United States". For purposes of income
     taxation, the "United States" as defined in the IRC is no
     larger than the territory over which Congress exercises
     exclusive legislative authority, i.e., the federal zone. If
     you study Treasury Decision 2313 carefully, you will come to
     discover that Frank Brushaber was classified by the Treasury
     Department as a nonresident alien. His court documents
     prove that he claimed to be a State Citizen who lived and
     worked in New York City. Therefore, State Citizens who are
     notalso federal citizens are "nonresident aliens" as far as
     federal income taxes are concerned. How many millions of
     Americans have been victimized by the deliberate and
     criminal confusion which has been fostered by vague and
     ambiguous terms in the IRC? I say at least 100 million,
     counting all those who have paid income taxes and passed
     away since 1913.

[8] It certainly is ludicrous for the "United States" to
     claim tax jurisdiction over nonresident aliens who earn
     income from "non-US" sources, but IT makes this claim all
     the time. By IT I mean the authority granted to Congress by
     1:8:17 and 4:3:2 in the U.S. Constitution, which authority
     MUST be lawfully delegated to the Internal Revenue Service
     (a private mercantile organization which collects interest
     payments for the Federal Reserve banks).

          The evidence is overwhelming that Congress simply does
     not have exclusive legislative authority over the 50 States.
     The study entitled "Jurisdiction Over Federal Areas Within
     the States" makes this case over and over and over. At last
     count, this study cites more than 700 federal and state
     court cases which all found the same thing: Congress does
     not enjoy exclusive legislative jurisdiction inside the
     boundaries of the 50 States until and unless a State
     Legislature cedes its sovereign jurisdiction to Congress,
     and does so for a specific parcel of land (called an
     "enclave").

          At this point in the game, Karl, you can no longer
     claim ignorance of this massive body of case law. Congress
     cannot impose a direct tax on State Citizens unless that tax
     is duly apportioned. The earnings of State Citizens are
     exempt from taxation by the fundamental law. The
     apportionment rule is found in the fundamental law, but
     there are no apportionment provisions anywhere in the
     Internal Revenue Code. The burden is now upon you to prove
     otherwise!


                        Page P - 31 of 98

                                                The Federal Zone:


     A man with your intelligence should not hesitate to admit
that the ambiguities in Title 26 had to be intentional. We know
that the Treasury Department can be clear when it needs to be
clear. The most important ambiguity is found in the several
meanings of "State" and "United States" in the statute and its
regulations. There is an obvious reason why the definitions are
not crystal clear and completely unambiguous, and that reason is
MONEY. A crystal clear and completely unambiguous definition of
federal income tax jurisdiction would limit the definition of
"United States" to the federal zone and no more. There is a
massive amount of case law which proves that Congress does not
exercise exclusive legislative jurisdiction upon any of the
Citizens or the territory of the 50 States.

     In support of all my observations above, I have enclosed for
your information the drafts of several chapters from the third
edition of The Federal Zone, which has not yet been published. I
strongly encourage you to devour this material, and also the
court cases and other publications cited therein. If you persist
in claiming that there is nothing to be made of difference
between "Citizens" and "citizens", particularly in the face of
all the evidence which I am now sharing with you, then I will be
forced to conclude that you and I going in opposite directions.
At the very least, I will be forced to conclude that your
understanding of federal tax law does not warrant the high costs
you are charging for your trust advisory services.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

enclosures


                        Page P - 32 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                    San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   October 1, 1992
Hi John,

     I've continued to think about De Ganay vs Lederer, 250 U.S.
376. Here's a decision table to help us organize our thoughts.
It is not necessarily rigorous or exhaustive, but provides a
useful framework. For what it's worth, this table distinguishes
stockholder dividends from corporate profits, as follows:


Case 1:
Both stockholder and corporation are overseas.

Plaintiff Defendant 16th Result

overseas overseas yes Congress cannot tax at all because
NRA corp. both are beyond its jurisdiction.

overseas overseas no Congress cannot tax at all because
NRA corp. both are beyond its jurisdiction.

The decisive factor here is territorial jurisdiction. The 16th
Amendment is irrelevant.


Case 2:
Corporation is chartered by a Union State (a/k/a "State corp.").
The tax on stockholder dividends is a "direct" tax, per Pollock.

Plaintiff Defendant 16th Result

overseas State yes Congress can tax without apportionment
NRA corp. because stockholder is not protected by
                         the Constitution.

overseas State no Congress can tax without apportionment,
NRA corp. because stockholder is not protected by
                         the Constitution.

State State yes Congress can tax without apportionment
Citizen corp. if both are inside a Union State.

State State no Congress cannot tax without apportion,
Citizen corp. Congress can tax with apportion,
                         if both are inside a Union State.

The decisive factor here is the protection afforded by the
applicable Constitution(s), if any. Note that a ratified 16th
Amendment makes a difference for State Citizens, but not for
overseas NRA's.


                        Page P - 33 of 98

                                                The Federal Zone:


Case 3:
Corporation is chartered by a Union State (a/k/a "State corp.").
The tax on corporate profits is always an "indirect" tax:

Plaintiff Defendant 16th Result

either State yes Congress can tax if tax is uniform and
NRA corp. corporation is inside a Union State.

either State no Congress can tax if tax is uniform and
NRA corp. corporation is inside a Union State.

The decisive factor here is that profit generation by State
corporations is a revenue-taxable activity because corporations
are privileged creations of government (they enjoy the privilege
of limited liability). The tax rates must be uniform, however.

Case 4:
Corporation is chartered inside federal zone (a/k/a "domestic").
The tax on corporate profits is always an indirect tax.

Plaintiff Defendant 16th Result

either domestic yes inside federal zone, Congress can tax
NRA corp. without uniformity or apportionment

either domestic no inside federal zone, Congress can tax
NRA corp. without uniformity or apportionment

The decisive factor here is that profit generation by "domestic"
corporations is a revenue-taxable activity because these
corporations are privileged creations of Congress. Tax rates
need not be uniform or apportioned; only majority rule needs to
be satisfied.

Summary

     Thus, if my analysis of corporate profits is correct, the
16th Amendment is not relevant, even if the corporation is
chartered by a Union State. Congress is free to define a tax on
corporate profit as an excise tax, and Congress need only satisfy
the uniformity rule if the corporation is chartered by a Union
State. Congress need only satisfy majority rule if the
corporation is chartered inside the federal zone (see Chapter 13,
3rd edition).

     The situation is a bit different if the subject is
dividends. The status of dividend recipients then becomes
relevant, as does the ratification of the 16th Amendment. I
distinguish dividends from profits because they can be taxed
separately. There is no compelling logical reason why dividend
payors must be held liable for the tax on dividends; dividend
recipients could be designated the liable party (if not the
withholding agent).


                        Page P - 34 of 98

                                                       Appendix P


     So, the De Ganay case does not represent a threat to the
thesis of The Federal Zone after all. This is so because the
dividend recipient was unprotected by the Constitution and the
corporation was engaged in a privileged, revenue-taxable
activity, even if it was chartered by the Commonwealth of
Pennsylvania.

     If this analysis does anything, it reveals a need to
distinguish overseas NRA's (like Emily De Ganay) from State
Citizens (like Frank R. Brushaber). The current Internal Revenue
Code does not make this distinction, however.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


                        Page P - 35 of 98

                                                The Federal Zone:


                   Conklin Rebuttal (briefly)

                               by

                    Mitch Modeleski, Founder
                 Account for Better Citizenship

                          July 4, 1992


Liability of Individuals

Conklin is saying that nobody is made liable for income taxes.
His ad in The Connector of May 1992 stated: "My name is Bill
Conklin and I have searched the Internal Revenue code for twelve
years: it is my opinion after extensive research that there is
no statute that makes anyone liable for the income tax ..."
[emphasis added]. This statement is wrong; "withholding agents"
are specifically made liable by Sections 1441 and 1461 of the
Internal Revenue Code (IRC).

Effect of Regulations

Conklin has written privately that Congress cannot promulgate
regulations which exceed the statute and that a regulation cannot
exceed the limitations created by the statute. The preponderance
of case law proves that the regulations in 26 CFR do have the
force and effect of law. See 2 Am Jur 2d, Section 289 et seq.
See also the Federal Register Act and Administrative Procedure
Act. The regulations in 26 CFR are not so easily swept away.

In re: Becraft

This is not a good decision because Becraft's research concludes
that only "aliens here and citizens abroad" are liable for
federal income taxes. This conclusion is easily disproven by 26
CFR 1.1-1(b), one of the key regulations which define the income
tax liability of individuals:

     In general, all citizens of the United States**, wherever
     resident, and all resident alien individuals are liable to
     the income taxes imposed by the Code whether the income is
     received from sources within or without the United States**.

                                [26 CFR 1.1-1(b), emphasis added]

Moreover, that court reduced Becraft's argument to one elemental
proposition, and rejected it for "absurdity" and "frivolity":

     The Sixteenth Amendment does not authorize a direct
     non-apportioned income tax on resident United States
     citizens [sic] and thus such citizens are not subject to the
     federal income tax laws. We hardly need comment on the
     patent absurdity and frivolity of such a proposition.


                        Page P - 36 of 98

                                                       Appendix P


Well, the Brushaber decision found otherwise. Moreover, the
Becraft court uses the term "resident United States citizen",
which manifests a lack of understanding of the relevant
regulations and their legislative history. The citizen/alien
dimension is a birth status (or naturalization status). The
resident/nonresident dimension is a location status. The term
"resident United States citizen" only makes sense if one intends
to distinguish it from "nonresident United States citizen",
"resident alien" and "nonresident alien". The Becraft court
would benefit enormously by mastering The Matrix as explained in
The Federal Zone. Their failure to define terms is a serious, if
not fatal flaw.

U.S. vs Collins

* By citing Collins as an authority for defeating The Federal
     Zone thesis, Conklin confuses judicial jurisdiction with
     legislative jurisdiction. The two are obviously different:
     district court jurisdiction is created by statute,
     legislative jurisdiction is created by the Constitution.

* Collins ruled: "The argument that the sixteenth amendment
     does not authorize a direct, non-apportioned tax on United
     States citizens similarly is devoid of any arguable basis in
     law" [emphasis added]. This statement is demonstrably false
     because the Brushaber decision supports this argument.

* Collins also ruled: "For seventy-five years, the Supreme
     Court has recognized that the sixteenth amendment authorizes
     a direct nonapportioned tax upon United States citizens
     throughout the nation, not just in federal enclaves, see
     Brushaber ...." Brushaber is NOT an authority for this
     statement; Brushaber ruled that income taxes are indirect
     taxes and the only effect of the 16th Amendment was to
     overturn the Pollock principle. Read it!

The existence of one or more apparently unfavorable cases does
not invalidate The Federal Zone (see Unfavorable Case Law below).

Sixteenth Amendment

Most federal courts refuse to recognize the mountain of material
evidence which impugns the ratification of the so-called 16th
Amendment. However, the judge in U.S. vs Benson admitted, on the
record, that there is no law if Bill Benson is correct. By
citing Collins, Conklin is siding with irresponsible judges who
label the evidence a "political" question. Well, it wasn't a
"political" question in the years immediately after the amendment
was "declared" ratified. Both the Collins and Becraft decisions
are badly defective because they attempt to sustain the obvious
fiction that there is no material evidence against the 16th
Amendment. Mr. Conklin needs to choose between fact and fiction.
(Racing firemen don't stop for curb dogs.)


                        Page P - 37 of 98

                                                The Federal Zone:


Treasury Decision 2313

This Treasury Decision is crucial evidence that The Federal
Zone's status and jurisdiction arguments are valid. Frank
Brushaber declared himself to be a citizen of the State of New
York, and a resident of the Borough of Brooklyn, in the City of
New York. Both the federal courts and the Treasury Department
found that Frank Brushaber was a NONRESIDENT ALIEN, according to
their own rules! The Secretary of the Treasury had no basis for
extending T.D. 2313 to those who were not parties to the
Brushaber case. Frank Brushaber did err in assuming that his
defendant was a foreign corporation; the Union Pacific Railroad
Company was a domestic corporation, because it was originally
created by an Act of Congress. Conklin has neglected to mention
T.D. 2313 anywhere in his published and private communications.

The Three United States

The Hooven case is standing authority for the fact that the term
"United States" has three separate meanings, all different from
each other. Federal courts had an excuse before this decision;
but after Hooven, courts have no excuse for failing to specify
which of these three meanings they intend, with each and every
use of the term. This lack of specificity leads to uncertainty,
which leads in turn to court decisions which are also void for
vagueness. The 6th Amendment guarantees  our right to ignore
vague and ambiguous laws, and this must be extended to vague and
ambiguous case law. Moreover, Hooven is also standing authority
for the principle of territorial heterogeneity, an important
theme in The Federal Zone which Conklin ignores almost
completely. Similarly, Conklin has failed even to mention "The
Insular Cases" or to deal with the obvious relevance of Downes vs
Bidwell, namely, excise uniformity doesn't rule inside the
federal zone; the majority rules inside the federal zone.

Knowledge of the Book

Conklin has not purchased The Federal Zone, and has yet to admit
that he has even read the book. The failed ratification of the
Sixteenth Amendment figures prominently in the book's main logic.
Territorial heterogeneity is a theme which Conklin ignores almost
completely. The "void for vagueness" doctrine affords all of us
an opportunity to agree, on the vagueness at least. If the
statute is clear, then why did Conklin fail to find the sections
that make withholding agents liable? He had 12 years, and he
still missed them. The Spreckels case ruled that "doubt is to be
resolved in favor of those upon whom the tax is sought to be
laid." Wigglesworth ruled that, in case of doubt, statutes
levying taxes "are construed most strongly against the
Government, and in favor of the citizen". The continuing debate
on all sides is important empirical proof that the IRC should be
nullified for vagueness. If the Supreme Court cannot be clear,
then nobody can; and their titles are Justice.


                        Page P - 38 of 98

                                                       Appendix P


Unfavorable Case Law

The existence of one or more apparently unfavorable cases does
not invalidate The Federal Zone, particularly when those cases
are predicated on rebuttable assumptions (like the 16th
Amendment, or "clarity" in the statute, or arbitrary definitions
of "income"). The book proves that chaos exists in the relevant
federal cases: the Supreme Court has clearly contradicted itself
when defining the effects of a ratified 16th Amendment. "The
devil can quote scripture for his purpose," wrote William
Shakespeare. With courts in conflict, one can cite authorities
for either side of any such unresolved debates. The Prince of
Darkness is also the Prince of Lies.

Private Law

There are many mysteries which are amazingly clarified by The
Federal Zone, including the "private law" nature of the IRC. The
IRC is a municipal statute for the federal zone. Congress is the
sovereign municipal authority for the federal zone. If Congress
had intended the IRC to apply to all 50 States, Title 26 would
have need to be enacted into positive, "public" law. It was not.
(For details, see Super Gun by Lori Jacques, pages 74-81.)

Uniform Commercial Code

The UCC is precisely on point, because federal tax returns are
"foreign bills of exchange" which are subject to rules,
regulations and case law which have built up around the UCC. The
50 States are "foreign" to each other, just as each is foreign to
the federal zone (see In re Merriam). The UCC has explicit
provisions for reserving the unalienable rights of those who
enter such contracts, including but not limited to the right to
due process and the immunity against self-incrimination.
Moreover, the UCC has a guarantee that statutes must be construed
in harmony with the Common Law. The U.S. Constitution is the
last vestige of the Common Law at the federal level.

The Smoking Gun

The Federal Zone documents the "smoking gun" -- awesome proof
that the vagueness, deception, confusion and jurisdictional
ambiguities in Title 26 were intentional.


                        Page P - 39 of 98

                                                The Federal Zone:


MEMO

TO: John Voss, Director, N.C.B.A.
          other interested parties

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: June 9, 1992

SUBJECT: Do the regulations in 26 C.F.R.
          have the force and effect of law?


The debate fostered by the claims on N.C.B.A.'s $50,000 Reward
appears to have reached the following point of departure:


     Mr. Conklin has argued that Title 26 makes nobody liable for
     federal income taxes.

     This argument was defeated by reference to clear sections of
     Title 26 which make "withholding agents" liable for federal
     income taxes.

     I do not as yet know if Mr. Conklin is a withholding agent.

     In a private communication, Mr. Conklin has also argued that
     the regulations in 26 C.F.R.  create no liability because "a
     regulation cannot exceed the limitations created by the
     statute."


The purpose of the remainder of this memo is to cite some of the
case law which is relevant to the questions of validity, and of
the legal force and effect, of regulations promulgated by the
Secretary of the Treasury. The attached abstracts from American
Jurisprudence reveal a substantial body of case law which is not
always entirely consistent on this question. For example:


     A regulation cannot supply omissions of the statute.

                                       [2 Am Jur 2d, Section 289]
                              -but-

     A regulation which fulfills the purpose of the law cannot be
     said to be an addition to the law.

                                             [ibid., Section 300]


The following are notable excerpts from the attached Am Jur
sections that deal with the effect and validity of rules:


                        Page P - 40 of 98

                                                       Appendix P


     Rules, regulations, and general orders enacted by
     administrative agencies pursuant to the powers delegated to
     them have the force and effect of law. [page 119]

     There have been applied to administrative regulations the
     principles that everyone is presumed to know the law or that
     ignorance of the law is no excuse, and the courts will take
     judicial notice of them. [page 120]

     ... [T]here is no violation of the Federal Constitution in
     an act of Congress which provides for a defense to an action
     under the statute based on good faith reliance upon any
     administrative regulation .... [page 120]

     Administrative regulations are held to be "laws" for various
     purposes, including jurisdiction of courts and criminal
     liability. If Congress imposes criminal sanctions for
     disobedience of regulations, it can hardly be contended that
     such regulations are not a "law" for the purposes of the
     Criminal Code. [page 121]

     Compliance with valid administrative regulations is
     compliance with law, as has been held where it was sought to
     induce actions contrary to the regulations or to impose
     liability for actions which accorded with regulations.
     [page 122]

     Valid administrative rules or regulations are generally
     regarded as legislative enactments, and have the same effect
     as if enacted by the legislature. They have the force of a
     statute and the same effect as if part of the original
     statute. They become integral parts of the statutes,
     particularly where they are legislative in nature -- that
     is, are called for by the statute itself. [page 122]

     While in the strict sense of the term an administrative
     regulation is not actually a "statute" but is at most an
     offspring of a statute, a regulation may be deemed to come
     within the term "statute." [page 123]

     ...[R]ules and regulations will be upheld where they are
     within the statutory authority of the agency and reasonable,
     ... they must be sustained unless unreasonable and plainly
     inconsistent with the statute. [page 123]

     Only when discretion has been arbitrarily exercised,
      resulting in injustice or unfairness, do the courts
     intervene to strike down a rule promulgated by the proper
     agency designed to give appropriate effect to the provisions
     of the act involved. [page 124]

     Administrative regulations which go beyond what the
     legislature can authorize are void and may be disregarded.
     [page 124]


                        Page P - 41 of 98

                                                The Federal Zone:


     Regulations which are legislative in character should not be
     overruled by the courts unless clearly contrary to the will
     of the legislature. [page 124]

     Thus there are applicable the rules in regard to presumption
     of validity and partial or entire invalidity; and, just as
     in individual cases hardship and loss may flow from
     legislative acts which are nevertheless valid, so
     administrative regulations may also operate. [page 125]

     Administrative rules and regulations, to be valid, must be
     within the authority conferred upon the administrative
     agency. A rule or regulation which is broader than the
     statute empowering the making of rules, or which oversteps
     the boundaries of interpretation of a statute by extending
     or restricting the statute contrary to its meaning, cannot
     be sustained. [page 127]

     They are valid and binding only when they are in furtherance
     of the intention of the legislature as evidenced by its
     acts, and a regulation, valid when promulgated, becomes
     invalid upon the enactment of a statute in conflict with the
     regulation. However, an administrative regulation will not
     be considered as having been impliedly annulled by a
     subsequent act of the legislature unless the two are
     irreconcilable, clearly repugnant, and so inconsistent that
     they cannot have concurrent operation. [page 127]

     Administrative regulations which go beyond what the
     legislature has authorized, which violate the statute, or
     which are inconsistent or out of harmony with the statute
     conferring the power, have been said to be void. [page 128]

     ... [A]dministrative regulations, to be valid, are required
     to be appropriate, reasonable, or not inconsistent with law.
     A rule or regulation which is within the broad rulemaking
     powers commonly conferred on administrative agencies will be
     sustained by the courts. [page 128]

     ... [A] regulation which fulfills the purpose of the law
     cannot be said to be an addition to the law. Before a rule
     or regulation may be declared void it must be definitely in
     excess of the scope of authority, or plainly or palpably
     inconsistent with law. [page 129]

     ... [A]n administrative agency may not create a criminal
     offense or any liability not sanctioned by the lawmaking
     authority, especially a liability for a tax or inspection
     fee. [page 129]

     ... [I]ssuance of regulations is in effect exercise of
     delegated legislative power. [page 770]


                        Page P - 42 of 98

                                                       Appendix P


     Administrative Procedure Act ... and Federal Register Act
     ... set up procedure which must be followed in order for
     agency rulings to be given force of law. [page 770]

     Contents of Federal Register are judicially noticed and may
     be cited by volume and page number. [page 772]

     ... [F]ederal courts are required to take judicial notice of
     contents of Federal Register. [page 772]

     Code of Federal Regulations being nothing more than
     supplemental edition of Federal Register, court is entitled
     to take judicial notice of cited regulation in brief of
     prosecution[,] and conviction of defendant thereon is not
     precluded by government's failure to introduce such
     applicable section in evidence. [page 772]

     Court was required to take judicial notice of the Federal
     Register and the Code of Federal Regulations. [page 772]


In closing, the following excerpt from an unpublished treatise by
attorney Lowell Becraft is extremely relevant to the force and
effect of regulations:


                   CONSTRUCTION OF REGULATIONS

          In 5 U.S.C., section 301, heads of Executive
     departments are given authority to make and publish
     regulations. It has been previously demonstrated how the
     current federal income tax laws in question today relate
     back to the 1916 income tax act. Section 15 of that act
     defined the terms "State" and "United States" in clear
     jurisdictional terms. All income tax acts passed by
     Congress have authorized the Secretary of the Treasury to
     promulgate regulations, which he has done since the first
     income tax act in 1913. All of the income tax regulations
     published since January 28, 1921, have defined the people
     subject to the tax as "citizens of the United States subject
     to its jurisdiction." Thus, this phrase has been a part of
     the regulations for some 67 years, and applied to the 1918,
     1921, 1924, 1926, 1928, 1932, 1934, 1936 and 1938 acts, as
     well as the 1939 and 1954 Codes.

          The Secretary of the Treasury and the United States are
     firmly bound by these prior regulations as well as the
     current Treasury Regulation 1.1-1(c), which defined the
     subject of the current tax as a "citizen subject to its
     jurisdiction." A long line of Supreme Court cases holds
     that an executive department head such as the Secretary of
     the Treasury is bound by the regulations he so promulgates
     and publishes ....


                        Page P - 43 of 98

                                                The Federal Zone:


          And the Supreme Court has found that regulations
     consistently promulgated in the same language for repeatedly
     re-enacted laws are very significant. In Old Colony R. Co.
     v. Commission of Internal Revenue, 284 U.S. 552, 52 S.Ct.
     211 (1932), the Supreme Court held that such regulations are
     given an implied legislative approval:


          "The repeated re-enactment of a statute without
          substantial change may amount to an implied legislative
          approval of a construction placed upon it by executive
          officers," 284 U.S., at 557

                                                 [emphasis added]


This brings us to the following regulation; it mentions liability
explicitly:


     In general, all citizens of the United States, wherever
     resident, and all resident alien individuals are liable to
     the income taxes imposed by the Code whether the income is
     received from sources within or without the United States.

                                             [26 C.F.R. 1.1-1(b)]


                             # # #


                        Page P - 44 of 98

                                                       Appendix P


MEMO

TO: John Voss, Director
          National Commodity and Barter Association

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: June 7, 1992

SUBJECT: Federal Income Tax Liability


     As distinct from the regulations published in 26 C.F.R.,
does the Internal Revenue Code itself specifically make anybody
liable for federal income taxes? Answer: a "withholding agent"
is specifically named as a "person" who is made liable for such a
tax. The proof is found in the combination of Sections 1441 and
1461 of the IRC, as follows:


     Section 1441. Withholding of Tax on Nonresident Aliens.

     (a) General Rule. -- Except as otherwise provided in
     subsection (c), all persons, in whatever capacity acting ...
     having the control, receipt, custody, disposal, or payment
     of any of the items of income specified in subsection (b)
     (to the extent that any of such items constitutes gross
     income from sources within the United States), of any
     nonresident alien individual or of any foreign partnership
     shall ... deduct and withhold from such items a tax equal to
     30 percent thereof, except that in the case of any item of
     income specified in the second sentence of subsection (b),
     the tax shall be equal to 14 percent of such item.


     Section 1461. Liability for Withheld Tax.

     Every person required to deduct and withhold any tax under
     this chapter is hereby made liable for such tax and is
     hereby indemnified against the claims and demands of any
     person for the amount of any payments made in accordance
     with the provisions of this chapter.

                                                 [emphasis added]


Therefore, if Bill Conklin is a withholding agent, then he is
liable for the federal income tax on the amount he withholds.
The question now becomes: Is Bill Conklin a withholding agent?
Yes or No? It is impossible to answer this question from your
$50,000 Reward advertisement, and I cannot tell from any of the
written communications I have received from him to date.


                        Page P - 45 of 98

                                                The Federal Zone:


     Now, permit me to specify the conditions under which Bill
Conklin would actually be liable for such a tax, by using a
practical and realistic example. Let us say that Bill Conklin
has a good friend named Sam who is an Air Force budget analyst.
This friend is responsible for a government research budget,
which provides grants for research in various areas of human
resources. Sam is impressed with Bill Conklin's knowledge of the
IRC. With Bill's consent, Sam agrees to hire Bill under contract
to the Air Force to provide tax consulting to other Air Force
budget analysts like Sam. When Bill gets this money, he calls
his colleague Mitch to help him work on this project, and agrees
to pay Mitch a flat rate of $60 per hour from the research grant.

     Mitch, by the way, is a nonresident alien, as confirmed by a
recent formal affidavit served on the Secretary of the Treasury.
Having accepted funds from the Air Force, Bill is thereby
receiving money from a source that is "inside the United States".
Rather than paying Mitch the full $60 per hour, the statute
requires Bill to withhold 30 percent from Mitch's wages, per
Section 1441 of the IRC. Moreover, Bill Conklin is the "person"
who is liable for this tax, not Mitch. However, Mitch would be
required to file a "return" on Form 1040NR, because he had "gross
income" as defined in Section 872(a), to show that the tax had
already been withheld and therefore paid. The tax is actually
paid by the "person made liable", that is, Bill Conklin.

     Now, to elaborate this example just a little more, Bill
hires two more people, both of whom declare themselves to be
"United States citizens" and both of whom complete and sign a
valid W-4 certificate. By law, Bill is also required to act as
their "withholding agent", albeit at rates that are different
from the flat 30 percent levied against the gross income of
nonresident aliens. Graduated tax rates are applied to their
taxable income. Once again, as their withholding agent, Bill is
also liable for the amounts which he withheld from their pay, as
authorized by W-4 certificates that were lawfully and validly
executed. The tax is actually paid by the "person made liable",
that is, Bill Conklin.


     Incidentally, the above Sections are listed in the IRC
definition of "withholding agent", as follows:


     (16) Withholding Agent. -- The term "withholding agent"
     means any person required to deduct and withhold any tax
     under the provisions of section 1441, 1442, 1443, or 1461.

                                          [26 U.S.C. 7701(a)(16)]
                                                 [emphasis added]


                        Page P - 46 of 98

                                                       Appendix P


     John, maybe I should withdraw my original claim and submit
another one for the full $50,000 amount. This is my formal
notice to you that I have reserved my right to do so, even though
and regardless of the fact that I have already filed one claim
for $1 of this reward.

     As I write this, I must add that my colleague John C. Alden
just now informed me that recent N.C.B.A. literature admits that
withholding agents are specifically defined by statute to be
liable for federal income taxes. For the record, I have not yet
read your literature on this subject, and honestly heard about
the literature for the first time from John C. Alden.

     Thank you very much for your consideration.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


copies: John Pleasant
          Brett Brough
          other interested parties


                        Page P - 47 of 98

                                                The Federal Zone:


MEMO

TO: John C. Alden, M.D.

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: June 7, 1992


Let's combine two recent analyses into one: the "liability"
question and The Matrix "chain" of logic.

It is interesting that the only "person" actually made liable by
the statute is a withholding agent.

When you go to the sections listed in the definition of
"withholding agent", the term "nonresident alien" is mentioned.

When you go to the definition of "nonresident alien", the term is
defined as "not a citizen" and "not a resident".

The terms "citizen" and "resident" are entirely dependent on the
meaning of "United States".

The definition of "United States" is dependent on the meaning of
"District of Columbia" and the "States".

The definition of "States" is dependent on the meaning of the
"District of Columbia" and "include". And so on.

Notice how the thread from "liability" takes you right back down
the same path already traversed in my original claim to the
$50,000 reward. It's like a pile of spaghetti, only the strands
merge.

That is, "include" may be expansive, but it can only encompass
territory over which the "United States" is sovereign.

For purposes of acquiring citizenship at birth, a person is born
subject to the jurisdiction of the "United States" if his birth
occurs in territory over which the "United States" is sovereign
(from Am Jur).

We end up at the same place -- sovereignty -- which vaults us
into the domain of the study entitled Jurisdiction over Federal
Areas within the States (see Chapter 11 and also Becraft's
excellent brief on jurisdiction).

As you may already know, there is a large number of cases which
define the res judicata of sovereignty. We are right where we
want to be!


                        Page P - 48 of 98

                                                       Appendix P


MEMO

TO: John C. Alden, M.D.

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: May 28, 1992

SUBJECT: Sovereignty and The Matrix


     I want to try some logic on you; it's an extension of the
matrix logic discussed in The Federal Zone. Let's use the
following schema, in order to develop a "chain" of logic:

                        c a
                       +---------+
                    R | Rc | Ra | R
                      |----+----|
                    N | Nc | Na | N
                      +---------+
                        c a

Use capital letters to identify one matrix dimension, and small
letters to identify the other matrix dimension.

     Now, take an index card and cover up row 1 (the "Resident"
row). This leaves only row 2 (the "Nonresident" row), columns 1
and 2. If you are a "Nonresident", then it is important to know
whether you are a "citizen" or not. If you are a "citizen", then
you are an "Nc" and you pay tax on your worldwide "income". If
you are not a "citizen", then you are an "alien" and you are an
"Na". The definition of "citizen" is therefore pivotal.

     Now, move the index card so it covers only column 2 (the
"alien" column). Whether you are a "Resident" citizen ("Rc") or
a "Nonresident" citizen ("Nc"), you are still a "citizen" and you
pay tax on your worldwide "income" regardless of where you
"Reside". The definition of "citizen" is again pivotal.

     Once again, move the index card so it covers only row 2 (the
"Nonresident" row). Whether you are a Resident "citizen" ("Rc")
or a Resident "alien" ("Ra"), you are still a "Resident" and you
pay tax on your worldwide "income" regardless of your status.
Now the definition of "Resident" becomes pivotal.

     Finally, move the index card so it covers only column 1 (the
"citizen" column). If you are an "alien", then it is important
to know whether you are a "Resident" or not. If you are a
"Resident", then you are an "Ra" and you pay tax on your
worldwide "income". If you are not a Resident, then you are an
"Na". The definition of "Resident" is again pivotal.


                        Page P - 49 of 98

                                                The Federal Zone:


     We deduce from the above that the definitions of "citizen"
and "Resident" are both pivotal. Are these two definitions
related in any way? Yes, they both refer to the same thing,
namely, the "United States". If you are not a "citizen" of the
"United States", then you are an alien with respect to the
"United States". If you are not a "Resident" of the "United
States", then you are a Nonresident with respect to the "United
States". The definitions of "citizen" and "Resident" thus pivot
around the same term: "United States".

     Although Becraft's essay does an excellent job of describing
the jurisdiction of the "United States", it lacks the necessary
rigor to define precisely the status of its "citizens". As a
result, his discussion of tax "subjects" is vague and confusing
(e.g., "aliens here, citizens abroad"). This is surprising,
since our logic proves that the terms "citizen" and "Resident"
both pivot around the meaning of "United States", the
jurisdiction of which Becraft appears to understand quite well,
but the citizens of which Becraft appears to misunderstand. His
confusion might have been eliminated by better research into the
exact definition of "citizen".

     Compare his discussion of tax "subjects" with the key we
have found in American Jurisprudence:


     "A person is born subject to the jurisdiction of the United
     States, for purposes of acquiring citizenship at birth, if
     his birth occurs in territory over which the United States
     is sovereign ...."


I keep coming back to this statement, because it is so clear and
unequivocal. It's too bad that Becraft didn't quote this
definition and incorporate it into his treatise. A "citizen of
the United States" is a person who was either born or naturalized
in the "United States" and is also subject to its jurisdiction.
Thus, you are a "citizen of the United States" if you were born
in the "United States" and you are subject to its jurisdiction.
You are also a "citizen of the United States" if you were
naturalized in the "United States" and you are subject to its
jurisdiction. Pure logic allows for the following two
permutations: (1) you were born in the "United States" but you
are not now subject to its jurisdiction and (2) you were
naturalized in the "United States" but you are not now subject to
its jurisdiction. "Expatriation" is the legal way of accounting
for these two permutations.

     There are three official definitions of "United States",
only two of which are singular nouns (the nation and the federal
zone). Using grammatical rules, the term "its jurisdiction" can
only apply to the nation or to the federal zone, but not to the
50 States (because the 50 States are plural). So, we have to
choose between the nation and the federal zone, and the best way


                        Page P - 50 of 98

                                                       Appendix P


to do so is to understand the meaning of "sovereign" as used
above. The terms "citizen" and "Resident" pivot around the
meaning of "United States", and the term "United States" pivots
around the meaning of "sovereign". Clearly, that territory over
which the "United States" is sovereign becomes logically and
absolutely fundamental to the whole discussion.

     Having come this far, the door is now open to Becraft's
excellent treatise on jurisdiction, and to the myriad of cases
which define the territory over which the "United States" is
sovereign. The cases all demonstrate that this territory does
NOT include the 50 States. (I am not aware of a single case
which found otherwise.) Therefore, the term "United States" is
NOT the nation in this context, because the 50 States belong,
without question, to the nation. The logic is not only correct;
it also conforms to the intent of the Constitution.


                             # # #


                        Page P - 51 of 98

                                                The Federal Zone:


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   May 18, 1992
Charles L. Harrison
Corresponding Secretary
Monetary Realist Society
P. O. Box 31044
St. Louis, Missouri
Postal Code 63131/TDC

Dear Charles:

     I am writing in response to a statement that is made in your
bulletin for April 1992 in the article entitled "He Didn't Do It;
I Saw Him with My Own Eyes!". This article makes the following
statement:

     "... the XVIth Amendment was never properly ratified by the
     states, and thus, there IS no income tax!"

This statement is incorrect because it is a non sequitor.
Enclosed please find a collection of essays which examine this
notion in depth. With all due respect to authors Benson and
Beckman, and to the leaders of Patriot groups around the country,
this assertion is not only misleading, but also the cause of much
unnecessary confusion among the membership, and would-be
membership, of these groups. I believe that, if you take the
time to review the logic in the enclosed papers, you will come to
see why there can be an income tax without the 16th Amendment.

     In "The Insular Cases" that were decided at the turn of the
century, 12 years prior to the so-called 16th Amendment, the
Supreme Court gave its blessing to a doctrine which I have called
"territorial heterogeneity" in my recent book entitled The
Federal Zone. In exercising its exclusive authority over the
federal zone, Congress is not subject to the same constitutional
limitations that exist inside the 50 states. Specifically,
Congress is not required to apportion direct taxes levied inside
the federal zone, with or without a 16th Amendment.

     For reasons like this, the areas that are inside and outside
the federal zone are heterogeneous with respect to each other.
This difference results in a principle of territorial
heterogeneity: the areas within (or inside) the federal zone are
subject to one set of rules; the areas without (or outside) the
federal zone are subject to a different set of rules. The
Constitution rules outside the zone and inside the 50 States.
The Congress rules inside the zone and outside the 50 States.

     The 50 States are, therefore, in one general class, because
all constitutional restraints upon Congress are in force
throughout the 50 States, without prejudice to any one State.


                        Page P - 52 of 98

                                                       Appendix P


The areas within the federal zone are in a different general
class, because these same constitutional restraints simply do not
limit Congress inside that zone. This principle of territorial
heterogeneity is documented in detail in Chapters 12 and 13 of
The Federal Zone: Cracking the Code of Internal Revenue. It
stems from our pivotal finding that Title 26 is a "municipal
statute", the territorial extent of which is the federal zone.
Congress is the "City Hall" for the federal zone.

     Now, there certainly are a host of reasons to believe that a
failed 16th Amendment nullifies the federal income tax. Among
these reasons are statements in the Federal Register by
Commissioners of Internal Revenue, and other written
communications which have issued from the Internal Revenue
Service over the years, that the 16th Amendment is the federal
government's general authority to tax the incomes of individuals
and corporations. If you are building a reliance defense, the
Federal Register statements are certainly a good place to start,
because of the legal status extended to notices that are
published therein.

     Nevertheless, given the huge mass of evidence which
seriously impugns its ratification, in the face of which Congress
has now fallen silent, the act of declaring the 16th Amendment
ratified was an act of outright fraud by Secretary of State
Philander C. Knox in the year 1913. Therefore, it is not
surprising that succeeding officials in the federal government,
like Donald C. Alexander in the year 1974, might also be victims
of this fraud, because the work of Benson and Beckman was not
published until the year 1985. It is entirely possible that IRS
officials were acting in good faith when they told America, for
so many years, that the 16th Amendment was their required
authority. That's how sinister Knox's fraud actually was.
However, a failed 16th Amendment does not mean that Congress now
has no authority whatsoever to levy direct taxes on incomes,
particularly when those incomes derive from sources that are
situated inside territory over which Congress has exclusive
legislative jurisdiction, i.e., the federal zone.

     I sincerely hope that this letter, and the enclosed
materials, do provide you with a satisfactory clarification of
the 16th Amendment and the real constitutional implications of
its failure to be ratified. Thank you for your consideration.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

enclosures


                        Page P - 53 of 98

                                                The Federal Zone:


Memo

TO: Friends, Neighbors, Colleagues
          and all interested people

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: April 8, 1992

SUBJECT: The "Key"

     In the course of doing further research for the next edition
of The Federal Zone, I was directed by the work of author Lori
Jacques to investigate the reference work American Jurisprudence.
I was delighted to find a definition which provides the "key" we
have all been looking for. This key provides yet more dramatic
support for the major jurisdictional thesis of The Federal Zone,
namely, that the Internal Revenue Code is a municipal statute and
"citizens of the United States" are those who are born or
naturalized into this municipal jurisdiction. Congress is the
"City Hall" for the federal zone. Read the following very
carefully:

     Sec. 1420. -- Who is born in United States and subject to
                    United States jurisdiction

     A person is born subject to the jurisdiction of the United
     States, for purposes of acquiring citizenship at birth, if
     his birth occurs in territory over which the United States
     is sovereign, even though another country provides all
     governmental services within the territory and the territory
     is subsequently ceded to the other country. [!!!]

                                        [3A Am Jur 2d, page 1419]

     Note that the term "United States" is used in its singular
sense, that is, "... territory over which the United States is
sovereign". This is crucial evidence to support my argument that
the term "United States", as used in Title 26, refers to the
second of three official definitions of that term by the U.S.
Supreme Court. Note, in particular, the pivotal word
"sovereign", which controls the entire meaning of this passage.
The federal zone is the area over which Congress is sovereign;
it does not include the 50 States because Congress is not
sovereign over the 50 States. Chapter 11 in The Federal Zone is
dedicated to discussing sovereignty in depth. My thesis is
bolstered even further by the qualifying phrase "... even though
... the territory is subsequently ceded to the other country."
Governmental sovereignty over any territory is relinquished when
that territory is ceded to another country, but not before. (See
Chapter 11 for details.) An area of land joins the federal zone
if and only if one of the 50 States cedes that land to Congress.


                        Page P - 54 of 98

                                                       Appendix P


     Now refer to the definition of "citizen of the United
States" as published in the Code of Federal Regulations for Title
26, the Internal Revenue Code:


     (c) Who is a citizen. Every person born or naturalized in
     the United States and subject to its jurisdiction is a
     citizen.
                                                [26 CFR 1.1-1(c)]
                                                 [emphasis added]

     Notice the singular sense of "its jurisdiction" in this
regulation. If a person is naturalized in the "United States",
he is automatically "subject to its jurisdiction", because the
Constitution authorizes Congress to legislate rules for
immigration and naturalization. On the other hand, a person is
born "subject to its jurisdiction" if his birth occurs in
territory over which the "United States" is sovereign.
Therefore, a person is born subject to the jurisdiction of the
"United States" if his birth occurs inside the federal zone.

     Notice also that the letter "c" in "citizen" is in lower
case. This is the case that is used in the word "citizen"
throughout the Internal Revenue Code and throughout the
regulations. Those who argue against the upper/lower case
distinction are overlooking this remarkable consistency, spanning
more than 8,000 pages of law and regulations. Such amazing
consistency could never have happened by accident; the odds
against such an accident are astronomical. We must discount all
references to "Citizen" in the first word of any sentence,
because English grammar requires that it be capitalized in that
position. The other occurrences of "Citizen" are found in the
first word of heading phrases, for example:


     (b) Citizens or residents of the United States liable to
          tax.
                                                [26 CFR 1.1-1(b)]

     Whatever ambiguitythis usage may create is totally
eliminated by the statutory definition of "United States" in
Title 26. It is now conclusive that the term "United States", as
defined in Title 26, is the federal zone.

     The above citation from American Jurisprudence is the key we
have all been looking for: it is succinct, unequivocal, and
razor sharp. It is the key which unlocks the chains that bind
our freedom, the chains which now belong on the Congress of
[belonging to] the united States of America.


Account for Better Citizenship
c/o USPS Post Office Box 6189
San Rafael, California Republic


                        Page P - 55 of 98

                                                The Federal Zone:


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   April 7, 1992
Free State Constitutionists
P. O. Box 3281
Baltimore, Maryland
Postal Code 21228/TDC

Dear Free State Constitutionists:

     I have recently received from you a document entitled:

                 WE CHALLENGE ANYONE TO DISPROVE
                THESE FACTS ABOUT INCOME TAX LAW

I hereby accept this challenge, in good faith and with a sincere
intent to get to the bottom of this mess we call federal income
taxation. A document very similar to yours has been disseminated
by the Save-A-Patriot Fellowship for some years.

     Your document is erroneous because it is based on obsolete
technology and an evident failure to penetrate the intentional
deceptions which are built into the Internal Revenue Code and its
regulations. See enclosed documents. For example, your Fact #1
states:

     RESIDENTS OF THE STATES OF THE UNION ARE NOT REQUIRED BY LAW
     TO FILE FORMS 1040 AND THEY ARE NOT LIABLE FOR THE PAYMENT
     OF A TAX ON "INCOME" UNLESS THEY ARE WITHHOLDING AGENTS.

This statement is erroneous because all "U.S. citizens" are
liable for federal taxes on their worldwide income, regardless of
where they "reside" and even if they are "residents of the
States". I assume by "States" you mean the 50 States of the
Union. See 26 CFR 1.1-1 et seq. Congress has the power to
delegate to the Secretary of the Treasury the authority to issue
regulations which have the force and effect of law. Therefore,
it is somewhat misleading to argue that the statute does not
contain this or that specific provision when the regulations do.

     Moreover, if a "resident of the States" should receive
dividends from stocks and/or interest from bonds issued by
"domestic" corporations, the income derived therefrom would be
included in the quantity "gross income" as defined at 26 U.S.C.
872(a). The payor of the dividends or interest is the
"withholding" agent, not the recipient. This is explained
clearly in Treasury Decision 2313. Frank Brushaber declared
himself a citizen of the State of New York, and a resident of the
Borough of Brooklyn, in the city of New York. As such, T.D. 2313
designated him a nonresident alien. Any other allegations about
his citizenship and residence assume facts that were not in
evidence.


                        Page P - 56 of 98

                                                       Appendix P


     For your information, I have enclosed a number of other
letters, and a memorandum to individuals at the Save-A-Patriot
Fellowship. I have heard nothing from them in response to my
memorandum.

     I have also enclosed an order form for my recently published
book entitled The Federal Zone: Cracking the Code of Internal
Revenue. The following succinct statement is directly over the
target (which explains to me why we are getting so much flak
about our understanding of the statute and its regulations):


     3A Am Jur 1420, Aliens and Citizens, explains: "A Person is
     born subject to the jurisdiction of the United States, for
     purposes of acquiring citizenship at birth, if his birth
     occurs in territory over which the United States is
     sovereign ..."

          [quoted in A Ticket to Liberty, November 1990, page 32]


This statement, in and of itself, has enough power to unlock the
entire puzzle of federal income taxation. When you understand
sovereignty as it applies to federal and State jurisdiction, you
will own the key. And then you can share this key with others.
You would expect the government to create a flood of propaganda
and other diversions in order to distract everyone from the core
of their deception. This core is found in the statutory
definitions of "State" and "United States".

     The constitutional authority for Title 26 is 1:8:17 and
4:3:2. The Supreme Court gave its blessing to a legislative
democracy inside the federal zone in the case of Downes vs
Bidwell (see enclosed). Accordingly, within the federal zone,
Congress is not restrained by the apportionment rule for direct
taxes, nor by the uniformity rule for indirect taxes. The
"majority" rules inside the federal zone, not the constitution.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


enclosures


                        Page P - 57 of 98

                                                The Federal Zone:


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   March 27, 1992
Bill Conklin
N.C.B.A.
8000 E. Girard Avenue, Suite 215
Denver, Colorado
Postal Code 80231/TDC

Dear Bill:

     This is my sincere attempt to claim the $50,000 Reward which
you have recently publicized in newspapers around the country.
Before I detail my claim, I wish to express my solemn intent to
rebate $49,999 back to the N.C.B.A., in the event that I earn the
reward. Thus, you will owe me $1.00 if I win, and I will gladly
pay you $1.00 if I lose. By the way, who are the judges in this
contest? Are they unbiased? Are they federal?

1. What statute makes Bill Conklin liable to pay an income tax?

     Before I can address this question, I need to know your
answers to the following two questions:

     (a) Are you a "citizen of the United States"?

     (b) Are you a "resident of the United States"?

If your answer to either of these questions is YES, then you are
liable for federal taxes on the income which you derive from
worldwide sources, as follows:


     In general, all citizens of the United States, wherever
     resident, and all resident alien individuals are liable to
     the income taxes imposed by the Code whether the income is
     received from sources within or without the United States.
     ... As to tax on nonresident alien individuals, see
     sections 871 and 877.

                                                [26 CFR 1.1-1(b)]


If you have any question as to the meaning of the term "citizen
of the United States", then base your answer on the following
definition:


     Every person born or naturalized in the United States and
     subject to its jurisdiction is a citizen.

                                                [26 CFR 1.1-1(c)]


                        Page P - 58 of 98

                                                       Appendix P


     If you are not a "citizen of the United States", then you
are an alien with respect to the "United States". If you have any
question as to the meaning of "resident alien", then base your
answer on the following definition:


     Definition of Resident Alien and Nonresident Alien. --

     (1) In General. -- Forpurposes of this title (other than
          subtitle B) --


          (A) Resident Alien. -- An alien individual shall be
               treated as a resident of the United States with
               respect to any calendar year if (and only if) such
               individual meets the requirements of clause (i),
               (ii), or (iii):


               (i) Lawfully Admitted for Permanent Residence.
                    -- Such individual is a lawful permanent
                    resident of the United States at any time
                    during such calendar year.


               (ii) Substantial Presence Test.
                    -- Such individual makes the election
                    provided in paragraph (3).


               (iii) First Year Election.
                    -- Such individual makes the election
                    provided in paragraph (4).

                                 [26 USC 7701(b), emphasis added]


     If you are not resident, then you are nonresident.
Accordingly, if you are not a "citizen of the United States" and
you are not a "resident of the United States", then you are a
"nonresident alien" by definition:


          (B) Nonresident Alien. -- An individual is a
               nonresident alien if such individual is neither a
               citizen of the United States nor a resident of the
               United States (within the meaning of subparagraph
               (A)). [see above]

                                 [26 USC 7701(b), emphasis added]


     If you are a nonresident alien as defined, then you are
liable for federal taxes on your "gross income" as defined:


                        Page P - 59 of 98

                                                The Federal Zone:


     (a) General Rule. -- In the case of a nonresident alien
          individual, except where the context clearly indicates
          otherwise, gross income includes only --

          (1) gross income which is derived from sources within
               the United States and which is not effectively
               connected with the conduct of a trade or business
               within the United States, and

          (2) gross income which is effectively connected with
               the conduct of a trade or business within the
               United States.

                                                  [26 USC 872(a)]


     If you are unclear what is meant by the term "United
States", you may utilize the general definition found in the
Internal Revenue Code, as follows:


     (9) United States. -- The term "United States" when used in
          a geographical sense includes only the States and the
          District of Columbia.

                                              [26 USC 7701(a)(9)]

     If you are unclear what is meant by the term "States" in
this definition of "United States", you may utilize the
definition found in the Internal Revenue Code, as follows:


     (10) The term "State" shall be construed to include the
          District of Columbia, where such construction is
          necessary to carry out provisions of this title.


     If you are unclear about the operative meaning of the term
"include" in the above definition of "State", you may utilize the
following clarification of the terms "includes" and "including",
as follows:


     (c) Includes and Including. -- The terms "includes" and
          "including" when used in a definition contained in this
          title shall not be deemed to exclude other things
          otherwise within the meaning of the term defined.

                                                 [26 USC 7701(c)]

You will note that the term "include" is not mentioned in the
definition of "includes" and "including" at 7701(c). However,
words importing the plural include and apply to the singular form
of those words:


                        Page P - 60 of 98

                                                       Appendix P


     Section 1. Words denoting number, gender, and so forth.

     In determining the meaning of any Act of Congress, unless
     the context indicates otherwise -- words importing the
     singular include and apply to several persons, parties or
     things; words importing the plural include the singular;

                                                        [1 USC 1]

     Thus, the definition of "State" also applies to the meaning
of "States", and the definition of "includes" also applies to
"include". The phrase "It includes ..." is singular in syntax;
the phrase "they include ..." is plural in syntax. Thus, the
term "include" when used in Title 26 shall be deemed to include
other things otherwise within the meaning of the term defined.
Therefore, the meaning of "State" is not restricted to the
District of Columbia. To determine what other things are
otherwise within the meaning of the term defined, see the
following:

     (g) United States. The term "United States" when used in a
          geographical sense includes any territory under the
          sovereignty of the United States. It includes the
          states, the District of Columbia, the possessions and
          territories of the United States, the air space over
          the United States, and the seabed and subsoil of those
          submarine areas which are adjacent to the territorial
          waters of the United States and over which the United
          States has exclusive rights, in accordance with
          international law, with respect to the exploration and
          exploitation of natural resources.

                                              [26 CFR 1.911-2(g)]

Thus, based upon the preceding, you may define the "United
States" to consist only of the following constituent components:


(1) District of Columbia ......................... Federal State
(2) Commonwealth of Puerto Rico .................. Federal State
(3) Virgin Islands ............................... Federal State
(4) Guam ......................................... Federal State
(5) American Samoa ............................... Federal State
(6) Northern Mariana Islands ................ Federal Possession
(7) Trust Territory of the Pacific Islands .. Federal Possession

     Inclusive of the aforementioned Federal States and Federal
     Possessions, "exclusive federal jurisdiction" also extends
     over all Places purchased by the Consent of the Legislature
     of one of the Fifty States, in which the Same shall be, for
     the Erection of Forts, Magazines, Arsenals, dock-Yards, and
     other needful Buildings.

                      [see 1:8:17 and 4:3:2 in U.S. Constitution]


                        Page P - 61 of 98

                                                The Federal Zone:


     Therefore, you may, as I have done, define the territory
under the sovereignty of the "United States" to consist of the
District of Columbia, the federal territories and possessions,
and the enclaves ceded to Congress by acts of State Legislatures
(such as military bases and the like). I have coined the term
"Federal Zone" to refer to all territory which is under the
sovereignty of the "United States". This interpretation conforms
to the second of three Supreme Court definitions of the term
"United States", as follows:


     The term "United States" may be used in any one of several
     senses. It may be merely the name of a sovereign occupying
     the position analogous to that of other sovereigns in the
     family of nations. It may designate the territory over
     which the sovereignty of the United States extends, or it
     may be the collective name of the states which are united by
     and under the Constitution.

                    [Hooven & Allison Co. vs Evatt, 324 U.S. 652]
                                                 [emphasis added]

     To summarize, you are liable for federal taxes on income
derived from worldwide sources if you are either a "citizen of
the United States" or a "resident of the United States" as those
terms are defined above. If you are neither, then you are a
nonresident alien and, as such, you are liable for federal taxes
on all income which is derived from sources within the United
States (as defined above), and on all income which is effectively
connected with the conduct of any "United States" trade or
business. For example, if you are employed by the federal
government, your pay comes from a source inside the United States
(as defined). Similarly, if you receive dividends from bonds
issued by the federal government, or by corporations chartered in
the District of Columbia (i.e., "domestic" corporations), this
"income" derives from a source that is within the United States
(as defined) and it is taxable. See Treasury Decision 2313 for a
clarification of the taxability of bond interest and stock
dividends issued by domestic corporations to nonresident aliens.

     If you are unclear as to the meaning of the term "income",
please understand that the Supreme Court has instructed Congress
it cannot by any definition it may adopt conclude the matter (of
defining income), because Congress cannot by legislation alter
the Constitution, from which alone it derives its power to
legislate, and within whose limitations alone that power can be
lawfully exercised. Even though the 16th Amendment was never
ratified and the word "income" is not found in the Constitution,
Congress has continued to obey this prohibition. Nevertheless,
the Supreme Court has issued numerous official definitions of the
term "income", perhaps the most famous of which is the decision
which issued this prohibition, namely, Eisner vs Macomber, 252
U.S. 189. The Supreme Court has had to define "income" so many


                        Page P - 62 of 98

                                                       Appendix P


times, it decided that the definition was finally settled in
Merchant's Loan & Trust vs Smietanka, 255 U.S. 509.

     Finally, the 16th Amendment is not the constitutional
authority for Title 26. That authority issues from 1:8:17 and
4:3:2 in the U.S. Constitution. Title 26 is a "municipal"
statute which is not affected by either the apportionment rule or
the uniformity rule in the Constitution. Think of Congress as
"City Hall" for the federal zone. Congress has exclusive
legislative authority within the federal zone (see Downes vs
Bidwell, 182 U.S. 244, which is discussed in the attached
memorandum to staff members of the Save-A-Patriot Fellowship).
The operant "rule" that applies to Title 26 is majority rule. If
you want to change Title 26, then change the composition of the
Senate and House of Representatives.


2. How can Bill Conklin file a tax return without waiving his
     Fifth Amendment protected Rights?

     Sign your name with the following phrase above your
signature:

     with explicit reservation of all my unalienable rights and
     without prejudice to any of my unalienable rights UCC 1-207

In order to inform the world as to the meaning of this phrase,
you may opt to attach an explanation like the following:

     My use of the phrase "WITH EXPLICIT RESERVATION OF ALL MY
     RIGHTS AND WITHOUT PREJUDICE UCC 1-207" above my signature
     on this document indicates: that I explicitly reject any and
     all benefits of the Uniform Commercial Code, absent a valid
     commercial agreement which is in force and to which I am a
     party, and cite its provisions herein only to serve notice
     upon ALL agencies of government, whether international,
     national, state, or local, that they, and not I, are subject
     to, and bound by, all of its provisions, whether cited
     herein or not; that my explicit reservation of rights has
     served notice upon ALL agencies of government of the
     "Remedy" they must provide for me under Article 1, Section
     207 of the Uniform Commercial Code, whereby I have
     explicitly reserved my Common Law right not to be compelled
     to perform under any contract or commercial agreement, that
     I have not entered into knowingly, voluntarily, and
     intentionally; that my explicit reservation of rights has
     served notice upon ALL agencies of government that they are
     ALL limited to proceeding against me only in harmony with
     the Common Law and that I do not, and will not accept the
     liability associated with the "compelled" benefit of any
     unrevealed commercial agreements; and that my valid
     reservation of rights has preserved all my rights and
     prevented the loss of any such rights by application of the
     concepts of waiver or estoppel.


                        Page P - 63 of 98

                                                The Federal Zone:


     Put simply, if you are signing a tax return, you are
entering a commercial agreement with the "United States".
Government officials are bound by the Uniform Commercial Code to
preserve your rights unless you waive any of them with knowingly
intelligent acts, done with sufficient awareness of the relevant
circumstances and consequences (see Brady vs U.S., 397 U.S. 742,
748 (1970)). This places government officials on notice that
they must disclose in advance all terms and conditions attached
to that commercial agreement. Your explicit reservation of
rights prevents the loss of any of your rights, including your
Fifth Amendment protected right against self-incrimination, by
application of the concepts of waiver or estoppel.

     Finally, per 28 USC 1746, if you are a nonresident alien,
you should modify the perjury jurat on all IRS forms by
indicating that you are making your affirmation "without the
United States, under the laws of the United States of America".
I have attached the operative statute, for your information.
Note also the Form 1040X and 1040NR instructions for foreign
addresses. If you do not follow these instructions, the "United
States" is entitled to presume that you have a "domestic" address
and that you are, therefore, "resident" in the "United States" as
defined.

     If you have any questions about the above, and/or you wish
additional clarification, please don't hesitate to contact me in
writing at the above address. Copies of The Federal Zone:
Cracking the Code of Internal Revenue have already been forwarded
to John Voss, Sharon Voss, and Brett Brough. Much additional
clarification of my answers in this letter can be found in that
book.

     Thank you very much for your interest in Title 26.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

enclosures

copies: John Voss
          John Pleasant
          Brett Brough


                        Page P - 64 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   March 29, 1992

The Sovereign Advisor
Common-Law Service Center HQ
3rd Judicial District
564 La Sierra Drive, Suite 187
Sacramento, California Republic

Dear Sovereign Advisor:

     I was very happy to receive a complimentary copy of The
Sovereign Advisor recently from a friend and colleague in the
freedom movement. Please accept my qualified praise for your
first edition, the December Issue "91". I am writing to share
with you some of the many thoughts which occurred to me as I was
reading this first issue.

     First of all, I am alarmed by what I consider to be a
glaring contradiction which is evident in your newsletter. On
page 2 in the article entitled "5, 4, 3, 2, 1, Liftoff!", you
state:

     There are several groups out there that are deliberately
     trying to keep you within the system by claiming you are an
     American Citizen, this is a false and misleading term. ...
     Now if you are or claim to be an American Citizen and you
     are located within any one of the states of the union you
     are a federal citizen, subject to the municipal laws of the
     district of columbia [sic].


     On page 6, in the article entitled "Is the United States
Guilty of Genocide?", you state:

     The State of California was required to have its own
     Citizens, who were first, State Citizens, then as a
     consequence of State Citizenship were American Citizens,
     known as Citizens of the United States, (Capitol [sic] "C")
     there were [sic] no specific class as this, but for
     traveling and protection by the United States government
     while out of the country, they were generally called
     Citizens of the United States. (capital "C")


It is difficult enough to identify oneself with the freedom
movement in the United States of America without also having to
reconcile the positions of various organizations which contradict
each other. It is entirely impossible to reconcile those
sections of your newsletter which flatly contradict each other.


                        Page P - 65 of 98

                                                The Federal Zone:


     Second, the former paragraph quoted above states that there
are several groups "out there" that are deliberately trying to
keep us within the system by claiming that we are American
Citizens. I strongly object to this statement, for several
reasons. Your statement implies that you are privy to the
motivations of individuals and groups who make this claim, when
you are not. Unless people have actually revealed their
motivations to you, I don't see how you can be so privy to those
motivations. Such a statement in your newsletter suggests a
desire on your part to convince readers that you have all the
answers, and that others in the freedom movement do not. This
sounds more like crass commercial advertising than serious legal
scholarship, and it does serious damage to your overall
credibility.

     I, for one, have been known to utilize the term "American
Citizen" and I have not done so with the purpose of keeping
myself and others "within the system" as you put it. If I am not
an American, then I do not know what I am. I have also
distributed a great deal of written materials, among them an
affidavit of revocation, which utilizes the term "American
Citizen" by defining it clearly to mean a "free sovereign natural
born Citizen per 2:1:5 in the U.S. Constitution". I would
certainly hope that you would have the courtesy to extend your
respect to any of us who take the time to define our terms with
care, and not accuse us of trying to keep people "in the system",
even though our choice of definitions may not agree with yours.

     Since our nation has been known as the United States of
America at least since the U.S. Constitution was ratified, your
definition of "American Citizens" as federal citizens is
misleading and confusing. There is a popular, colloquial sense
in which we are ALL Americans. I would hesitate to recommend
that any Americans stop using that term to identify themselves,
particularly when The Sovereign Advisor obviously cannot make up
its own mind about the meaning of "American Citizens".

Elsewhere in your newsletter, you state:

     An American Citizen is an Indian who leaves the reservation;
     a U.S. Citizen residing outside the District of Columbia in
     one of the federal judicial districts; an alien residing in
     one of the several states; a State Citizen residing outside
     of the several states of the union.

In this statement, did you mean to say that an American Citizen
is a "U.S. Citizen" or a "U.S. citizen"? Your use of the phrase
"residing outside the District of Columbia" is also confusing.
The distinction that is made between the terms "resident" and
"nonresident" at 26 U.S.C. 7701(b)(1) suggests that one can be
either a "U.S. Citizen" or a "U.S. citizen", regardless of
whether one is a "resident" in the District of Columbia or not.
One attribute is a birth status; the other attribute is a
location status. Note, in particular, your own citation of Cook


                        Page P - 66 of 98

                                                       Appendix P


vs Tait, which stated that "citizens of the United States
wherever they are resident" are subject to the income tax, which
is based upon citizenship of the United States. The phrase
"wherever they are resident" is very revealing in this context.

     Title 26, Section 7701(b)(1)(B) makes it very clear that one
is an "alien" with respect to the "United States" if and only if
one is not a "citizen of the United States". You have used the
term "alien" without defining it, and without proper citations in
case law. (See Treasury Decision 2313.) The definition found in
Title 26 makes it very clear that one is an alien if and only if
one is not a "citizen of the United States". Therefore, the term
"alien" as defined encompasses all of the following: State
Citizens, Citizens of foreign countries like France, and beings
from other planets. Very simply, you are an "alien" if you are
not a "citizen", and you are a "nonresident" if you are not a
resident (see 26 U.S.C. 7701(b)(1)(A)-(B)).

     Allow me to offer the following clarifications. I define an
"American Citizen" to mean a sovereign State Citizen. (You are
free to disagree with this definition, but bear with me for the
moment, please.) As such, a sovereign State Citizen is
identifiable by the term "U.S. Citizen", which is an abbreviated
way of saying "Citizen of the United States of America", or
"Citizen of one of the 50 States of the Union". The term "United
States" in this context means the 50 States of the Union, united
by the Constitution.

     A sovereign State Citizen is not a "citizen of the United
States" (which is another way of saying "U.S. citizen") because
the "United States" in this context means the subjects and
jurisdiction over which Congress has exclusive legislative
authority. In order to solve a very large number of terminology
problems, I refer to this jurisdiction as "The Federal Zone",
namely, the areas of land over which the Congress has exclusive
legislative authority. These areas of land consist of the
District of Columbia, the federal territories and possessions,
and all federal enclaves ceded to Congress by acts of the State
Legislatures. The authority to have exclusive jurisdiction over
these areas of land issues from 1:8:17 and 4:3:2 in the U.S.
Constitution. You may choose to disagree with this
interpretation of the term "exclusive", but in doing so you are
disagreeing with the Supreme Court of the United States (see
Downes vs Bidwell, 182 U.S. 244 (1901)). The authority for Title
26 is not the so-called 16th Amendment, despite statements to
that effect which have been published in the Federal Register by
former Commissioners of Internal Revenue.

     Accordingly, an "alien residing in one of the several
states" is a "nonresident alien" with respect to the "United
States" as defined in Title 26, that is, with respect to The
Federal Zone, if he was born in one of the 50 States. An "alien
residing in one of the several states" is a "resident alien" with
respect to the "United States" as defined by Title 26, i.e., with


                        Page P - 67 of 98

                                                The Federal Zone:


respect to The Federal Zone, if he was born in a foreign country
like France and he was lawfully admitted for permanent residence.
Notice the phrase "lawfully admitted for permanent residence".
Birth status and location status create four different cases:
resident citizen, nonresident citizen, resident alien, and
nonresident alien.

     Congress has jurisdiction over immigration and
naturalization; Congress does not have jurisdiction over
sovereign State Citizens, because They created the Constitution,
and the Constitution created Congress. I presume that you are
using the term "several states" to mean the 50 States, even
though you have not capitalized the word "states". I prefer to
use the lower-case "states" to refer to federal territories and
possessions and upper-case "States" to refer to the 50 Sovereign
Members of the Union.

     The phrase "State Citizen residing outside of the several
states of the union" is also ambiguous, because it does not
identify whether this "State Citizen" is residing inside The
Federal Zone, or inside a foreign country like France. It makes
a difference. If this "State Citizen" resides inside The Federal
Zone, then he is a "resident alien" by definition (see
substantial presence test at 7701(b)(1)(A)). If he resides
inside a foreign country like France, then he is a "nonresident
alien" with respect to The Federal Zone, but he is still a
"Citizen of the United States of America" and, as such, Congress
does have jurisdiction over him as long as he resides therein.
He could request the protection of the U.S. State Department, for
example, by seeking help from an American embassy, and his status
as a "Citizen of the United States of America" would entitle him
to that protection.

     Finally, I am very concerned about the poor state of
grammar, spelling and punctuation in your newsletter. Any
organization which claims to know a technical subject like law,
and which claims to know it well enough to publicize a newsletter
on a specialized aspect of law, should be willing to embrace the
minimum standard for language accuracy. You have made a big
issue of upper and lower case letters, then you refer to the seat
of government and "the municipal laws of the district of
columbia". When the District of Columbia is obviously at issue
here, you should know better than to refer to the first letter in
"Citizen" as "Capitol C", when the correct term is "capital C".
Then you refer to "capital C" immediately after referring to
"Capitol C". (Is it possible that your staff is infiltrated?)
The Congress conducts its business in the "Capitol" building;
upper case letters are referred to as "capital" letters. If you
are attempting to write in an expository style, then do
everything to insure that your exposition is clear, unequivocal
and precise. Otherwise, you run the risk that a competing group
will criticize you for being motivated by an intent to equivocate
in your newsletter, when you are not so motivated (as far as I
can tell).


                        Page P - 68 of 98

                                                       Appendix P


     Please accept these criticisms in the constructive spirit in
which they are made. The issues which you have raised in your
newsletter are just too terribly important to risk any loss of
credibility through contradictions and substandard English. Our
language is rich and powerful enough to accommodate the most
exacting requirements of any discipline.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


                        Page P - 69 of 98

                                                The Federal Zone:


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   March 17, 1992

Louis Watson
International Tax Technology
16776 Bernardo Center Drive, #203
San Diego, California Republic
Postal Code 92128/TDC

Dear Lou:

     Thank you for the time and energy that went into your
presentation in Sparks, Nevada last Friday evening. I have been
debating whether or not to write you about my experience there.
Since I am still thinking about it, now four days later, I am
taking the chance that you will read this letter with an open
mind and an honest interest in what I have to say.

     Please bear in mind that, at least twice during your
lecture, you invited the audience to challenge anything you were
saying. Unfortunately for me, when I took you up on your offer,
your response was anything but receptive. In fact, after my
first question, your volume increased dramatically and your tone
of voice became defensive and harsh. It is for this reason that
I feel I am taking a chance that you may not read this letter
with an open mind and an honest interest in what I have to say.

     Let me begin with a somewhat technical point which, as it
turns out, is representative of the many problems we all
experience with Title 26. As you already know, the word
"include" and its several variations are utilized in many key
definitions within the IRC. After much research and writing on
the subject, I personally believe that it begs the question to
make our point with a partial quotation from Black's Law
Dictionary. If it does anything, such a partial reading exposes
our own biases, more than anything else. Fortunately, we can't
afford, nor do we need bias to win our argument with the IRS and
to convince the general public of the validity of our position.
The following is the complete definition of "include" from
Black's, Sixth Edition:

     Include. (Lat. inclaudere, to shut in, keep within.) To
     confine within, hold as in an inclosure, take in, attain,
     shut up, contain, inclose, comprise, comprehend, embrace,
     involve. Term may, according to context, express an
     enlargement and have the meaning of and or in addition to,
     or merely specify a particular thing already included within
     general words theretofore used. "Including" within statute
     is interpreted as a word of enlargement or of illustrative
     application as well as a word of limitation.
                                                 [emphasis added]


                        Page P - 70 of 98

                                                       Appendix P


     Notice, in particular, that this definition permits both the
expansive as well as the restrictive meanings. For this reason,
it is misleading to quote only the first definition, "to confine
within ...", when we attempt to decipher the IRC definitions of
"State" and "United States". Moreover, the statute itself
manifests an expansive intent when it defines "includes" and
"including" as follows:

     Includes and Including. The terms "includes" and
     "including" when used in a definition contained in this
     title shall not be deemed to exclude other things otherwise
     within the meaning of the term defined.

                                                 [26 USC 7701(c)]

     I find it quite fascinating that the word "include" is not
mentioned in this definition. Are we therefore justified in
arguing that "includes" and "including" are expansive, but
"include" is restrictive? This is not an idle question, because
the word "include" is used in the definition of "State" at
7701(a)(10), and the word "includes" is used in the definition of
"United States" at 7701(a)(9). Black's doesn't help us here,
because it embraces both the expansive and restrictive meanings.
How do we resolve this ambiguity?

     One could argue that "includes" is the singular form of the
verb, while "include" is the plural form of the verb. For
example, the sentence "It includes ..." has a singular subject
and a singular predicate. The sentence "They include ..." has a
plural subject and a plural predicate. An entry in the Code of
Federal Regulations of 1961 explains how plural forms include the
singular, and vice versa:

     170.60 Inclusive language.

     Words in the plural form shall include the singular and vice
     versa, and words in the masculine gender shall include the
     feminine as well as trusts, estates, partnerships,
     associations, companies, and corporations.

                   [26 CFR 170.59, revised as of January 1, 1961]

     On the basis of this regulation, therefore, one is justified
in arguing that "include" is also expansive because it is merely
the plural form of "includes", which is expansive per 7701(c). I
believe that this same rule is found in Title 1 of the U.S. Code,
but I can't quite put my finger on the citation just now.

     It would be nice if this were the end of the story, but
unfortunately for us, it is not. There are other published rules
which produce different results. One well established rule of
statutory construction is the rule of inclusio unius est exclusio
alterius. Black's defines this rule as follows:


                        Page P - 71 of 98

                                                The Federal Zone:


     Inclusio unius est exclusio alterius. The inclusion of one
     is the exclusion of another. The certain designation of one
     person is an absolute exclusion of all others. ... This
     doctrine decrees that where law expressly describes
     particular situation to which it shall apply, an irrefutable
     inference must be drawn that what is omitted or excluded was
     intended to be omitted or excluded.


     Now, the word "include" is omitted from the expansive
definition of "includes" and "including" found at 7701(c), is it
not? Using the above rule, we are permitted to draw an
irrefutable inference that the word "include" was omitted or
excluded because it was intended to be omitted or excluded.
Well, if "include" is not among the list of terms which are to be
given an expansive meaning, can we infer therefrom that it must
be given a restrictive meaning instead? If so, why?

     Another rule which raises even more questions is the
"ejusdem generis" canon, defined in Black's Sixth Edition as
follows:


     Under "ejusdem generis" canon of statutory construction,
     where general words follow the enumeration of particular
     classes of things, the general words will be construed as
     applying only to things of the same general class as those
     enumerated.
                                                 [emphasis added]


     Is California in the same general class as the District of
Columbia? Is Puerto Rico in the same general class as
California? One of the major points of my book is to distinguish
the 50 States from the federal zone by using a principle which I
call "territorial heterogeneity". The 50 States are in one
general class, because of the Constitutional restraints under
which Congress must operate inside those 50 States. The areas
within the federal zone are in a different general class, because
these same constitutional restraints simply do not limit Congress
inside that zone (see Downes vs Bidwell, 182 U.S. 244).

     This line of reasoning allows for an expansive definition of
"include", but expansive only up to a point, and not beyond.
What is that point? Refer now, if you would, to the start of the
IRC section on definitions, which begins as follows:


     When used in this title, where not otherwise distinctly
     expressed or manifestly incompatible with the intent
     thereof--
                                                    [26 USC 7701]


                        Page P - 72 of 98

                                                       Appendix P


     So, if an expansive definition of "include" results in
applying Title 26 to the 50 States, have we not produced a result
that is "manifestly incompatible with the intent thereof"? There
are no provisions for apportioning the direct taxes levied by
Title 26, and the Constitution still requires that direct taxes
be apportioned. This fact is dramatically reinforced by the
17,000 State-certified documents which have been assembled by Red
Beckman and Bill Benson to prove that the so-called 16th
Amendment was never ratified. It cannot have been the intent of
Title 26 to violate the Constitution. Just how do we resolve
this apparent conflict? You already know the answer: the
territorial scope of Title 26 is the federal zone; the political
scope of Title 26 is the set of persons who are "citizens" of
that zone (whether those persons are natural born, naturalized,
or "artificially born" per the 14th Amendment).

     We could spend even more time reviewing the numerous
decisions of the Supreme Court which have adopted either
expansive or restrictive definitions of "include" and its many
variations in order to arrive at those decisions. I am now
convinced that this is a waste of time, because it doesn't settle
the debate; it only aggravates the debate. If I leave you with
any one single point, I want to stress that Title 26 utilizes
words that have a long, documented history of semantic confusion.
"Include" and its many variations are among those words:


     This word has received considerable discussion in opinions
     of the courts. It has been productive of much controversy.

                                [Treasury Decision 3980, Vol. 29]
                                [January-December, 1927, page 64]
                                                 [emphasis added]

     Accordingly, I am delighted if you agree with the main
thesis of The Federal Zone, that is, the principle of territorial
heterogeneity. But I am also delighted if you disagree with this
thesis, because in doing so, your disagreement constitutes
undeniable proof of a parallel thesis of The Federal Zone,
namely, that Title 26 is null and void for vagueness. The "void
for vagueness" doctrine is deeply rooted in our right to due
process (under the Fifth Amendment) and our right to know the
nature and cause of an accusation (under the Sixth Amendment).
The latter right goes far beyond the contents of any criminal
indictment.

     The right to know the nature and cause of an accusation
starts with the statute which any defendant is accused of
violating. A statute must be sufficiently specific and
unambiguous in all its terms, in order to define and give
adequate notice of the kind of conduct which it forbids. If it
fails to indicate with reasonable certainty just what conduct the
legislature prohibits, a statute is necessarily void for
uncertainty, or "void for vagueness" as it is usually phrased.


                        Page P - 73 of 98

                                                The Federal Zone:


Any prosecution which is based upon a vague statute must fail
together with the statute itself. A vague criminal statute is
unconstitutional for violating the 6th Amendment.


For your information, I have enclosed some additional materials
which supplement the arguments I have made in this letter.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


enclosures

copies: Chris Wilder
          Michael Thomas
          Red Beckman


        Page  P - 74 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   July 24, 1991


Church of Scientology International
6331 Hollywood Boulevard, Suite 1200
Los Angeles, California Republic
Postal Code 90028/TDC

Dear Church of Scientology:

     Please accept my sincerest praise for the courage and
dedication you have shown by publishing a full-page advertisement
in the July 3, 1991 issue of USA Today. Your ad, "We Believe A
Fair Tax Is Worth Fighting For", was very professional, very
informative, and very convincing.

     I am writing to take issue with the contents of paragraph
three of that ad, which reads:


     This door opened a crack in 1913 with the passage of the
     16th Amendment to the Constitution, which allowed an income
     tax to be instituted. This door has since swung wide and
     Americans again are subjected to an unfair tax system.


     Attached please find a copy of my letter dated March 1, 1991
to Mr. David Miscavige, author of the article "Freeing the U.S.
From the IRS" which appeared in Freedom magazine, May 31, 1990.
In my letter to Mr. Miscavige, I did my best to explain briefly
how the 16th Amendment was never ratified; it was merely
"declared" ratified by Secretary of State Philander C. Knox in
the year 1913, in the face of serious evidence impugning the
entire ratification process.

     Moreover, Congress never "passed" the 16th Amendment,
because Congress has never been empowered to amend the
Constitution. Congress merely passed "resolutions" proposing
that the State legislatures ratify the text of a proposed
amendment. Since three-fourths of the States failed to ratify
the text of the proposed amendment, the proposal never became a
law. Therefore, as law-abiding Americans, we must act as if "the
bill never became a law and was as completely a nullity as if it
had been the act or declaration of an unauthorized assemblage of
individuals," to quote an Illinois State court.


                        Page P - 75 of 98

                                                The Federal Zone:


     This issue is not a minor legal technicality. It is
misleading to publish a statement that "the 16th Amendment was
passed in 1913," without also referring to documented historical
facts which prove that the proposed amendment was simply not
ratified. This issue is a major constitutional question. If any
attempt to amend the Constitution fails to obey the rules for
amending that document, which rules are found in the Constitution
itself, then the text of that attempt cannot in any way be
considered a part of the Constitution and must be considered null
and void.

     The United States Constitution is the supreme law of the
land, and any statute, to be valid, must be in agreement with it,
and therefore with all relevant provisions for amending it. It
is impossible for both the Constitution and a law violating it to
be valid; one must prevail. That "one" is the Constitution.
This is succinctly stated as follows:


     The general rule is that an unconstitutional statute, though
     having the form and name of law, is in reality no law, but
     is wholly void and ineffective for any purpose; since
     unconstitutionality dates from the time of its enactment,
     and not merely from the date of the decision so branding it.
     An unconstitutional law, in legal contemplation, is as
     inoperative as if it had never been passed. Such a statute
     leaves the question that it purports to settle just as it
     would be[,] had the statute not been enacted.


     Since an unconstitutional law is void, the general
     principles follow that it imposes no duties, confers no
     rights, creates no office, bestows no power or authority on
     anyone, affords no protection, and justifies no acts
     performed under it ....


     A void act cannot be legally consistent with a valid one.
     An unconstitutional law cannot operate to supersede any
     existing valid law. Indeed, insofar as a statute runs
     counter to the fundamental law of the land, it is superseded
     thereby.


     No one is bound to obey an unconstitutional law, and no
     courts are bound to enforce it.

                               [Sixteenth American Jurisprudence]
                                    [Second Edition, Section 177]
                                                 [emphasis added]


                        Page P - 76 of 98

                                                       Appendix P


     I invite you also to review the enclosed letter to the
Save-A-Patriot Fellowship, in which I stress the legal importance
of being historically correct about the so-called "16th
Amendment". The preponderance of historical evidence proves that
the proposal to amend the Constitution failed to obtain the
approval of 36 States, and as such never achieved the status of a
ratified Amendment and never became an Article of that
Constitution. It is not now a law, and never was a law, not in
this country, not in all of recorded history, not on this planet.

     Thank you for your consideration.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


                        Page P - 77 of 98

                                                The Federal Zone:


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   March 1, 1991

Mr. David Miscavige, Chairman
Religious Technology Center
c/o Freedom Magazine
6331 Hollywood Blvd., Suite 1200
Los Angeles, California Republic
Postal Code 90028-6329/TDC

Dear Mr. Miscavige:

     I enjoyed reading your article entitled "Freeing the U.S.
From the IRS" which appeared in the May 31, 1990 issue of Freedom
magazine.

     The article cites numerous excellent reasons for abolishing
federal income taxes. I agree with every one of your
conclusions. I cannot, however, agree with all of your "facts".
Specifically, in your first paragraph, you write,

     Since 1913, when an income tax was made possible by the
     passage of the 16th Amendment, Americans have faced a filing
     deadline 78 times. When the constitutional amendment was
     passed, voters were promised this new tax would be fairly
     administered.


     I cannot agree with this statement, because the evidence
which is available to me indicates that the 16th Amendment was
never lawfully ratified. It was merely "declared" ratified by
the U.S. Secretary of State in 1913, Philander Knox, in the face
of serious evidence impugning the entire ratification process.

     Enclosed please find a detailed summary of the evidence
against the 16th Amendment, and a brief analysis of the legal and
economic implications of acting on these facts. That is, as
law-abiding Americans, we must act as if "the bill never became a
law and was as completely a nullity as if it had been the act or
declaration of an unauthorized assemblage of individuals", to
quote an Illinois State court.

     I would enjoy hearing from you on this important question.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


                        Page P - 78 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   April 10, 1991


Dr. Lois Callahan, President
College of San Mateo
1700 West Hillsdale Boulevard
San Mateo, California Republic
Postal Code 94402/TDC

Dear Dr. Callahan:

     I am writing to file a formal complaint against the offices
of television station KCSM, which are located in Building 9 on
your campus.

     Last evening, I personally witnessed an act of political
censorship by the staff of station KCSM. My colleague, Mr.
Godfrey Lehman, had previously received a written invitation to
appear on the KCSM program "Legal Currents" at 7:30 p.m. The
scheduled topic was "Income Tax Filing: What are your rights?
Where will the money go?" In addition to a cover letter, the
invitation included two maps with directions to KCSM offices, a
temporary parking permit, and wardrobe guidelines. I personally
drove Mr. Lehman and accompanied him to this scheduled event.

     After our arrival, the second scheduled guest arrived, Mr.
Larry Wright, Public Affairs Officer with the Internal Revenue
Service in San Francisco. Upon learning of KCSM's plans to air
the two guests together, Mr. Wright objected to the presence of
Mr. Lehman on the same program. He cited what he termed a long-
standing policy of the IRS to avoid all confrontations over the
tax law outside the court room. A KCSM staff member was also
present to hear Mr. Wright's objections. This staff member tried
in vain to persuade the IRS agent to modify his position.

     At this point, the KCSM staff member left the room in order
to obtain a decision from her management. She returned some
minutes later to inform all of us that Mr. Wright would be
allowed to appear on the program, but that Mr. Lehman would not
be allowed to appear on the program. At this point, Godfrey
Lehman and I obtained permission to view the "Legal Currents"
program on a television monitor which was already installed in
the office where we had been meeting. The aired program offered
no explanation for Mr. Lehman's absence, offered no apology for
the abrupt change of scheduled programming, and made no reference
whatsoever to Mr. Godfrey Lehman, despite the fact he had already
informed numerous colleagues of his scheduled appearance.


                        Page P - 79 of 98

                                                The Federal Zone:


     Now that I have summarized the relevant facts of this event,
I wish to express my outrage at such a blatant act of political
censorship by the management of television station KCSM. When a
private Citizen is flatly denied access to public broadcast
media, while government agents are allowed to prevail, do we not
thereby undermine the very foundations of our constitutional
republic? Have we not emphatically and dramatically denied that
Citizen his right to freedom of speech, a right which is
explicitly guaranteed by the First Amendment to the Constitution
of the United States? Even if the station can be persuaded at
some future date to abide by some "equal time doctrine", how can
we begin to assess the real damage to that Citizen's precious
civil rights? When government distortion and intimidation are
sponsored without challenge, are we not paving a sure path away
from educated electorates, in the direction of police state
tactics and totalitarian control?

     I am asking these questions because I require answers to
these questions. Is it, or is it not the policy of the
administration of the College of San Mateo to encourage this
brand of media censorship? on the campus of a public educational
institution? in the offices of a publicly licensed broadcast
station? Are you now aware that government "public relations"
agents have been allowed to prevail over the written invitation
to a private Citizen, a published author and a recognized
constitutional authority on the federal tax law?

     I would greatly appreciate your immediate attention to this
important matter. If I can assist you in any way to investigate
this incident, please don't hesitate to contact me.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


copy: Board of Trustees,
       San Mateo County Community College District


                        Page P - 80 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   March 18, 1991


Mr. Peter Gabel, President
New College of California
50 Fell Street
San Francisco, California Republic
Postal Code 94102/TDC

Dear Mr. Gabel:

     I was shocked to read the recent San Francisco Chronicle
article about the threatened IRS seizure of one of your classroom
buildings. With this letter, I hope to make you fully aware of
the powerful forces which can be made available to defend your
college against this unjust and illegal attack. Permit me to get
right to the major points:

     Our research into the U.S. Constitution, Congressional
taxing powers, and the Internal Revenue Service has uncovered a
mountain of material evidence which supports the following
conclusions:


     1. Wages are not taxable income, as the term is clearly
          and consistently defined by several key decisions of
          the U.S. Supreme Court that remain in force today.


     2. The U.S. Constitution authorizes Congress to levy
          "direct taxes" on private property, but only if those
          taxes are apportioned across the 50 States.


     3. The IRS now enforces the collection of "income taxes"
          as direct taxes without apportionment, and cites the
          16th Amendment for its authority to do so.


     4. The 16th Amendment, the so-called "income tax"
          amendment, was never lawfully ratified by the required
          36 States, but was declared ratified by the U.S.
          Secretary of State in the year 1913.


     5. The 16th Amendment could never have done away with the
          apportionment rule for any direct taxes if it never
          became a law in the first place.


                        Page P - 81 of 98

                                                The Federal Zone:


     The documentary substantiation for these conclusions is
found in the attached formal petition, dated December 24, 1990,
to Congresswoman Barbara Boxer, my Representative in the Congress
of the United States. Rep. Boxer has, to date, failed to respond
to this formal petition. For this reason, we have recently filed
a formal Request for Investigation by the Marin County Grand
Jury, a copy of which is attached for your review. We have
requested the Marin County Grand Jury:

     1. to investigate possible obstruction of justice and
          misprision of felony by Rep. Barbara Boxer for her
          failure, against a spoken promise before hundreds of
          witnesses at Pt. Reyes Station on August 22, 1990, to
          examine the material evidence of felony fraud when U.S.
          Secretary of State Philander C. Knox declared the 16th
          Amendment ratified,

     2. to subpoena or otherwise require Representative Boxer
          to explain, under oath, why she and her staff have
          failed to answer our formal, written petition for
          redress of this major legal grievance with agents of
          the federal government,

     3. to review the material evidence against the so-called
          16th Amendment which we have assembled and are prepared
          to submit in expert testimony, under oath, to the Marin
          County Grand Jury.

     Mr. Gabel, we have developed a network of constitutional and
legal experts whose resources can be made available to assist you
on very short notice. As you can infer for yourself from the
attached materials, we see the IRS attack on your college as an
illegal and unconstitutional act by an agency of the Federal
Reserve System. This attack is designed to harass and intimidate
an educational institution dedicated to the goals of social
responsibility and progressive change. These goals are inimical
to the purposes for which the IRS was established. You must
fully appreciate that the Internal Revenue Service is not a
service to the American people. It is not a service to the U.S.
Government. It is a service to the Federal Reserve System, which
is not an agency of the federal government.

     After you have had a chance to review this letter and its
attachments, may I recommend that we meet privately to discuss
your situation and to consider the several ways in which we can
bring our collective expertise to bear upon it. For example, I
am ready on short notice to present the results of our research
in a guest lecture to your law students and faculty, at no charge
to the College. Similarly, I am prepared to share with you the
material evidence against the 16th Amendment which I currently
hold in my possession. I should think that a fight for the very
survival of your college would provide an excellent motivation
for one exciting moot courtroom drama for all faculty members,
students, and staff.


                        Page P - 82 of 98

                                                       Appendix P


     Please feel free to call me at your earliest convenience.
If I have not heard from you by this coming Friday, I will
contact your office by telephone to discuss this letter and
hopefully arrange a meeting. Thank you very much for your
consideration, and good luck!


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

attachments

copies: selected colleagues


                        Page P - 83 of 98

                                                The Federal Zone:


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   March 25, 1991

Marion McEwen
FIJA California
24828 Canyon View Court
Hayward, California Republic
Postal Code 94541/TDC

Dear Marion:

     I obtained your name and address from the Special Conference
Issue of The FIJA Activist. I am writing you to request any
advice or assistance you may be able to provide to me in a matter
of utmost importance to the general welfare of all American
Citizens.

     In the summer of 1990, I personally received material
evidence that the 16th Amendment, the so-called income tax
amendment, was never lawfully ratified. This evidence indicates
that the act of declaring the 16th Amendment "ratified" was an
act of outright fraud by then Secretary of State Philander C.
Knox. In August of 1990, I brought this evidence to the
attention of Congresswoman Barbara Boxer, my representative in
the Congress of the United States. In front of several hundred
witnesses at a community meeting sponsored by Rep. Boxer, she did
agree to examine the evidence to which I refer. During the next
several months, I heard nothing from Rep. Boxer's office on this
matter.

     In December of 1990, I personally prepared a formal, written
petition to Rep. Barbara Boxer, reminding her of her promise to
examine the material evidence against the 16th Amendment, and
reminding her also of her solemn oath of office, by which she
swore to uphold and defend the Constitution of the United States.
A copy of this formal, written petition is enclosed, for your
review. To date, I have received no responses from Rep. Boxer
nor from any of her staff on this matter.

     Accordingly, on March 11, 1991, I filed a formal Request for
Investigation by the Marin County Grand Jury. As stated in the
summary section of our completed form, we requested the Grand
Jury to do the following:


     1. investigate possible obstruction of justice and
          misprision of felony by Rep. Barbara Boxer for her
          failure, against a spoken promise before hundreds of
          witnesses, to examine the material evidence of felony
          fraud when U.S. Secretary of State Philander C. Knox
          declared the 16th Amendment ratified,


                        Page P - 84 of 98

                                                       Appendix P


     2. to subpoena or otherwise require Rep. Boxer to explain,
          under oath, why she and her staff have failed to answer
          our formal, written petition for redress of this major
          legal grievance with agents of the federal government,


     3. to review the material evidence against the so-called
          16th Amendment which we have assembled and are prepared
          to submit in expert testimony, under oath, to the Marin
          County Grand Jury.


     In a written response dated March 13, 1991, the Marin County
Grand Jury declined to proceed with an investigation. Their
reasons were stated as follows:


     In the panel's opinion that subject matter was not within
     its jurisdiction. We serve in a watchdog manner over local
     public departments and agencies. As a result of Proposition
     115 this Grand Jury is apparently relegated to civil
     matters, whereas indictment and accusation cases are to be
     handled by a special criminal Grand Jury.


These reasons were cited, despite a recent newspaper article
which described the Grand Jury as follows:

     The Grand Jury operates under the auspices of the Superior
     Court and has the authority to investigate the personnel and
     operations of any county, city or local government agency as
     well as the conduct of any elected, appointed or hired
     official.

              [Coastal Post, March 4, 1991, p. 3, emphasis added]


     I do understand from your newsletter that there is a
parallel FIGJA (grand jury) organization. Because I intend to
write to them directly, I would appreciate it very much if you
could do more than merely refer this letter to them. For
example, I would be very interested to know if there is any way I
can successfully persuade the Marin County Grand Jury to
reconsider their decision to decline the investigation which I
have requested.

     Please understand that I have no personal vendetta against
Rep. Boxer, nor do I wish to create an embarrassing situation for
her. I agree with her positions on a number of important public
policy issues, and wish her the best of luck in her bid for a
seat in the Senate of the United States. Nevertheless, she is my
elected Representative in the Congress of the United States, and
the First Amendment to the U.S. Constitution does guarantee my
right to petition the Government for a redress of grievances.


                        Page P - 85 of 98

                                                The Federal Zone:


     If Rep. Boxer has anyone to fear, it is Rep. Boxer herself.
If she or her staff have, in fact, chosen to ignore this matter,
then she is failing to do the job she was elected to do, and she
may in fact be guilty of obstructing justice and misprision of
felony (see attached).

     For your information, I am also planning to write to
Supervisor Gary Giacomini of the Marin County Board of
Supervisors. In the March 11, 1991 issue of the Coastal Post,
Supervisor Giacomini was quoted to say:


     "It's a bad time for us that are in government with no money
     coming from Washington or the State. Nineteen years ago
     when I got started, the federal government paid 34 percent
     of the county budget. Now they pay 7 percent. There are
     dues to pay for the deficit in Washington and dues to pay
     for war," he explained.
                            [emphasis added]


     To many, there is little if any connection between federal
income taxes and the current fiscal squeeze on state and local
governments, or the poor state of the national economy in
general. On the contrary, the research I have done during the
past 9 months now convinces me that the connection is direct.
Federal income taxes are used to make interest payments to the
Federal Reserve banks, and their collection agency is the
Internal Revenue Service. The IRS is not a service to the people
of the United States.  It is not a service to the government of
the United States. It is a service to the Federal Reserve
System, a private credit monopoly described as "one of the most
corrupt institutions the world has ever known" by Congressman
Louis T. McFadden, Chairman of the U.S. Banking and Currency
Commission for some 22 years. Witness McFadden's statement
published in the Congressional Record of June 10, 1932:


     Mr. Chairman, we have in this country one of the most
     corrupt institutions the world has ever known. I refer to
     the Federal Reserve Board and the Federal Reserve banks.
     The Federal Reserve Board, a Government board, has cheated
     the Government of the United States and the people of the
     United States out of enough money to pay the national debt.
     The depredations and iniquities of the Federal Reserve Board
     and the Federal Reserve banks acting together have cost this
     country enough money to pay the national debt several times
     over. This evil institution has impoverished and ruined the
     people of the United States; has bankrupted itself, and has
     practically bankrupted our Government. It has done this
     through the defects of the law under which it operates,
     through the maladministration of that law by the Federal
     Reserve Board, and through the corrupt practices of the
     moneyed vultures who control it.


                        Page P - 86 of 98

                                                       Appendix P


     Some people think the Federal Reserve banks are United
     States Government institutions. They are not Government
     institutions. They are private credit monopolies which prey
     upon the people of the United States for the benefit of
     themselves and their foreign customers; foreign and
     domestic speculators and swindlers; and rich and predatory
     money lenders. In that dark crew of financial pirates there
     are those who would cut a man's throat to get a dollar out
     of his pocket; there are those who send money into States
     to buy votes to control our legislation; and there are
     those who maintain an international propaganda for the
     purpose of deceiving us and of wheedling us into the
     granting of new concessions which will permit them to cover
     up their past misdeeds and set again in motion their
     gigantic train of crime.


     The manipulations of the Federal Reserve System and their
effects on the entire American economy have been shrouded in
considerable secrecy for too many years now. This secrecy has
been a conscious and deliberate feature of its corrupting
influence on officials in all branches of the federal government.
To illustrate my point, I have now personally witnessed documents
which prove that a federal grand jury in Orem, Utah issued two
formal indictments against the Federal Reserve System, but those
indictments were subsequently obstructed by the Department of
Justice and by the Federal judiciary. These documents show that
the first indictment was issued on or about February 16, 1982.
The second indictment was issued on or about July 7, 1982. This
documentation can be made available to you upon request.

     I sincerely hope that this letter has provided you with a
glimpse of just how serious and widespread a problem the
so-called 16th Amendment has created for millions of Americans, a
problem that now extends through two whole generations of our
brief history as a nation. As I myself have come to appreciate
the true essence of this problem, I have also come to the
conclusion that the millions of hard-working Americans burdened
by this scourge now deserve an honest explanation. This
explanation can only be forthcoming if we, the people, exercise
our unalienable right to correct a government which has now
drifted so far off course, it hardly resembles the constitutional
republic it was designed to be.

     I do honestly believe that, whenever any form of government
becomes destructive of our rights, it is also our right to alter
or abolish it, and to institute a new government, laying its
foundation on such principles, and organizing its powers in such
form, as to us, the U.S., shall seem most likely to effect our
safety and our happiness.

     To this end, I dedicate my life, my fortune, and my sacred
honor. Won't you please join me?


                        Page P - 87 of 98

                                                The Federal Zone:


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


copy: Lowell A. Airola, Foreperson
       Grand Jury of Marin County

       Gary Giacomini, Member
       Marin County Board of Supervisors


                        Page P - 88 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   an Rafael, California
                                   Postal Code 94903-0189/TDC

                                   April 29, 1991

Dianne Bast
Heartland Institute
654 South Wabash, 2nd Floor
Chicago, Illinois
Postal Code 60605/TDC

Dear Dianne:

     At the request of my colleague, Kirby Ferris, enclosed
please find a collection of papers and letters which summarize
our continuing research and political action with respect to the
16th Amendment and related subjects.

     It has been difficult obtaining reliable information on the
Federal Reserve System, because this syndicate has been shrouded
in almost total secrecy since its creation. Even though I take
exception to the religious prejudice he sometimes exhibits,
author Eustace Mullins does appear to have the inside track on
the origins and development of this syndicate. In particular,
the enclosed quote from A Writ for Martyrs is the most succinct
statement of "The Problem" that I have been able to find
anywhere.

     Interestingly, the enclosed quote by Eustace Mullins is
entirely consistent with statements by Beardsley Ruml in the
January 1946 issue of American Affairs magazine. Mr. Ruml,
Chairman of the Federal Reserve Bank of New York at that time,
was the person who devised the income tax withholding system. In
this article, he wrote,


     By all odds, the most important single purpose to be served
     by the imposition of federal taxes is the maintenance of a
     dollar which has stable purchasing power over the years.


     In other words, federal income taxation is the
counterbalance to the flood of paper money which pours into the
economy as the Fed creates it "out of thin air". Without this
counterbalance, inflation would skyrocket. "... [W]ithout the
use of federal taxation all other means of stabilization, such as
monetary policy and price controls and subsidies, are
unavailing," concluded Ruml [emphasis added].

     What does all this mean? It means that income taxes have
nothing to do with the funding of government services. The
report of the Grace Commission confirmed the same finding. All
individual income tax revenues go to pay for interest on the


                        Page P - 89 of 98

                                                The Federal Zone:


national debt, which debt is owed to a private credit monopoly
once described by Congressman Louis T. McFadden as "one of the
most corrupt institutions the world has ever known".

     Therefore, as you study the many problems that exist with
the so-called "ratification" of the 16th Amendment, try to
realize the true motives which underpin the chicanery that
occurred in that ratification process. For example, the Governor
of the State of Arkansas vetoed the resolution to amend the
Constitution. The Kentucky Senate Journal recorded a vote of 9
FOR and 22 AGAINST the resolution. An Illinois State court ruled
that "it never became a law, and was as much a nullity as if it
had been the act or declaration of an unauthorized assemblage of
individuals." Nevertheless, the U.S. Secretary of State in the
year 1913, Philander C. Knox, "declared" it ratified anyway. It
is no coincidence that this act by Secretary Knox occurred in the
same year the Federal Reserve Act was passed by Congress.

     For your information, I have also enclosed a copy of a
recent bibliography which we have assembled on the subjects of
income taxes, the 16th Amendment, and the Federal Reserve System.
These references are an excellent place to continue your
education. If there is anything else we can do for you, please
don't hesitate to contact us.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

copy: Kirby Ferris

enclosures: bibliography
             assembled papers


                        Page P - 90 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   May 29, 1991
Producers
60 Minutes
524 West 57th Street
New York, New York
Postal Code 10019/TDC

Dear Producers:

     I am writing this letter at the request of my colleague, Mr.
Godfrey Lehman. In his letter to you dated May 21, 1991, Godfrey
has already written an excellent summary identifying the major
problems which his research has discovered with federal income
taxes and the Internal Revenue Service.

     Do you have any interest in developing a special segment to
discuss the mass of new evidence which now seriously impugns the
ratification of the 16th Amendment, the so-called income tax
amendment?

     The material evidence in our possession proves that the 16th
Amendment was never lawfully ratified. This evidence indicates
that the act of declaring it "ratified" was an act of outright
fraud by Secretary of State Philander C. Knox in the year 1913.
You may already know that fraud has no statute of limitations.

     To date, I have already filed four formal petitions for
redress of this major grievance with the Congress of the United
States. Three were addressed to Barbara Boxer, the
Representative for the Congressional district in which I reside.
The fourth petition was addressed to Rep. Dan Rostenkowski,
Chairman of the House Committee on Ways and Means. Copies of
these petitions are enclosed, for your review, in addition to a
collection of letters and other materials.

     To many, there is little if any connection between federal
income taxes and the current fiscal squeeze on state and local
governments, or the disintegration of the national economy in
general. On the contrary, the research I have done during the
past year now convinces me that the connection is direct.

     Federal income taxes are used to make interest payments to
the Federal Reserve banks, and their collection agency is the
Internal Revenue Service. The IRS is not a service to the people
of the United States. It is not a service to the government of
the United States. It is a service to the Federal Reserve
System, a private credit monopoly described as "one of the most
corrupt institutions the world has ever known" by Louis T.
McFadden, Chairman of the House Banking and Currency Committee,
1927-1933.


                        Page P - 91 of 98

                                                The Federal Zone:


     The manipulations of the Federal Reserve System and their
effects on the entire American economy have been shrouded in
considerable secrecy for too many years now. This secrecy has
been a conscious and deliberate feature of its corrupting
influence on officials in all branches of the federal government.

     This secrecy has also made it very difficult to obtain
reliable information about the Federal Reserve. Even though I
take exception to the religious prejudice he sometimes exhibits,
author Eustace Mullins does appear to have the inside track on
the origins and development of this syndicate. In particular,
the enclosed excerpt from A Writ for Martyrs is the most succinct
statement of "The Problem" that I have been able to find
anywhere. In his recent book The Shadows of Power, author James
Perloff puts it this way:


     The year 1913 was an ominous one -- there now existed the
     means to loan the government colossal sums (the Federal
     Reserve), and the means to exact repayment (income tax).
     All that was needed now was a good reason for Washington to
     borrow. In 1914, World War I erupted on the European
     continent. America eventually participated, and as a result
     her national debt soared from $1 billion to $25 billion.


     I sincerely hope that this letter has provided you with a
glimpse of just how serious and widespread a problem the
so-called 16th Amendment has created for millions of Americans, a
problem that now extends through two whole generations of our
brief history as a nation. As I myself have come to appreciate
the true essence of this problem, I have also come to the
conclusion that the millions of hard-working Americans burdened
by this scourge now deserve an honest explanation. This
explanation can only be forthcoming if we, the people, exercise
our unalienable right to correct a government which has now
drifted so far off course, it hardly resembles the constitutional
republic it was designed to be.

     Please feel free to contact me at any time concerning this
proposal for "60 Minutes" coverage of the 16th Amendment fraud.
Thank you very much for your consideration.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship

enclosures


                        Page P - 92 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   May 29, 1991

Mr. Dennis Bernstein
Radio Station KPFA
2207 Shattuck Avenue
Berkeley, California Republic

Dear Mr. Bernstein:

     Do you have any interest in developing a segment to discuss
the mass of new evidence which now seriously impugns the
ratification of the 16th Amendment, the so-called income tax
amendment?

     The material evidence in our possession proves that the 16th
Amendment was never lawfully ratified. This evidence indicates
that the act of declaring it "ratified" was an act of outright
fraud by Secretary of State Philander C. Knox in the year 1913.
You may already know that fraud has no statute of limitations.

     To date, I have already filed four formal petitions for
redress of this major grievance with the Congress of the United
States. Three were addressed to Barbara Boxer, the
Representative for the Congressional district in which I reside.
The fourth petition was addressed to Rep. Dan Rostenkowski,
Chairman of the House Committee on Ways and Means. Copies of
these petitions are enclosed, for your review, in addition to a
collection of letters and other materials.

     To many, there is little if any connection between federal
income taxes and the current fiscal squeeze on state and local
governments, or the disintegration of the national economy in
general. On the contrary, the research I have done during the
past year now convinces me that the connection is direct.

     Federal income taxes are used to make interest payments to
the Federal Reserve banks, and their collection agency is the
Internal Revenue Service. The IRS is not a service to the people
of the United States. It is not a service to the government of
the United States. It is a service to the Federal Reserve
System, a private credit monopoly described as "one of the most
corrupt institutions the world has ever known" by Louis T.
McFadden, Chairman of the House Banking and Currency Committee,
1927-1933.

     The manipulations of the Federal Reserve System and their
effects on the entire American economy have been shrouded in
considerable secrecy for too many years now. This secrecy has
been a conscious and deliberate feature of its corrupting
influence on officials in all branches of the federal government.


                        Page P - 93 of 98

                                                The Federal Zone:


     This secrecy has also made it very difficult to obtain
reliable information about the Federal Reserve. Even though I
take exception to the religious prejudice he sometimes exhibits,
author Eustace Mullins does appear to have the inside track on
the origins and development of this syndicate. In particular,
the enclosed excerpt from A Writ for Martyrs is the most succinct
statement of "The Problem" that I have been able to find
anywhere. In his recent book Shadows of Power, author James
Perloff puts it this way:


     The year 1913 was an ominous one -- there now existed the
     means to loan the government colossal sums (the Federal
     Reserve), and the means to exact repayment (income tax).
     All that was needed now was a good reason for Washington to
     borrow. In 1914, World War I erupted on the European
     continent. America eventually participated, and as a result
     her national debt soared from $1 billion to $25 billion.


     I sincerely hope that this letter has provided you with a
glimpse of just how serious and widespread a problem the
so-called 16th Amendment has created for millions of Americans, a
problem that now extends through two whole generations of our
brief history as a nation. As I myself have come to appreciate
the true essence of this problem, I have also come to the
conclusion that the millions of hard-working Americans burdened
by this scourge now deserve an honest explanation. This
explanation can only be forthcoming if we, the people, exercise
our unalienable right to correct a government which has now
drifted so far off course, it hardly resembles the constitutional
republic it was designed to be.

     Please feel to contact me at any time concerning this
proposal for KPFA coverage of the 16th Amendment fraud. Thank
you very much for your consideration.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


enclosures


                        Page P - 94 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   July 21, 1991


Ken Ellis
Maintenance Engineer
KPFA-FM 94.1
2207 Shattuck Avenue
Berkeley, California Republic
Postal Code 94704/TDC

Dear Ken:

     I enjoyed our brief conversation after the last meeting of
the Free Enterprise Society in Berkeley. Enclosed is a copy of
my letter of May 29, 1991 to Dennis Bernstein.

     For your information, Lewis vs United States, 680 F.2d 1239,
June 24, 1982 is the Ninth Circuit Court decision which proves
that the Federal Reserve is a private corporation.

     Two full pages are dedicated to the details of this ruling
in Alan Stang's excellent book entitled Tax Scam, published by
Mount Sinai Press, P. O. Box 1220, Alta Loma, California 91701,
telephone [phone]. Stang's mailing address is 4770 West
Bellfort, #269, Houston, Texas 77035. Quoting Stang from page
232:


     Mr. Lewis was hit by a truck owned by the Federal Reserve
     Bank of San Francisco, so he sued. The trouble was that he
     sued the U.S. government under the Federal Tort Claims Act,
     in the belief that the bank is a government agency. The
     Court ruled against Mr. Lewis, explaining that he had
     mistakenly named the wrong defendant, that the government
     had nothing to do with it -- and that Mr. Lewis should
     have sued the Bank, which is a private corporation.


     You know, if I wished to subvert the monetary system of any
country, I would arrange a secret meeting of finance moguls,
require all participants to use first names only, shield the
meeting from the scrutiny of press and public, draft legislation
which was too long for experts to understand without lengthy
study, and ram it thru Congress two days before Christmas, after
donating first class travel fare to all my opponents, glossing
over dozens of major differences between the House and Senate
versions, and scheduling a vote at 1:30 in the morning, after all
my opponents were scattered to the four winds.


                        Page P - 95 of 98

                                                The Federal Zone:


     Those who prefer to regard the events at Jekyll Island as an
unsubstantiated conspiracy appear, to me, very similar to those
who even now retain their belief that Lee Harvey Oswald was the
lone assassin of President Kennedy. If there were no conspiracy,
then why all the evidence indicating that there was? One can
argue that some author doesn't have his facts straight because
that same author harbors a prejudice or two, but to argue this
way in the face of incriminating facts really begs the question
that is raised by the facts themselves. The secrecy alone is
something which I personally find abhorrent to our principles of
due process, representative government, and freedom of the press.
If anyone can produce a credible challenge to the facts we
allege, then let's hear from them. Until then, the facts as we
know them speak for themselves. All by itself, the fraud
surrounding the 16th Amendment is substantiated by 17,000 State-
certified documents.

     Isn't this mass of evidence enough to justify maybe even a
brief mention on a publicly funded radio station?


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


copy: Dennis Bernstein
       interested colleagues


                        Page P - 96 of 98

                                                       Appendix P


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   August 23, 1990

Editor
Point Reyes Light
P. O. Box 210
Pt. Reyes Station, California Republic
Postal Code 94956/TDC

Dear Editor:

     On the evening of August 22, 1990, in Point Reyes Station,
Congresswoman Barbara Boxer publicly consented to inspect
personally the evidence against the 16th Amendment to the U.S.
Constitution (1913 Income Tax). This evidence shows that the
16th Amendment was fraudulently ratified. We applaud her courage
and her willingness to pursue the truth in this matter.

     Six States are on official federal record as opposing the
16th Amendment. If we can prove to Representative Boxer that
seven additional States were so immersed in fraudulent procedures
as to nullify their ratification proceedings, we will have
produced a total of thirteen votes against the 16th Amendment.
Such proof will effectively nullify the Income Tax in the United
States of America, since 36 of 48 States were required to ratify
a constitutional amendment in 1913.

     Needless to say, this is a mind-boggling assertion, but
fraud has no statute of limitations. We do not ask our neighbors
to take our claims lightly. We do want the opportunity to prove
our case to the American people. Therefore, we will publish the
document numbers that are pertinent in the "dirty seven" States
that we have identified. Each and every one of you will be able
to request your own certified copies of these documents from the
State houses of those seven States.

     Remember that an income tax is absolutely unnecessary to
finance the U.S. government. From 1787 until 1942 (when the
income tax had reached a nominal 2 percent on corporations only)
our nation demonstrated unprecedented prosperity. Ironically,
the national debt has increased as income taxes have increased.
Before long, the interest on the national debt will exceed the
total income tax revenues collected by the federal government.
It doesn't take a genius to figure out what that means.

     Not one penny of your Form 1040 check goes anywhere except
into the vaults of the private banks of the Federal Reserve
System (see report of the Grace Commission). Every penny of
income tax is diverted to pay interest to bankers on the money
they authorize the U.S. Treasury to print (i.e., create out of
thin air) as Federal Reserve Notes, and then LOAN to us! We


                        Page P - 97 of 98

                                                The Federal Zone:


advise all American Citizens to pay very close attention as this
story unfolds. Imagine being able to raise your own personal
credit limit simply by raising your hand. The U.S. Congress does
it all the time when it passes laws to raise the federal debt
limit.

     Again, our thanks to Congresswoman Barbara Boxer for her
willingness to keep an open mind and to seek the truth in this
matter.


Sincerely yours,


/s/ Mitch Modeleski, Founder
Account for Better Citizenship


                        Page P - 98 of 98


                           Appendix Q

                      Apportionment Statute
                          July 14, 1798


                         Page Q - 1 of 4

                                                The Federal Zone:


Reader's Notes:


                         Page Q - 2 of 4

                                                       Appendix Q


Fifth Congress, Second Session, Chapter 75, 1798

Chapter 75. -- An Act to lay and collect a direct tax within the
               United States, July 14, 1798

Section 1. Be it enacted by the Senate and House of
Representatives of the United States of America in Congress
assembled, That a direct tax of two millions of dollars shall
be, and hereby is laid upon the United States, and apportioned to
the states respectively, in the manner following: --

     To the state of New Hampshire, seventy-seven thousand seven
hundred and five dollars, thirty-six cents and two mills.

     To the state of Massachusetts, two hundred and sixty
thousand four hundred and thirty-five dollars, thirty-one cents
and two mills.

     To the state of Rhode Island, thirty-seven thousand five
hundred and two dollars and eight cents.

     To the state of Connecticut, one hundred and twenty-nine
thousand seven hundred and sixty-seven dollars, and two mills.

     To the state of Vermont, forty-six thousand eight hundred
and sixty-four dollars eighteen cents and seven mills.

     To the state of New York, one hundred and eighty-one
thousand six hundred and eighty dollars, seventy cents and seven
mills.

     To the state of New Jersey, ninety-eight thousand three
hundred and eighty-seven dollars, twenty-five cents, and three
mills.

     To the state of Pennsylvania, two hundred and thirty-seven
thousand one hundred and seventy-seven dollars, seventy-two cents
and seven mills.

     To the state of Delaware, thirty thousand four hundred and
thirty dollars, seventy-nine cents, and two mills.

     To the state of Maryland, one hundred and fifty-two thousand
five hundred and ninety-nine dollars, ninety-five cents, and four
mills.

     To the state of Virginia, three hundred and forty-five
thousand four hundred and eighty-eight dollars, sixty-six cents,
and five mills.

     To the state of Kentucky, thirty-seven thousand six hundred
and forty-three dollars, ninety-nine cents, and seven mills.


                         Page Q - 3 of 4

                                                The Federal Zone:


     To the state of North Carolina, one hundred and ninety-three
thousand six hundred and ninety-seven dollars, ninety-six cents,
and five mills.

     To the state of Tennessee, eighteen thousand eight hundred
and six dollars, thirty-eight cents, and three mills.

     To the state of South Carolina, one hundred and twelve
thousand nine hundred and ninety-seven dollars, seventy-three
cents and nine mills.

     To the state of Georgia, thirty-eight thousand eight hundred
and fourteen dollars, eighty-seven cents, and five mills.


Section Two. And be it further enacted, That the said tax shall
be collected by the supervisors, inspectors and collectors of the
internal revenues of the United States, under the direction of
the Secretary of the Treasury, and pursuant to such regulations
as he shall establish; and shall be assessed upon dwelling-
houses, lands and slaves, according to the valuations and
enumerations to be made pursuant to the act, intituled "An act to
provide for the valuation of lands and dwelling-houses, and the
enumeration of slaves within the United States," and in the
following manner: ....


Displayed in tabular format, the States of the Union were
assessed as follows:

               State Direct Tax
               ------------- -------------
               New Hampshire 77,705.362
               Massachusetts 260,435.312
               Rhode Island 37,502.080
               Connecticut 129,767.002
               Vermont 46,864.187
               New York 181,680.707
               New Jersey 98,387.253
               Pennsylvania 237,177.727
               Delaware 30,430.792
               Maryland 152,599.954
               Virginia 345,488.665
               Kentucky 37,643.997
               North Carolina 193,697.965
               Tennessee 18,806.383
               South Carolina 112,997.739
               Georgia 38,814.875
                                      -------------
               Total: 2,000,000.000
                                      =============


                         Page Q - 4 of 4


                           Appendix R

                 Affirmations: Within & Without


                         Page R - 1 of 4

                                                The Federal Zone:


Reader's Notes:


                         Page R - 2 of 4

                                                       Appendix R


                   TITLE 28 UNITED STATES CODE


Section 1746. Unsworn declarations under penalty of perjury

Wherever, under any law of the United States or under any rule,
regulation, order, or requirement made pursuant to law, any
matter is required or permitted to be supported, evidenced,
established, or proved by the sworn declaration, verification,
certificate, statement, oath, or affidavit, in writing of the
person making the same (other than a deposition, or an oath of
office, or an oath required to be taken before a specified
official other than a notary public), such matter may, with like
force and effect, be supported, evidenced, established, or proved
by the unsworn declaration, certificate, verification, or
statement, in writing of such person which is subscribed by him,
as true under penalty of perjury, and dated, in substantially the
following form:


(1) If executed without the United States: "I declare (or
     certify, verify, or state) under penalty of perjury under
     the laws of the United States of America that the foregoing
     is true and correct. Executed on (date).

                                                    (Signature)".


(2) If executed within the United States, its territories,
     possessions, or commonwealths: "I declare (or certify,
     verify, or state) under penalty of perjury that the
     foregoing is true and correct. Executed on (date).

                                                    (Signature)".


(Added Oct. 18, 1976, P. L. 94-550, Section 1(a), 90 Stat. 2534.)


                                                 [emphasis added]


Author's Note:

Now review the perjury oaths found on IRS Forms 1040NR and W-8
(Appendix K and Appendix L, respectively). Judges who see your
signature on these forms are allowed to take "silent judicial
notice" of the jurisdiction within which the oaths were taken.
And, to make matters worse, these same judges almost always take
the position that ignorance of the law is no excuse! We are
presumed to know about 28 USC 1746.


                         Page R - 3 of 4

                                                The Federal Zone:


Reader's Notes:


                         Page R - 4 of 4


                           Appendix S

                   Affidavit of Foreign Status


                         Page S - 1 of 8

                                                The Federal Zone:


Reader's Notes:


                         Page S - 2 of 8

                                                       Appendix S


Certified Mail Number: __________________________________________

                 Date: __________________________________________


John Q. Doe
c/o USPS Post Office Box [##]
Marin County
San Rafael, California Republic
united States of America
zip code exempt (DMM 122.32)


                    FOREIGN STATUS AFFIDAVIT


CALIFORNIA STATE/REPUBLIC )
                             ) Subscribed, Sworn and Sealed
MARIN COUNTY )


                            PREAMBLE

     The following Affidavit of Foreign Status is a public notice
to all interested parties concerning the Affiant's "birthrights"
and his "status" as an "AMERICAN INHABITANT", as that status
would apply with respect to the American States (the 50
independent States of the Union) and also with respect to the
"United States", as follows:


     1. The Affiant, John Q. Doe, was natural born a free
Sovereign in Massachusetts, which is one of the sovereign States
of the Union of several States joined together to comprise the
confederation known as the united States of America. He is,
therefore, a "nonresident alien" individual with respect to the
"United States", which entity obtains its exclusive legislative
authority and jurisdiction from Article 1, Section 8, Clause 17
and Article 4, Section 3, Clause 2 of the Constitution for the
united States of America. The Affiant's parents were Sovereigns
also, born in sovereign States of the Union. As the progeny of
Sovereign people, the Affiant was born "... one of the sovereign
people .... A constituent member of the sovereignty synonymous
with the people." Scott vs Sanford, 19 How. 404. The Affiant is
alien to so-called 14th Amendment "United States" citizenship,
and also nonresident to so-called 14th Amendment State residency,
and therefore he is a "nonresident alien" with respect to both.
As a Sovereign whose Citizenship originated in Massachusetts by
birth, and who has remained intact in California since the year
1952, the Affiant is also a foreigner (alien) with respect to the
other 49 States of the Union and with respect to the "United
States". As a consequence of his birth, the Affiant is an
"American Inhabitant". And further


                         Page S - 3 of 8

                                                The Federal Zone:


     2. The Affiant, to the best of his informed knowledge, has
not entered into any valid agreements of "voluntary servitude".
And further

     3. The Affiant is a "NONRESIDENT ALIEN" with respect to
the "United States", as that term is defined and used within the
Internal Revenue Code (Title 26, United State Code) and/or Title
27 and the rules and regulations promulgated thereunder as
follows:


     The Internal Revenue Code (Title 26, United State Code) and
associated federal regulations, clearly and thoroughly make
provision for Americans born and living within one of the 50
Sovereign States of America, to wit:


     Section 1.871-4 Proof of residence of aliens.

     (a) Rules of evidence. The following rules of evidence
          shall govern in determining whether or not an alien
          within the United States has acquired residence therein
          for purposes of the income tax.

     (b) Nonresidence presumed. An alien by reason of his
          alienage, is presumed to be a nonresident alien.

                                                 [26 CFR 1.871-4]

     And further

     4. The Affiant was not born or naturalized in the "United
States", consequently he is not a "citizen of the "United States"
nor a "United States citizen", as those terms are defined and
used within the Internal Revenue Code (26 U.S.C.) and/or Title 27
and the rules and regulations promulgated thereunder; and,
therefore, he is not subject to the limited, exclusive
territorial or political jurisdiction and authority of the
"United States" as defined.


     The "United States" is definitive and specific when it
defines one of its citizens, as follows:


     Section 1.1-1

     (c) Who is a citizen. Every person born or naturalized in
          the United States and subject to its jurisdiction is a
          citizen.
                                                [26 CFR 1.1-1(c)]

     And further


                         Page S - 4 of 8

                                                       Appendix S


     5. The Affiant is not a "citizen of the United States" nor
a "United States citizen living abroad", as those phrases are
defined and used in the Internal Revenue Code (26 U.S.C.) and/or
Title 27 and the rules and regulations promulgated thereunder.
And further

     6. The Affiant is not a "resident alien residing within
the geographical boundaries of the United States", as that phrase
is defined and used in the Internal Revenue Code (26 U.S.C.)
and/or Title 27 and the rules and regulations promulgated
thereunder. And further

     7. The Affiant is not a "United States person", a
"domestic corporation", "estate", "trust", "fiduciary" or
"partnership" as those terms are defined and used within the
Internal Revenue Code (26 U.S.C.) and/or Title 27 and the rules
and regulations promulgated thereunder. And further

     8. The Affiant is not an "officer", "employee" or "elected
official" of the "United States", of a "State" or of any
political subdivision thereof, nor of the District of Columbia,
nor of any agency or instrumentality of one or more of the
foregoing, nor an "officer" of a "United States corporation", as
those terms are defined and used within the Internal Revenue Code
(26 U.S.C.) and/or Title 27 and the rules and regulations
promulgated thereunder. And further

     9. The Affiant receives no "income" or "wages with respect
to employment" from any sources within the territorial
jurisdiction of the "United States" and does not have an "office
or other fixed place of business" within the "United States" from
which the Affiant derives any "income" or "wages" as such, as
those terms and phrases are used and defined within the Internal
Revenue Code (26 U.S.C.) and/or Title 27 and the rules and
regulations promulgated thereunder. And further

     10. The Affiant has never engaged in the conduct of a
"trade or business" within the "United States", nor does the
Affiant receive any income or other remuneration effectively
connected with the conduct of a "trade or business" within the
"United States", as those terms are defined and used within the
Internal Revenue Code (26 U.S.C.) and/or Title 27 and the rules
and regulations promulgated thereunder. And further

     11. The Affiant receives no "income", "wages", "self-
employment income" or "other remuneration" from sources within
the "United States", as those terms are defined and used in the
Internal Revenue Code (26 U.S.C.) and/or Title 27 and the rules
and regulations promulgated thereunder. All remuneration paid to
the Affiant is for services rendered outside (without) the
exclusive territorial, political and legislative jurisdiction and
authority of the "United States". And further


                         Page S - 5 of 8

                                                The Federal Zone:


     12. The Affiant has never had an "office" or "place of
business" within the "United States", as those terms are defined
and used in the Internal Revenue Code (26 U.S.C.) and/or Title 27
and the rules and regulations promulgated thereunder. And
further

     13. The Affiant has never been a "United States employer",
nor "employer", nor "employee" which also includes but is not
limited to an "employee" and/or "employer" for a "United States"
"household", and/or "agricultural" activity, as those terms are
defined and used in the Internal Revenue Code (26 U.S.C.) and/or
Title 27 and the rules and regulations promulgated thereunder.
And further

     14. The Affiant has never been involved in any "commerce"
within the territorial jurisdiction of the "United States" which
also includes but is not limited to "alcohol", "tobacco" and
"firearms" and Title 26, Subtitle D and E excises and privileged
occupations, as those terms are defined and used in the Internal
Revenue Code (26 U.S.C.) and/or Title 27 and the rules and
regulations promulgated thereunder. And further

     15. The Affiant has never been a "United States"
"withholding agent" as those terms are defined and used in the
Internal Revenue Code (26 U.S.C.) and/or Title 27 and the rules
and regulations promulgated thereunder. And further

     16. The Affiant had no liability for any type, kind or
class of Federal Income Tax in past years, and was and is
entitled to a full and complete refund of any amounts withheld,
because any liability asserted and amounts withheld were premised
upon a mutual mistake of fact regarding the Affiant's status.
The Affiant has never knowingly, intentionally, and voluntarily
changed his Citizenship status nor has he ever knowingly,
intentionally, and voluntarily elected to be treated as a
"resident" of the "United States". And further

     17. The Affiant, to the best of his current knowledge, owes
no "tax" of any type, class or kind to the "United States" as
those terms are defined and used in the Internal Revenue Code (26
U.S.C.) and/or Title 27 and the rules and regulations promulgated
thereunder. And further

     18. The Affiant anticipates no liability for any type,
class or kind of federal income tax in the current year, because
the Affiant does not intend to reside in the "United States", he
does not intend to be treated as either a "resident" or a
"citizen" of the "United States", he is not and does not intend
to be involved in the conduct of any "trade or business" within
the "United States" or receive any "income" or "wages" from
sources within the "United States", as those terms are defined
and used in the Internal Revenue Code (26 U.S.C.) and/or Title 27
and the rules and regulations promulgated thereunder. And
further


                         Page S - 6 of 8

                                                       Appendix S


     19. The Affiant, by means of knowingly intelligent acts
done with sufficient awareness of the relevant circumstances and
consequences (Brady vs U.S., 397 U.S. 742, 748 (1970)) never
agreed or consented to be given a federal Social Security Number
(SSN), same said as to a federal Employee Identification Number
(EIN) and, therefore, waives and releases from liability the
"United States" and any State of the Union of 50 States, for any
present or future benefits that the Affiant may be entitled to
claim under the Old-Age Survivors and the Disability Insurance
Act, and/or the Federal Unemployment Tax Act. Additionally, your
Affiant makes no claim to any present or future benefits under
any of the foregoing; and

     20. Therefore, I, John Q. Doe, am a natural born free
inhabitant and, as such, a Sovereign Citizen/Principal inhabiting
the California Republic. Therefore, I am not "within the United
States" but lawfully I am "without the United States" (per Title
28, U.S.C., Section 1746, Subsection 1), and therefore I have no
standing capacity to sign any tax form which displays the perjury
clause pursuant to Title 28, Section 1746, Subsection 2. And
further


     PLEASE NOTE WELL: At no time will the Affiant construe any
of the foregoing terms defined within the Internal Revenue Code,
Title 26, United State Code, or within any of the other United
State Code, in a metaphorical sense. When terms are not words of
art and are explicitly defined within the Code and/or within a
Statute, the Affiant relies at all times upon the clear language
of the terms as they are defined therein, NO MORE and NO LESS:


     ... When aid to construction of the meaning of words, as
     used in the statute, is available, there certainly can be no
     'rule of law' which forbids its use, however clear the words
     may appear on 'superficial examination' ....

                 [United States vs American Trucking Association]
                                   [310 U.S. 534, 543,544 (1939)]


     This unsworn certification is being executed WITHOUT the
"United States", pursuant to Section 1746(1) of Title 28, United
State Code, Federal Rules of Civil Procedure:


     I affirm under penalty of perjury, under the laws of the
United States of America, that I executed the foregoing for the
purposes and considerations herein expressed, in the capacity
stated, and that the statements contained herein are true and
correct, to the best of my knowledge.


                         Page S - 7 of 8

                                                TheFederal Zone:


Executed Anno Domini, on this the ___________ day in the month of

___________________________, 1993.


Subscribed, sealed and affirmed to this ________________ day of

___________________________, 1993.


_________________________________________________________________
John Q. Doe, Citizen/Principal, by special Appearance, in Propria
Persona, proceeding Sui Juris, with Assistance, Special, with
explicit reservation of all of my unalienable rights and without
prejudice to any of my unalienable rights.


                           John Q. Doe
                  c/o USPS Post Office Box [##]
                 San Rafael, California Republic
                  zip code exempt (DMM 122.32)


             California All-Purpose Acknowledgement

CALIFORNIA STATE/REPUBLIC )
                                )
COUNTY OF MARIN )

     On the ________ day of ____________, 199_ Anno Domini,
before me personally appeared John Q. Doe, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
Person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in His authorized
capacity, and that by His signature on this instrument the
Person, or the entity upon behalf of which the Person acted,
executed the instrument. Purpose of Notary Public is for
identification only, and not for entrance into any foreign
jurisdiction.

WITNESS my hand and official seal.


_____________________________________
Notary Public


                         Page S - 8 of 8


                           Appendix T

                 Revocation of Birth Certificate


                        Page T - 1 of 12

                                                The Federal Zone:


Reader's Notes:


                        Page T - 2 of 12

                                                       Appendix T


FROM: John Q. Doe
          Marin County, California
          c/o USPS Post Office Box [##]
          San Rafael, California Republic
          united States of America
          zip code exempt (DMM 122.32)

TO: Registry of Vital Records
          Commonwealth of Massachusetts
          150 Tremont Street, Room B-3
          Boston, Massachusetts
          Postal Code 02111/TDC

TO: Social Security Administration
          Office of the Commissioner
          6301 Security Boulevard
          Baltimore, Maryland
          Postal Code 21235/TDC


              NUNC PRO TUNC REVOCATION OF CONTRACT
              AND REVOCATION OF POWER ASSEVERATION


California State/Republic )
                            ) Subscribed, Sworn and Sealed
Marin County )


                            PREAMBLE

     I, John Q. Doe, being natural born in Massachusetts a male
human being, now living in Marin County, California Republic, as
a Citizen  in the California Republic, do hereby make this Special
Appearance, by Affidavit, in Propria Persona, proceeding Sui
Juris, At Law, in Common Law, with Assistance, Special, neither
conferring nor consenting to any foreign jurisdiction, except to
the judicial power of California and/or America, and as such I
willfully enforce all Constitutional limitations respectively on
all government agencies when dealing with them. Wherefore, the
undersigned Affiant named herein and above, upon affirmation
declares and evidences the following:

     I, the undersigned, a natural born free Sovereign Citizen in
the California Republic, and thereby in the united States of
America, hereby affirm, declare and give notice:

     1. That I am competent to testify to the matters herein;
and further

     2. That I have personal knowledge of my status and of the
facts and evidence stated herein; and further


                        Page T - 3 of 12

                                                The Federal Zone:


     3. That all the facts stated herein are not hearsay but
true and correct, and admissible as evidence, if not rebutted;
and further

     4. That I, John Q. Doe, am of lawful age and competent; I
am a natural born free Sovereign Citizen now living in the
California Republic, and thereby in the united States of America,
in fact, by right of heritage, a Citizen inhabiting the
California Republic, protected by the Northwest Ordinance of
1787, the Organic Act of 1849, the original Constitution of
California (1849), the Articles of Confederation (1777), the
Constitution for the united States of America (1787) including
its Preamble, and the Bill of Rights (1791) including its
Preamble; and as such I retain all my fundamental, unalienable
rights granted by God in positive law, embodied in the
Declaration of Independence of 1776 and binding rights upon
myself and my parentage, this day and for all time; and further

     5. That this document has been prepared, witnessed and
filed because the State of Massachusetts holds the position that
there are no statutory provisions to rescind a Birth Certificate,
nor any trust or contractual obligations derived therefrom, and
because there is no other remedy available to me At Law by which
I can declare and enforce my right to be free from State
enfranchisement and the benefits therefrom; and further

     6. That, on my birthday, June 21, 1948, I was born in
Worcester, Massachusetts to my parents, James F. Doe and Jane M.
(Smith) Doe, who were both under the misconception that they were
required to secure a Certificate of Birth on my behalf, and they
did obtain the same; and further

     7. That my parents were not aware that, at the Common Law,
births were to be recorded in the family Bible, and that only
deaths were made a matter of public record; and further

     8. That my parents were not aware that any certificate
required by statute to be made by officers may, as a rule, be
introduced into evidence (see Marlowe vs School District, 116 Pac
797) and, therefore, they were acquiescing to State requirements
which violate my rights to privacy and the 4th Amendment
protections under the Constitution for the united States of
America, because the Birth Certificate is the record of the State
of Massachusetts, not of the individual, and the State may be
compelled to introduce said record without my permission; and
further

     9. That such statutory practices by the State of
Massachusetts are deceitful misrepresentations by the State and
society, on the recording of births, and my parents were unaware
that a Birth Certificate was not necessary, nor were they aware
that they were possibly waiving some of my rights, which rights
are unalienable rights guaranteed to me by the Constitution for
the united States of America; and further


                        Page T - 4 of 12

                                                       Appendix T


     10. That the doctor who delivered me acted as a licensed
agent of the State of Massachusetts without the consent of either
my own parents or myself, and offered me into a State trust to be
regulated as other State and corporate interests and property as
a result of that offer and acceptance, which comprises a fiction
of law under statutory law (called contracts of adhesion,
contracts implied by law, constructive contracts, quasi
contracts, also referred to as implied consent legislation); and
further

     11. That, from my own spiritual beliefs and training, I
have come, and I have determined that the right to be born comes,
from God Almighty (who knew me before I existed) -- not the State
of Massachusetts and not the State of California -- and therefore
original  jurisdiction upon my behavior requiring any specific
performance comes from my personal relationship with God
Almighty, unless said performance causes demonstrable damage or
injury to another natural human being; and further

     12. That, after studying the Birth Certificate, I have come
to the conclusions that the Birth Certificate creates a legal
estate in myself, and acts as the nexus to bring actions against
this individual as if he were a corporate entity, that the State
of Massachusetts, in cooperation with the federal government and
its agents and assigns, is maintaining the Birth Certificate so
as to assume jurisdiction over many aspects of my life in direct
contravention of my unalienable rights and Constitutionally
secured rights to be a "Freeman" and to operate at the Common
Law; and further

     13. That such statutory provisions also cause a loss or
diminution (depending upon other statutory provisions) of rights
guaranteed by the 1st, 2nd, 4th, 5th, 6th, 7th, and 9th
amendments in the Constitution for the united States of America;
and further

     14. That, as a result of my earnest and diligent studies,
my prior ignorance has come to an end, and I have regained my
capacity to be an American Freeman; therefore, it is now
necessary that I declare any nexus assumed as a result of the
Birth Certificate, by the State of Massachusetts or by any of
its agents and assigns, including the federal government, and any
jurisdictional or other rights that may be waived as a result of
said trust/contract with all forms of government, to be null and
void from its inception, due to the deceptive duress, fraud,
injury, and incapacity perpetrated upon my parents and myself by
the State of Massachusetts, the third party to the contract; and
further

     15. That I was neither born nor naturalized in the "United
States" as defined in Title 26, United States Codes and,
therefore, I am not subject to its foreign jurisdiction. See 26
CFR 1.1-1(b)-(c); and further


                        Page T - 5 of 12

                                                The Federal Zone:


     16. That, with this revocation of contract and the
revocation of power, I do hereby claim all of my rights, all of
my unalienable rights and all rights guaranteed by the
Constitution for the united States of America, At Law, and do
hereby declare, to one and all, that I am a free and independent
Citizen now inhabiting the California Republic, who is not a
creation of, nor subject to any State's civil law of admiralty,
maritime, or equity jurisdictions and, as such, I am only
attached to the judicial Power of California and/or the united
States of America; and further

     17. That I affirm, under penalty of perjury, under the
Common Law of America, without the "United States" (see 1:8:17
and 4:3:2 in the U.S. Constitution), that the Preamble and
Sections 1 thru 16 of this Affidavit, are true and correct and so
done in good faith to the best of my knowledge; and further

     18. That my use of the phrase "WITH EXPLICIT RESERVATION OF
ALL MY RIGHTS AND WITHOUT PREJUDICE UCC 1-207 (UCCA 1207)" above
my signature on this document indicates: that I explicitly reject
any and all benefits of the Uniform Commercial Code, absent a
valid commercial agreement which is in force and  to which I am a
party, and cite its provisions herein only to serve notice upon
ALL agencies of government, whether international, national,
state, or local, that they, and not I, are subject to, and bound
by, all of its provisions, whether cited herein or not; that my
explicit reservation of rights has served notice upon ALL
agencies of government of the "Remedy" they must provide for me
under Article 1, Section 207 of the Uniform Commercial Code,
whereby I have explicitly reserved my Common Law right not to be
compelled to perform under any contract or commercial agreement,
that I have not entered into knowingly, voluntarily, and
intentionally; that my explicit reservation of rights has served
notice upon ALL agencies of government that they are ALL limited
to proceeding against me only in harmony with the Common Law and
that I do not, and will not accept the liability associated with
the "compelled" benefit of any unrevealed commercial agreements;
and that my valid reservation of rights has preserved all my
rights and prevented the loss of any such rights by application
of the concepts of waiver or estoppel. And


Further This Affiant Saith Not.


Subscribed and affirmed to, Nunc Pro Tunc, on the date of my
majority, which date was June 21, 1969.


Subscribed, sealed and affirmed to this __________________ day of

__________________________, 1993 Anno Domini.


                        Page T - 6 of 12

                                                       Appendix T


     I now affix my signature to all of the affirmations herein
WITH EXPLICIT RESERVATION OF ALL MY RIGHTS, AND WITHOUT PREJUDICE
UCC 1-207 (UCCA 1207):


_________________________________________________________________
John Q. Doe, Citizen/Principal, by Special Appearance, in Propria
Persona, proceeding Sui Juris, with Assistance, Special, with
explicit reservation of all my unalienable rights and without
prejudice to any of my unalienable rights.


                           John Q. Doe
                  c/o USPS Post Office Box [##]
                 San Rafael, California Republic
                  zip code exempt (DMM 122.32)


             California All-Purpose Acknowledgement

CALIFORNIA STATE/REPUBLIC )
                                )
COUNTY OF MARIN )

     On the ________ day of ____________, 199_ Anno Domini,
before me personally appeared John Q. Doe, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
Person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in His authorized
capacity, and that by His signature on this instrument the
Person, or the entity upon behalf of which the Person acted,
executed the instrument. Purpose of Notary Public is for
identification only, and not for entrance into any foreign
jurisdiction.

WITNESS my hand and official seal.


_____________________________________
Notary Public


                        Page T - 7 of 12

                                                The Federal Zone:


                                   c/o USPS P.O. Box 6189
                                   San Rafael, California
                                   zip code exempt (DMM 122.32)

                                   April 3, 1992

Registrar
Department of Public Health
The Commonwealth of Massachusetts
150 Tremont Street
Boston, Massachusetts


RE: NUNC PRO TUNC REVOCATION OF CONTRACT AND REVOCATION OF POWER
     ASSEVERATION


Dear Registrar:

     Your letter to me dated March 23, 1992 acknowledges receipt
of my signed and notarized revocation affidavit, referenced
above. I am writing this letter in order to address the two
statements contained in your letter, and to rebut any
presumptions which could or might be conclusively established by
allowing your two statements to remain unchallenged.


Statement #1: "This letter is to inform you that there is no
               provision under Massachusetts law to rescind a
               properly filed birth certificate."

     Although this statement may, in fact, be technically and
generally true, it is irrelevant to the specific issue at hand,
for several reasons. First of all, it implies that my original
birth certificate, on file in your office, was "properly filed".
You have made this statement contrary to numerous facts which are
contained in my revocation affidavit. You have now had ample
opportunity to rebut any and all of those facts, and you have not
done so. Accordingly, your failure to rebut anyof those facts
now renders them all conclusive, permanently for the record. You
are now forever barred and estopped from challenging those facts
as stated. Therefore, my original birth certificate was not
"properly filed" as you incorrectly attempt to imply.

     As a member of the Sovereignty by right of birth and
hereditary succession, I belong to that group of people by whose
authority the Massachusetts State Constitution was created. The
Massachusetts State Legislature was created, in turn, by that
Constitution. The "Massachusetts law" to which you refer is, in
turn, a creation of that Legislature. Regardless of your status
prior to becoming a State employee, your current status as a
State employee necessarily subjects you to the letter of that
"law". I am not subject either to the letter or to the spirit of
that law, however.


                        Page T - 8 of 12

                                                       Appendix T


     Even though you are evidently restricted by law from
unilaterally rescinding a birth certificate, I am not subject to
any such a restriction. As someone who has explicitly reserved
all my unalienable rights without prejudice to any of my
unalienable rights, I specifically retain my right to
unilaterally revoke and cancel my original birth certificate, for
the several reasons stated in my affidavit, and to render it null
and void from its inception. The affidavit which I have filed
with your office is prima facie evidence that I have, in fact,
exercised that right, the exercise of which is entirely within my
Sovereign power and authority to do.

     Moreover, you are evidently unaware of my prior written
correspondence with Governor William F. Weld, in which I
documented the fraud to which the Commonwealth of Massachusetts
is an "accommodation party" as defined in the Uniform Commercial
Code. If you have any need to obtain copies of this
correspondence between me and Governor Weld, I recommend that you
first contact the Governor's staff for assistance.
Alternatively, Governor Weld's office has personally informed me
that my notice to him, with attachments, has now been forwarded
to the offices of Senator Edward M. Kennedy, United States
Senate, Washington, District of Columbia. Governor Weld's office
did not challenge or rebut any statement of fact contained in my
correspondence to him, except to suggest incorrectly that the
issues which I raised were not within his jurisdiction. Senator
Kennedy's office has not responded to me in any way concerning
the materials which he received from Governor Weld.

          The Commonwealth of Massachusetts is bound by the
provisions of the Uniform Commercial Code (see MCLA c 106 Section
1-207). The conclusive facts as stated in my revocation
affidavit now constitute material proof that my original birth
certificate was an unconscionable contract ab initio because,
among other reasons, it was lacking in meaningful choice on my
part. You have already been notified, and I hereby notify you
again, that I have explicitly reserved all my unalienable rights,
without prejudice to any of my unalienable rights. This means
that I explicitly reject any and all benefits of the Uniform
Commercial Code, absent a valid commercial agreement which is in
force and to which I am a party, and cite its provisions herein
only to serve notice upon all agencies of government, whether
international, national, state, or local, that they, and not I,
are subject to, and bound by, all of its provisions, whether
cited herein or not.

     Furthermore, my explicit reservation of rights has served
notice upon all agencies of government, including but not limited
to the Commonwealth of Massachusetts, of the "Remedy" which you
must provide for me under Article 1, Section 207 of the Uniform
Commercial Code, whereby I have explicitly reserved my Common Law
right not to be compelled to perform under any contract or
commercial agreement, that I have not entered into knowingly,
voluntarily, and intentionally.


                        Page T - 9 of 12

                                                The Federal Zone:


     My explicit reservation of rights has served notice upon all
agencies of government, including but not limited to the
Commonwealth of Massachusetts and all of its assignees, that they
are all limited to proceeding against me only in harmony with the
Common Law and that I do not, and will not accept the liability
associated with the "compelled" benefit of any unrevealed
commercial agreements (see UCC 3-305(2)(c)). You are under the
obligation of good faith imposed at several places in the Uniform
Commercial Code (see, e.g., 1-203). My valid reservation of
rights has preserved all my rights and prevented the loss of any
such rights by application of the concepts of waiver or estoppel.


Statement #2: "For this reason, your birth certificate on file
               in the Commonwealth of Massachusetts remains
               valid."

     This statement is clearly incorrect because it is a non
sequitor, in light of my responses in this letter to Statement
#1, and particularly in light of the conclusive facts as stated
in my revocation affidavit. As an unconscionable contract the
primary purpose of which was to offer me into a State trust, to
be regulated as other State and corporate interests without my
full consent of majority, this birth certificate is null and void
from its inception, as are any rights of interest which may, now
or in the future, be claimed as a result of any conveyance or
reconveyance thereof to undisclosed third parties.

     Your attempt to assert its validity in the face of contrary
evidence is noted and can be used as prima facie evidence of your
willingness to violate and otherwise contravene my unalienable
rights and my Constitutionally secured rights as a Sovereign
Freeman. These rights include, but are not limited to, those
which are enumerated in my revocation affidavit.

     You are hereby warned that you can and will be held
personally liable for any further attempts to violate my
fundamental, unalienable rights by acts on your part which
attempt to compel my specific performance to any third-party debt
or obligation created through the unlawful conveyance, conversion
or other instrumentality of an invalid birth certificate. As an
employee of the Commonwealth of Massachusetts, you are under a
legal obligation to recognize that "Constructive fraud as well as
actual fraud may be the basis of cancellation of an instrument,"
El Paso Natural Gas Co. vs Kysar Insurance Co., 605 Pacific 2d
240 (1979). Your ignorance of the law is no excuse in this
matter. If you are unsure about your own legal situation in this
matter, may I recommend that you contact the State Attorney
General's office for advice and assistance.

     For your information, I am not subject to any foreign
jurisdiction by reason of any contract or commercial agreement
resulting in adhesion thereto across America, nor are millions of
other Sovereign Citizens, unless they have provided waivers of


                        Page T - 10 of 12

                                                       Appendix T


rights guaranteed by the Constitution by means of knowingly
intelligent acts, such as contracts or commercial agreements with
such government(s) "with sufficient awareness of the relevant
circumstances and likely consequences", as ruled by the U.S.
Supreme Court in Brady vs U.S., 397 U.S. 742, 748 (1970). I have
given no such waivers, nor is it possible that I could have given
such waivers by reason of a birth certificate executed by other
parties long before I was even able to speak or write, and long
before my age of majority. Therefore, the birth certificate at
issue is necessarily null and void, ab initio, notwithstanding
any and all unsubstantiated statements by you to the contrary.

     If I do not hear from you within ten (10) calendar days of
the above date, I will be entitled to the conclusive presumption
that this matter is settled. Thank you very much for your
consideration.


Sincerely yours,


John Q. Doe, Sui Juris
with explicit reservation of all my unalienable rights
and without prejudice to any of my unalienable rights


copies: Senator Edward M. Kennedy
          United States Senate

          Social Security Administration
          Baltimore, Maryland


                        Page T - 11 of 12

                                                The Federal Zone:


Reader's Notes:


                        Page T - 12 of 12


                           Appendix U

                Revocation of Voter Registration


                         Page U - 1 of 6

                                                The Federal Zone:


Reader's Notes:


                         Page U - 2 of 6

                                                       Appendix U


                                   c/o USPS P. O. Box 6189
                                   San Rafael, California
                                   Postal Code 94903-0189/TDC

                                   March 10, 1992

Registrar of Voters
P. O. Box "E"
San Rafael, California
Postal Code 94913/TDC

Dear Registrar:

As instructed by a member of your staff, please accept this
letter as formal notice that I hereby revoke my voter
registration with your office.

It is with enormous regret that I must take this step, because I
consider voting to be among the most important civic duties that
we have in America today, particularly during a presidential
election year.

Nevertheless, it has come to my attention that your registration
forms now explicitly state, in red letters, that they are "For
U.S. Citizens Only". Moreover, these same forms exhibit the
following affidavit, which must be signed under penalties of
perjury:

     "I am a citizen of the United States and will be at least 18
     years of age at the time of the next election. I am not
     imprisoned or on parole for the conviction of a felony. I
     certify under penalty of perjury under the laws of the State
     of California that the information on this affidavit is true
     and correct."

This affidavit is followed by a clear WARNING, also in red
letters, that "Perjury is punishable by imprisonment in state
prison for two, three or four years. Section 126 Penal Code".

My chief concern with this affidavit has to do with the
definition of "United States" that is implied by the form. I
have recently authored a well documented book, a major thesis of
which relies upon the following ruling by the U.S. Supreme Court:

     The term "United States" may be used in any one of several
     senses. It may be merely the name of a sovereign occupying
     the position analogous to that of other sovereigns in the
     family of nations. It may designate the territory over
     which the sovereignty of the United States extends, or it
     may be the collective name of the states which are united by
     and under the Constitution.

                    [Hooven & Allison Co. vs Evatt, 324 U.S. 652]
                                                 [emphasis added]


                         Page U - 3 of 6

                                                The Federal Zone:


     From this ruling by the U.S. Supreme Court, it is obvious
that the term "United States" can mean any one of three entirely
different things. I draw your attention specifically to the
second of these three different meanings of "United States": it
may designate the territory over which the sovereignty of the
United States extends. This territory includes only the District
of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands,
Guam, American Samoa, the Northern Mariana Islands, the Trust
Territory of the Pacific Islands, and the federal "enclaves"
which have been ceded to Congress by acts of the 50 State
Legislatures. The authority to have exclusive legislative
jurisdiction over this limited area of land is granted to
Congress by Article 1, Section 8, Clause 17 and Article 4,
Section 3, Clause 2 of the U.S. Constitution.

     It follows, then, that declaring oneself to be a "citizen of
the United States" could be construed to mean that one has been
either born or naturalized into this jurisdiction and, that one
is therefore subject to this jurisdiction (see 26 CFR 1.1-1(c)).
This is particularly true if the "c" in "citizen" is lower case,
as is the case in the Code of Federal Regulations just cited, and
also in the so-called 14th Amendment to the U.S. Constitution.
Last but not least, the word "of" is often interpreted by courts
to mean "belonging to". Thus, the term "citizen of the United
States" can and has been interpreted by the courts to mean a
"subject" who "belongs to" the "Congress".

     On the contrary, I have recently filed a notarized affidavit
with the California Secretary of State, March Fong Eu, in which I
declare my status to be that of a "natural born Citizen" as
stated in Article 2, Section 1, Clause 5 of the U.S.
Constitution. Contrary to widespread public opinion, a "natural
born Citizen" is not the same thing as a "citizen of the United
States". There are also numerous court authorities for these two
different kinds of citizenship. As a natural born Citizen, I am
a member of the Sovereignty; I am subject only to my Creator,
because my fundamental, unalienable rights are endowed by my
Creator (see Declaration of Independence, 1776). Those rights
are not granted to me by anyone or anything else. If you request
it in writing, a notarized copy of my affidavit can be provided
to you.

     Accordingly, a shrewd and constructive fraud has been
perpetrated upon me, if the presence of my name on your voter
registration roster can be presumed by State and federal courts
to mean that I am a "citizen of the United States", with all of
the legislated privileges, immunities and liabilities attached
thereto. I will not allow such a presumption or adhesion to
exist, and it is primarily for this reason that I hereby revoke
my registration as a voter in the County of Marin, California
Republic. This revocation is retroactive to my date of majority,
which date was June 21, 1969. I remind you that there is no
statute of limitations on fraud.


                         Page U - 4 of 6

                                                       Appendix U


     Please be advised that my use of the phrase "WITH EXPLICIT
RESERVATION OF ALL MY RIGHTS AND WITHOUT PREJUDICE UCC 1-207
(UCCA 1207)" above my signature on this document indicates: that
I explicitly reject any and all benefits of the Uniform
Commercial Code, absent a valid commercial agreement which is in
force and to which I am a party, and cite its provisions herein
only to serve notice upon ALL agencies of government, whether
international, national, state, or local, that they, and not I,
are subject to, and bound by, all of its provisions, whether
cited herein or not; that my explicit reservation of rights has
served notice upon ALL agencies of government of the "Remedy"
they must provide for me under Article 1, Section 207 of the
Uniform Commercial Code, whereby I have explicitly reserved my
Common Law right not to be compelled to perform under any
contract or commercial agreement, that I have not entered into
knowingly, voluntarily, and intentionally; that my explicit
reservation of rights has served notice upon ALL agencies of
government that they are ALL limited to proceeding against me
only in harmony with the Common Law and that I do not, and will
not accept the liability associated with the "compelled" benefit
of any unrevealed commercial agreements; and that my valid
reservation of rights has preserved all my rights and prevented
the loss of any such rights by application of the concepts of
waiver or estoppel.

I presume that you will make copies of this letter of revocation
available to all interested County departments.

Thank you very much for your consideration.


WITH EXPLICIT RESERVATION OF ALL MY RIGHTS
AND WITHOUT PREJUDICE UCC 1-207 (UCCA 1207)


John Q. Doe
All Rights Reserved

registered as: John Q. Doe
               Address
               City, State


copies: County Board of Supervisors
          Jury Commissioner, County of Marin
          California Secretary of State


                         Page U - 5 of 6

                                                The Federal Zone:


Reader's Notes:


                         Page U - 6 of 6


                           Appendix V

                   Affidavit of Applicable Law


                         Page V - 1 of 8

                                                The Federal Zone:


Reader's Notes:


                         Page V - 2 of 8

                                                       Appendix V


Certified U.S. Mail #P xxx xxx xxx
Dated: mm/dd/yy

John Q. Doe
c/o USPS Post Office Box [##]
San Rafael, California Republic
united States of America
ZIP code exempt (DMM 122.32)


                   AFFIDAVIT OF APPLICABLE LAW

                AND DENIAL OF SPECIFIC LIABILITY

                    FOR FEDERAL INCOME TAXES

               DURING CALENDAR YEARS 199_ AND 199_


CALIFORNIA STATE/REPUBLIC )
                            )
MARIN COUNTY )


                            PREAMBLE


     The undersigned Affiant, John Q. Doe, is of majority age and
of sound mind, and has researched the laws as stated herein, and
is competent to testify as to his personal knowledge and belief
of the truth of all the following:


     1. That, during calendar years 199_ and 199_, the Affiant
was a Sovereign Citizen of the California Republic, which was one
of the States of the Union of several States; that, as such, his
birth and declared political status placed him in the class of
natural born Persons who were non-immigrant "nonresident aliens"
with respect to the "United States" as those terms were defined
by the Internal Revenue Code (hereinafter "IRC"), Sections
865(g)(1)(B), 7701(b)(1)(B), 7701(a)(9) and 7701(a)(10);

     2. That Congress, acting in its municipal capacity,
enacted IRC Subchapter N of Chapter 1, in order to separate the
50 Union States from the "United States" (i.e. the District of
Columbia and its Territories, Possessions and Enclaves);

     3. That a cursory examination of said Subchapter N reveals
that all "gross income" received from sources within the 50 Union
States was defined as "Income From Sources Without the United
States" (IRC Section 862); that all income derived from sources
within the District of Columbia (i.e. the "United States"), or


                         Page V - 3 of 8

                                                The Federal Zone:


"effectively connected with a United States trade or business",
was income from sources within the "United States";

     4. That everyone who inhabited the 50 Union States, who
was neither a "citizen of the United States" nor a "resident
alien", was by definition a "nonresident alien", as that term was
defined at IRC 7701(b)(1)(B) (see Treasury Decision 2313);

     5. That the Affiant was not a "resident alien", as that
term was defined at IRC 7701(b)(1)(A), because he did not satisfy
the substantial presence test, because he was never lawfully
admitted for permanent residence, and because he did not elect to
be treated as a "resident";

     6. That all compensation received by the Affiant for his
labor during calendar years 199_ and 199_ was from sources
without, and not effectively connected with, the "United States"
(i.e. the District of Columbia, its Territories, Possessions and
Enclaves);

     7. That Black's Law Dictionary, Sixth Edition, defined the
term "United States" to mean "... the territory over which
sovereignty of United States extends ....";

     8. That Citizens of one of the several Union States were
those who were born or naturalized within the "freely associated
compact states" (i.e. 50 Union States), as that term was utilized
by Congress at 28 U.S.C. Section 297, as lawfully amended;

     9. That "United States citizens" were those persons who
were citizens of the District of Columbia and resident any place
in the world, and those people who were residents of any
territory which was subject to the exclusive legislative
jurisdiction of the "United States", which included the
Territories, Possessions, Enclaves and the Federal States (see
Title 4 U.S.C., Chapter 4, Section 110(d), for a definition of
"Federal States");

     10. That, for purposes of the IRC, Subtitle A -- Income
Taxes, Congress created a "word of art" definition for the terms
"State" and "United States"; said terms were defined at IRC
Sections 7701(a)(9) and 7701(a)(10) as follows:


     (9) United States. -- The term "United States" when used in
          a geographical sense includes only the States and the
          District of Columbia.


     (10) State. -- The term "State" shall be construed to
          include the District of Columbia, where such
          construction is necessary to carry out provisions of
          this title.
                                                 [emphasis added]


                         Page V - 4 of 8

                                                       Appendix V


     11. That Congress imposed a Tax on Petroleum at IRC Section
4611, and used a different "word of art" definition for the term
"United States" in that Section; said "word of art" definition
was found at IRC 4612(a)(4)(A), to wit:

     (4) United States. --

     (A) In General. -- The term "United States" means the 50
          States, the District of Columbia, the Commonwealth of
          Puerto Rico, any possession of the United States, the
          Commonwealth of the Northern Mariana Islands, and the
          Trust Territory of the Pacific Islands.

     12. That Congress excluded the 50 Union States from the
definition of "United States", for purposes of Subtitle A, and
defined all "income" from these 50 States as "Income From Sources
Without the United States", at IRC Section 862;

     13. That Congress stated at IRC Section 864(c)(4)(A) that:

     ... no income, gain, or loss from sources without the United
     States shall be treated as effectively connected with the
     conduct of a trade or business within the United States.

     14. That, during calendar years 199_ and 199_, the Affiant
was neither a "citizen of the United States" nor was he a
"resident" or inhabitant of the "United States", i.e. the
District of Columbia, its Territories, Possessions, Enclaves or
Federal States, as those terms were defined supra;

     15. That all compensation received by the Affiant during
calendar years 199_ and 199_ consisted of "compensation for labor
or personal services performed without the United States", as
that term was utilized by Congress at IRC Section 862(a)(3);

     16. That Congress treated "compensation for labor or
personal services performed without the United States" as income
from sources without the United States, at IRC Section 862(a)(3);

     17. That IRC Section 864 "Definitions" stated:

     (b) Trade or Business within the United States. -- For
          purposes of this part, part II, and chapter 3, the term
          "trade or business within the United States" includes
          the performance of personal services within the United
          States at any time within the taxable year ...

     (c)(4) Income from sources without the United States. --

     (A) ... no income, gain, or loss from sources without the
          United States shall be treated as effectively connected
          with the conduct of a trade or business within the
          United States.
                                                 [emphasis added]


                         Page V - 5 of 8

                                                The Federal Zone:


     18. That the word "certain" was defined as:

     Certain. Ascertained; precise; identified; settled; exact;
     definitive; clearly known; unambiguous; or, in law, capable
     of being identified or made known, without liability to
     mistake or ambiguity, from data already given. Free from
     doubt.
                          [Black's Law Dictionary, Sixth Edition]
                                           [emphasis in original]

     19. That page 46 of the 1991 IRS Instructional Booklet for
Form 1040 stated that "certain earned income" was "NONTAXABLE";

     20. That, in general, Congress defined the term "earned
income" to mean "wages, salaries, or professional fees ..." at
IRC Section 911(d)(2)(A);

     21. That Congress excluded from taxation certain "earned
income", as that term was defined at IRC Section 911(d)(2)(A);

     22. That there were two (2) classes of citizenship within
the United States of America, as fully explained by the U.S.
Supreme Court in the following cases:

     There is in our political system a government of the United
     States and a government of each of the several states. Each
     of these governments is distinct from the others, and each
     has citizens of its own, who owe it allegiance, and whose
     rights, within its jurisdiction, it must protect.

           [U.S. vs Cruikshank, 92 U.S. 542, 23 L.Ed. 588 (1875)]
                                                 [emphasis added]

     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. 36 (page 408)]
                               [16 Wall. 36, 21 L.Ed. 394 (1873)]
                                                 [emphasis added]

     23. That the Affiant did not ever knowingly, intentionally,
or voluntarily enter into any agreement, or contract, to be made
partially liable for the federal debt, nor did he ever "elect" to
be treated as a "resident" of the United States under 26 C.F.R.
part 5h and IRC Sections 6013(g) & (h), by the signing Forms 1040
or any other related "United States" forms, and therefore none of
the Affiant's earnings can be taxed under the provisions of "Debt
Management for the Federal Debt" at 7 C.F.R. Part 3;

     24. That the Affiant did not voluntarily agree to use the
federal obligations of the "United States", as those terms were
defined at 18 U.S.C. 8; that, if any such unknown contract was


                         Page V - 6 of 8

                                                       Appendix V


entered into, it was by means of deception and the withholding of
pertinent and material facts, which deception and withholding of
pertinent and material facts constitute constructive fraud by the
federal government and are, therefore, null and void ab initio
under all forms of law.

     I hereby certify, under penalty of perjury, under the laws
of the United States of America, without the "United States",
that the foregoing is true and correct in fact and in substance,
to the best of my current information, knowledge and belief, per
28 U.S.C. 1746(1).

Further This Affiant saith not.

Subscribed, sealed and affirmed to this ______ day of __________,
199_ Anno Domini.

I now affix my own signature to all of the above affirmations:


_________________________________________________________________
John Q. Doe, Citizen/Principal, by special  Appearance, in Propria
Persona, proceeding Sui Juris, with Assistance, Special.

                           John Q. Doe
                  c/o USPS Post Office Box [##]
                 San Rafael, California Republic
                  ZIP code exempt (DMM 122.32)


             California All-Purpose Acknowledgement

CALIFORNIA STATE/REPUBLIC )
                                )
COUNTY OF MARIN )

     On the ________ day of ____________, 199_ Anno Domini,
before me personally appeared John Q. Doe, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
Person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in His authorized
capacity, and that by His signature on this instrument the
Person, or the entity upon behalf of which the Person acted,
executed the instrument. Purpose of Notary Public is for
identification only, and not for entrance into any foreign
jurisdiction.

WITNESS my hand and official seal.


_____________________________________
Notary Public


                         Page V - 7 of 8

                                                The Federal Zone:


Reader's Notes:


                         Page V - 8 of 8


                           Appendix W

                   Memos on Downes vs Bidwell


                        Page W - 1 of 12

                                                The Federal Zone:


Reader's Notes:


                        Page W - 2 of 12

                                                       Appendix W


MEMO

TO: Edward A. Ellison, Jr., J.D.
          John William Kurowski

FROM: Mitch Modeleski, Founder
          Account for Better Citizenship

DATE: March 24, 1992

SUBJECT: "Direct Taxation and the 1990 Census"
          your essay in Reasonable Action newsletter,
          Save-A-Patriot Fellowship, July/August 1991

     I was very gratified to see such a thorough and
authoritative treatment of "direct taxation" in the July/August
1991 issue of the Reasonable Action newsletter. My research
continues to convince me of the extreme constitutional importance
of the apportionment rule for direct taxes levied by Congress
within the 50 States of the Union. I am writing this memo to
share with you some of my thoughts on the subject, and to offer
my challenge to a few points which are not necessarily beyond
dispute. Please understand that I am in general agreement with
most, but not all of your essay. Permit me to play "devil's
advocate" as I focus on some issues which deserve greater
elaboration and substantiation.

     The so-called 16th Amendment remains highly relevant to this
subject, for a number of important reasons. First of all, since
1913, several federal courts have attempted to isolate the
precise effects of a ratified 16th Amendment. Unfortunately for
us, when all of these cases are assembled side-by-side, the
rulings are not consistent. We are forced to admit the existence
of separate groups of court decisions that flatly contradict each
other. One group puts income taxes into the class of indirect,
excise taxes. Another group puts income taxes into the class of
direct taxes. One group argues that a ratified 16th Amendment
did not change or repeal any other clause of the Constitution.
Another group argues that a ratified 16th Amendment relieved
income taxes from the apportionment rule. Even experts disagree.
To illustrate the range of disagreement on such fundamental
constitutional issues, consider the conclusion of legal scholar
Vern Holland:

     ... [T]he Sixteenth Amendment did not amend the
     Constitution. The United States Supreme Court by unanimous
     decisions determined that the amendment did not grant any
     new powers of taxation; that a direct tax cannot be
     relieved from the constitutional mandate of apportionment;
     and the only effect of the amendment was to overturn the
     theory advanced in the Pollock case which held that a tax on
     income, was in legal effect, a tax on the sources of the
     income.
                                  [The Law That Always, page 220]


                        Page W - 3 of 12

                                                The Federal Zone:


Now consider the opposing view of another competent scholar.
After much research and much litigation, author and attorney
Jeffrey A. Dickstein offers the following concise clarification:


     A tax imposed on all of a person's annual gross receipts is
     a direct tax on personal property that must be apportioned.
     A tax imposed on the "income" derived from those gross
     receipts is also a direct tax on property, but as a result
     of the Sixteenth Amendment, Congress no longer has to enact
     legislation calling for the apportionment of a tax on that
     income.
               [Judicial Income and Your Income Tax, pages 60-61]


The following Appellate ruling is unique among all the relevant
federal cases for its clarity and conciseness on this question:


     The constitutional limitation upon direct taxation was
     modified by the Sixteenth Amendment insofar as taxation of
     income was concerned, but the amendment was restricted to
     income, leaving in effect the limitation upon direct
     taxation of principal.

               [Richardson vs United States, 294 F.2d 593 (1961)]
                                                 [emphasis added]

Granted, this is not a decision by the Supreme Court, but the
decision is useful because it is so clear and concise, and also
because it is very representative of that group of rulings which
found that a ratified 16th Amendment relieved income taxes from
the apportionment rule. By inference, if income taxes were
controlled by the apportionment rule prior to the 16th Amendment,
then they must be direct taxes (according to one group of
rulings).

     Recall now that 17,000 State-certified documents have been
assembled to prove that the 16th Amendment was never ratified.
Congress has already been served with several official complaints
documenting the evidence against the 16th Amendment, pursuant to
the First Amendment guarantee for redress of grievances.
Congress has now fallen silent. I am the author of one of these
complaints (see The Federal Zone, Appendix J). Relying on one
group of rulings, the Pollock, Peck, Eisner and Shaffer decisions
leave absolutely no doubt about the consequences of the failed
ratification: the necessity still exists for an apportionment
among the 50 States of all direct taxes, and income taxes are
direct taxes.

     Federal courts did not hesitate to identify the effects of a
ratified 16th Amendment. Now that the evidence against its
ratification is so overwhelming and incontrovertible, the federal
courts are unwilling to identify the effects of the failed


                        Page W - 4 of 12

                                                       Appendix W


ratification. These courts have opted to call it a "political"
question, even though it wasn't a "political" question in the
years immediately after Philander C. Knox declared it ratified.
I personally find it hard to believe that the federal courts are
incapable of exercising the logic required to isolate the legal
effects of the failed ratification. Quite simply, if a ratified
16th Amendment had effect X, then a failed ratification proves
that X did not happen. What is X? Their "political"
unwillingness to exercise basic logic means that the federal
courts have abdicated their main responsibility -- to uphold the
constitution -- and that we must now do it for them instead.
That is just one of the many reasons why I wrote and published
The Federal Zone in the first place. I believe I have succeeded
in accurately situating the issue of the 16th Amendment inside a
much broader context. What is that much broader context?

     Let me begin my answer to that question by first quoting
from your essay, in the section entitled "Documenting the Truth":


     The Constitution still grants to the Congress the power of
     laying an "apportioned" direct tax but notwithstanding the
     advent of the 16th Amendment all "direct" taxes must be
     apportioned. There is no exception to this rule.

                                                 [emphasis added]

     In a strictly normative sense, I would certainly agree that
this is the way it should be. But, in a practical and empirical
sense, is this really the way it is? I say no. In exercising
its exclusive authority over the federal zone, Congress is not
subject to the same constitutional limitations that exist inside
the 50 States. For this reason, the areas that are inside and
outside the federal zone are heterogeneous with respect to each
other. This difference results in a principle of territorial
heterogeneity: the areas within (or inside) the federal zone are
subject to one set of rules; the areas without (or outside) the
federal zone are subject to a different set of rules. The
Constitution rules outside the zone and inside the 50 States.
The Congress rules inside the zone and outside the 50 States.
The 50 States are, therefore, in one general class, because all
constitutional restraints upon Congress are in force throughout
the 50 States, without prejudice to any one State. The areas
within the federal zone are in a different general class, because
these same constitutional restraints simply do not limit Congress
inside that zone (see The Federal Zone, chapters 12 and 13).

     I would never ask you to accept this principle of
territorial heterogeneity simply on faith. There is solid case
law to substantiate it. You may recall, it is the Hooven case
which officially defined the three separate and distinct meanings
of the term "United States". This same definition can also be
found in Black's Law Dictionary, Sixth Edition. The Supreme
Court ruled that this case would be the last time it would


                        Page W - 5 of 12

                                                The Federal Zone:


address official definitions of the term "United States".
Therefore, this ruling must be judicially noticed by the entire
American legal (and paralegal) community. In my opinion, the
most significant holding in Hooven has to do with territorial
heterogeneity, as follows:


     ... [T]he United States** may acquire territory by conquest
     or by treaty, and may govern it through the exercise of the
     power of Congress conferred by Section 3 of Article IV of
     the Constitution ....

     In exercising this power, Congress is not subject to the
     same constitutional limitations, as when it is legislating
     for the United States***. ... And in general the guaranties
     [sic] of the Constitution, save as they are limitations upon
     the exercise of executive and legislative power when exerted
     for or over our insular possessions, extend to them only as
     Congress, in the exercise of its legislative power over
     territory belonging to the United States**, has made those
     guarantees applicable.

             [Hooven & Allison Co. vs Evatt, 324 U.S. 652 (1945)]
                                                 [emphasis added]

I have taken the liberty of adding asterisks ("**","***") to the
above, in order to identify which meaning of "United States" is
being used in each occurrence of the term. Computer users prefer
the term "stars" over "asterisks" because it has fewer syllables.

     Return now to your statement that "there is no exception to
this rule" that all direct taxes must be apportioned. Using the
Hooven case and others as our guide, it is more accurate to say
that all direct taxes must be apportioned whenever they are
levied inside the 50 States of the Union. On the other hand,
direct taxes need NOT be apportioned whenever they are levied
outside the 50 States of the Union, and inside the areas of land
over which Congress has exclusive legislative jurisdiction. The
authorities for this exclusive legislative jurisdiction are
1:8:17 and 4:3:2 in the U.S. Constitution. You may disagree with
this interpretation of the term "exclusive", and that is your
right, but in doing so you are disagreeing with the Supreme
Court. Evidently, this was not the first, nor the last time the
high Court has differed with the Framers of the Constitution.

     As it turns out, the pivotal case law on this question
predates Hooven by 44 years, and predates the so-called 16th
Amendment by 12 years. In Downes vs Bidwell, 182 U.S. 244
(1901), the issue was a discriminatory tariff which Congress had
levied on goods imported from Puerto Rico (or "Porto Rico" as it
was spelled then). Congress had recently obtained exclusive
legislative jurisdiction over this territory by virtue of the
treaty of peace with Spain. The import duty was obviously not
uniform, as required by 1:8:1 in the U.S. Constitution, since it


                        Page W - 6 of 12

                                                       Appendix W


was levied specifically against goods originating in Puerto Rico.
In a 5-to-4 decision, the Supreme Court upheld the import duty,
even though it was not uniform, on the principle that the
uniformity rule applied only to the 48 States and not to the
areas of land, i.e., enclaves, territories and possessions, over
which Congress has exclusive legislative authority.

     The controversy that surrounded Downes vs Bidwell was
intense, as evidenced by the flurry of articles that were
published in the Harvard Law Review on the subject of "The
Insular Cases" as they were called. Perhaps the most lucid
criticism of the Downes majority can be found in Justice Harlan's
dissent:


     The idea prevails with some -- indeed, it found expression
     in arguments at the bar -- that we have in this country
     substantially or practically two national governments; one,
     to be maintained under the Constitution, with all its
     restrictions; the other to be maintained by Congress
     outside and independently of that instrument, by exercising
     such powers as other nations of the earth are accustomed to
     exercise.

                         [Downes vs Bidwell, 182 U.S. 244 (1901)]
                                                 [emphasis added]

To appreciate how alarmed Justice Harlan had become as a result
of this new "theory", consider the following from his dissent:


     I take leave to say that if the principles thus announced
     should ever receive the sanction of a majority of this
     court, a radical and mischievous change in our system of
     government will be the result. We will, in that event, pass
     from the era of constitutional liberty guarded and protected
     by a written constitution into an era of legislative
     absolutism. ...


     It will be an evil day for American liberty if the theory of
     a government outside of the supreme law of the land finds
     lodgment in our constitutional jurisprudence. No higher
     duty rests upon this court than to exert its full authority
     to prevent all violation of the principles of the
     Constitution.

                         [Downes vs Bidwell, 182 U.S. 244 (1901)]
                                                 [emphasis added]

This theory has been documented by patriot John Knox as follows:


                        Page W - 7 of 12

                                                The Federal Zone:


     This theory of a government operating outside the
     Constitution over its own territory with citizens of the
     United States belonging thereto under Article 4, Section 3,
     Clause 2 of the Constitution was further confirmed in 1922
     by the Supreme Court in Balzac vs Porto Rico, 258 U.S. 300
     (EXHIBIT #4) where that Court affirmed that the Constitution
     does not apply outside the limits of the 50 States of the
     Union at page 305 quoting Downes, supra and De Lima, supra.
     That under Article IV, section 3 the "United States" was
     given exclusive power over the territories and their
     citizens of the "United States" residing therein.


This quote is from an unpublished brief entitled "Memorandum in
Support of Request for the District Court to Consider the T.R.O.
and Injunction by the Magistrate" by John Knox, Knox vs U.S.,
United States District Court for the Western District of Texas,
San Antonio, Texas, Case No. SA-89-CA-1308.

     People will not fully appreciate a central thesis of The
Federal Zone if they believe that I agree with the minimal
majority by which Downes was decided. I don't agree with the
majority; I agree with Harlan. I have simply tried to describe,
in lucid language, how Congress is now able to pass legislation
which is not restrained by the U.S. Constitution as we know it.
This type of legislation is also known as "municipal" law,
because Congress is the municipal authority inside the federal
zone. When I visited the District of Columbia during my senior
year at UCLA as a summer intern in political science, I asked a
Capitol guard where I could find city hall. We were standing on
the Capitol lawn when he pointed to the Capitol Building and
said, "That is City Hall!"

     The Downes decision sent many shock waves through the
American legal community, as evidenced by the deep concern that
is expressed by author Littlefield in "The Insular Cases", 15
Harvard Law Review 169, 281. He points out how the dissenting
minority were of a single mind, while the assenting majority
exploited a multiplicity of conflicting and mutually incompatible
themes. Just one vote turned the tide. Littlefield's words jump
off the page like grease popping off a sizzling griddle.

     Accordingly, I now believe that we must go back further than
1913 to isolate the major turn in the tide of American
constitutional integrity and continuity. Medina in The Silver
Bulletin traces the fork to the tragic American Civil War --
the counter revolution -- when Lincoln was murdered by a
Rothschild agent, clearing the stage for resurrecting the
federalists' heartthrob -- a central bank. For example, in the
context of everything we now know about territorial
heterogeneity, to the extent that it was a "municipal" statute
for the federal zone, the Federal Reserve Act was constitutional
under the rubric of the Downes doctrine.


                        Page W - 8 of 12

                                            Appendix W


     The consequences of this doctrine have been profound and
far-reaching, just as Harlan predicted. One of Lyndon Johnson's
first official acts was to rescind JFK's executive order
authorizing the circulation of $4.5 billion in interest-free
"United States Notes" instead of interest-bearing "Federal
Reserve Notes". It is a shame that Oliver Stone did not cover
this motive in his movie JFK. All we need to do is connect the
dots, and the picture will emerge, clear as day.

     Specifically, Title 26 is a municipal statute and, as such,
it is not subject to the apportionment rule. The territorial
scope of Title 26 is the federal zone; the political scope of
Title 26 is the set of "persons" who are either citizens and/or
residents of that zone: "U.S.** citizens" and "U.S.** residents".
The term "U.S.**" in this context refers to the second of the
three Hooven definitions, namely, the territory over which the
sovereignty of Congress extends, i.e., the federal zone.
Incidentally, the flat tax provisions in Title 26 do conform to
the uniformity rule because the tax rate is uniform across the 50
States (see A Ticket To Liberty, by Lori Jacques).

     Since involuntary servitude is now forbidden everywhere in
this land, it is possible under law to acquire citizenship in the
federal zone at will via naturalization, even if one is a natural
born Sovereign State Citizen by birth. It is also possible to
abandon citizenship in the federal zone at will, via
expatriation. In this context, it is revealing that the Internal
Revenue Code has provisions for dealing with "U.S.** citizens"
who expatriate to avoid the tax. Similarly, Americans are free
to reside wherever they want, under the law. If you choose to
reside in the federal zone, you are liable for the income tax, by
definition (see 26 U.S.C. 7701(b)(1)(A) and 26 C.F.R. 1.1-1(b)).
Finally, if you are a "nonresident alien" with respect to the
"United States**" as those terms are defined in Title 26 and in
Title 42, you are only liable for taxes on income which is
effectively connected with a U.S.** trade or business, and on
income which derives from U.S.** sources. All other income for
nonresident aliens is excluded from the computation of "gross
income" as defined (see 26 U.S.C. 872(a)).

     I hope this discussion has provided you with some valuable
feedback concerning the 16th Amendment, direct taxes, the
apportionment rule, Title 26 and The Federal Zone. You have, no
doubt, heard several references to the "secret jurisdiction"
under which the IRS has been operating. I now believe that this
jurisdiction is no longer totally a secret; it issues from
1:8:17 and 4:3:2 in the Constitution. Contrary to the statement
quoted above from your essay, there are exceptions to the
apportionment rule for direct taxes, and there are exceptions to
the uniformity rule for indirect taxes. Inside the federal zone,
Congress is free to do pretty much whatever it wants, per the
Downes doctrine. Inside the federal zone, it is a legislative
democracy, with majority rule. If you want to change the rules,
then change the majority. Our best hope for changing those rules


                        Page W - 9 of 12

                                                The Federal Zone:


rests, therefore, in changing the membership in the House and
Senate. As a Sovereign State Citizen, however, I am not subject
to those rules, primarily and most importantly because the
Constitution created the legislature and We Sovereigns created
the Constitution. A Sovereign is never subject to his own
creation, unless he volunteers himself into that status, for
whatever reason (e.g., the security of socialism a/k/a Social
Security).

     For your edification, the following is a list of Harvard Law
Review articles which discuss the insular cases in some detail:


     Langdell, "The Status of Our New Territories"
     12 Harvard Law Review, 365, 371

     Thayer, "Our New Possessions"
     12 Harvard Law Review, 464

     Thayer, "The Insular Tariff Cases in the Supreme Court"
     15 Harvard Law Review 164

     Littlefield, "The Insular Cases"
     15 Harvard Law Review, 169, 281


                        Page W - 10 of 12

                                                       Appendix W


MEMO

TO: Godfrey Lehman

FROM: Mitch Modeleski

DATE: March 2, 1992

SUBJECT: Downes vs Bidwell

Thank you for the materials on 1:8:17. That was then. This is
now:

     1. The issue as to whether there are different meanings to
     the term "United States," and whether there are three
     different "United States" operating within the same
     geographical area, and one "United States" operating outside
     the Constitution over its own territory, in which it has
     citizens belonging to said "United States," was settled in
     1900 by the Supreme Court in De Lima vs Bidwell, 182 U.S. 1,
     and in Downes vs Bidwell, 182 U.S. 244. In Downes supra,
     Justice Harlan dissenting stated as follows:

          The idea prevails with some -- indeed, it found
          expression in arguments at the bar -- that we have in
          this country substantially or practically two national
          governments; one, to be maintained under the
          Constitution, with all its restrictions; the other to
          be maintained by Congress outside and independently of
          that instrument, by exercising such powers as other
          nations of the earth are accustomed to exercise.

     He went on to say on page 823:

          It will be an evil day for American liberty if the
          theory of a government outside of the supreme law of
          the land finds lodgment in our constitutional
          jurisprudence. No higher duty rests upon this court
          than to exert its full authority to prevent all
          violation of the principles of the Constitution.

                [Downes vs Bidwell, 182 U.S. 244, emphasis added]

     2. This theory of a government operating outside the
     Constitution over its own territory with citizens of the
     United States belonging thereto under Article 4, Section 3,
     Clause 2 of the Constitution was further confirmed in 1922
     by the Supreme Court in Balzac vs Porto Rico, 258 U.S. 300
     (EXHIBIT #4) where that Court affirmed that the Constitution
     does not apply outside the limits of the 50 States of the
     Union at page 305 quoting Downes, supra and De Lima, supra.
     That under Article IV, section 3 the "United States" was
     given exclusive power over the territories and their
     citizens of the "United States" residing therein.


                        Page W - 11 of 12

                                                The Federal Zone:


This quote is from an unpublished brief entitled "Memorandum in
Support of Request for the District Court to Consider the T.R.O.
and Injunction by the Magistrate" by John Knox, Knox vs U.S.,
United States District Court for the Western District of Texas,
San Antonio, Texas, Case No. SA-89-CA-1308.

People will not understand a central thesis of The Federal Zone
if they believe that I agree with the minimal majority by which
Downes was decided. I don't agree. I have simply tried to
describe, in simple and lucid language, how Congress is now able
to pass legislation which is not restrained by the Constitution
as we know it.

The Downes decision sent many shock waves through the American
legal community, as evidenced by the deep concern that is
expressed by author Littlefield in "The Insular Cases", 15
Harvard Law Review 169, 281. He points out how the dissenting
minority were of a single mind, while the assenting majority
exploited a multiplicity of conflicting and mutually incompatible
themes. Just one vote turned the tide.

Accordingly, I now believe that we must go back further than 1913
to isolate the major turn in the tide of constitutional integrity
and continuity. Medina in The Silver Bulletin traces the fork to
the Civil War -- the American counter revolution -- when
Lincoln was murdered by a Rothschild agent, clearing the stage
for resurrecting the federalists' heartthrob -- a central bank.

The consequences were profound. One of Lyndon Johnson's first
official acts was to rescind JFK's executive order authorizing
the circulation of $4.5 billion in interest-free "United States
Notes" instead of interest-bearing "Federal Reserve Notes". All
we need to do is connect the dots, and the picture will emerge,
clear as day.

For your edification, see the following:

     Langdell, "The Status of Our New Territories"
     12 Harvard Law Review, 365, 371

     Thayer, "Our New Possessions"
     12 Harvard Law Review, 464

     Thayer, "The Insular Tariff Cases in the Supreme Court"
     15 Harvard Law Review 164

     Littlefield, "The Insular Cases"
     15 Harvard Law Review, 169, 281


                        Page W - 12 of 12


                           Appendix X

            Certificate of Exemption from Withholding


                         Page X - 1 of 4

                                                The Federal Zone:


Reader's Notes:


                         Page X - 2 of 4

                                                       Appendix X


    CERTIFICATE OF EXEMPTION FROM WITHHOLDING IN LIEU OF W-4

Consistent and in pari materia with Section 3402(n) of the
Internal Revenue Code, shown herewith, I hereby certify to being
EXEMPT by law from all federal income tax withholdings because:

A. No liability for income tax has knowingly been incurred by
     me under Subtitle A in the past year or in previous years.

B. No liability for income tax will knowingly be incurred by me
     under Subtitle A in the current year or in future years.

Effective immediately, stop all federal tax withholdings.

Thank you for your consideration.

With Explicit Reservation of All My Unalienable Rights
and Without Prejudice to Any of My Unalienable Rights


Signed: _________________________________________________________

Name: ___________________________________________________________

Address: ________________________________________________________

County of: ______________________________________________________

State of: _______________________________________________________


             California All-Purpose Acknowledgement

CALIFORNIA STATE/REPUBLIC )
                                )
COUNTY OF MARIN )

     On the ________ day of ____________, 199_ Anno Domini,
before me personally appeared John Q. Doe, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
Person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in His authorized
capacity, and that by His signature on this instrument the
Person, or the entity upon behalf of which the Person acted,
executed the instrument. Purpose of Notary Public is for
identification only, and not for entrance into any foreign
jurisdiction.

WITNESS my hand and official seal.


_____________________________________
Notary Public


                         Page X - 3 of 4

                                                The Federal Zone:


Internal Revenue Code, Section 3402(n):

(n) Employees Incurring No Income Tax Liability. --

     Notwithstanding any other provision of this section, an
     employer shall not be required to deduct and withhold any
     tax under this chapter upon a payment of wages to an
     employee if there is in effect with respect to such payment
     a withholding exemption certificate (in such form and
     containing such other information as the Secretary may
     prescribe) furnished to the employer by the employee
     certifying that the employee --


     (1) incurred no liability for income tax imposed under
          Subtitle A for his preceding taxable year, and

     (2) anticipates that he will incur no liability for income
          tax imposed under Subtitle A for his current taxable
          year.


     The Secretary shall by regulations provide for the
     coordination of the provisions of this subsection with the
     provisions of subsection (f).

                                                    [IRC 3402(n)]


IRS Form 8233:
EXEMPTION FROM WITHHOLDING OF COMPENSATION FOR PERSONAL SERVICES

IRS Form 8233 is an alternative to a CERTIFICATE OF EXEMPTION
FROM WITHHOLDING IN LIEU OF W-4. The following is the abstract
describing Form 8233 in the IRS Printed Product Catalog:


     8233 62292K (Each)

     Exemption from Withholding of Compensation for Personal
     Services

     Used by non resident alien individuals to claim exemption
     from withholding on compensation for personal services
     because of an income tax treaty or the personal exemption
     amount. D:R:FP:F Tax Related Public Use

                                    [IRS Printed Product Catalog]
                                [Document 7130, Rev. 6-89, p. 66]


                         Page X - 4 of 4


                           Appendix Y

                        Memoranda of Law


                        Page Y - 1 of 40

                                                The Federal Zone:


Author's Note:

These Memoranda of Law have been adapted and updated from the
files FMEMOLAW and 9THAPPEA on Richard McDonald's electronic
bulletin board system (BBS). See references to MEMOLAW and
FMEMOLAW in Chapter 11.

Richard McDonald has given his generous permission to publish the
following versions of these documents as another Appendix in the
third and subsequent editions of The Federal Zone.

Editing, minor additions and grammatical clarifications were done
by Mitch Modeleski, also with Richard McDonald's approval.


                        Page Y - 2 of 40

                                                       Appendix Y


           IN THE DISTRICT COURT OF THE UNITED STATES

           FOR THE DISTRICT OF ______________________


                         ) NOTICE OF LACK OF JURISDICTION
Plaintiff )
                         ) AND
                         )
vs ) DEMAND FOR HEARING
                         )
                         ) TO ORDER PROOF
Defendant/Citizen )
                         ) OF JURISDICTION
                         )


TO ALL INTERESTED PARTIES:


     PLEASE TAKE NOTICE that a hearing has been requested by the
Accused Common-Law Citizen [DEFENDANT] to take place on the
________ day of ___________________, 1993, at _____________ hours
in Courtroom _______, of the above entitled Court located at
________________.


     1. This hearing has been called to resolve certain
conclusions of law which are in controversy. The demand for this
hearing constitutes a direct challenge to the jurisdiction of
this Court in the instant matter at bar. The accused Citizen
[DEFENDANT] is aware that he has been compelled to participate in
this action under threat of arrest and incarceration, should he
fail to appear when ordered to do so.

     2. The subject matter jurisdiction of this Court is not in
question here. Rather, because the matter is criminal in nature
and involves a compelled performance to what is essentially
derived from Roman Civil (Administrative) Law, the Accused
herewith challenges the In Personam jurisdiction of this Court.
The Accused does so on the ground that the Plaintiff has failed
to provide an offer of proof that the Accused is subject to the
legislative equity jurisdiction in which this Court intends to
sit to hear and determine only the facts of this matter, and not
the law, arising from a "Bill of Pains and Penalties".

     3. It is well known that jurisdiction may be challenged at
any time as an issue of law because, absent jurisdiction, all
acts undertaken under the color of statute or under the color of
ordinance are null and void ab initio (from their inception).


                        Page Y - 3 of 40

                                                The Federal Zone:


     4. Because the Accused was compelled, under threat of
further damage and injury, to enter this Court to demand relief,
this appearance is SPECIAL, and not general in nature.

     5. The argument which follows sets forth the nature of the
controversy "At Law". This Court is bound by its oath of office
to sit on the Law side of its jurisdiction to hear the
controversy in a neutral capacity and to make a fair and
impartial determination.

     6. This document, and the argument contained herein, is
intended to be the basis for further action on appeal, should
this Court fail to afford a complete hearing on the law of the
matter at the noticed request of the Accused. Furthermore, a
failure of this Court to seat on the Law side of its jurisdiction
to determine this timely question will give the Accused cause to
file for a Writ of Prohibition in a higher Court.


                            ARGUMENT


     1. The Constitution of the United States of America (1787)
is the supreme law of the land. The Constitution of State of
California must be construed in harmony with the supreme law of
the land; otherwise, the State of California has violated its
solemn contract with the Union of States known as the United
States of America, and the question raised herein becomes one
which is a proper original action before the Supreme Court of the
United States, sitting in an Article 3 capacity.

     2. An employee of the Internal Revenue Service has
submitted allegations in what amounts to a "Bill of Pains and
Penalties" alleging that I, [DEFENDANT], have somehow failed to
perform according to the terms of some agreement for specific
performance on my part.

     3. By submitting this Bill of Pains and Penalties, the
individual in question has accused [DEFENDANT] of failing to
perform specifically to some legislative statute which is being
presented as evidence of the law. Statutes are not laws; they
are administrative regulations which are civil in nature, even
when they carry sanctions of a criminal nature, unless there is
an injured party who is brought forward as a corpus delicti.

     4. Thus, because of this unsupported conclusion of law,
and because the Internal Revenue Service has administratively
decided that the Accused is subject to the statutes in question,
the Accused Citizen holds that a contrary conclusion of law
exists to challenge the jurisdiction of this Court. Therefore,
this Court must now sit in a neutral position, on the Law side of
its jurisdiction, to hear and resolve the question of
controversial positions of law as they affect its jurisdiction or
lack of jurisdiction In Personam.


                        Page Y - 4 of 40

                                                       Appendix Y


     5. This argument is intended to serve as both a defense
"At Law" in this Court, and as the basis of future actions,
should it become necessary to appeal the question presented to a
higher judicial authority.


     6. If the Accused Citizen is correct, and if this Court is
sitting to hear the violation of a regulatory statute, then it is
possible that the judges of this Court, in hearing this matter,
are acting in an administrative capacity rather than a judicial
capacity. This issue is discussed in detail in the argument
which follows.


     7. This Court is placed on NOTICE that, if it fails to sit
and hear this issue "At Law" upon a timely request, then you may
have violated your oath of office to uphold and defend the
Constitutions of the United States of America (1787) and the
California Republic (1849). Such an act will serve to place you
and the other parties to this action outside the realm of
judicial immunity and subject to future action by this Accused
California Citizen. The Prosecutor in this action is
specifically placed on NOTICE that s/he carries no shirttail
immunity should s/he continue to prosecute, in the absence of a
determination "At Law" of the question presented herein before
trial.

                           JURISDICTION


     8. In 1849, California became one of the several States of
the Union of States known as the United States of America.
California is a "Common Law" State, meaning that the Common Law,
as derived from the common law of England, is a recognized form
of law in the State of California.


     9. Article 3 of the Constitution of the United States of
America gives "judicial" power to the various courts, among them
the District Courts. What is not generally recognized is that
the District Courts may seat in different jurisdictions. Judges
may wear different hats, so to speak, depending on the nature of
the case brought before them.


     10. This Court may sit "At Law" to hear crimes and civil
complaints involving a damage or injury which is unlawful under
the Common Law of a State; or it may seat in equity to determine
specific performance to a contract in equity. Alternatively, as
a creation of the foreign Corporate State, this Court may seat
administratively in a fiction which may be termed "legislative
equity", under authority to regulate activities not of common
right, such as commerce for profit and gain, or other privileged
activities.


                        Page Y - 5 of 40

                                                The Federal Zone:


     11. The Internal Revenue Code is essentially a "civil,
regulatory statute" which was enacted in 1939 to tax and regulate
employees of the Federal Government and "citizens of the United
States" (i.e., of the District of Columbia), and to set forth
rules and regulations for the production of revenue for the
"United States", as defined in the U.S. Constitution.

     12. It is an unlawful abuse of procedure to use civil
statutes as "evidence of the law" in a criminal matter,
particularly when a United States Code has not been enacted into
positive law (see, specifically, 26 U.S.C. 7851(a)(6)(A)).

     13. Both civil and criminal matters "At Law" require that
the complaining party be a victim of some recognizable damage.
The "Law" cannot recognize a "crime" unless there is a victim who
properly claims to have been damaged or injured.

     14. Regulatory statutes, on the other hand, are enacted
under the police power of State and Federal Governments to
regulate activities not of common right. All statute law is
inferior to, and bound by, the restrictions of the Constitution.
These "regulatory" statutes operate as "law" on the subjects of
those statutes, and violations may carry sanctions of a criminal
nature, even in the absence of a victim or injury.

     15. A self-evident truth which distinguishes "crimes" under
the Law, from "offenses of a criminal nature" under regulatory
statutes, is the difference between Rights afforded to a
defendant in a criminal proceeding, and "rights" available to a
defendant under "due process" in a statutory proceeding.

     16. In the case of true crimes "At Law", the Common-Law
Citizen [DEFENDANT] enjoys all his fundamental rights as
guaranteed by the State and Federal Constitutions, including both
"substantive" and "procedural" due process. In contrast, when
regulatory offenses "of a criminal nature" are involved, the
statutory defendant cannot demand constitutional rights, since
only certain "civil rights" have been granted in these actions,
and only "procedural due process", consisting of the right to be
heard on the facts alone, is allowed. Constitutional rights and
substantive due process are noticeably absent. Therefore, the
Court must be seated in some jurisdiction other than "At Law", in
order to hear an alleged violation of a regulatory statute.

     17. The Accused Common-Law Citizen [DEFENDANT], hereby
places all parties and the Court on NOTICE, that he is not a
"citizen of the United States" under the so-called 14th
Amendment, i.e., a juristic person or a franchised person who can
be compelled to perform under the regulatory Internal Revenue
Code, which is civil in nature. Moreover, the Accused Common-Law
Citizen [DEFENDANT] hereby challenges the In Personam
jurisdiction of the Court with this contrary conclusion of law.
This Court is now mandated to seat on the Law side of its
capacity to hear evidence of the status of the Accused Citizen.


                        Page Y - 6 of 40

                                                       Appendix Y


     18. The Accused Common-Law Citizen [DEFENDANT] contends
that the Internal Revenue Service made a false conclusion of law
in an administrative capacity when it first brought this action
before the Court, and in so doing failed to impart jurisdiction
upon this Court to seat and hear this matter in a jurisdiction of
legislative equity.

     19. The Accused Common-Law Citizen [DEFENDANT] now demands
that the attorney for the Plaintiff in this matter step forward
with an offer of proof that the Accused Common-Law Citizen
[DEFENDANT], has lost his status as a Common-Law Citizen of the
California Republic, and is now a "resident" of this State who
can be compelled to perform to the letter of every civil statute
because he is either an immigrant alien, a statutory resident
(14th Amendment citizen), a juristic person (corporation), or an
enfranchised person (i.e., one who has knowingly, willingly and
voluntarily entered into an agreement for the exercise of a
privilege or the receipt of a benefit and for the attendant
considerations carried with the grant of that privilege or
benefit).

     20. Once jurisdiction is challenged, this Court must sit on
the Law side of its jurisdiction as a neutral arbitrator, before
the allegations of statutory wrongdoing can proceed. Failure to
do so may subject the judge of this Court to charges of perjury
for violating the oath of office by refusing to uphold and
protect the rights guaranteed and protected by the Constitutions
of the California Republic and of the United States of America.

     21. The Accused Common-Law Citizen [DEFENDANT] requests
that this Court take judicial notice that he has been compelled
to enter this Court to answer the allegation, and contends that
the allegations are founded upon false conclusions of law. The
Memorandum of Law which follows will set forth the position of
the Accused Common-Law Citizen [DEFENDANT], and the record will
show that no evidence is before this Court which contradicts the
position of Citizen [DEFENDANT], except a mere fiction of law.
This fiction of law cannot stand in the face of a clear and
direct challenge.


Dated , 1993


Respectfully submitted
with explicit reservation of all my unalienable rights
and without prejudice to any of my unalienable rights,


Citizen of the California Republic
In Propria Persona, Sui Juris


                        Page Y - 7 of 40

                                                The Federal Zone:


                        MEMORANDUM OF LAW

                      CLASSES OF CITIZENSHIP

     1. The Constitution of the United States of America
recognizes several classes of people who exist in this Union of
States, as described in Article 1, Section 2, Clause 3 (1:2:3).

     2. This Court is herewith mandated to take judicial notice
of the Constitution of the United States of America, the
Constitution of the California Republic, the Statutes at Large of
the United States of America, and all case law presented herein,
pursuant to the Federal Rules of Evidence, Section 201, et seq.,
and Article 4, Section 1 (4:1) of the Constitution of the United
States of America (1787).

     3. Excluding "Indians not taxed", since they are not under
consideration in this matter, we are left with two other classes
of individuals defined in 1:2:3 of the U.S. Constitution, to wit:
"free Persons" and "three-fifths of all other Persons".

     4. The term "three fifths of all other Persons" referred
to the Black slave population and all others of races other than
"white" who could not and did not have Common-Law Citizenship of
one of the several States, at the time the Constitution was
adopted. (For an in-depth analysis of this fact, see the cases
of Dred Scott vs Sandford, 19 How. 393; U.S. vs Rhodes, 1 Abbott
39; Slaughter House Cases, 16 Wall. 74; Van Valkenburg vs
Brown, 43 Cal. 43; U.S. vs Wong Kim Ark, 169 U.S. 649; and K.
Tashiro vs Jordan, 201 Cal. 239; et al.)

     5. The Thirteenth Amendment, officially and lawfully
ratified in 1865, served only to abolish slavery within the
corporate United States. No race other than the white race could
claim Common-Law Citizenship of one of the several States, which
Citizenship was afforded the protection of the Constitutions.
(This is discussed in depth in Dred Scott vs Sandford, supra).

     6. Further proof that this argument applies to the State
of California is found in Article 2, Section 1 of the Original
California Constitution (1849) which states in part: "Every WHITE
male Citizen of the United States, and every WHITE male citizen
of Mexico ..." [emphasis added]. Obviously, this provision
excluded all other races from being Common-Law Citizens of
California and from having the full protection of the State and
Federal Constitutions. This was the case even before the famous
Dred Scott decision. It is most notable that the California
Constitution was altered after the so-called 14th Amendment so as
to delete all references to "white" male Citizens, and today it
refers only to "persons".

     7. Following the decision in Dred Scott, supra, Congress
allegedly enacted and ratified the so-called 14th Amendment to
the Constitution of the United States of America to afford


                         Page Y - 8 of 40

                                                       Appendix Y


"statutory citizenship" status to those who were deemed excluded
from this Common-Law status under the Supreme Court's
interpretations of the Constitution. This event unfolds in
detail in the case law surrounding the 13th and 14th Amendments,
with a very significant difference which is of great importance
to the instant matter.

     8. Such cases as the Slaughter House Cases, supra;
Twining vs New Jersey, 211 U.S. 78; K. Tashiro vs Jordan, supra;
among many others, all declared that under the Law, "there is a
clear distinction between a Citizen of a State and a citizen of
the United States".

     9. A famous French statesman, Fredrick Bastiat, noted in
the early 1800's that if freedom were to be destroyed in America,
it would result from the question of slavery and from the failure
to equate all races and all humans as "equals". The Accused is
not responsible for the errors of the past and elects not to
dwell at length on this subject. However, the so-called 14th
Amendment must now be discussed and, as abhorrent as it may
sound, it is a matter of fact and law that this is the position
(intentional or unintentional) which forms the basis of the law
with which we live today.

     10. In brief, as a result of the 13th Amendment, the U.S.
Supreme Court decided that the Union of States known as the
United States of America was founded by "white" people and for
"white" people, and only "white" people could enjoy the Rights,
Privileges and Immunities afforded and protected by the Federal
and State Constitutions. This fact is most eloquently set forth
in Dred Scott vs Sandford, supra, in stating that "... if a black
nation were to adopt our Constitution verbatim, they would have
the absolute right to restrict the right of citizenship only to
the black population if they chose to do so ...."

     11. To overcome the decision in Dred Scott, supra, the
so-called 14th Amendment to the Constitution of the United States
of America was allegedly ratified "at the point of a bayonet",
and was "declared" to be a part of the Constitution in the year
1868. However, an examination of the ratification by the several
States shows that various improper proceedings occurred which, in
effect, nullify the Amendment. "I cannot believe that any
court, in full possession of its faculties, could honestly hold
that the amendment was properly approved and adopted." State vs
Phillips, 540 P.2d. 936 (1975); see also Dyett vs Turner, 439
P.2d. 266 (1968).

     12. Accused Common-Law Citizen [DEFENDANT] will not digress
into an in-depth dissertation of the bogus ratification of the
so-called 14th Amendment, because the only necessary point to be
made is that the so-called 14th Amendment had a profound effect
upon the Union of these United States, and this effect continues
to the present time.


                        Page Y - 9 of 40

                                                The Federal Zone:


     13. The Original Constitution of the United States of
America (1787) refers to Common-Law Citizens of the several
States in the Preamble, in Article 4, Section 2, Clause 1
(4:2:1), and in numerous other sections. Always, the word
Citizen is spelled with an upper-case "C" when referring to this
class of Common-Law Citizen as a "Citizen of the United States",
i.e., as a "Citizen of one of the United States".

     14. In contrast, the so-called 14th Amendment utilizes a
lower-case "c" to distinguish this class of citizens whose status
makes them "subject to the jurisdiction thereof" as a statutory
"citizen of the United States".

     15. In the law, each word and each use of the word,
including its capitalization or the lack of capitalization, has a
distinctive legal meaning. In this case, there never was the
specific status of a "citizen of the United States" until the
advent of the 1866 Civil Rights Act (14 Stat. 27) which was the
forerunner of the so-called 14th Amendment. (See Ex Parte
Knowles, 5 Cal. 300. The definition of the "United States" is
discussed in the next section of this Memorandum.)

     16. Before the so-called 14th Amendment was declared to be
a part of the U.S. Constitution, there were a number of State
"residents" who could not enjoy "Common-Law Citizenship" in one
of the several States under that Constitution, because they were
not "white". The effect of the so-called 14th Amendment was to
give to all those residents a citizenship in the nation-state
that was created by Congress in the year 1801 and named the
"United States". (See 2 Stat. 103; see also U.S. vs Eliason, 41
U.S. 291, 16 Peter 291, 10 L.Ed. 968; U.S. vs Simms, 1 Cranch
255, 256 (1803).) The original Civil Rights Act of 1866 was not
encompassing enough, so it was expanded in the year 1964; but
the legal effect was the same, namely, to grant to "citizens of
the United States" the equivalent rights of the Common-Law white
Citizens of the several States. In reality, however, those
"equivalent rights" are limited by various statutes, codes and
regulations and can be changed at the whim of Congress.

     17. Under the Federal and State Constitutions, "... We the
People" did not surrender our individual sovereignty to either
the State or Federal Government. Powers "delegated" do not
equate to powers surrendered. This is a Republic, not a
democracy, and the majority cannot impose its will upon the
minority simply because some "law" is already set forth. Any
individual can do anything he or she wishes to do, so long as it
does not damage, injure or impair the same Right of another
individual. The concept of a corpus delicti is relevant here, in
order to prove some "crime" or civil damage.

     18. The case law surrounding the 13th and 14th Amendments
all rings with the same message: "These amendments did not
change the status of Common-Law Citizenship of the white Citizens
of one of the several States of the Union" (now 50 in number).


                        Page Y - 10 of 40

                                                       Appendix Y


     19. This goes to the crux of the controversy because, under
the so-called 14th Amendment, citizenship is a privilege and not
a "Right". (See American and Ocean Ins. Co. vs Canter, 1 Pet.
511; Cook vs Tait, 265 U.S. 47 (1924).)

     20. It was never the intent of the so-called 14th Amendment
to change the status of the Common-Law Citizens of the several
States. (See People vs Washington, 36 C. 658, 661 (1869);
French vs Barber, 181 U.S. 324; MacKenzie vs Hare, 60 L.Ed. 297).

     21. However, over the years, the so-called 14th Amendment
has been used to create a fiction and to destroy American freedom
through administrative regulation. How is this possible? The
answer is self-evident to anyone who understands the law, namely,
a "privilege" is regulatable to any degree, including the
alteration and even the revocation of that privilege.

     22. Since the statutory status of "citizen of the United
States, subject to the jurisdiction thereof" (1866 Civil Rights
Act) is one of privilege and not of Right, and since the
so-called 14th Amendment mandates that both Congress and the
several States take measures to protect these new "subjects",
then both the Federal and State governments are mandated to
protect the privileges and immunities of ONLY these "citizens of
the United States". (See Hale vs Henkel, 201 U.S. 43).

     23. Of course, the amount of protection afforded has a
price to pay, but the important fact is that the "privilege" of
citizenship under the so-called 14th Amendment can be regulated
or revoked because it is a "privilege" and not a RIGHT. It is
here that the basic, fundamental concept of "self-government"
turns into a King "governing his subjects".

     24. One can be called a "freeman", but that was a title of
nobility granted by the King. To be really free encompasses a
great deal more than grants of titles and privileges.

     25. Over the years since 1787, because our forefathers
would have rather fought than bow to involuntary servitude, the
"powers that be" have slowly and carefully used the so-called
14th Amendment and the Social Security Act to force primary State
Citizenship into relative extinction, in the eyes of the courts.
Nevertheless, this class of Common-Law Citizens is not extinct
yet; it is simply being ignored, in order to maintain and
enlarge a revenue base for Congress.

     26. Since the State of California has been mandated by the
14th Amendment to protect the statutory "citizens of the United
States", and since the People in general have been falsely led to
obtain "Social Security Numbers" as "U.S. citizens", the State of
California under prompting by the Federal Government has used the
licensing and registration of vehicles and people under the
"equal protection" clause for the "Public Welfare" to perpetuate
a scheme of revenue enhancement and regulation. This scheme has


                        Page Y - 11 of 40

                                                The Federal Zone:


been implemented, in part, by promoting the fiction that the
Common-Law "Citizens of a State of the Union of several States"
can be regulated to the same degree as statutory "citizens of the
United States".

     27. I, [DEFENDANT], contend that both the State of
California and the Federal Government (known as the "United
States") are committing an act of GENOCIDE upon the Common-Law
State Citizens of the several States by perpetrating and
perpetuating the "fiction of law" that everyone is a statutory
"citizen of the United States".

     This allegation is now discussed by proving exactly what the
"United States" means and in what capacity it now operates.


                  WHAT IS THE "UNITED STATES"?

     28. As we begin, it must be noted that this Common-Law
Citizen alleges "fraud" by the State and Federal Governments in
their failure to inform the people that they are all included
(through the use of a fiction of law) in that statutory class of
persons called "citizens of the United States".

     29. The use of this fiction of law is particularly
abhorrent in view of the fact that, when arbitrarily applied to
everyone, the States lose their sovereignty, the Common-Law
Citizens of the State lose their fundamental rights, and the
"citizens of the United States" lose the guidelines which
established their "civil rights". The net effect is that these
actions have lowered everyone's status to that of a "subject".

     30. There is a clear distinction between the meanings of
"United States" and "United States of America". The people of
America have been fraudulently and purposely misled to believe
that these terms are completely synonymous in every context.

     31. In fact, in Law the term "United States of America"
refers to the several States which are "united by and under the
Constitution"; the term "United States" refers to that
geographical area defined in Article 1, Section 8, Clause 17
(1:8:17) and in Article 4, Section 3, Clause 2 (4:3:2) of the
Federal Constitution.

     32. In 1802, the "Congress Assembled" incorporated a
geographical area known as the "United States". The "United
States" is, therefore, a nation-state which is separate and
unique unto itself. Furthermore, even though the "United States"
is not a member of the "Union of States united by and under the
Constitution", it is bound by that Constitution to restrict its
activities in dealing with the several States and with the
Common-Law Citizens of those States. Under 1:8:17 and 4:3:2 of
the Constitution of the United States of America (1787), Congress
has exclusive power to legislate and regulate the inhabitants of


                        Page Y - 12 of 40

                                                       Appendix Y


its geographical territory and its statutory "citizens" under the
so-called 14th Amendment, wherever they are "resident", even if
they do inhabit one of the 50 States of the Union.

     33. The term "United States" has always referred to the
"Congress Assembled", or to those geographical areas defined in
1:8:17 and 4:3:2 in the U.S. Constitution. The proof of this
fact is found in the Articles of Confederation.

                     ARTICLES OF CONFEDERATION

     Whereas the Delegates of the United States of America in
     Congress Assembled did on the fifteenth day of November in
     the year of our Lord One Thousand Seven Hundred and Seventy
     Seven, and in the Second Year of the Independence of America
     agree to certain Articles of Confederation and perpetual
     union between the States of ....

     ARTICLE I. The title of this confederacy shall be "The
     United States of America".

     ARTICLE II. Each State retains its sovereignty, freedom and
     independence, and every power, jurisdiction and right, which
     is not by this confederation expressly delegated to the
     United States, in Congress Assembled.


     NOTE: The term "UNITED STATES" as used therein refers
expressly to "Congress Assembled" on behalf of the several States
which comprise the Union of States (now 50 in number).

     34. As can readily be seen from the quote below, with three
separate and distinct definitions for the term "United States",
it becomes absolutely necessary to separate and define each use
of this term in law. It is equally as necessary to separate and
define to whom the law applies when there are two classes of
citizenship existing side-by-side, with separate and distinct
rights, privileges and immunities for each. Such a separate
distinction is not made in the Internal Revenue Code. Citizens
of the California Republic are nowhere defined in this Code or in
its regulations, but are expressly omitted as such and identified
indirectly at best (see 26 U.S.C. 7701(b)(1)(B)).

     The term "United States" may be used in any one of several
     senses. It may be merely the name of a sovereign occupying
     the position analogous to that of other sovereigns in a
     family of nations. It may designate territory over which
     sovereignty of the United States extends, or it may be the
     collective name of the States which are united by and under
     the Constitution.

             [Hooven & Allison Co. vs Evatt, 324 U.S. 652 (1945)]
                              [65 S.Ct. 870, 880, 89 L.Ed. 1252]
                                                 [emphasis added]


                        Page Y - 13 of 40

                                                The Federal Zone:


     35. The term "United States", when used in its territorial
meaning, encompasses the areas of land defined in 1:8:17 and
4:3:2, nothing more. In this respect, the "United States" is a
separate Nation which is foreign with respect to the States
united by and under the Constitution, because the "United States"
as such has never applied for admission to the Union of States
known as the "United States of America". Accordingly, statutory
"citizens of the United States", who are "subject to the
jurisdiction thereof", are defined in the wording of the
so-called 14th Amendment and of The Civil Rights Acts. At best,
this so-called Amendment is a "private Act", rather than a public
act, which designates a class of people who are unique to the
territorial jurisdiction of the District of Columbia, the Federal
Territories and Possessions, and the land which has been ceded by
the Legislatures of the 50 States to the foreign nation-state of
the "United States" for forts, magazines, arsenals and "other
needful buildings" (see 1:8:17 and 4:3:2). Collectively, this
territorial jurisdiction is now termed "The Federal Zone" to
distinguish it uniquely from the nation as a whole and from the
50 States of the Union. The "nation" can, therefore, be defined
as the mathematical union of the federal zone and the 50 States.

     36. The District of Columbia is technically a corporation
and is only defined as a "State" in its own codes and under
International Law (e.g., see 26 U.S.C. 7701(a)(10)).

     37. The several States which are united by and under the
Constitution are guaranteed a "Republican" (or "rule of law")
form of government by Article 4, Section 4 of the Constitution.
However, the foreign nation-state  created by Congress and called
the "United States", in its territorial sense, is a "legislative
democracy" (or "majority rule" democracy) which is governed by
International Law rather than the Common Law.

     38. The U. S. Supreme Court has ruled that this foreign
nation has every right to legislate for its "citizens" and to
hold subject matter and in personam jurisdiction, both within
(inside) and without (outside) its territorial boundaries, when
legislative acts call for such effects (Cook vs Tait, supra).

     39. As a foreign nation under International law, which is
derived from Roman Civil Law (see Kent's Commentaries on American
Law, Lecture 1), it is perfectly legal for this nation to
consider its people as "subjects" rather than as individual
Sovereigns. The protections of the State and the Federal
Constitutions do not apply to these "subjects" unless there is
specific statutory legislation granting specific protections
(e.g., The Civil Rights Act). The guarantees of the Constitution
extend to the "United States" (i.e., the federal zone) only as
Congress has made those guarantees applicable (Hooven, supra).

     40. California is a Republic. How does this International
Law come into play in the California Republic? The answer to
this question is presented in the following section.


                        Page Y - 14 of 40

                                                       Appendix Y


                       FAILURE TO DISCLOSE

     41. Because only "white" people can hold primary Common-Law
State Citizenship under the Constitution, Congress created a
different class of "citizen" and then legislated rights,
privileges and immunities which were intended to be mirror images
of the Rights, Privileges and Immunities enjoyed by the
Common-Law Citizens of the several States.

     42. Unfortunately, the nation-state of the "United States"
(District of Columbia) is a democracy and not a Republic. It is
governed basically under authority of International Law, rather
than the Common Law, and its people hold citizenship by
"privilege" rather than by "Right".

     43. Certain power-mad individuals, commonly known today as
the Directors of the Federal Reserve Board and the twelve (12)
major international banking families, have used the so-called
14th Amendment to commit "legal genocide" upon the class of
Common-Law Citizens known as the Citizens of the several States.
This has been accomplished by the application of Social Security
through fraud, deception and non-disclosure of material facts,
for the purpose of reducing the Union of States to a people who
are once again enslaved by puppet masters, in order to gather
revenue for the profit of international banks and their owners.

     44. It is a fact so well known and understood that it is
indisputable, that "any privilege granted by government is
regulatable, taxable and subject to any restrictions imposed by
the legislative acts of its governing body", including alteration
and even revocation by that governing body.

     45. If necessary to do so, the Accused [DEFENDANT] will
submit an offer of proof to show that the "Social Security Act"
is in fact a private act applying only to the territory of the
"United States", acting in its limited capacity, and to its
statutory "citizens of the United States", under the so-called
14th Amendment. Yet, this act has been advertised and promoted
throughout the several States of the Union as being "mandatory
upon the public in general", rather than a "private" act.

     46. The effect in law is that, when Common-Law Citizens of
the several States apply for and receive Social Security Numbers,
they voluntarily surrender their primary Common-Law Citizenship
of a State and exchange it for that of a statutory "citizen of
the United States". It is most interesting that any State has
the power to "naturalize" a non-Citizen, but today everyone is
naturalized as "citizens of the United States" under purview of
the so-called 14th Amendment. The long-term effect of this
procedure is that the Common-Law white State Citizens are an
endangered species, on the verge of extinction, and only the
"subject class citizens" will survive to be ruled at the whim and
passion of a jurisdiction which was not intended by our Founding
Fathers or the Framers of the original U.S. Constitution.


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                                                The Federal Zone:


                     JURISDICTION OF THE COURT


     47. Section 1 of the so-called 14th Amendment has had a
far-reaching effect upon the several States of this Union,
because Congress mandated that it would protect its new statutory
"citizens" and that each of the States would also guarantee to
protect these special "citizens".


     48. This Nation was founded upon the fundamental principles
of the Common Law and self-government, with limited actual
government. In contrast, the "subjects" of the "United States"
are considered to be incapable of self-government and in need of
protection and regulation by those in authority.


     49. The majority of statute law is civil and regulatory in
nature, even when sanctions of a criminal nature are attached for
alleged violations.


     50. Among the rights secured by the Common Law in the
Constitution in "criminal" cases are the right to know the
"nature and cause" of an accusation, the right to confront an
accuser, and the right to have both substantive and procedural
due process.


     51. It is a fact that the District Court, in Internal
Revenue cases, DOES NOT disclose the nature and cause of the
accusation, does not afford "substantive" due process, and rarely
produces a "corpus delicti" to prove damage or an injured party.


     52. The final proof is that the rights given to an accused
in an Internal Revenue case are "civil rights", rather than
Constitutional Rights. The District Court can hear a
Constitutional question, but it cannot rule upon the merits of
the question, because the Constitution does not apply to
regulatory statutes. They are set in place to regulate and
protect the statutory "citizens of the United States" who cannot
exercise, and are not given, the right of individual
self-government.


     53. The Federal Constitution mandates that "counsel" be
present at all phases of the proceedings. In contrast, District
Court often conducts arraignment proceedings without either
counsel for the defense or counsel for the prosecution being
present.


                        Page Y - 16 of 40

                                                       Appendix Y


                           CONCLUSION


     54. This Court is proceeding under a jurisdiction which is
known to the Constitution, but which is foreign to the intent of
the Constitution, unless applied to those individuals who do not
have Common-Law access by "Right" to the protection of the State
and Federal Constitutions.

     55. Whether this jurisdiction be named International Law,
Admiralty/Maritime Law, Legislative Equity, Statutory Law or any
other name, it is abusive and destructive of the Common-Law
Rights of the Citizens of the several States. The Constitutions
of the California Republic and the United States of America
mandate that these rights be guaranteed and protected by all
agencies of government. This is the Supreme Law of our Land.

     56. The limit of police power and legislative authority is
reached when a statutory "law" derogates or destroys Rights which
are protected by the Constitution and which belong to the
Common-Law Citizens of the several States who can claim these
Rights.

     57. [DEFENDANT] is a white, male Common-Law Citizen of the
Sovereign California Republic. This declaration of status is
made openly and notoriously on  the record of these proceedings.

     58. As an individual whose primary Common-Law Citizenship
is of the California Republic, [DEFENDANT] claims all the Rights,
Privileges and Immunities afforded and protected by the
Constitutions of the California Republic (1849) and of the United
States of America (1787), as lawfully amended.

     59. [DEFENDANT] has never, to the best of his knowledge and
belief, knowingly, intentionally and voluntarily surrendered his
original status as a Common-Law Citizen of the several States, to
become a so-called 14th Amendment Federal citizen who is subject
to the jurisdiction of the "United States".

     60. This Court is proceeding in a legislative jurisdiction
which allows a "civil" statute to be used as evidence of the Law
in a "criminal proceeding", and affords only "civil rights",
"procedural due process" and the right to be heard on the facts
evidenced in the statute, rather than the Law and the facts.

     61. It is now incumbent upon the Court to seat on the Law
side of its jurisdiction and to order the plaintiff to bring
forth an offer of proof that the Accused [DEFENDANT] can be
subjected to a jurisdiction which uses civil statutes as evidence
of the fundamental Law in criminal cases, which refuses to afford
all Rights guaranteed by the Constitution and available to the
Accused in criminal matters, and which practices procedural due
process to the exclusion of substantive due process, wherein only
the "facts" and not the "facts and Law" are at issue.


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                                                The Federal Zone:


     62. Should the prosecution fail to bring forth proof that
the Accused [DEFENDANT] has surrendered his original status as a
Common-Law "California State Citizen" for one that is essentially
in "legislative/regulatory equity", then this Court has no
alternative but to dismiss this matter of its own motion in the
interests of justice, for lack of jurisdiction.


Dated , 1993


Respectfully Submitted


Citizen of the California Republic
In Propria Persona, Sui Juris


                        Page Y - 18 of 40

                                                       Appendix Y


           C E R T I F I C A T E O F S E R V I C E


     I, [DEFENDANT], under penalties of perjury, declare that I
am a California Citizen, domiciled in the California Republic,
and a Citizen of the several States united by and under the
Constitution of the United States of America (see 4:2:1). I am
not a "citizen of the United States" (District of Columbia) nor a
subject of Congress under the 14th Amendment, nor a "resident" in
the State of California who seeks or who is otherwise is under
the protection of the so-called 14th Amendment.


     It is hereby certified that service of this notice has been
made on the Plaintiffs and other interested parties by personal
service or by mailing one copy each thereof, on this ________ day
of __________________, 1993, in a sealed envelope, with postage
prepaid, properly addressed to them as follows:


The Solicitor General
Department of Justice
Washington, District of Columbia
Postal Zone 20530/tdc

[others as listed here]


Dated , 1993


Respectfully submitted
with explicit reservation of all my unalienable rights
and without prejudice to any of my unalienable rights,


Citizen of the California Republic
In Propria Persona, Sui Juris


                        Page Y - 19 of 40

                                                The Federal Zone:


[from 9THAPPEA.DIR\APPEAL.DOC]


              STATEMENT OF STATUS AND JURISDICTION


     The Appellant [DEFENDANT], who enjoys the status of a
Caucasian Citizen of the California Republic with Common-Law
rights by birth as a member of the sovereign political body (see
Dred Scott vs Sandford, 19 How. 393, 404) and who enjoys these
unalienable Common-Law rights by virtue of his birth, is not a
"citizen of the United States" under the so-called 14th
Amendment. Thus, jurisdiction is invoked per the Magna Carta,
Chapters 61, 63; the Declaration of Independence, July 4, 1776;
the Preamble to the Constitution for the United States of
America, 1787; Article 3, Sections 1 and 2, and Article 6,
Section 2 of the Constitution for the United States of America,
(1787); the California Civil Code, Source of Law, Section 22.2;
the California Code of Civil Procedure, Section 1899; and
Marbury vs Madison, 5 U.S. 368 (1803).


                        Page Y - 20 of 40

                                                       Appendix Y


                            ARGUMENT

                                I

    THE 14TH AMENDMENT WAS NOT PROPERLY APPROVED AND ADOPTED
          ACCORDING TO THE MANDATES OF THE CONSTITUTION
                     AND THE MAXIMS OF LAW;
  IT DID NOT INCLUDE THE WHITE CITIZENS OF THE SEVERAL STATES,
            AND DID NOT AUTHORIZE CONGRESS TO ABOLISH
   THE INTENT AND MEANING OF THE ORIGINAL CONSTITUTION (1787)
    OR TO CREATE A NEW CONSTITUTION UNDER THE 14TH AMENDMENT,
          THEREBY DEPRIVING THE APPELLANT [DEFENDANT],
                 A WHITE DE JURE STATE CITIZEN,
    OF HIS UNALIENABLE RIGHTS TO LIFE, LIBERTY AND PROPERTY.


                              POINT 1

     The Appellant [DEFENDANT] was indicted and convicted under
the purview of the so-called 14th Amendment. Therefore, the
constitutionality and application of this so-called amendment is
brought squarely before this Court.


     The so-called 14th Amendment is invalid, in that it was NOT
properly approved and adopted according to the provisions of
Article 5 of the Constitution (see House Congressional Record for
June 13, 1967, pages 15641-15646, incorporated fully herein by
reference and attached as exhibit "A").


     The Fourteenth Amendment was forced upon the people "at the
point of a bayonet" and by the coercion that resulted from not
seating various senators who would not vote in favor of the
so-called amendment, and various other improper proceedings too
numerous to mention here (for details, see 28 Tulane Law Review
22; 11 South Carolina Law Quarterly 484). It is apparent that,
once a fraud is perpetrated, the fraud enlarges from the effort
to maintain illegitimate power and to conceal its legal effect
upon the invalidity of the so-called 14th Amendment.


     The so-called 14th "Amendment" cannot and does not terminate
the Constitutional intent of de jure State Citizenship of the
Appellant [DEFENDANT]. There is ample evidence that no court has
ever held that this "Amendment" was properly approved and
adopted. See, in particular, State vs Phillips, 540 P.2d 936
(1975); Dyett vs Turner, 439 P.2d 266 (1968).


                                                  [continued ...]


                        Page Y - 21 of 40

                                                The Federal Zone:


                            POINT 2:

                THE ACCUSED'S DE JURE CITIZENSHIP
                      CANNOT BE TAKEN AWAY


     The presumed 14th Amendment is illegally applied to the
Appellant [DEFENDANT], a male Caucasian born in the State of
Illinois and now a Citizen of California. The Appellant was not
within the intent or meaning of the so-called 14th Amendment.


     It may be stated, as a general principle of law, that it is
     for the legislature to determine whether the conditions
     exist which warrant the exercise of power; but the question
     as to what are the subjects of its exercise, is clearly a
     judicial question. One may be deprived of his liberty, and
     his constitutional rights thereto may be violated, without
     actual imprisonment or restraint of his person.

                    [In re Aubrey, 36 Wn 308, 314-314, 78 P. 900]
                                                 [emphasis added]

     The most important thing to be determined is the intent of
Congress. The language of the statute may not be distorted under
the guise of construction, so as to be repugnant to the
Constitution, or to defeat the manifest intent of Congress.
United States vs Alpers, 338 U.S. 680, 94 L.Ed. 457, 460; United
States vs Raynor, 302 U.S. 540, 82 L.Ed. 413, 58 S.Ct. 353.

     Citizenship is a status or condition, and is the result of
both act and intent. 14 C.J.S. Section 1, p. 1130, n. 62.

     14th Amendment federal citizenship is a political status
which constitutes a privilege which may be defined and limited
by Congress, Ex Parte (ng) Fung Sing, D.C. Wash. 6 F.R.D. 670.
There is a clear distinction between federal and State
citizenship, K. Tashiro vs Jordan, 256 P. 545, 201 Cal. 239, 53
A.L.R. 1279, affirmed 49 S.Ct. 47, 278 U.S. 123, 73 L.Ed. 214, 14
C.J.S. 2, p. 1131, n. 75.

     The classification "citizen of the United States" is
distinguished from a Citizen of one of the several States, in
that the former is a special class of citizen created by
Congress, U.S. vs Anthony, 24 Fed 829 (1873). As such, a
"citizen of the United States" receives created rights and
privileges from Congress, and thus has a "taxable citizenship" as
a federal citizen under the protection and jurisdiction of
Congress, wherever such citizens are "resident". Cook vs Tait,
265 U.S. 47 (1924), 44 S. Ct. 447; 11 Virginia Law Review 607,
"Income Tax Based Upon Citizenship". This right to tax federal
citizenship is an inherent right under the rule of the Law of
Nations, which is part of the law of the "United States", as
described in Article 1, Section 8, Clause 17 (1:8:17) and Article


                        Page Y - 22 of 40

                                                       Appendix Y


4, Section 3, Clause 2 (4:3:2). The Lusitania, 251 F. 715, 732.
The federal government has absolutely no authority whatsoever to
tax the Citizens of the several States for their Citizenship.
The latter have natural rights and privileges which are protected
by the U.S. Constitution from federal intrusion. These rights
are inherent from birth and belong to "US the People" as Citizens
of one of the several States as described in Dred Scott vs
Sandford, 19 How. 393. Such Citizens are not under the direct
protection or jurisdiction of Congress, but they are under the
protection of the Constitutions of the States which they inhabit.

     The Act of Congress called the Civil Rights Act, 14 U.S.
Statutes at Large, p. 27, which was the forerunner of the
so-called 14th Amendment, amply shows the intent of Congress, as
follows:


     ... [A]ll 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 citizens, of every race and color ... shall have the
     same right, in every State and Territory in the United
     States ... to full and equal benefit of all laws and
     proceedings for the security of person and property, as is
     enjoyed by white citizens ....
                                                 [emphasis added]

This was the intent of Congress, namely, not to infringe upon the
Constitution or the status of the de jure Citizens of the several
States. The term "persons" did not include the white de jure
State Citizens. It was never the intent of the 14th Amendment to
subvert the authority of the several States of the Union, or that
of the Constitution as it relates to the status of de jure State
Citizens. See People vs Washington, 36 C. 658, 661 (1869),
overruled on other grounds; also French vs Barber, 181 U.S. 324;
MacKenzie vs Hare, 60 L. Ed. 297.

     The so-called 14th Amendment uses language very similar to
the Civil Rights Act of 1866. Harlan J. explained his
interpretation of its meaning in a dissenting opinion which
quoted from the scorching veto message of President Johnson,
Lincoln's successor: It "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." Elk vs Wilkins, 112 U.S. 94, 114, 5 S.Ct. 41,
28 L.Ed. 643; see also In re Gee Hop, 71 Fed. 274.

     In light of the statement by Chief Justice Taney in Dred
Scott vs Sandford, 19 How. 393, 422, in defining the term
persons, the Judge mentioned "... persons who are not recognized
as citizens ...." See also American and Ocean Ins. Co. vs
Canter, 1 Pet. 511, which also distinguishes "persons" and


                        Page Y - 23 of 40

                                                The Federal Zone:


"citizens". These were the persons who were the object of the
14th Amendment, to give citizenship to this class of native born
"persons" who were "resident" in the several States, and to
legislate authority to place races other than the white race
within the special category of "citizen of the United States".

     It was the intent of the so-called amendment that de jure
Citizens in the several States were not included in its
terminology because they were, by birthright, Citizens as defined
in the Preamble, and could receive nothing from this so-called
amendment. See Van Valkenburg vs Brown, 43 Cal. Sup. Ct. 43.

     Congress has adopted this definition of "person", as
previously described, so that the Internal Revenue Code would be
constitutional. See McBrier vs Commissioner of Internal Revenue,
108 F.2d 967, Fn 1 (1939). Thus, Congress has absolute authority
to regulate this de facto entity created by an Act of Congress,
this juristic person who is not given de jure State Citizenship
by birth.

     Since the term "citizen of the United States" was used to
create and distinguish a different class of citizen in the 14th
Amendment, this term has been widely used in various revenue
acts, e.g., Tariff Act of August 5, 1909, Section 37, c. 6, 36
Stat. 11; Act of September 8, 1916, 39 Stat. 756; Revenue Act
of November 23, 1921, 40 Stat. 227; the Internal Revenue Code of
1939 and 26 C.F.R. 1.1-1(b). These all had a specific meaning,
which did not include a Citizen of one of the several States who
had no franchise with the federal Government (i.e., the District
of Columbia). In fact, the Social Security Act, 49 Stat. 620,
Title I, Section 3, (3) states:


     (3) Any citizenship requirement which excludes any citizen
     of the United States.


     This specifically means that the Original Social Security
Act, created in 1935, did not change one's citizenship upon
obtaining a SSN. The original Title VIII of the Social Security
Act was repealed by P.L. 76-1, Section 4, 53 Stat. 1, effective
February 11, 1939. Then the substance was added to the 1939
Income Tax Code at Sections 1400-1425. Currently, the substance
of the repealed section can be found in the 1954 Internal Revenue
Code at Sections 3101-3126. This repealing, in effect, has
voided the original intent and meaning, and replaced it with a
new intent and meaning. This new intent is unconstitutionally
applied to the Appellant, a de jure State Citizen, who is a
member of the posterity as identified in the Preamble to the
Constitution for the United States of America. This new intent
has never been addressed by any court, as it relates to the
deprivation of State Citizenship.


                        Page Y - 24 of 40

                                                       Appendix Y

     All changes made after the fact, under the Social Security
Act as it relates to citizenship, are null and void due to fraud
(specifically, non-disclosure). Congress does not now, nor has
it ever had, the authority to take Citizenship away from the
Appellant, a Citizen of the several States, without his knowledge
and informed consent.

     The error occurs when, through economic duress and the
failure to disclose to Appellant [DEFENDANT] the liabilities
associated with a Social Security Number, a de jure State Citizen
is compelled "at the point of a bayonet" to give up a Citizenship
that was derived by birth and blood. By obtaining a Social
Security Number, such a State Citizen becomes, in effect, a
second-class citizen under the so-called 14th Amendment, in order
to obtain work to purchase necessities to sustain life.

     The so-called 14th Amendment was not intended to impose any
new restrictions upon Citizenship, or to prevent anyone from
becoming a Citizen by fact of birth within the United States of
America, who would thereby acquire Citizenship according to the
law existing before its adoption. "An amendatory act does not
alter the rights existing before its adoption." Billings vs Hall,
7 Cal. 1. Its main purpose was to establish the citizenship of
free negroes and to put it beyond doubt that all blacks as well
as whites were citizens. U.S. vs Wong Kim Ark, 169 U.S. 649, 18
S.Ct. 456, 42 L.Ed. 890; Slaughter House Cases, 16 Wall. (U.S.)
36, 21 L.Ed. 394; Strauder vs West Virginia, 100 U.S. 303, 25
L.Ed. 664; In re Virginia, 100 U.S. 339; Neal vs Delaware, 103
U.S. 370, 26 L.Ed. 567; Elk vs Wilkins, 112 U.S. 94, 5 S.Ct. 41,
28 L.Ed. 643; Van Valkenburg vs Brown, 43 Cal. 43, 13 Am. Rep.
136; (numerous other cites omitted).

     The First Clause of the so-called 14th Amendment of the
Federal Constitution made negroes "citizens of the United States"
and citizens of the State in which they reside, and thereby
created two classes of citizens: one of the United States and the
other of the State. 4 Dec. Dig. '06, page 1197; Cory vs Carter,
48 Ind. 327, 17 Am. Rep. 738; and it distinguishes between
federal and state citizenship, Frasher vs State, 3 Tex. App. 263,
30 Am. Rep. 131.

     Nothing can be found in the so-called 14th Amendment, or in
any reference thereto, that establishes any provision that
transforms Citizens of any state into "citizens of the United
States". In the year 1868 or now (1993), the so-called amendment
created no new status for the white State Citizens. White State
Citizens are natural born Citizens, per Article 2, Section 1,
Clause 5 (2:1:5) and, as such, they are fully entitled to the
"Privileges and Immunities" mentioned in Article 4, Section 2,
Clause 1 (4:2:1), as unalienable rights. These unalienable
rights cannot be overruled or abolished by any act of congress.


                        Page Y - 25 of 40

                                                The Federal Zone:


     The birthright of the Appellant [DEFENDANT]'s de jure State
Citizenship cannot be subordinated merely because Congress
desires more power and control over the people, in order to
create a larger revenue base for the profit of certain private
individuals. Oyama vs California, 332 U.S. 633.


     State citizenship, as defined, regulated and protected by
     State authority, would disappear altogether, except as
     Congress might choose to withhold the exercise of powers.
     The tendency of Congress, especially since the adoption of
     the recent amendments, has been to overstep its own
     boundaries and undertake duties not committed to it by the
     Constitution.

                   [16 Albany Law Journal 24 (1877), (Exhibit B)]


     A citizen may not have his de jure citizenship taken away,
Richards vs Secretary of State, (9th Cir) 752 F.2d 1413, (1985);
Afroyim vs Rusk, 387 U.S. 253, 87 S.Ct. 1660, 18 L.Ed.2d 757
(1967); Baker vs Rusk, 296 F. Supp. 1244 (1969); Vance vs
Terrazas, 444 U.S. 252, 100 S.Ct. 540, 62 L.Ed.2d 461 (1980);
U.S. vs Wong Kim Ark, 169 U.S. 18 S. Ct. 456, 42 L.Ed. 890
(1898).


                              POINT 3


     In the formation of the Constitution for the United States
of America, care was taken to confer no power upon the federal
government to control and regulate Citizens within the several
States, because such control would lead to tyranny.

     By the Constitution, Congress was to be a representative of,
and an extension of the Several States only for external affairs.
Congress was forbidden to pass municipal laws to regulate and
control de jure Citizens of a State of the Union of the United
States of America. This is, without a doubt, the true
construction of the intent of the Constitution.

     That Congress has no authority to pass laws and bind the
rights of the Citizens in the several States, beyond the powers
conferred by the Constitution, is not open to controversy. But,
it is insisted that (1) under the so-called 14th Amendment,
Congress has power to legislate for, and make a subject of, the
Appellant [DEFENDANT] through secret interpretations of the law
and (2) by force of power, laws are enacted in order to control,
by force and fraud, the Nation and the People within the several
States for the purpose of raising revenue for the profit of the
Federal Reserve banks and their private owners.


                        Page Y - 26 of 40

                                                       Appendix Y


     No rational man can hesitate to believe that the
deprivations of Citizenship and the abuses of the Constitution
are not derived from the Federal Reserve Act. No one can deny
that Congress has thereby attempted to abolish the classification
of de jure Citizen of a State of the Union of the United States,
so that a ever larger revenue base can be maintained.


     ... nor would the government suffer a loss of his
     withholdings.

             [[DEFENDANT]'s Pre-Sentence Report, [DATE], page 10]


This establishes, without a doubt, that the United States
government is only concerned about raising revenue under forced
extraction by the withholding system, which was prompted by the
Federal Reserve banks at the instigation of Beardsley Ruml,
former chairman of the Federal Reserve Bank of New York.

     Congress, through Social Security and the so-called 14th
Amendment, cannot do indirectly what the Constitution prohibits
directly. If Congress, by pseudo power, can legislate away
[DEFENDANT]'s status as a de jure Citizen of the several States,
so might Congress exclude all of [DEFENDANT]'s unalienable rights
as protected and guaranteed by the Constitution.

     Social Security and the Federal Reserve banks, by creating a
fictitious debt, have re-instituted an insidious form of slavery.
All slavery has its origin in power, thus usurping a jurisdiction
which does not belong to them and which is against the
unalienable rights of the appellant [DEFENDANT].

     Our Constitution is a restraint upon government, purposely
provided and declared upon consideration of all the consequences
which it prohibits and permits, making restraints upon government
the rights of the governed. This careful adjustment of power and
rights makes the constitution what it was intended to be and is,
namely, a real charter of liberty which deserves the praise that
has often been given to it as "The most wonderful work ever
struck off at any given time by the brain and purpose of man."
Block vs Hirsch, 256 U.S. 135.

     Thus, this court must uphold the principles upon which the
Constitution was founded; it must be held to guarantee not
particular forms of procedure, but the very substance of
individual rights to life, liberty and property. Basic "State
Citizenship" is the absolute bulwark against "National Tyranny"
as is fostered andapplied through the so-called 14th Amendment.
Nowhere in the debates, papers or any court decision written by
anyone does it state that the Constitution authorizes Congress to
destroy the State Citizenship of the Appellant [DEFENDANT].


                        Page Y - 27 of 40

                                                The Federal Zone:


     Prior to the Federal Reserve Act, no political dreamer was
ever wild enough to think of breaking down the lines which
separate the States, and of compounding the American People into
one common mass of slaves. Yet, this is exactly what has
happened under Social Security, by creating a revenue base for
the collection of interest on a fictitious national debt owed to
the Federal Reserve, in other  words, slavery to the national debt
under the so-called 14th Amendment.

     The status of "de jure State Citizen" is [DEFENDANT]'s
property. When the application of Social Security annihilates
the value of any property and strips it of its attributes, by
which alone it is distinguishable as property, the Appellant
[DEFENDANT], a de jure State Citizen, is deprived of it according
to the plainest interpretation of the 5th Amendment, and
certainly within the Constitutional provisions intended to shield
[DEFENDANT]'s personal rights and liberty from the exercise of
arbitrary government power.

     This is a case of "suspect classification" in that the
Appellant [DEFENDANT] is "saddled with such disabilities ... as
to command extraordinary protection from the majoritarian process
...." 411 U.S. 2, 28. Thus, the devolution of [DEFENDANT]'s de
jure Citizenship into the classification of a de facto juristic
person under the so-called 14th Amendment is such a "suspect
classification" and must be reviewed in the light of the original
intent of our Founding Fathers in establishing the Union of
several States in the first place.

     Citizenship under the so-called 14th Amendment is a
privilege granted by Congress, i.e., a civil status conferring
limited rights and privileges, not a birthright that is secured
by the Constitution. [DEFENDANT], a white de jure State Citizen,
by virtue of his birth in one of the several States, received
that which cannot be granted by Congress, nor can Congress make
void a Citizenship status which he derived by birth and by blood.

     ... [A]nd no member of the state should be disfranchised, or
     deprived of any of his rights or privileges under the
     constitution, unless by the law of the land, or judgment of
     his peers.

           [Kent's Commentaries, Vol. II, p. 11, 1873, 12th ed.]

     There can be no law, statute or treaty that can be in
conflict with the intent of the original founding constitution.
For, if this were permitted to occur, the founding Constitution
would be a nullity. The original Constitution of 1787 is
perpetual, as is the Citizenship that is recognized by it. See
Texas vs White, 7 Wallace 700. If any legislation is repugnant
to the Constitution, this Court has the eminent power to declare
such enactments null and void ab initio (from their inception).
See Marbury vs Madison, 5 U.S. (1 Cranch) 137, 177-180 (1803).


                        Page Y - 28 of 40

                                                       Appendix Y


     The rule that should be applied is that laws, especially
foundational laws such as our Constitution, should be interpreted
and applied according to the plain import of the language used,
as it would have been the intent and understood by our Founding
Fathers. The so-called 14th Amendment has been used to distort
and nullify the purposes and intent of the foundational
Constitution, for the ulterior motive of giving pseudo power
where no such power was granted or intended, and where such
pseudo power was specifically denied in the Constitution.

     This has resulted in the complete annihilation of the
balance of checks, so desired by our Founding Fathers. One of
these was the sovereignty of the people. At the present time,
the "United States", under Article 1, Section 8, Clause 17, has
extended its pseudo authority to abolish the status of de jure
State Citizens, and to render [DEFENDANT] a "federal" citizen
under the so-called 14th Amendment who is more apply described as
a subject of Congress and a "federal" resident within the several
States. This has had the unlawful effect of denying
[DEFENDANT]'s birthright to be a free born de jure State Citizen,
as was the intent of the original Constitution.

     The so-called 14th Amendment did not authorize Congress to
change either the Citizenship or the status of Citizens of the
several States. "They are unaffected by it." U.S. vs Anthony,
24 F. 829. Yet, through deliberate misinterpretation of the Act,
Congress has by statute overruled and voided the Constitution.
This was done at the prompting of the Federal Reserve banks and
their private owners.

     In application, Congress and the Federal Reserve banks have
utilized the so-called 14th Amendment as a totally new
Constitution, solely for the benefit of the Federal Reserve, and
to the detriment of Appellant [DEFENDANT], a sovereign Citizen of
the California Republic.

     This Union of the United States of America was founded upon
the principles of the Christianity and the common law. Force and
fraud cannot prevail against the will of the people and the
Constitution. The legislative intent of the so-called 14th
Amendment was only to grant citizenship to a distinct class of
people, not to create a new constitution. This court must
determine whether the "act" was properly approved and adopted.
State vs Phillips, 540 P.2d 936, 942 (1975). If it was properly
approved and adopted, this court must also determine if it is
also being unconstitutionally applied against the Appellant
[DEFENDANT], a de jure State Citizen of California.

     The abuses heaped upon the Appellant, a California State
Citizen, only foretell the impending doom and downfall of a
centralized government. Our Founding Fathers understood this,
and the Constitution was written so that this would not occur.
But, to the great shame of the judicial system, they have let
the thirst for power prevail over the Constitution. (Exhibit A)


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                                                The Federal Zone:


     Hitler used National Social Insurance to control and enslave
the people of Germany. Likewise, the "United States" (Article 1,
Section 8, Clause 17) is doing the same thing here in America.
(Perhaps now it should be spelled "Amerika"). When is enough
enough? When will the courts quit playing "ostrich", pull their
heads out of the sand, see what is happening and correct the
situation before it is too late. The camel of tyranny now has
its nose and its two front legs under the tent.

     Congress has passed the 14th Amendment under force of arms,
included the municipal code of the District of Columbia into the
United States Codes, and made various secret interpretations of
the acts, never inquiring whether they had authority to proceed.
But, can this Court also undertake for itself the same sundry
constructions? The Executive, Legislative and Judicial Branches
have all repeatedly acknowledged that our particular security is
in the possession and adherence to the written Constitution.
Yet, by various and sundry constructions and the wrongful
application of the acts of Congress, the House and Senate are
attempting to turn the Constitution into a blank piece of paper,
with complete judicial approval.

     [DEFENDANT], a de jure natural State Citizen, is in full
possession of personal and political rights, which the "United
States" (Article 1, Section 8, Clause 17) did not give and cannot
take away. Dred Scott vs Sandford, 19 How. 393, 513; Afroyim vs
Rusk, 387 U.S. 253; U.S. vs Miller, 463 F.2d 600. Nor is the
Appellant a de jure State Citizen restrained by any enumeration
or definition of his rights or liberties. The so-called 14th
Amendment did not impair or change the status of the de jure
Citizens of the several States of the Union of the United States
of America. To imply that an act of Congress supersedes and
makes null and void the Constitution for the United States of
America, is blatantly and demonstrably absurd. This construction
cannot be enforced or adopted by any legal authority whatsoever.

     The municipal jurisdiction of Congress does not extend to
the Appellant or to his property. This is the case because he is
a de jure State Citizen of the several States. The municipal
jurisdiction of Congress only extends to the limits as defined in
the Constitution itself (see 1:8:17 and 4:3:2).


     Where rights are secured by the Constitution there can be no
     legislation or rule making which would abrogate them.

                               [Miranda vs Arizona, 384 U.S. 436]


Thus, the Citizenship of the Appellant as a Citizen of California
must be upheld by the preceding positive statement and decree by
the U.S. Supreme Court. This court must uphold this principle of
law.


                        Page Y - 30 of 40

                                                       Appendix Y


                               II

         THE PREAMBLE AND THE UNITED STATES CONSTITUTION
                  ARE IN FULL FORCE AND EFFECT.
               THEREFORE, CONGRESS CANNOT DEPRIVE
     A WHITE STATE CITIZEN OF HIS DE JURE STATE CITIZENSHIP
                  AS A MEMBER OF THE POSTERITY,
           AS WAS THE INTENT DEFINED IN THE PREAMBLE.


                             POINT 1

     The Preamble to the Constitution of the United State
declares the intent and purpose of the covenant:


     We the People of the United States, in Order to form a more
     perfect Union, establish justice, insure domestic
     Tranquility, provide for the common defence, promote the
     general Welfare, and secure the Blessings of Liberty to
     ourselves and our Posterity, do ordain and establish this
     Constitution for the United States of America.
                                                       [Preamble]


Justice Story, in his Commentaries on the Constitution, expounded
on the importance of this Preamble:


     The importance of examining the preamble, for the purpose of
     expounding the language of a statute, has been long felt,
     and universally conceded in all judicial discussions. It is
     an admitted maxim in the ordinary course of the
     administration of justice, that the preamble of a statute is
     a key to open the mind of the makers, as to the mischiefs,
     which are to be remedied, and the objects, which are to be
     accomplished by the provisions of the statute. We find it
     laid down in some of our earliest authorities in the common
     law; and civilians are accustomed to a similar expression,
     cessante ratione legis, cessat et ipsa lex. Probably it has
     a foundation in the exposition of every code of written law,
     from the universal principle of interpretation, that the
     will and intention of the legislature is to be regarded and
     followed. It is properly resorted to, where doubts or
     ambiguities arise upon the words of the enacting part; for
     if they are clear and unambiguous, there seems little room
     for interpretation, except in cases leading to an obvious
     absurdity, or to a direct overthrow of the intention
     expressed in the Preamble.

          [Commentaries on the Constitution of the United States]
            [Joseph Story, Vol. 1, De Capo Press Reprints (1970)]
                                              [at pages 443, 444]


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                                                The Federal Zone:


     With the authority of Justice Story, then, we examine the
wording of the Preamble as to the term "Union". The term "Union"
as used in the Preamble is evidently the one declared in the
Declaration of Independence (1776) and organized in accordance
with "certain articles of Confederation and Perpetual Union
between the States" which declared that "the Union shall be
perpetual." See Texas vs White, 7 Wallace 700.

     The Union of the States never was a purely artificial and
     arbitrary relation. It began among Colonies, and grew out
     of common origin, mutual sympathies, kindred principles,
     similar interest, and geographical relations. It was
     confirmed strengthened by the necessities of war, and
     received definite form, and character, and sanction from the
     Articles of Confederation. By these the Union was solemnly
     declared to "be perpetual." And when these Articles were
     found to be inadequate to the exigencies of the country, the
     Constitution was ordained "to form a more perfect union."
     It is difficult to convey the idea of indissoluble unity
     more clearly than these words. What can be indissoluble if
     a perpetual Union, made more perfect, is not?

     But the perpetuity and indissolubility of the Union, by no
     means implies the loss of distinct and individual existence,
     or of the right of self-government by the States. Under the
     Articles of Confederation each State retained its
     sovereignty, freedom, and independence, and every power,
     jurisdiction, and right not expressly delegated to the
     United States. Under the Constitution, though, the powers
     of the States were much restricted, still, all powers not
     delegated to the United States, nor prohibited to the
     States, are reserved to the States respectively or to the
     people. And we have already had occasion to remark at this
     term, that "the people of each State compose a State, having
     its own government, and endowed with all the functions
     essential to separate and independent existence," and that
     "without the States in union, there could be no such
     political body as the United States." Not only, therefore,
     can there be no loss of separate and independent autonomy to
     the States, through their union under the Constitution, but
     it may be not unreasonably said that the preservation of the
     States, and the maintenance of their governments, are as
     much within the design and care of the maintenance of the
     National government. The Constitution, in all its
     provisions, looks to an indestructible Union, composed of
     indestructible States.

     When, therefore, Texas became one of the United States, she
     entered into a indissoluble relation. All the obligations
     of perpetual union, and all the guarantees of republican
     government in the Union, attached at once to the State. The
     act which consummated her admission into the Union was
     something more than a compact; it was the incorporation of
     a new member into the political body. And it was final.


                        Page Y - 32 of 40

                                                       Appendix Y


     The union between Texas and the other States was as
     complete, as perpetual, and as indissoluble as the union
     between the original States. There was no place for
     reconsideration, or revocation, except through revolution,
     or through consent of the States.

          [Texas vs White, 7 Wallace, at pages 723 to 726 (1886)]

     Similarly, the term "establish", as used in the Preamble,
means to fix perpetually:

       STAB'LISH ...

       1. To set and fix firmly or unalterable; to settle
               permanently.

               I will establish my covenant with him for an
               everlasting covenant. Gen. xvii

       2. To found permanently; to erect and fix or settle;
               as, to establish a colony or empire.

       3. To enact or decree by authority and for permanence

       4. To settle or fix; to confirm.

       5. To make firm; to confirm; to ratify what has
               been previously set or made.

               Do we then make void the law through faith? God
               forbid: yea, we establish the law. Rom. iii.

                 [An American Dictionary of the English Language]
                              [Noah Webster (1828), reprinted by]
             [Foundation for American Christian Education (1967)]

     ESTABLISH. This word occurs frequently in the Constitution
     of the United States, and it is there used in different
     meanings:

       1. to settle firmly, to fix unalterable; as to
               establish justice, which is the avowed object of
               the Constitution ...

       2. To settle or fix firmly; place on a permanent
               footing; found; create; put beyond doubt or
               dispute; prove; convince ...

                     [Black's Law Dictionary, supra, at page 642]

     Thus, if the Union is perpetual, then so too is the founding
law upon which that Union was predicated in the first place, and
so too is the unalienable Citizenship recognized therein.


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                                                The Federal Zone:


                              POINT 2

                         THE ORGANIC LAW
                  AND THE UNION FOUNDED THEREON
                          ARE PERPETUAL


     The founding law of the nation is the perpetual authority
upon which the continued existence of the nation itself is
predicated. As such, the founding law carries universal
authority and cannot be overthrown or subverted without
repudiating the very existence of the nation established thereby.


     ORGANIC LAW. The fundamental law, or constitution, of a
     state or nation, written or unwritten; that law or system
     of laws or principles which defines and establishes the
     organization of its government. St. Louis vs Dorr, 145 Mo.
     466, 46 S.W. 976, 42 LRA 686, 68 Am St Rep 575

     [Black's Law Dictionary, 4th Ed., West Pub. (1968), p. 1251]


     The authority of the organic law is universally
     acknowledged; it speaks the sovereign will of the people;
     its injunction regarding the process of legislation is as
     authoritative as are those touching the substance of it.
     Suth. Statutory Construction, 44, note 1. "This Constitution
     ... shall be the supreme law of the land ...." Article 6,
     Constitution of the United States (1787).


     That the people have an original right to establish, for
     their future government, such principles as, in their
     opinion, shall be most conducive to their own happiness, is
     the basis on which the whole American fabric has been
     erected. The exercise of the original right is a very
     great exertion, nor can it, nor ought it to be frequently
     repeated. The principles, therefore, so established, are
     deemed fundamental. And as the authority, from which they
     proceed, is supreme, and can seldom act, they are designed
     to be permanent.


     The original and supreme will organizes the government, and
     assigns, to different departments, their respective powers.
     It may either stop here; or establish certain limits not to
     be transcended by those departments.


     The government of the United States is of the latter
     description. The powers of the legislature are defined, and
     limited; and those limits may not be mistaken, or
     forgotten, the constitution is written. To what purpose are


                        Page Y - 34 of 40

                                                       Appendix Y


     the powers limited, and to what purpose is that limitation
     committed to writing, if the limits may, at any time be
     passed by those intended to be restrained? The distinction,
     between a government with limited and unlimited powers, is
     abolished, if those limits do not confine the persons on
     whom they are imposed, and if acts prohibited and acts
     allowed, are of equal obligation. It is a proposition too
     plain to be contested, that the constitution controls any
     legislative act repugnant to it; or, that the legislature
     may alter the constitution by an ordinary act.


     Between these alternatives there is no middle ground. The
     constitution is either a superior, paramount law,
     unchangeable by ordinary means, or it is on a level with
     ordinary legislative acts, and like other acts, is alterable
     when the legislature shall please to alter it.


     If the former part of the alternative be true, then a
     legislative act contrary to the constitution is not law: if
     the latter be true, then written constitutions are absurd
     attempts, on the part of the people, to limit a power, in
     its own nature illimitable. Certainly all those who have
     framed written constitutions contemplate them as forming the
     fundamental and paramount law of the nation, and
     consequently the theory of every such government must be,
     that an act of the legislature, repugnant to the
     constitution, is void ....


     If then the courts are to regard the constitution; and the
     constitution is superior to any ordinary act of the
     legislature; the constitution, and not such ordinary act,
     must govern the case to which they both apply.


     Those then who controvert the principle that the
     constitution is to be considered, in court, as a paramount
     law, are reduced to the necessity of maintaining that the
     courts must close their eyes on the constitution, and see
     only the law.

          [Marbury vs Madison, 1 Cranch 137, at pages 176 to 178]


                                                  [continued ...]


                        Page Y - 35 of 40

                                                The Federal Zone:


                               III


     AN INDICTMENT IS INSUFFICIENT TO SUSTAIN A CONVICTION,
             IF IT USES WORDS OF NUMEROUS MEANINGS,
                SO AS TO BE VAGUE AND AMBIGUOUS,
                SO THE DEFENDANT IS UNCERTAIN OF
                  SECRET AND SPECIFIC MEANINGS,
                 THEREBY BEING DENIED A DEFENSE.


     1. The indictment utilizes the term "resident" as its
jurisdictional statement, without any further clarification.

      "The jurisdiction of a federal court must affirmatively and
distinctly appear and cannot be helped by presumptions or by
argumentive inferences drawn from the pleadings." Norton vs
Larney, 266 U.S. 511, 515, 45 S. Ct. 145, 69 L.Ed. 413 (1925).
Accord, Bender vs Williamsport Area Schools District, 475 U.S.
534, 106 S.Ct. 1326, 1334, 89 L.Ed.2d 501, rehearing denied, 106
S.Ct. 2003 (1986); Nor can a contester's allegations of
jurisdiction be read in isolation from the complaint's factual
allegations, Schilling vs Rogers, 363 U.S. 666, 676, 80 S.Ct.
1288, 4 L.Ed.2d 1478 (1960), nor can jurisdiction be effectively
established by omitting facts which would establish that it does
not exist. Lambert Run Coal Co. vs Baltimore & Ohio R. Co., 258
U.S. 377, 382, 42 S.Ct. 349, 66 L.Ed. 671 (1922). Nor can
jurisdiction be "gleaned from the briefs and arguments" of the
Plaintiff. Bender, supra, 106 S.Ct. at 1334. The burden fully
to demonstrate jurisdiction clearly falls on the Plaintiff, and a
failure fully to define the conditions creating some nexus under
the ambiguous term "resident" is an error.

     The requirement to prove jurisdiction is particularly
important when the government of a foreign state (the "United
States") brings criminal charges against a Citizen of another
State.

     Where jurisdiction is denied and squarely challenged,
jurisdiction cannot be assumed to exist "sub silentio" but must
be proven. Hagans vs Lavine, 415 U.S. 528, 533, n. 5; Monell vs
N.Y., 436 U.S. 633. Mere "good faith" assertions of power and
authority (jurisdiction) have been abolished. Owen vs Indiana,
445 U.S. 622; Butz vs Economou, 438 U.S. 478; Bivens vs 6
unknown agents, 403 U.S. 388.

     An indictment is "vague" if it does not allege each of the
essential elements of the crime with sufficient clarity to enable
the defendant to prepare his defense. U.S. vs BI-CO Pavers, 741
F.2d 730 (1984). Where the defendant must guess at its meaning,
it is vague and violates the first essential element of due
process. See Connolly vs General Construction Co., 269 U.S. 385,
391, 46 S.Ct. 126, 127, 70 L.Ed. 322 (1926).


                        Page Y - 36 of 40

                                                       Appendix Y


     It is an elementary principle of criminal pleading, that
     where the definition of an offense, whether it be at common
     law or by statute, "includes generic terms, it is not
     sufficient that the indictment shall charge the offense in
     the same generic terms as in the definition; but it must
     state the species; it must descend to the particulars. 1
     Arch. Cr. Pr. and Pl. 291.

                [U.S. vs Cruikshank, La. 92 U.S. 542, 558 (1872)]
                                                 [emphasis added]


                               IV

            26 U.S.C. SECTION 7203, IN AND OF ITSELF,
    IS INSUFFICIENT TO SUSTAIN AN INDICTMENT AND CONVICTION,
     WHEN NO OTHER STATUTE IS ALLEGED TO HAVE BEEN VIOLATED.


     26 U.S.C. 7203, in and of itself, does not describe a
triable offense, nor does it state any basis for any crimes or
public offenses, so as to confer jurisdiction for any issue that
is triable as a "misdemeanor". On the contrary, as will be
shown, jurisdiction is absent.


     Sec. 7203. Willful Failure to File Return, Supply
     Information, or Pay Tax.

     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 pay such
     estimated tax or tax, make such return, keep such records,
     or supply such information at the time or times required by
     law and regulations, shall, in addition to other penalties
     provided by law, be guilty of a misdemeanor and, upon
     conviction thereof, shall be fined not more than $25,000
     ($100,000 in the case of a corporation), or imprisoned not
     more than 1 year, or both, together with the costs of the
     prosecution. In the case of any person with respect to whom
     there is a failure to pay any estimated tax, this section
     shall not apply to such person with respect to such failure
     if there is no addition to tax under section 6654 or 6655
     with respect to such failure.

                                                 [26 U.S.C. 7203]


     IRC 7203 fails to provide any definition of any offense by
failing to charge any statutory crime in any language of any
statute.


                        Page Y - 37 of 40

                                                The Federal Zone:


     The language of 26 U.S.C. 7203, in and of itself, and any
alleged violation as propounded in Appellee's indictment, fails
to be fully descriptive of any offense or crime. It is,
therefore, fundamentally impossible to violate Section 7203 since
this Section, in and of itself, does not include or refer to any
specific statute that could provide a nexus for prosecution, as
is clearly shown in U.S. vs Menk, 260 F. Supp. 784:


     But, rather, all three sections referred to in the
     information, sections 4461, 4901, and 7203, must be
     considered together before a complete definition of the
     offense is found. Section 4461 imposes a tax on persons
     engaged in a certain activity; section 4901 provides the
     payment of the tax shall be a condition precedent to
     engaging in the activity subject to the tax and Section 7203
     makes it a misdemeanor to engage in the activity without
     first having paid the tax, and provides the penalty. It is
     impossible to determine the meaning or intended effect of
     any one of these three sections without reference to the
     others.
                            [U.S. vs Menk, supra, emphasis added]

     Contrary to the accusatory pleadings, 26 U.S.C. 7203, in and
of itself, is not a statute subject to violation since it is
nothing more than a penalty clause for some undefined franchise
obligation. Section 7203, upon which the Appellee's indictment
is based, fails to provide a complete definition of any offense,
and therefore, in and of itself, it fails to state properly a
claim upon which probable cause could predicate. As the Court
stated in U.S. vs Menk, supra:


     The Court of Appeals for the Seventh Circuit has repeatedly
     held that an indictment or information is sufficient which
     defines a statutory crime substantially in the language of
     the statute if such language is fully descriptive of the
     offense.

                                     [U.S. vs Menk, supra at 786]

Section 7203 contains no such descriptive language, nor does it
identify any other statutes.

     It cannot be said that Section 7203 imposes a tax on persons
engaged in a certain activity, nor can it be said that 7203
provides that the payment of the tax shall be a condition
precedent to engaging in the activity subject to the tax.
However, 7203 makes it a misdemeanor to engage in the activity
without having first paid the tax, and provides the penalty. In
addition, 7203 makes it a misdemeanor not to file a return, keep
records or supply information that may be required by several
other statutes and regulations, which specifically determine that
activity and crime.


                        Page Y - 38 of 40

                                                       Appendix Y


     Because the activity in the Appellees' indictment is
undefined, Section 7203 is not, in and of itself, a basis for
prosecution, and there is no probable cause of action against the
Appellant. Similarly, it is impossible to determine the meaning
or intended effect of Section 7203 without having reference to
other possibly applicable and as yet undefined sections of Title
26, U.S.C.

     Plainly and simply, Section 7203 is only a penalty statute,
and by itself cannot stand without reference to other statutes
and or regulations. An IRS agent stated on the record that no
other statutes were violated or identified as such before the
grand jury (CR June 28, 1988, p. 13, lines 5-12).

     Thus the indictment is vague and the court is in error in
sustaining the indictment and conviction.


                                V


    THE DEFINITION OF THE WORD "PERSON" USED IN SECTION 7203,
     AS DEFINED IN 7343 FOR CHAPTER 75, WHICH INCLUDES 7203,
              CANNOT BE EXTENDED TO INCLUDE SOMEONE
      OTHER THAN THE INDIVIDUALS DESCRIBED IN SECTION 7343.


     The words used in a statute cannot be extended beyond the
clear meaning and intent of the legislative body which created
the statute.

     The courts, in construing the words of any statute, cannot
include someone other than the ones described in that statute;
to do so would be like extending the law that controls the speed
of an airplane propeller to include a pedestrian walking along a
path in a forest.

     Chapter 75, which contains Section 7343, carries the heading
"Crimes, Other Offenses, and Forfeitures". Section 7343 states:


     Section 7343. Definition of term "person."

     The term "person" as used in this chapter includes an
     officer or employee of a corporation, or a member or
     employee of a partnership, who as such officer, employee or
     member is under a duty to perform the act in respect of
     which the violation occurs.
                                                 [26 U.S.C. 7343]


                        Page Y - 39 of 40

                                                The Federal Zone:


     This section was previously found in Section 150, which
referred only to corporation tax returns. This was the original
intent of Congress. Thus, Section 7806 is brought to bear upon
the application of this section. Section 7806 States:


     Sec. 7806. Construction of title.

     (b) Arrangement and Classification.

     No inference, implication, or presumption of legislative
     construction shall be drawn or made by reason of the
     location or grouping of any particular section or provision
     or portion of this title, nor shall any table of contents,
     table of cross references, or similar outline, analysis, or
     descriptive matter relating to the contents of this title be
     given any legal effect. The preceding sentence also applies
     to the sidenotes and ancillary tables contained in the
     various prints of this Act before its enactment into law.

                                               [26 U.S.C. 7806(b)]

Thus, 26 U.S.C. 7203 does not apply to the Appellant, a
California State Citizen, because such individual Citizens are
not within the purview of Chapter 75. Therefore, the indictment
must fail.


                           CONCLUSION


     For the forgoing reasons, the Accused's conviction must be
reversed, with an affirmative declaration that the Accused is a
de jure California State Citizen, and a member of the Posterity,
as defined in the Preamble to the Constitution for the United
States of America.


Respectfully submitted
with explicit reservation of all my unalienable rights
and without prejudice to any of my unalienable rights,


[DEFENDANT]


                        Page Y - 40 of 40


                           Appendix Z

                 The Nature and Cause: Case Law


                        Page Z - 1 of 16

                                                The Federal Zone:


Reader's Notes:


                        Page Z - 2 of 16

                                                       Appendix Z


MEMO

TO: Federal Zone Readers

FROM: Mitch Modeleski

DATE: March 1, 1992

SUBJECT: More on the 6th and 16th Amendments


     I have recently found an unusually clear and concise quote
on the effect of a ratified 16th Amendment among some Appellate
decisions I have been reviewing. This quote will be incorporated
into chapter 5 of the second edition of The Federal Zone. After
reading either edition, you will know the logic: if a ratified
16th Amendment had effect X, then a failed ratification proves
that X did not happen. What is X? Answer:


     The constitutional limitation upon direct taxation was
     modified by the Sixteenth Amendment insofar as taxation of
     income was concerned, but the amendment was restricted to
     income, leaving in effect the limitation upon direct
     taxation of principal.

               [Richardson vs United States, 294 F.2d 593 (1961)]


This ultra-clear ruling dovetails perfectly with the work of
author Jeffrey A. Dickstein but, unfortunately, this case is not
discussed in his book Judicial Tyranny (see the Bibliography).


     My 6th Amendment research has also merged perfectly with a
parallel thesis of the book, namely, that the IRC should be
declared null and void for vagueness. It turns out that there is
a ton of legal precedent on the "nature and cause of the
accusation". Our fundamental right to ignore vague and arbitrary
laws is deeply rooted in our fundamental right to due process.
Here's the tentative new paragraph for chapter 5:


     The "void for vagueness" doctrine is deeply rooted in our
     right to due process (under the Fifth Amendment) and our
     right to know the nature and cause of an accusation (under
     the Sixth Amendment). The latter right goes far beyond the
     contents of any criminal indictment. The right to know the
     nature and cause of an accusation starts with the statute
     which any defendant is accused of violating. A statute must
     be sufficiently specific and unambiguous in all its terms,
     in order to define and give adequate notice of the kind of

                                                  [continued ...]


                        Page Z - 3 of 16

                                                The Federal Zone:


     conduct which it forbids. If it fails to indicate with
     reasonable certainty just what conduct the legislature
     prohibits, a statute is necessarily void for uncertainty, or
     "void for vagueness" as it is usually phrased. Any
     prosecution which is based upon a vague statute must fail
     together with the statute itself. A vague criminal statute
     is unconstitutional for violating the 6th Amendment.


     With this mountain of court precedent, we can now attack
U.S. vs Hicks as well as U.S. vs Bentson (see Appendix H). The
9th Circuit kept referring to the importance of "explicit
statutory requirements".

     Well, are those statutory requirements explicit if they
utilize the key word "income" but don't even define it (because
they can't without violating the Eisner prohibition)?

     Are they explicit if they define "State" in such a way as to
create confusion about the precise limits of sovereign
jurisdiction?

     Are they explicit if they qualify definitions by stating
"where not otherwise manifestly incompatible with the intent
thereof", but never define the intent thereof?

     Can we ever know the real intent of Congress, when Title 26
was never enacted into positive law?

     How can we know which of the 3 official definitions of
"United States" to apply to the terms "United States citizen" and
"United States resident" when the IRC doesn't tell us, precisely
and unambiguously, which definition it is using?

     How can we ever expect to quiet the debate about "includes"
and "including", when the Treasury Department's own decision,
published in 1927, frankly admits that these terms have a long
history of semantic confusion?


     "This word has received considerable discussion in opinions
     of the courts. It has been productive of much controversy."


Their own published Treasury Decision proves that Title 26
contains terms that have a documented history of controversy and
confusion.


                        Page Z - 4 of 16

                                                       Appendix Z


[following quotes from Modern Constitutional Law, by Antineau]:

5:116. Historical Considerations

     The United States Supreme Court has often recognized the
relevance of the lessons of history in determining the particular
demands of due process of law. Due process of law, says the
Court, is "a historical product."

     Justice Frankfurter has aptly pointed out that the Sixth and
Seventh Amendment guarantees of criminal and civil jury trials
are almost entirely defined by historical materials. "The gloss
may be the deposit of history," he observes, "whereby a term
gains technical  content. Thus the requirements of the Sixth and
Seventh Amendments for trial by jury in the federal courts have a
rigid meaning."

              [Modern Constitutional Law, by Chester J. Antineau]
                    [The Lawyers Co-operative Publishing Company]
                      [Rochester, New York, 1969, emphasis added]

Footnotes cite the following cases:

     Rochin vs California, 342 U.S. 165 (1952)
     Jackman vs Rosenbaum Co., 260 U.S. 22 (1922)


5:118. The moral basis of the norm

     Due process of law is defined in procedural cases by the
Supreme Court with full consideration to what society considers
wrong and unfair.

     Justice Frankfurter, who contributed greatly to the
definition and expansion of procedural due process, stated in
1950: "the Due Process Clause embodies a system of rights based
on moral principles so deeply embedded in the traditions and
feelings of our people as to be deemed fundamental to a civilized
society as conceived by our whole history." On many another
occasion, the Court has stressed the role of "conscience" in
defining due process of law.

              [Modern Constitutional Law, by Chester J. Antineau]
                    [The Lawyers Co-operative Publishing Company]
                      [Rochester, New York, 1969, emphasis added]


Footnotes cite the following cases:

     Solesbee vs Balkcom, 339 U.S. 9 (1950)
     Leland vs Oregon, 343 U.S. 790 (1952)
     Snyder vs Massachusetts, 291 U.S. 97 (1934)


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                                                The Federal Zone:


[following quotes are from Rochin vs People of California]:

     Words being symbols do not speak without a gloss. On the
one hand the gloss may be the deposit of history, whereby a term
gains technical content. Thus the requirements of the Sixth and
Seventh Amendments for trial by jury in the federal courts have a
rigid meaning. No changes or chances can alter the content of
the verbal symbol of "jury" -- a body of twelve men who must
reach a unanimous conclusion if the verdict is to go against the
defendant.3 On the other hand, the gloss of some of the verbal
symbols of the Constitution does not give them a fixed technical
content. It exacts a continuing process of application.
____________________

3. This is the federal jury requirement constitutionally
     although England and at least half of the States have in
     some civil cases juries which are composed of less than 12
     or whose verdict may be less than unanimous. ...

              [Rochin vs People of California, 342 U.S. 165, 169]
                                                 [emphasis added]

[Comment: Accordingly, does not the "nature and cause of the
accusation" also have a rigid meaning, founded on the lessons of
history, so deeply embedded in the traditions and feelings of our
people as to be deemed fundamental to a civilized society?]


[following quotes from Modern Constitutional Law, by Antineau]:

5:5. Notice of the Accusation

     The Sixth Amendment to the United States Constitution
requires that every person accused shall "be informed of the
nature and cause of the accusation," and the same rule is binding
upon persons brought to trial in the state courts under the
Fourteenth Amendment. Additionally, state constitutional clauses
customarily provide that "In all criminal prosecutions, the
accused shall be informed of the nature and cause of the
accusation against him."

     A person charged with a crime has the constitutional right
to receive from the government a written statement indicating
with particularity the offense to which he must plead and prepare
a defense. The necessity of such a statement has been recognized
by the Oklahoma appellate court which observes:

     "Every person accused of an offense, under the Constitution
     and statutes of this State, has a right to be informed of
     the nature and cause of the accusation against him. ... It
     is difficult to see how this can be safely and orderly
     accomplished without a definite written accusation or
     complaint."
                          [Cole vs Arkansas, 333 U.S. 196 (1948)]


                        Page Z - 6 of 16

                                                       Appendix Z


     Charging a person in the language of an unconstitutionally
vague statute or ordinance is violative of his constitutional
rights.

     An information, indictment, complaint or summons used to
commence a criminal prosecution must contain sufficient facts and
specific details to reasonably apprise the defendant of the exact
charge placed against him. The time, place and manner of the
alleged offense must customarily be set out.

     The Supreme Court has ruled that it violates due process for
a state high court to affirm convictions under a criminal statute
for the violation of which the defendants had not been charged.
The Court stated:


     No principle of procedural due process is more clearly
     established than that notice of the specific charge, and a
     chance to be heard in a trial of the issues raised by that
     charge, if desired, are among the constitutional rights of
     every accused in a criminal proceeding in all courts, state
     or federal. ... It is as much a violation of due process to
     send an accused to prison following conviction of a charge
     on which he was never tried as it would be to convict him
     upon a charge that was never made.

                          [Cole vs Arkansas, 333 U.S. 196 (1948)]

              [Modern Constitutional Law, by Chester J. Antineau]
                    [The Lawyers Co-operative Publishing Company]
                                      [Rochester, New York, 1969]
                                                 [emphasis added]

Footnotes cite the following cases:

     Cole vs Arkansas, 333 U.S. 196 (1948)
     Ex parte Bochman, 201 P 537, 541 (1921)
     Shreveport vs Brewer, 72 So 2d 308 (1954)
     Telheard vs Bay St. Louis, 40 So 326 (1905)
     Scott vs Denver, 241 P2d 857 (1952)
     Bellville vs Kiernan, 121 A2d 411 (1956)


[Comment: A core issue raised by the charge of violating 7203 is
the definition of "any person required." To assume that
DEFENDANT was in the class of persons required, is to make a
conclusion of law, not to state a fact. What section of the IRC
defines which persons are required? Are Canadian persons
required? Are Australian Aborigines required? The presiding
judge merely instructed the jury that "THE LAW REQUIRES EVERY
CITIZEN OF THIS COUNTRY TO FILE AN INCOME TAX RETURN." That is
not what the statute says; that is not what the regulations say.
The presiding judge misquoted the law in his instructions to the
trial jury.]


                        Page Z - 7 of 16

                                                The Federal Zone:


[following quotes from Cole vs Arkansas]:

2. Constitutional law

     Notice of specific charge and a chance to be heard in a
trial of the issues raised by that charge, if desired, are among
the constitutional rights of every accused in a criminal
proceeding. U.S.C.A. Const. Amend. 14


3. Constitutional law

     It is as much a violation of due process to send an accused
to prison following conviction of a charge on which he was never
tried as it would be to convict him upon a charge that was never
made. U.S.C.A. Const. Amend. 14

     [2, 3] No principle of procedural due process is more
clearly established than that notice of the specific charge, and
a chance to be heard in a trial of the issues raised by that
charge, if desired, are among the constitutional rights of every
accused in a criminal proceeding in all courts, state or federal.
In re Oliver, 333 U.S. 257, 68 S.Ct. 499, and cases there cited.
If, as the State Supreme Court held, petitioners were charged
with a violation of Section 1, it is doubtful both that the
information fairly informed them of that charge and that they
sought to defend themselves against such a charge; it is certain
that they were not tried for or found guilty of it. It is as
much a violation of due process to send an accused to prison
following conviction of a charge on which he was never tried as
it would be to convict him upon a charge that was never made. De
Jonge vs State of Oregon, 299 U.S. 353, 362, 57 S.Ct. 255, 259,
81 L.Ed. 278.

     We are constrained to hold that the petitioners have been
denied safeguards guaranteed by due process of law -- safeguards
essential to liberty in a government dedicated to justice under
law.
                     [Cole vs Arkansas, 333 U.S. 196, 201 (1948)]
                                                 [emphasis added]


[following quotes from In re Oliver]:

11. Constitutional law

     A person's right to reasonable notice of a charge against
him and an opportunity to be heard in his defense are basic, and
such rights include, as a minimum, a right to examine witnesses
against him, to offer testimony, and to be represented by
counsel.


                        Page Z - 8 of 16

                                                       Appendix Z


16. Constitutional law

     No man's life, liberty or property may be forfeited as
punishment until there has been a charge fairly made and fairly
tried in a public tribunal. U.S.C.A. Const. Amend. 14


     [10, 11] We further hold that failure to afford the
petitioner a reasonable opportunity to defend himself against the
charge of false and evasive swearing was a denial of due process
of law. A person's right to reasonable notice of a charge
against him, and an opportunity to be heard in his defense -- a
right to his day in court -- are basic in our system of
jurisprudence; and these rights include, as a minimum, a right
to examine witnesses against him, to offer testimony, and to be
represented by counsel.

     [13, 14] Except for a narrowly limited category of
contempts, due process of law as explained in the Cooke case
requires that one charged with contempt of court be advised of
the charges against him, have a reasonable opportunity to meet
them by way of defense or explanation, have the right to be
represented by counsel, and have a chance to testify and call
other witnesses in his behalf, either by way of defense or
explanation.

     [16] It is "the law of the land" that no man's life,
liberty or property be forfeited as a punishment until there has
been a charge fairly made and fairly tried in a public tribunal.
See Chambers vs Florida, 309 U.S. 227, 236, 237, 60 S.Ct. 472,
477, 84 L.Ed. 716. The petitioner was convicted without that
kind of trial.


     Michigan's one-man grand jury, as exemplified by this
record, combines in a single official the historically separate
powers of grand jury, committing magistrate, prosecutor, trial
judge and petit jury. This aggregated authority denies to the
accused not only the right to a public trial, but also those
other basic protections secured by the Sixth Amendment, namely,
the rights "to be informed of the nature and cause of the
accusation;1 to be confronted with the witnesses against him;
to have compulsory process for obtaining witnesses in his favor,
and to have the Assistance of Counsel for his defence."

____________________

1. The requirement, of course, contemplates that the accused be
     so informed sufficiently in advance of trial or sentence to
     enable him to determine the nature of the plea to be entered
     and to prepare his defense if one is to be made.


                        Page Z - 9 of 16

                                                The Federal Zone:


[Comment: Since the indictment contained a conclusion of law
that DEFENDANT was a "person required," he was therefore not
informed sufficiently in advance of trial to determine the nature
of his plea and to prepare his defense.]


     I do not conceive that the Bill of Rights, apart from the
due process clause of the Fifth Amendment, incorporates all such
ideas. But as far as its provisions go, I know of no better
substitutes. A few may be inconvenient. But restrictions upon
authority for securing personal liberty, as well as fairness in
trial to deprive one of it, are always inconvenient -- to the
authority so restricted. And in times like these I do not think
substitutions imported from other systems, including continental
ones, offer promise on the whole of more improvement than harm,
either for the cause of perfecting the administration of justice
or for that of securing and perpetuating individual freedom,
which is the main end of our society as it is of our
Constitution. ... [I]t is both wiser and safer to put up with
whatever inconveniences that charter creates than to run the risk
of losing its hard-won guaranties by dubious, if also more
convenient substitutions imported from alien traditions.9

____________________

9. ... Whatever inconveniences these or any of them may be
     thought to involve are far outweighed by the aggregate of
     security to the individual afforded by the Bill of Rights.
     That aggregate cannot be secured, indeed it may be largely
     defeated, so long as the states are left free to make
     broadly selective application of its protections.

                                     [In re Oliver, 333 U.S. 257]
                                                 [emphasis added]


[following quotes from United States vs Cruikshank]:

     In criminal cases, prosecuted under the laws of the United
States, the accused has the constitutional right "to be informed
of the nature and cause of the accusation." Amend. VI. In U.S.
v. Mills, 7 Pet., 142, this was construed to mean that the
indictment must set forth the offense "with clearness and all
necessary certainty, to apprise the accused of the crime with
which he stands charged;" and in U.S. v. Cook, 17 Wall., 174 [84
U.S., XXI., 539], that "Every ingredient of which the offense is
composed must be accurately and clearly alleged." It is an
elementary principle of criminal pleading, that where the
definition of an offense, whether it be at common law or by
statute, "includes generic terms, it is not sufficient that the
indictment shall charge the offense in the same generic terms as
in the definition; but it must state the species; it must
descend to particulars." 1 Arch. Cr. Pr. and Pl., 291. The
object of the indictment is, first, to furnish the accused with


                        Page Z - 10 of 16

                                                       Appendix Z


such a description of the charge against him as will enable him
to make his defense, and avail himself of his conviction or
acquittal for protection against a further prosecution for the
same cause; and, second, to inform the court of the facts
alleged, so that it may decide whether they are sufficient in law
to support a conviction, if one should be had. For this, facts
are to be stated, not conclusions of law alone. A crime is made
up of acts and intent; and these must be set forth in the
indictment, with reasonable particularity of time, place and
circumstances.

[Comment: The indictment contained a conclusion of law that
DEFENDANT was a "person required"; it did not establish that he
was a "person required" as a matter of fact. The indictment also
failed to specify every ingredient of the offense, because it
failed to specify which IRC section made DEFENDANT a "person
required."]


     The accused has, therefore, the right to have a
specification of the charge against him in this respect, in order
that he may decide whether he should present his defense by
motion to quash, demurrer or plea; and the court, that it may
determine whether the facts will sustain the indictment. ...
Therefore, the indictment should state the particulars, to inform
the court as well as the accused. It must be made to appear --
that is to say, appear from the indictment, without going further
-- that the acts charged will, if proved, support a conviction
for the offense alleged.

[Comment: If the indictment did not cite the statute which made
DEFENDANT a "person required," then the act charged, i.e.,
failing to file, did not support a conviction for the alleged
offense, even if DEFENDANT admitted, under oath, that he did not
file.]

     Vague and indefinite allegations of the kind are not
sufficient to inform the accused in a criminal prosecution of the
nature and cause of the accusation against him, within the
meaning of the Sixth Amendment of the Constitution.

     Judge Story says the indictment must charge the time and
place and nature and circumstances of the offense with clearness
and certainty, so that the party may have full notice of the
charge, and be able to make his defense with all reasonable
knowledge and ability. 2 Story, Const., sec. 1785.

[Comment: An indictment with conclusions of law is necessarily
vague, indefinite, and insufficient to inform the accused of the
nature and cause of the accusation. An indictment with
conclusions of law does not exhibit clearness and certainty, so
that DEFENDANT did not have full notice of the charge, nor was he
able to make his defense with all reasonable knowledge and
ability.]


                        Page Z - 11 of 16

                                                The Federal Zone:


     Reasonable certainty, all will agree, is required in
criminal pleading .... Accused persons, as matter of common
justice, ought to have the charge against them set forth in such
terms that they may readily understand the nature and character
of the accusation, in order that they, when arraigned, may know
what answer to make to it, and that they may not be embarrassed
in conducting their defense; and the charge ought also to be
laid in such terms that, if the party accused is put to trial,
the verdict and judgment may be pleaded in bar of a second
accusation for the same offense.


[Comment: If the indictment did not state the statute which made
DEFENDANT a "person  required," then it failed to provide
DEFENDANT with reasonable certainty that he was in the class of
persons who were required to file in the years in question. He
did not know what answer to make to the indictment and, in fact,
refused to enter a plea. The mention of 6012 by an IRS witness
embarrassed DEFENDANT.]


     Descriptive allegations in criminal pleading are required to
be reasonably definite and certain, as a necessary safeguard to
the accused against surprise, misconception and error in
conducting his defense, and in order that the judgment in the
case may be a bar to a second accusation for the same charge.
Considerations of the kind are entitled to respect; but it is
obvious, that, if such a description of the ingredient of an
offense created and defined by an Act of Congress is held to be
sufficient, the indictment must become a snare to the accused;
as it is scarcely possible that an allegation can be framed which
would be less certain, or more at variance with the universal
rule that every ingredient of the offense must be clearly and
accurately described so as to bring the defendant within the true
intent and meaning of the provision defining the offense. Such a
vague and indefinite description of a material ingredient of the
defense [sic] is not a compliance with the rules of pleading in
framing an indictment. On the contrary, such an indictment is
insufficient, and must be held bad on demurrer or in arrest of
judgment.
                  [United States vs Cruikshank, 92 U.S. 542, 557]


[Comment: Similarly, the mention of 6012 by an IRS witness came
as a surprise to DEFENDANT (and to a gallery witness also, who
almost jumped out of his seat when the IRS witness first
mentioned it). The Court itself never mentioned 6012, nor did
the Court read this IRC section into the record. The indictment
must state every ingredient or element of the offense charged.
The first element of "failing to file" is that the defendant was
a "person required." But, required by what? The indictment
failed to state which IRC section established the filing
requirement.]


                        Page Z - 12 of 16

                                                       Appendix Z


[Notes from Words and Phrases, Permanent Edition, West Publishing
Company, St. Paul, Minnesota, Volume 28]:

     Under Const. art. 1, section 13, entitling defendant to
demand "nature and cause of accusation" against him and to have
copy thereof, defendant is entitled to have gist of offense
charged in direct and unmistakable terms. Large v. State, 164
N.E. 263, 264, 200 Ind. 430.

     The words "nature and cause of the accusation" in Const.
Bill of Rights, art. 1, section 13, providing that an accused
shall have the right to demand the nature and cause of the
accusation against him, mean that the gist of an offense shall be
charged in direct and unmistakable terms. Hinshaw v. State, 122
N.E. 418, 420, 188 Ind. 147.

[Comment: The terms of a penalty statute are indirect and
mistakable terms. They are indirect because they necessarily
involve another statute which specifies "persons required." They
are mistakable because it is quite possible for grand juries to
make mistakes in their conclusions of law. If the statute is
vague, then it is probable that grand juries will make mistakes.]


     A constitutional requirement that a person accused of crime
shall enjoy the right to be "informed of the nature and cause of
the accusation" against him means, by a long line of precedents,
resting on principle, that in a prosecution for the commission of
a statutory offense the words of the statute, or others of fully
equivalent import, should be employed. State v. Judge of
Criminal Dist. Ct. for Parish of Orleans, 21 So. 690, 691, 49
La.Ann. 231.

[Comment: The words of the statute which made DEFENDANT a
"person required" were not expressed either by the indictment,
nor by the Court when challenged to express them.]


     Constitutional provision requiring indictment to inform
accused of "nature and cause of accusation" means that indictment
to be valid must at least fully and plainly identify the offense,
so that defendant may defend properly and later plead a
conviction or acquittal in bar of a subsequent charge for the
same offense, and so that court may pronounce sentence on
conviction according to the right of the case. Const. art. 1,
section 10, State v. Domanski, R.I., 190 A. 854, 857.


[Comment: Indictment did not fully identify the offense.
DEFENDANT could not defend properly. DEFENDANT was unable to
enter a plea; the presiding judge entered it for him and later
instructed the jury that the DEFENDANT had entered a plea of "not
guilty."]


                        Page Z - 13 of 16

                                                The Federal Zone:


[following quotations from Large vs State]:

1. Indictment and Information: 71 -- Defendant is entitled to
have offense charged in direct and unmistakable terms; "nature
and cause of accusation" (Const. art. 1, section 13).

     Under Const. art. 1, section 13, entitling defendant to
demand "nature and cause of accusation," against him and to have
copy thereof, defendant is entitled to have gist of offense
charged in direct and unmistakable terms.

     It is the constitutional right of the defendant to demand
the nature and cause of the accusation against him and to have a
copy thereof. Article 1, section 13, Constitution of Indiana,
McLaughlin v. State, 45 Ind. 388.

     [1] In Hinshaw v. State, 188 Ind. 147, 122 N.E. 418, it is
said the words "nature and cause of the accusation" have a well-
defined meaning and had such a meaning at the time of the
adoption of the Constitution. That meaning is that the gist of
an offense shall be charged in direct and mistakable terms. In
passing upon the same provision of the Federal Constitution in
United States v. Cruikshank (1875) 92 U.S. 542, 557 (23 L.Ed.
588), the court said: "In criminal cases, prosecuted under the
laws of the United States, the accused has the constitutional
right 'to be informed of the nature and cause of the accusation.'
Amend. VI. In United States v. Mills, 7 Pet. 142 [8 L.Ed. 636],
this was construed to mean that the indictment must set forth the
offense 'with clearness and all necessary certainty, to apprise
the accused of the crime with which he stands charged.' And in
United States v. Cook, 17 Wall 174 [21 L.Ed. 538], that 'every
ingredient of which the offense is composed must be accurately
and clearly alleged.' It is an elementary principle of criminal
pleading, that where the definition of an offense, whether it be
at common law or by Statute, 'includes generic terms, it is not
sufficient that the indictment shall charge the offense in the
same generic terms as in the definition; but it must state the
species; it must descend to the particulars.'"

     In Mayhew v. State, 189 Ind. 545, 128 N.E. 599, it is said:
"The particular crime with which the accused is charged must be
preferred [sic] with such reasonable certainty by the essential
averments in the pleading as will enable the court and jury to
distinctly understand what is to be tried and determined, and
fully inform the defendant of the particular charge he is to
meet. The averments must be so clear and distinct that there may
be no difficulty in determining what evidence is admissible
thereunder." [numerous citations follow]

     Section 2225, Burns' 1926 (section 2063, Burns' 1914) clause
10, provides that no indictment or affidavit shall be deemed
invalid, nor shall the same be set aside or quashed, nor shall
the crime charged or other proceedings be stayed or arrested or
in any manner affected for any of the following: "* * * For


                        Page Z - 14 of 16

                                                       Appendix Z


any * * * defect or imperfection which does not tend to the
prejudice of the substantial rights of the defendant upon the
merits."
                              [Large vs State, 164 N.E. 263, 264]

[Comment: DEFENDANT's indictment tended to prejudice his
substantial 6th Amendment right to know the "nature and cause of
the accusation." It did not descend to the particulars; the
presiding judge denied his motion for a Bill of Particulars.]


[following quotations from Hinshaw vs State]:

7. Indictment and Information: 56 -- Constitutional Law --
     Pleading

     Acts 1915, c. 62, relating to the sufficiency of criminal or
civil pleading, is void so far as it applies to indictments,
because Const. Bill of Rights, art. 1, section 13, provides that
an accused shall have the right to demand the nature and cause of
the accusation against him.


8. Indictment and Information: 70 -- "Nature and Cause of
     Accusation."

     The words "nature and cause of the accusation" in Const.
Bill of Rights, art. 1, section 13, providing that an accused
shall have the right to demand the nature and cause of the
accusation against him, mean that the gist of an offense shall be
charged in direct and unmistakable terms.

     This act (chapter 62 of the Acts of 1915, p. 123) is void,
so far as it applies to indictments, because section 13 of
article 1 of the Bill of Rights of the state Constitution
provides that "the accused shall have the right to demand the
nature and cause of the accusation against him and to have a copy
thereof." The words "nature and cause of the accusation" have a
well-defined meaning, and had such meaning at the time of the
adoption of the Constitution. That meaning is, that the gist of
an offense shall be charged in direct and unmistakable terms. In
passing upon the same provision of the federal Constitution in
United States v. Cruikshank, 92 U.S. 542, 557 (23 L.Ed. 588), the
court says: "In criminal cases, prosecuted under the laws of the
United States, the accused has the constitutional right 'to be
informed of the nature and cause of the accusation.' Amend. VI.
In United States v. Mills, 7 Pet. 142 [8 L.Ed. 636], this was
construed to mean that the indictment must set forth the offense
'with clearness and all necessary certainty, to apprise the
accused of the crime with which he stands charged'; and in
United States v. Cook, 17 Wall. 174 [21 L.Ed. 538], that 'every
ingredient of which the offense is composed must be accurately
and clearly alleged.' It is an elementary principle of criminal
pleading, that where the definition of an offense, whether it be


                        Page Z - 15 of 16

                                                The Federal Zone:


at common law or by statute, 'includes generic terms, it is not
sufficient that the indictment shall charge the offense in the
same generic terms as in the definition; but it must state the
species -- it must descend to the particulars.'"

            [Hinshaw vs State, 122 N.E. 418, 420, emphasis added]


[following quotations from State vs Judge of Criminal Dist. Ct.
for Parish of Orleans]:

     1. Every party charged with crime has the constitutional
right to have subjected to judicial investigation and testing the
fact whether or not any particular charge made against him has
come up to the standard of legal requirement or not ....

     That to the best of his knowledge and belief the criminal
district court is absolutely without jurisdiction to try said
cause by reason of there being no legal information pending
against him in said court. That he verily believes (1) that, if
the judge of said court be not prohibited from proceeding further
in this cause, he will force relator to trial, and impose a
sentence upon him (if convicted) in a case wherein there is no
appeal, and will forever deprive relator of his constitutional
right to be informed of the nature and cause of the accusation
against him before trial, and will thereby cause relator
irreparable injury. ...

[Comment: Going to jail when you're innocent, as proven by a
conviction that is overturned for violating the 6th Amendment, is
an irreparable injury.]


     We should have to be convinced that the objections to the
information were such as in point of fact would leave an accused
in ignorance of the nature and cause of the accusation against
him. The objections should not be such as the party making them
could only hope to succeed upon by the application of the most
stringent technical rules as to form and as to pleading -- such
defects as, in our opinion, would really work no injury.

     [State vs Judge of Criminal Dist. Ct. for Parish of Orleans]
                                [21 So. 690, 691, 49 La.Ann. 231]

[Comment: The IRC section which made DEFENDANT a "person
required" is not a stringent technical rule as to form and as to
pleading. DEFENDANT remained in ignorance of this IRC section
throughout the trial and throughout all pre-trial hearings.]


                             # # #


                        Page Z - 16 of 16

                           Chapter 14:
                           Conclusions


     The areas of land over which the federal government
exercises exclusive authority are the District of Columbia, the
federal territories and possessions, and the enclaves within the
50 States which have been ceded to the federal government by the
consent of State Legislatures. This book has referred to these
areas collectively as "the federal zone" -- the zone over which
Congress exercises exclusive legislative jurisdiction, the zone
over which the federal government is sovereign. Author Ralph
Whittington itemizes the federal "states" and possessions as
follows:


(1) District of Columbia ......................... Federal State
(2) Commonwealth of Puerto Rico .................. Federal State
(3) Virgin Islands ............................... Federal State
(4) Guam ......................................... Federal State
(5) American Samoa ............................... Federal State
(6) Northern Mariana Islands ................ Federal Possession
(7) Trust Territory of the Pacific Islands .. Federal Possession


     Inclusive of the aforementioned Federal State(s) and Federal
     Possessions, the "exclusive Federal Jurisdiction" also
     extends over all Places purchased by the Consent of the
     Legislature of one of the Fifty State(s), in which the same
     shall be, for the Erection of Forts, Magazines, Arsenals,
     dock-Yards, and other needful Buildings.

                                           [The Omnibus, page 87]
                                                 [emphasis added]


     In exercising its exclusive authority over the federal zone,
Congress is not subject to the same constitutional limitations
that exist inside the 50 States. For this reason, the areas that
are inside and outside the federal zone are heterogeneous with
respect to each other. This difference results in a principle of
territorial heterogeneity: the areas within the federal zone are
subject to one set of rules; the areas without (or outside) the
federal zone are subject to a different set of rules. The
Constitution rules outside the zone and inside the 50 States.
The Congress rules inside the zone and outside the 50 States.
The 50 States are, therefore, in one general class, because all
constitutional restraints upon Congress are in force throughout
the 50 States, without prejudice to any one State. The areas
within the federal zone are in a different general class, because
these same constitutional restraints simply do not limit Congress
inside that zone.


                        Page 14 - 1 of 8

                                                The Federal Zone:


     Without referring to it as such, Lori Jacques has concisely
defined the taxing effects of territorial heterogeneity as
follows:


     The "graduated income tax" is not a constitutionally
     authorized tax within the several states; however, Congress
     is apparently not prohibited from levying that type of tax
     upon the "subjects of the sovereign" in the Possessions and
     Territories. The definitions of "United States" and "State"
     are stated "geographically to include" only those areas
     constitutionally within congress' exclusive legislative
     jurisdiction upon whom a graduated tax can be imposed.

            [A Ticket to Liberty, November 1990 edition, page 54]
                                                 [emphasis added]

     It is in the area of taxation where the restraints of the
Constitution are most salient. Congress cannot levy indirect
taxes inside the borders of the 50 States unless the tax rates
are uniform across those 50 States. The mountain of material
evidence which impugns the ratification of the so-called 16th
Amendment should leave no doubt in anybody's mind that Congress
must still apportion all direct taxes levied inside the borders
of the 50 States and outside the federal zone. For example, if
California has 10 percent of the nation's population, then the
State of California would pay 10 percent of any apportioned
direct tax levied by Congress. Unfortunately, the IRS currently
enforces federal income taxes as direct taxes on the gross
receipts of individual persons without apportionment. This
results in great tension between the law and its administration.

     Similarly, Congress is not empowered to delegate unilateral
authority to the President to divide or join any of the 50 States
of the Union. Dividing or joining States of the Union can only
occur with the consent of Congress and of the Legislatures of the
States affected. For many reasons like this, the IRC would be
demonstrably unconstitutional if it applied to areas over which
the 50 States exercise sovereign jurisdiction. It is conclusive,
therefore, that the IRC is a municipal law for the federal zone
only. As the municipal authority with exclusive legislative
jurisdiction, Congress is "City Hall" for the federal zone.

     The Bill of Rights also constrains Congress from violating
the fundamental rights of Citizens of the 50 States. These
rights include, but are not limited to, the right to work for a
living, and the right to enjoy the fruits of individual labor.
These activities are free from tax under the fundamental law.
The fundamental law is the Constitution for the United States of
America, as lawfully amended. The first 10 amendments
institutionalize a number of explicit constraints on the acts of
Congress within the 50 States. The most salient of these
amendments are those that mandate due process and prohibit self-
incrimination.


                        Page 14 - 2 of 8

                                                      Conclusions


     The Internal Revenue Code and its regulations impose taxes
on the worldwide income of United States** citizens and United
States** residents. Throughout this book, two stars "**" after
the term "United States**" are used to emphasize that the "United
States" in this context has the second of three separate and
distinct meanings. These meanings were defined by the Supreme
Court in the pivotal case of Hooven & Allison Co. vs Evatt, which
is still the standing case law on this question. The high Court
indicated that the Hooven case would be the last time it would
address a definition of the term "United States". Therefore,
this ruling, and the preceding case law and law review articles
on which it was based, must be judicially noticed by the entire
American legal community.

     The United States**, as that term is used in the IRC, is the
area over which Congress exercises exclusive legislative
authority; it is the federal zone. If you are not a United
States** citizen, then you are an alien with respect to the
United States**. If you are not a United States** resident, then
you are nonresident with respect to the United States**.
Therefore, if you were born outside the federal zone, if you live
and work outside the federal zone, and if you were never
naturalized or granted residency privileges by the federal zone,
then you are a nonresident alien under the Internal Revenue Code,
by definition. Be clear that an "alien" is not a creature from
outer space. The term "alien" is the creation of lawyers.

     Nonresident aliens only pay taxes on income that is derived
from sources that are inside the federal zone. According to
explicit language in the Internal Revenue Code, gross income for
nonresident aliens includes only gross income which is
effectively connected with the conduct of a trade or business
within the United States**, and gross income which is derived
from sources within the United States**, even if it is not
connected with a U.S.** trade or business. Thus, employment with
the federal government produces earnings which have their source
inside the federal zone. Similarly, unearned dividends paid to
nonresident aliens from stocks or bonds issued by U.S.** domestic
corporations also have their source inside the federal zone, and
are therefore taxable. Frank Brushaber was such a nonresident
alien.

     For any federal tax liability that does exist, a nonresident
alien can utilize Form 1040NR to report and remit that tax
liability to the IRS. As a general rule, a nonresident alien
need not report or pay taxes on gross income which is derived
from sources that are outside the federal zone, or on gross
income which is effectively connected with the conduct of a trade
or business that is outside the federal zone. The regulations
specify a key exception to this general rule: a return must be
filed, however, by nonresident aliens who are engaged in any
U.S.** trade or business, whether or not they have derived income
from any U.S.** sources.


                        Page 14 - 3 of 8

                                                The Federal Zone:


     The law of presumption has made it possible for the federal
government to impose income taxes on individuals who had no tax
liability in the first place. The regulations which promulgate
the Internal Revenue Code make it very clear that all aliens are
presumed to be nonresident aliens because of their "alienage",
that is, because of their status as aliens from birth. However,
through their own ignorance, in combination with a systematic and
constructive fraud perpetrated upon them by the federal
government, nonresident aliens may have filed 1040 forms in the
past, in the mistaken belief they were required to do so, when
they were not required to do so.

     The receipt of these forms, signed under U.S.** penalties of
perjury, entitles the federal government to presume that
nonresident aliens have "elected" to be treated as residents
and/or they have volunteered to be treated as taxpayers. A
completed, signed and submitted 1040 or 1040A form is a
voluntarily executed commercial agreement which can be used as
prima facie evidence, in criminal trials and civil proceedings,
to show that nonresident aliens have voluntarily subjected
themselves to the federal income tax. This presumption was
described in a decision of the United States** Court of Appeals
for the 9th Circuit, in the 1974 ruling of Morse vs U.S. which
stated:


     Accordingly, when returns were filed in Mrs. Morse's name
     declaring income to her for 1944 to 1945, and making her
     potentially liable for the tax due on that income, she
     became a taxpayer within the meaning of the Internal Revenue
     Code.
                       [Morse vs United States, 494 F.2d 876,880]
                                                 [emphasis added]


     Within the borders of the 50 States, the "geographical"
extent of exclusive federal jurisdiction is confined to the
federal enclaves; this extent does not encompass the 50 States
themselves. We cannot blame the average American for failing to
appreciate this subtlety, particularly when officials in Congress
and elsewhere in the federal government have been guilty of
constructive as well as actual fraud ever since the year 1913.
Not only are the key definitions of "State" and "United States"
confusing and vague; the term "income" isn't even defined in the
statute or its regulations, and neither is its "intent".

     Close examination of the Internal Revenue Code (IRC),
reveals that the meaning of "income" is simply not defined,
period! There is an important reason in law why this is the
case. At a time when the U.S. Supreme Court did not enjoy the
benefit of 17,000 State-certified documents which prove it was
never ratified, that Court assumed that the 16th Amendment was
the supreme law of the land. In what is arguably one of the most
important rulings on the definition of "income", the Supreme


                        Page 14 - 4 of 8

                                                      Conclusions


Court of the United States has clearly instructed Congress that
it is essential to distinguish between what is and what is not
"income", and to apply that distinction according to truth and
substance, without regard to form. In that instruction, the high
Court has told Congress it has absolutely no power to define
"income" by any definition it may adopt, because that term was
considered by the Court to be a part of the U.S. Constitution:


     Congress cannot by any definition it may adopt conclude the
     matter, since it cannot by legislation alter the
     Constitution, from which alone it derives its power to
     legislate, and within whose limitations alone that power can
     be lawfully exercised.
                                 [Eisner vs Macomber, 252 US 189]
                                                 [emphasis added]


     Clearly, the Internal Revenue Code has not distinguished
between what is, and what is not income. To do so would be an
exercise of power which Congress has been told, in clear and
certain terms, it simply does not have. This is a Catch-22 from
which the Congress cannot escape, without officially admitting
that the 16th Amendment is not law. Congress either defines
income by statute, and thereby exercises a power which it does
not have, or it fails to define income, thereby rendering whole
chunks of the Internal Revenue Code null and void for vagueness.
If it argues that the word "income" is not really in the
Constitution after all, because the 16th Amendment was never
ratified, Congress will admit the amendment is null and void.

     The confusion that results from the vagueness we observe in
the IRC is inherent in the statute and evidently intentional,
which raises some very serious questions concerning the real
intent of that statute in the first place. The hired lawyers who
wrote this stuff should have known better than to use terms that
have a long history of semantic confusion. For this reason, and
for this reason alone, I am now convinced that the confusion is
inherent in the language chosen by these hired "guns" and is
therefore deliberate. Could money have anything to do with it?
You bet it does.

     It is clear that there is a huge difference between the area
enclosed by the federal zone, and the area enclosed by the 50
States of the Union. No one will deny that money is a powerful
motivation for all of us. Congress had literally trillions of
dollars to gain by convincing most Americans that they were
inside its revenue base when, in fact, most Americans were
outside its revenue base, and remain outside even today. This is
deception on a grand scale, and the proof of this deception is
found in the statute itself and its various amendments over time.


                        Page 14 - 5 of 8

                                                The Federal Zone:


     It is quite stunning how the carefully crafted definitions
of terms like "State" and "United States" do unlock a huge
statute, a mountain of regulations, and a pile of forms,
instructions and publications that are all horribly complex, and
deliberately so. As fate would have it, these carefully crafted
definitions also expose perhaps the greatest fiscal fraud that
has ever been perpetrated upon any people at any time in the
history of the world.

     It is now time for a shift in the wind. Let justice
prevail. Let no man or woman be penalized from the oppression
that results from arbitrary enforcement of vague and ambiguous
statutes that benefit the few and injure the many. The
Constitution for the United States of America guarantees our
fundamental right to ignore vague and ambiguous laws because they
violate the 6th Amendment. This is the Supreme Law of the Land.
Unlike other governments elsewhere in space and down through
time, the federal government of the United States of America is
not empowered to be arbitrary.

     The vivid pattern that has now painfully emerged is that
"citizens of the United States", as defined in federal tax law,
are the intended victims of a new statutory slavery that was
predicted by the infamous Hazard Circular soon after the Civil
War began. These statutory slaves are now burdened with a bogus
federal debt which is spiralling out of control. The White House
budget office recently invented a new kind of "generational
accounting" so as to project a tax load of seventy-one percent on
future generations of these "citizens of the United States". It
is our duty to ensure that this statutory slavery is soon gone
with the wind, just like its grisly and ill-fated predecessor.


     In the long history of the world, only a few generations
     have been granted the role of defending freedom in its hour
     of maximum danger. I do not shrink from this responsibility
     -- I welcome it. I do not believe that any of us would
     exchange places with any other people or any other
     generation. The energy, the faith, the devotion which we
     bring to this endeavor will light our country and all who
     serve it -- and the glow from that fire can truly light the
     world.

                              [President John Fitzgerald Kennedy]
                                [Inaugural Address, January 1961]


                             # # #


                        Page 14 - 6 of 8

                                                      Conclusions


Reader's Notes:


                        Page 14 - 7 of 8

                                                The Federal Zone:


Reader's Notes:


                        Page 14 - 8 of 8

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