Trial Logs

Our government's ability to incarcerate innocent people is evidenced by the number of those being exonerated, most often through DNA evidence. These wrongful convictions evidence our judicial system's failure. Trial Logs is currently covering the government's prosecution of those who question the application of the income tax laws. It is our hope that this coverage will help us understand the failings of our justice system and help those struggling to comprehend this nation's income tax laws.

Wednesday, October 05, 2005

Irwin Schiff Trial Coverage by Freedom Law School (Segment 3 of 3)

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41 Old Comments:

Lying on a credit application is bank fraud, even if its just a credit application for a single's dating service.

By Anonymous, at 10/05/2005 11:30 PM

Lying on a credit application is bank fraud,
What a load of hog wash

By Anonymous, at 10/05/2005 11:50 PM

It is a federal crime to make any false statements on a loan or credit application.

By Anonymous, at 10/05/2005 11:58 PM

"It is a federal crime to make any false statements on a loan or credit application."

well, that is surely a reliable piece of data - NOT. no wonder your name is anonymous!

By Anonymous, at 10/06/2005 8:11 AM

Yet another law you don't know about because your guru didn't tell you about it...

Title 18 Chapter 47 Fraud and False Statements, Section 1014

Whoever knowingly makes any false statement or report, for the purpose of influencing in any way the action of any institution the accounts of which are insured by the Federal Deposit Insurance Corporation, upon any application, advance, discount, purchase, purchase agreement, repurchase agreement, commitment, or loan, or any change or extension of any of the same, by renewal, deferment of action or otherwise, or the acceptance, release, or substitution of security thereforshall be fined not more than $1,000,000 or imprisoned not more than 30 years, or both.

By Anonymous, at 10/06/2005 9:11 AM

Yeap...Chuck Conces is currently using Title 18 Chapter 47 Fraud and False Statements, Section 1014
in filing his criminal complaints agains ALL IRS Operation Managers....he is sending these complaints to Federal robes. Thus far the robes have stayed away from them...the latest complaint, as of two days ago, was sent to the "judge" presiding in the Shiff trial...don't you think he'll be surprised to get the package!

It's just a matte of time until this fraud-scam falls...stay tuned...

By Anonymous, at 10/06/2005 10:00 AM

I find it way more concerning that the IRS uses your "Bank Signature Card" (which is not an accounting of digit entries) as a tool use to assist in determining your tax liability!

January 7, 1999 issue of USA Today, Mr. Reich (during Clinton administration) says this:

"The dirty little secret is that both houses of Congress are irrelevant." Robert Reich cut to the chase when he said that "America's domestic policy is now being run by Alan Greenspan and the Federal Reserve and America's foreign policy is now being run by the International Monetary Fund [IMF].

Could it be that the use of the foreign owned debt based non- Federal Reserve System currency attaches to you a "liability" to pay a tax because you use this private script rather than real American money, which was abandoned in favor of the system enacted just about the time that many other "CONVERSIONS," like with regard to your citizenship took place? Your thoughts? CJ

By Anonymous, at 10/06/2005 10:07 AM

Why is the "Bank Signature" card relevant?

Could it be that, under your signature, in small, fine, microsize print it states that you AGREE to abide by the rules, Past, Present and Future, of the Federal Reserve. Tell me, has anyone ever read the past and present rules of the Federal Reserve? How about the Future ones? Go to your bank and ask them for the rules...to date I have not had a bank hand me the rules that I am supposed to agree to abide by.

Now for those claiming that lying on a credit card application is bank fraud... Have you ever asked the bank what they do with the application after you give it to them? Did they disclose to you the following taken direct from my own personal hard print copy of Modern Money Mechanics from the Fed. Reserve Bank of Chicago page 6 column 2

Example is for a bank or CC loan of $9000..."Of course, they do not really pay out loans from the money they received as deposits. If they did this, no aditional money would be created. What they do when they make loans is to accept promissory notes in exchange for credits to the borrowers' transaction accounts. Loans (assets) and deposits (liabilities) both rise by $9000. Reserves are unchanged by the loan transactions. But the deposit credits constitute new additions to teh total deposits of teh banking system."

Now tell me who is doing what and to whom? Then read some history and see how and when the "act" was passed.

No more wonder why banks are a growth industry is there...
Respectfully submitted, CJ

"CJ

By Anonymous, at 10/06/2005 12:37 PM

"Whoever knowingly makes any false statement or report, for the purpose of influencing in any way the action of any institution the accounts of which are insured by the Federal Deposit Insurance Corporation,..." Ah, now I got it! The dating services are "insured" by the FDIC. Glad you cleared that up, anonymous.

By Anonymous, at 10/06/2005 12:42 PM

DON'T LET THEM PULL US OFF TOPIC.
IRWIN SCHIFF IS INNOCENT AND THIS TRIAL IS A SCAM.

INDEX CODE OF THE IRC: NO LISITING FOR LIABILITIES, PAYMENTS, OR PENALTIES WHEN IT COME TO INCOME TAXES.

No requirement to keep books and records for income taxes. HOWEVER, THERE ARE SEVERAL REQUIREMENTS FOR OTHER TAXES TO KEEP BNOOKS AND RECORDS. WHO'S SCAMMING WHO.

WHAT IS GOING TO HAPPEN WITH THIS ECONOMY ONCE IRWIN PROVES BEYOND A REASONABLE DOUBT THAT THE INCOME TAXES HAVE BEEN ILLEGALLY IMPOSED AND UNLAWFULLY COLLECTED IN DIRECT VIOLATION OF NUMEROUS US SUPREME COURT DECISIONS?

THATS THE PART THE POWERS THAT BE ARE TRYING TO PROTECT AGINST. THEY KNOW IRWIN IS CORRECT. BUT HOW DO THEY PROTECT THEIR INTEREST WHILE STILL GETTING PEOPLE TO PAY INCOME TAXES?

ONE CAN BE LIABLE FOR INCOME TAXES IF THAT TAX IS APPORTIONED ACCORDING TO THE CENSUS. THAT WOULD MEAN THAT EVERYBODY WOULD PAY THIER FAIR SHARE AND ALL THE TP's WOULD GO AWAY BECAUSE THEY WOULD KNOW THAT THEY WERE BEING TAXED LEGALLY. ITS THE ILLEGAL NATURE OF THE CURRENT SYSTEM THAT HAS TP'S UP IN ARMS, AND I DON'T BLAME THEM ONE BIT.

IF YOU ARE GOING TO TAX THE PEOPLE DO IT LEGALLY. WE WORK TO HARD FOR OUR MONEY.

quataloo!

By Anonymous, at 10/06/2005 12:52 PM

Put it in simple terms CJ:

For every $100 of assets held by the bank, the bank is allowed to "loan" $1000.

That means the bank creates $900 out of thin air, and then loans it out 'at interest'.

That means the borrower is paying "interest" on the money "borrowed".
In other words; the borrower is paying rent for using money that was created out of nothing.

By Anonymous, at 10/06/2005 12:54 PM

Dale Eastman said:

>For every $100 of assets held by >the bank, the bank is allowed >to "loan" $1000.

>That means the bank creates $900 >out of thin air, and then loans >it out 'at interest'.

>That means the borrower is >paying "interest" on the >money "borrowed".
>In other words; the borrower is >paying rent for using money that >was created out of nothing.

Please explain a little further. If I take a $1,000 loan at the bank, deposit it to my account, and then withdraw the $1,000 in cash, how has the bank created $1,000 out of nothing? Haven't I received the full $1,000 that I borrowed? Didn't the bank have to get that $1,000 from the Federal Reserve or elswhere and am I not paying "rent" for "real" money?

By Anonymous, at 10/06/2005 1:07 PM

I am involved in law and in loan apps...I can tell anonymous with out question...fabricating on a loan appl. ....is not bank fraud...:You need to either settle down and leave Irwin and company alone or go read the law and become involved on finance .....How many ways can I tell you that reporting eveything to the Federal government by april 15th ......is not Freedom....being searched by federal officals is not freedom...you are a slave go lick the boots of your master and ask for a scrap to eat....Being abused by the Federal government is not Freedom...is your mind so heavily chained that you can not think???

By Anonymous, at 10/06/2005 1:13 PM

Jerry Hosteg here (new to blog. And a neutral party),

The crime Irwin is being charged for has nothing to do with a credit application.

This should have been irrelevant in this case. The only damage the prosecution is probably trying to do is to let the jury judge the defense by character instead of the law.

We've all did stupid things in life. But why would my actions of something unrelated to a crime I'm am being charged with, even be allowed as evidence to prosecute?

I'm new here to the blog, and in my being neutral to all this it seems to me that Irwin is being seen as guilty already in the eyes of the judge. And the judge (even though it's not his job) is trying to get Irwin convicted. I always thought the defense is automatically innocent, and the prosecution is supposed to prove him guilty in order for him to be seen as guilty and then sentenced.

I'm curious, is this how the courts are supposed to work?

By Anonymous, at 10/06/2005 1:25 PM

"The crime Irwin is being charged for has nothing to do with a credit application."

Irwin disclosed on a credit application that he had substantial income, but he disclosed on his tax returns that he had no income.

If the credit app was incorrect, he committed fraud. If the 1040 was incorrect, he filed a false return. Discrepancies between parallel financial documents are therefore relevant.

By Anonymous, at 10/06/2005 1:34 PM

hk said "If I take a $1,000 loan at the bank, ..."

here is the way it works:

as soon as you sign the promissory note for the loan, YOU have created the "money" asset for the bank. that bank asset that YOU created by signing the promissory note IS the 10% fractional reserve which the bank uses to create more loans.

you think that you have borrowed "money" from the bank, but the bank has no "money" to loan. all it has are these assets (promissory notes) which are mere prima facia evidence of "money". what you received was credit only - postings in their computer - digits - electrons - 1's and 0's.

the $1000 balance in your bank account is a liability to the bank. when you reduce the balance by withdrawing the "money", you merely reduce the bank's liability. now the bank goes out to find another sucker to whom it can "loan" $900, obtain a promissory note asset, and make postings to his account!

it's all magic. you should read Ed Griffin's "The Creature From Jekyll Island".

By Anonymous, at 10/06/2005 1:34 PM

Parallel financial documents? These documents have nothing to do with each other. Irwin can just argue that the income on the credit app related to wage/salaries in order to get a loan.

But the income reported on the 1040 does not fall under the category of wage/salary income. This income he believes (according to the law) is not the same as the income on a credit app. Therefore on the 1040, this income that he's not making will be reported as zero.

Why is the government still trying to establish that wages/salries are in fact taxable income when it's not defined in the IRC?

By Anonymous, at 10/06/2005 2:00 PM

Anonymous said...

Irwin disclosed on a credit application that he had substantial income, but he disclosed on his tax returns that he had no income.

If the credit app was incorrect, he committed fraud. If the 1040 was incorrect, he filed a false return. Discrepancies between parallel financial documents are therefore relevant.

And that definition of "INCOME" is....?
_______________________________
_______________________________
_______________________________
_______________________________
Use extra lines if you need them.

By Anonymous, at 10/06/2005 2:05 PM

it's all magic. you should read Ed Griffin's "The Creature From Jekyll Island".

The Creature from Jekyll Island

By Anonymous, at 10/06/2005 2:08 PM

Please explain a little further. If I take a $1,000 loan at the bank, deposit it to my account, and then withdraw the $1,000 in cash, how has the bank created $1,000 out of nothing? Haven't I received the full $1,000 that I borrowed? Didn't the bank have to get that $1,000 from the Federal Reserve or elswhere and am I not paying "rent" for "real" money?

Brand new bank opens.
Here's the books:

Assets__________|______Liabilities
*********************************
_______________|_________________
_______________|_________________
*********************************
_______________|_________________
_______________|_________________
*********************************

First Customer deposits $100 dollars (Federal Reserve Notes[FRN's]) into a checking account.

Assets_________|______Liabilities
*********************************
Cust 1's $100_____|__Cust 1's $100__
held by bank_____|__owed to customer
*********************************
_______________|_________________
_______________|_________________
*********************************

Books are balanced.

Second customer applies for, and gets a loan of $1,000.

The Bank is allowed to create $900 out of thin air. Bank cuts a $1000 check.

Assets_________|______Liabilities
*********************************
Cust 1's $100__|__Cust 1's $100__
held by bank___|__owed to customer
*********************************
Cust X's_______|__$1K outstanding
$1K IOU________|___check_________
*********************************

The books are still balanced.

A "run on a bank" would be if Customer X attempts to cash the $1k check. The bank doesn't have enough reserves on hand. The bank would be insolvent.

Let us look at the bank years later with more customers:

Assets_________|______Liabilities
*********************************
Cust 1's $100__|__Cust 1's $100__
held by bank___|__owed to customer
*********************************
Cust 2's $100__|__Cust 2's $100__
held by bank___|__owed to customer
*********************************
Cust 3's $100__|__Cust 3's $100__
held by bank___|__owed to customer
*********************************
Cust 4's $100__|__Cust 4's $100__
held by bank___|__owed to customer
*********************************
Cust 5's $100__|__Cust 5's $100__
held by bank___|__owed to customer
*********************************
Cust 6's $100__|__Cust 6's $100__
held by bank___|__owed to customer
*********************************
Cust 7's $100__|__Cust 7's $100__
held by bank___|__owed to customer
*********************************
Cust 8's $100__|__Cust 8's $100__
held by bank___|__owed to customer
*********************************
Cust 9's $100__|__Cust 9's $100__
held by bank___|__owed to customer
*********************************
Cust 10's $100_|__Cust 10's $100__
held by bank___|__owed to customer
*********************************
Cash assets on hand: $1,000.
Liabilities: $1,000.

Customer X gets a loan of $1,000.
Bank cuts check adding the following to the ten entries just above:

Cust X's_______|__$1K outstanding
$1K IOU________|___check_________
*********************************

This time when Customer X cashes the check, there is enough cash on hand.

By Anonymous, at 10/06/2005 2:36 PM

Your right, sadly, because the explaination from the horses mouth, so to speak, the Federal Reserve is too complicated for those having never studied the subject.

The facts, as based upon Modern Money Mechanics is well told by the author ending his post calling attention to the book "Creature from Jekyll Island"

What Modern Money Mechanics reveals is that you are being lent your OWN money. YOU created the money with the signed application or promissory note and handed it back. This was a "deposit" into the "borrowers" account!!! The borrower is YOU. A Deposit. All of the money was created by YOU. The bank didn't have it prior to your signature. They then spun the books and make you pay your deposit back to them, in the form of a loan, with interest. Problem is, the interest doesn't exist unless someone else takes out a loan and you get your hands on that so called "money" to make your payments...problem again...never can it all be paid off in this manner...NEVER! A few cases were won against the banks for this fraud, so they changed their proceedures to monitize your negitiable instrument (your promissory note) immediately so you cannot sue them by proving they loaned your own deposit back to you.

YES the case is not about this, however it is a part of the puzzle they use to trap everyone into some sort of agreement without us knowing the entire agreement.

Irwin did nothing as compared to the above.

Ever wonder how your Credit Card contract is ever changing? The terms and conditions change from when you signed up. Was it a real and true contract wherein this and the above explaination was disclosed?

NOW IF a 1040 form (not a 1040 law) that is an illegal form as shown by the evidence at givemeliberty.org from Mr. Lear, through the court, how can the number zero under those terms be identified with the any number upon a credit app. otherwise called, by the FED RESERVE, a DEPOSIT?????

Stop right there...hahaha Get it?
Constitutionally yours, CJ

By Anonymous, at 10/06/2005 2:49 PM

Every one seems to miss a very important point. The application at the "bank" is not a "tax" form. The Accounting definition of "income" is different then the Constitutional definition of income in the Internal Revenue Code. So, as a matter of law one is not the other.

By Anonymous, at 10/06/2005 4:05 PM

By Anonymous, at 10/06/2005 4:35 PM

willing to pay some Taxes states:

So, after you spend hours slamming the government,

If "government" breaks the law and violates my Constitutional rights,

Should I;

A. Move to "somewhere else, like China, or maybe Iraq, Guatemala, Russia, Honduras";

Or;

B. "spend hours slamming the government" by exposing their ILLEGAL, LAWLESS ACTIONS?

===================================
you can run down to the well stocked neighborhood grocery store
And the goverment stocked this store how?
===================================
on the nicely paved roads
Having done close to a million miles in a class A, articulated vehicle, I'm calling you on your outright stupid statement. "Nicely paved" what a joke.

Oh, BTW. Those are "MY" roads YOU are driving on. It cost me approximately $41,700 just in federal fuel taxes for doing those million miles. The annual HVUT's of $550/year; $1,600/year license plate fees and a similar amount of state fuel taxes in addition to the appx $41,700 was not included.
===================================
buy almost any type of food that you need to munch on
And the government grew this food where?
===================================
the government that PROTECTS your right to do so
You have apparently never heard of Bastiat's legal plunder.
===================================
And if you don't have enough money to buy those munchies, yep, the government will help.
You apparently have never heard of

Bastiat's false charity.
Bastiat's false philanthropy.
===================================
No place is perfect and sure, there are problems but what the hell are you guys bitching about?
Your blind ignorance for starters.

By Anonymous, at 10/06/2005 5:23 PM

It occurs to me as I read so much of these vitrolic anti-government posts that you all should be somewhere else, like China, or maybe Iraq, Guatemala, Russia, Honduras. . . The fact remains that you live in a country that thousands who live elsewhere risk their lives, and yes, die each year, attempting to get to. So, after you spend hours slamming the government, you can run down to the well stocked neighborhood grocery store that on the nicely paved roads, occasionally having to pull over for the some type of government sponsered emergency vehicle that is going to help some hapless sick citizen, and buy almost any type of food that you need to munch on next to your computer when you return to safely type more vitrolic comments about the government that PROTECTS your right to do so. And if you don't have enough money to buy those munchies, yep, the government will help. And if you ever get sick of yourself, you can always call 911 and someone from some type of government will come to help. No place is perfect and sure, there are problems but what the hell are you guys bitching about? Oh my God, get a real life. Like I said, MOVE..LEAVE...GET OUT, we don't really need you here anyway. Signed, Happy to Live in the United States of America and willing to pay some Taxes to do so.

I didn't realize income taxes paid for the roads, or those "emergency" vehicles.

I thought property, gas and other types of excises did that.

I don't think anyone here opposes taxes; it is the lying cheating stealing demeanor of our government that upsets us.

If it weren’t for people like us, people like you would not have all those nice fancy things you mention.

Go back to the herd. But remember, one day you will wake up and wish you had taken a little time away from the ball game to take notice of what’s happening in this country you take for granted and are so quick to tell your fellow countrymen to leave because they take time to educate themselves and share a different opinion than you do.

"Few people are capable of expressing with equanimity opinions which differ from the prejudices of their social environment. Most people are even incapable of forming such opinions." - Albert Einstein

By Anonymous, at 10/06/2005 5:25 PM

Wait a second.. I'm not moving anywhere.. this is my country too.. and I feel that at best there is confusion about the definition of income.

By saying "move out" to folks you don't want to honestly debate with substance is intellectual sloth. Honestly, would you be able to take an oath to protect the constitution from all enemies foreign AND DOMESTIC?

Anyways, your probably writing on this blog because its part of your govt spin job. Yeah, yeah.. I know boss told you to "confuse" the topic or something.

Its too bad you don't actually read your country's laws.

What was the definition of income again?

By Anonymous, at 10/06/2005 5:36 PM

Wow read it again...
"It occurs to me as I read so much of these vitrolic anti-government posts that you all should be somewhere else, like China, or maybe Iraq, Guatemala, Russia, Honduras. . . The fact remains that you live in a country that thousands who live elsewhere risk their lives, and yes, die each year, attempting to get to. So, after you spend hours slamming the government, you can run down to the well stocked neighborhood grocery store that on the nicely paved roads, occasionally having to pull over for the some type of government sponsered emergency vehicle that is going to help some hapless sick citizen,..."

Good thing I have traveled much of the develped world and there are well stocked neighborhood groceries everywhere I have been, and paved roads and emergency vehicles as well.

Now that that's OUT OF THE WAY...
I must ask the author what "Rights" he or she is speaking of. Haven't your heard or read a judge say, "The Constitution doesn't apply in my courtroom." OR "The law is not allowed in my courtroom" as though it is not the people's courtroom...well maybe it isn't for the rights you speak of have disappeared right before your eyes...while you were watching and not seeing it happen, when you signed your SS form establishing your IRS account and converting you status (a.k.a. citizenship) from that of birth right to becoming a foreigner in your own country. I know this is hard to believe and understand but the facts, the evidence and the law is available to PROVE IT! CJ

By Anonymous, at 10/06/2005 6:02 PM

Rights, Rights, Rights, what rights? 1st amendment gone. People jailed for rendering their opinions. Redress of grievance, GONE, see givemeliberty.org and read the judges decision. The legislative democracy corporate government does not have to read or respond to anything the people say. IN OTHER WORDS, the government is now placed ABOVE the People for it was originally that the People were above the government and the government was to respond.

Right to a FAIR trial, you don’t have it, and neither does Irwin and many others recent past and someday it may be YOU, maybe on a different subject, but it may happen and then you can claim your "RIGHTS" and they will laugh at you, all the way to the bank…literally, to the bank for it is about commerce is it not?

By Anonymous, at 10/06/2005 6:34 PM

Reading your comments about what loans are makes me realize just how totally stupid you people are. It is no wonder that you are all losers in real life.

As far as Irwin's lies on his credit application goes, that is always relevant to credibility AND his state of mind. Irwin certainly understood "income" when making the application.

But such conduct is to be expected of a twice-convicted felon, no matter how many of you losers still believe in him.

By Anonymous, at 10/06/2005 8:08 PM

As far as Irwin's lies on his credit application goes, that is always relevant to credibility AND his state of mind. Irwin certainly understood "income" when making the application.

Yes. He does understand income.

Do you?

And your definition of "INCOME" is....?
_______________________________
_______________________________
_______________________________
_______________________________
Use extra lines if you need them.

By Anonymous, at 10/06/2005 9:27 PM

Income is an undeniable accession to wealth, clearly realized, and over which the recipient has complete dominion.

See COMMISSIONER v. GLENSHAW GLASS CO., 348 U.S. 426 (1955) at www.findlaw.com/casecode/supreme.html
and the cases citing that case.

By Anonymous, at 10/07/2005 5:47 AM

Jerry Hosteg here,

I expected battle between both sides to occur on this blog.

Apparently, one side is saying they are the true patriots of this nation, and the other side is saying they are the true patriots of this nation.

The side who supports our government is carrying out name-calling and apparently you're telling them to get out of this country?! Why do that? Your intelligence becomes diminished, you are proving that you are thinking too subjectively and uneducated about the subject, and you are only proving that Irwin's supporters have a stronger case.

Sure, I agree that our government is not perfect, and good things and bad things came out of the things they do. But the government violates rights sometimes by accident. But in this case with the Federal income tax, it is on purpose it seems.

I see these people are making educated, analytical statements that makes sense to someone with common sense.

I don't think I've seen these people expressed any hate to taxes and won't pay because of it. What they have expressed is a need of execution of a fair system that already exists. And is being improperly executed on purpose by federal government for gain.

Now do you think that nice things the government does acutually justify the violations of one's god-given (not man-given) rights?

I will automatically say "no." But I believe the majority of people in the United States will say "yes" because they don't care about rights, they care about nice things.

Only when they are in trouble with the law, will they go looking for the right and eventually realize that the right exists on paper and not in the minds of men.

This is the problem, and it needs to be fixed.

You can go ahead and pay the Federal Income Tax. It is your right to do so. But don't bash these people for not paying because according to the law and their beliefs on how the government is stealing, it is their voluntary right to comply with the Federal Income Tax.

By Anonymous, at 10/07/2005 9:53 AM

jg said...

Income is an undeniable accession to wealth, clearly realized, and over which the recipient has complete dominion.

See COMMISSIONER v. GLENSHAW GLASS CO., 348 U.S. 426 (1955) at www.findlaw.com/casecode/supreme.html
and the cases citing that case.

10/07/2005 6:47 AM

The Supreme Court at footnote 11 in Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955) states:

"In discussing 61 (a) of the 1954 Code, the House Report states:

"This section corresponds to section 22 (a) of the 1939 Code. While the language in existing section 22 (a) has been simplified, the all-inclusive nature of statutory gross income has not been affected thereby. Section 61 (a) is as broad in scope as section 22 (a). "Section 61 (a) provides that gross income includes `all income from whatever source derived.' This definition is based upon the 16th Amendment and the word `income' is used in its constitutional sense." H. R. Rep. No. 1337, supra, note 10, at A18. A virtually identical statement appears in S. Rep. No. 1622, supra, note 10, at 168."

Q1. Is the word "income" used "in its constitutional sense in section 61(a)"?
The default answer is yes.

Q2. If the word "income" has a "constitutional sense" does the word income then also have a nonconstitutional sense?
The default answer is yes.

Visual representation of the above question for clarification of same2.9 kb gif

In order, therefore, that the clauses cited from article 1 of the Constitution may have proper force and effect, save only as modified by the amendment, and that the latter also may have proper 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.
Eisner v. Macomber, 252 U.S. 189 (1920)

Q3. Is the term or word "INCOME" defined anywhere within the Internal Revenue Code?
The default anwser is no.

Q4. Is the reason that "INCOME" is not defined anywhere within the Internal Revenue Code because "Congress cannot by any definition it may adopt conclude the matter, since it cannot by legislation alter the Constitution"
The default answer is yes.

Q5. Does "it becomes essential to distinguish between what is and what is not 'INCOME,' mean that not everything that comes in is income?
The default answer is yes.

There remains the question, strenuously argued, whether this gain in four years of over $700,000 on an investment of about $500,000 is 'income' within the meaning of the Sixteenth Amendment to the Constitution of the United States. Merchants’ Loan & Trust Co. v. Smietanka, 255 U.S. 509 (1921)

Q6. Is "income within the meaning of the Sixteenth Amendment to the Constitution" the same as "Income in its constitutional sense"?
The default answer is yes.

Q7. Is the "question" stated in Merchants v. Smietanka, a question of whether the "gain" stated is "income within the meaning of the Sixteenth Amendment"?
The default answer is yes.

Q8. Is the "question" stated in Merchants v. Smietanka, a question of whether the "gain" stated is "income within the meaning of the Sixteenth Amendment mean that not everything that comes in is income?
The default answer is yes.

Q9. Does this "question" also ask whether the "gain" stated is NOT "income within the meaning of the Sixteenth Amendment"?
The default answer is yes.

Visual representation of the above question for clarification of same2.9 kb gif

We must reject in this case, as we have rejected in cases arising under the Corporation Excise Tax Act of 1909 (Doyle, Collector, v. Mitchell Brothers Co., and Hays, Collector, v. Gauley Mountain Coal Co., the broad content on submitted in behalf of the government that all receipts-everything that comes in-are income within the proper definition of the term 'gross income,' and that the entire proceeds of a conversion of capital assets, in whatever form and under whatever circumstances accomplished, should be treated as gross income...
Southern Pacific V. Lowe, 247 U.S. 330 (1918)

Q10. Is "everything that comes in is income" the concept being rejected?
The default answer is yes.

Q11. Does this mean not everything is "income in its constitutional sense"?
The default answer is yes.

Q12. Does this mean not everthing is "income within the meaning of the Sixteenth Amendment"?
The default answer is yes.

There remains the question, strenuously argued, whether this gain in four years of over $700,000 on an investment of about $500,000 is 'income' within the meaning of the Sixteenth Amendment to the Constitution of the United States.
The question is one of definition, and the answer to it may be found in recent decisions of this Court.
Merchants’ Loan & Trust Co. v. Smietanka, 255 U.S. 509 (1921)

Q13. Does the above passage indicate that the definiton of "income" is to be found in Supreme Court Cases?
The default answer is yes.

It is obvious that these decisions in principle rule the case at bar if the word 'income' has the same meaning in the Income Tax Act of 1913 that it had in the Corporation Excise Tax Act of 1909, and that it has the same scope of meaning was in effect decided in Southern Pacific Co. v. Lowe, where it was assumed for the purposes of decision that there was no difference in its meaning as used in the act of 1909 and in the Income Tax Act of 1913 (38 Stat. 114). There can be no doubt that the word must be given the same meaning and content in the Income Tax Acts of 1916 and 1917 that it had in the act of 1913. When to this we add that in Eisner v. Macomber, supra, a case arising under the same Income Tax Act of 1916 which is here involved, the definition of 'income' which was applied was adopted from Stratton's Independence v. Howbert, supra, arising under the Corporation Excise Tax Act of 1909, with the addition that it should include 'profit gained through 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.
Merchants’ Loan & Trust Co. v. Smietanka, 255 U.S. 509 (1921)

Q14. Does the court functionally state, "there was no difference in its meaning as used in the act of 1909 and in the Income Tax Act of 1913"?
The default answer is yes.

Q15. Does the court functionally state, "the word must be given the same meaning and content in the Income Tax Acts of 1916 and 1917 that it had in the act of 1913"?
The default answer is yes.

Q16. Is the meaning of the word income in EACH AND EVERY income tax act of Congress required to be THE SAME as the meaning used in the 1909 tax act with the noted additions?
The default answer is yes.

Q17. Does the addition to income of "profit gained through sale or conversion of capital assets" add in any way, the compensation for labor or services, or the pay of a worker, to the definition of "income"?
The default answer is no.

Working backwards through the string of cases dealing with the definition of "income":
1. Merchants’ Loan & Trust Co. v. Smietanka, 255 U.S. 509 (1921)
2. Eisner v. Macomber, 252 U.S. 189 (1920)
3. Doyle v. Mitchell Bros. Co. , 247 U.S. 179 (1918)
4. Stratton's Independence, LTD. v. Howbert, 231 U.S. 399 (1913)
5. Flint v. Stone Tracy Co., 220 U.S. 107(1911)

This case presents the question whether, by virtue of the Sixteenth Amendment, Congress has the power to tax, as income of the stockholder and without apportionment, a stock dividend made lawfully and in good faith against profits accumulated by the corporation since March 1, 1913.
EISNER v. MACOMBER , 252 U.S. 189 (1920)

Q18. Does the Eisner case question whether a stock dividend is "income"?
The default answer is yes.

Q19. Is a stock dividend an act of or the result of "corporate activities"?
The default answer is yes.

After examining dictionaries in common use ... we find little to add to the succinct definition adopted in two cases arising under the Corporation Tax Act of 1909 (Stratton's Independence v. Howbert; Doyle v. Mitchell Bros. Co), 'Income may be defined as the gain derived from capital, from labor, or from both combined,' provided it be understood to include profit gained through a sale or conversion of capital assets, to which it was applied in the Doyle Case...
EISNER v. MACOMBER , 252 U.S. 189 (1920)

Q20. Does Eisner cite Stratton's in regard to "gain derived from capital, from labor, or from both combined"?
The default answer is yes.

Q21. Does Eisner cite Doyle in regard to "profit gained through a sale or conversion of capital assets"?
The default answer is yes.

The government, although basing its argument upon the definition as quoted, placed chief emphasis upon the word 'gain,' which was extended to include a variety of meanings; while the significance of the next three words was either overlooked or misconceived. 'Derived-from- capital'; 'the gain-derived-from-capital,' etc. 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.
EISNER v. MACOMBER , 252 U.S. 189 (1920)

Q22. Does the "gain" in question, addressed in Eisner, happen to be the "gain" of a "CORPORATION"?
The default answer is yes.

Q23. Is this "income" itself "property"?
The default answer is yes.

Q24. Is a general tax on property a DIRECT TAX?
The default answer is yes.
Proof of this if challenged, will be made in a post just as long as this one.

This was an action to recover from the Collector additional taxes assessed against the respondent under the Corporation Excise Tax Act of August 5, 1909 (chapter 6, 36 Stat. 11, 112, 38), and paid under protest.

The facts are as follows: Plaintiff is a lumber manufacturing corporation which operates its own mills, manufactures into lumber therein its own stumpage, sells the lumber in the market, and from these sales and sales of various by-products makes its profits, declares its dividends, and creates its surplus.
Doyle v. Mitchell Bros. Co. , 247 U.S. 179 (1918)

Q25. Is Doyle a case in regard a CORPORATION and the corporation Excise Tax Act of August 5, 1909?
The default answer is yes.

An examination of these and other provisions of the act makes it plain that the legislative purpose was not to tax property as such, or the mere conversion of property, but to tax the conduct of the business of corporations organized for profit by a measure based upon the gainful returns from their business operations and property from the time the act took effect. As was pointed out in Flint v. Stone Tracy Co., the tax was imposed 'not upon the franchises of the corporation irrespective of their use in business, nor upon the property of the corporation, but upon the doing of corporate or insurance business and with respect to the carrying on thereof'; an exposition that has been consistently adhered to...

Selling for profit is too familiar a business transaction to permit us to suppose that it was intended to be omitted from consideration in an act for taxing the doing of business in corporate form upon the basis of the income received 'from all sources.'

Whatever difficulty there may be about a precise and scientific definition of 'income,' 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. As was said in Stratton's Independence v. Howbert: 'Income may be defined as the gain derived from capital, from labor, or from both combined.'
Doyle v. Mitchell Bros. Co. , 247 U.S. 179 (1918)

Q26. Does Doyle tell us that the tax act of 1909 is "an act for taxing the doing of business in corporate form"?
The default answer is yes.

This action was brought in the district court of the United States by Stratton's Independence, Limited, a British corporation carrying on mining operations in the state of Colorado upon mining lands owned by itself, to recover certain moneys paid under protest for taxes assessed and levied for the years 1909 and 1910 under the provisions of the corporation tax act, being 38 of the act of August 5, 1909

As to what should be deemed 'income' within the meaning of 38, it of course need not be such an income as would have been taxable as such, for at that time (the 16th Amendment not having been as yet ratified) income was not taxable as such by Congress without apportionment according to population, and this tax was not so apportioned.

Evidently Congress adopted the income as the measure of the tax to be imposed with respect to the doing of business in corporate form because it desired that the excise should be imposed, approximately at least, with regard to the amount of benefit presumably derived by such corporations from the current operations of the government.

In Flint v. Stone Tracy Co., it was held that Congress, in exercising the right to tax a legitimate subject of taxation as a franchise or privilege, was not debarred by the Constitution from measuring the taxation by the total income, although derived in part from property which, considered by itself, was not taxable.

It was reasonable that Congress should fix upon gross income, without distinction as to source, as a convenient and sufficiently accurate index of the importance of the business transacted.
Stratton's Independence, LTD. v. Howbert, 231 U.S. 399 (1913)

Q27. Is the Stratton's case in regard to a corporatation and the 1909 corporate excise tax act?
The default answer is yes.

Q28. Does the Stratton case address the concept of the definition of "income within the meaning of 38 such that "38" defines "INCOME"?
The default answer is yes.

Q29. Is "INCOME" the measure of the doing of business in corporate form?
The default answer is yes.

Q30. Prior to the 16th Amendment, was Congress allowed to use "INCOME" as the measure of the doing of business in the corporate form?
The default answer is yes.

Q31. Could it be reasonably said in the case of the tax act of 1909, that "INCOME" is an "accurate index of the importance of the business transacted"
The default answer is yes.

These cases involve the constitutional validity of 38 of the act of Congress approved August 5, 1909, known as 'the corporation tax' law.
Flint v. Stone Tracy Co., 220 U.S. 107(1911)

Q32. Can question 28 above now be restated as: "Does the Stratton case address the concept of the definition of "income within the meaning of 38 of the act of Congress approved August 5, 1909, known as 'the corporation tax' law such that "38 of the act of Congress approved August 5, 1909" is what defines "INCOME"?

Sec. 38. That every corporation, joint stock company, or association organized for profit and having a capital stock represented by shares, and every insurance company now or hereafter organized under the laws of the United States or of any state or territory of the United States, or under the acts of Congress applicable to Alaska or the District of Columbia, or now or hereafter organized under the laws of any foreign country, and engaged in business in any state or territory of the United States or in Alaska or in the District of Columbia, shall be subject to pay annually a special excise tax with respect to the carrying on or doing business by such corporation, joint stock company or association, or insurance company equivalent to one per certum upon the entire net income over and above five thousand dollars, received by it from all sources during such year, exclusive of amounts received by it as dividends upon stock of other corporations, joint stock companies or associations, or insurance companies subject to the tax hereby imposed; or, if organized under the laws of any foreign country, upon the amount of net income over and above five thousand dollars received by it from business transacted and capital invested within the United States and its territories, Alaska and the District of Columbia, during such year, exclusive of amounts so received by it as dividends upon stock of other corporations, joint stock companies or associations, or insurance companies subject to the tax hereby imposed.'
Flint v. Stone Tracy Co., 220 U.S. 107(1911)

Parsing the above:
Sec. 38. That every corporation, joint stock company, or association organized for profit and having a capital stock represented by shares... and engaged in business ... shall be subject to pay annually a special excise tax with respect to the carrying on or doing business by such corporation, joint stock company or association ... equivalent to one per certum upon the entire net income over and above five thousand dollars, received by it from all sources during such year

A reading of this portion of the statute shows the purpose and design of Congress in its enactment and the subject-matter of its operation. It is at once apparent that its terms embrace corporations and joint stock companies or associations which are organized for profit, and have a capital stock represented by shares. Such joint stock companies, while differing somewhat from corporations, have many of their attributes and enjoy many of their privileges.
Flint v. Stone Tracy Co., 220 U.S. 107(1911)

Q33. Is it true that corporations and joint stock companies have profit (and loss)?
The default answer is yes.

Each and all of these, the statute declares, shall be subject to pay annually a special excise tax with respect to the carrying on and doing business by such corporation, joint stock company or association, or insurance company. The tax is to be equivalent to 1 per cent of the entire net income over and above $5,000 received by such corporation or company from all sources during the year, excluding, however, amounts received by them as dividends upon stock of other corporations, joint stock companies or associations, or insurance companies, subject to the tax imposed by the statute. Similar companies organized under the laws of any foreign country, and engaged in business in any state or territory of the United States, or in Alaska or the District of Columbia, are required to pay the tax upon the net income over and above $5,000 received by them from business transacted and capital invested within the United States, the territories, Alaska, and the District of Columbia, during each year, with the like exclusion as to amounts received by them as dividends upon stock of other corporations, joint stock companies or associations, or insurance companies, subject to the tax imposed.
Flint v. Stone Tracy Co., 220 U.S. 107(1911)

Q34. Does ANY definition in ANY case cited state that what a natural person receives in exchange for their labor is "income"?
The default answer is NO!

By Anonymous, at 10/07/2005 5:39 PM

Dale,
By the very fact that you haven't been taken forcibly away and stuffed into a rubber room (which if I had a choice, you'd be taken forthwith), shows that your "rights" aren't being violated.

What's being violated is your "right" to use semantics to break the law. Define this and define that and tell me what nuance you had in mind when it was written and, by the way, if he had wheaties for breakfast instead of corn flakes, it's a sign that we're all heading into communism.

The only thing I've learned from reading what you type is that you have offered proof that life (of a sort) can exist in a vacuum.

By Anonymous, at 10/07/2005 9:42 PM

Mr. Buckner,
Did you have something of use to contribute, or were you just randomly pressing keys on the keyboard?

Do you have some point of tax law you want to heatedly debate, or are you just going to spew your ad hominems for no purpose other than to show the world how good you are with insults?

Do you really want to continue with your ad hominems and thereby prove to the world that your daddy and your uncle are the same man?

By Anonymous, at 10/07/2005 10:10 PM

By Anonymous, at 10/07/2005 10:29 PM

dale eastman said: "Does ANY definition in ANY case cited state that what a natural person receives in exchange for their labor is "income"?
The default answer is NO!"

You need to look to other cases that are later in time and also those that are in regard to an income tax.

All of the cases cited were from 1911-1921. Several of the cases were
in regard to the Corporate Tax Act of 1909 which is described in STRATTON'S INDEPENDENCE, LTD. v. HOWBERT, 231 U.S. 399 (1913)(by the words of the same justices ,save one, that decided Flint v. Stone Tracy): "As has been repeatedly remarked, the corporation tax act of 1909 was not intended to be and is not, in any proper sense, an income tax law."

I will repeat my suggestion to read COMMISSIONER v. GLENSHAW GLASS CO., 348 U.S. 426 (1955) where it was said: "Nor can we accept respondent's contention that a narrower reading of 22 (a) is required by the Court's characterization of income in Eisner v. Macomber, 252 U.S. 189, 207 , as "the gain derived from capital, from labor, or from both combined." The Court was there endeavoring to determine whether the distribution of a corporate stock dividend constituted a realized gain to the shareholder, or changed "only the form, not the essence," of his capital investment. Id., at 210. It was held that the taxpayer had "received nothing out of the company's assets for his separate use and benefit." Id., at 211. The distribution, therefore, was held not a taxable event. In that context - distinguishing gain from capital - the definition served a useful purpose. But it was not meant to provide a touchstone to all future gross income questions. Helvering v. Bruun, supra, at 468-469; United States v. Kirby Lumber Co., supra, at 3."

Clearly, the court rejected the argument for a definition limiting income to "the gain derived from capital, from labor, or from both combined."

Income is an undeniable accession to wealth, clearly realized, and over which the recipient has complete dominion (at least according to the Supreme Court in 1955).

By Anonymous, at 10/07/2005 10:43 PM

Oh, and by the way, Mr. Buckner, since each question is numbered WITH a default answer, your failure to contradict the default answer, by number, means you agree with the stated default answer.

Thanks for agreeing with us.

I wouldn't agree with you if you told me that rain was wet. You are a moron and by the all posting of yours I've read, have been for quite some time.

You wish to think of that as a personal attack, go right ahead. I prefer to think of it and realizing a truth.

By Anonymous, at 10/08/2005 12:19 AM

Mr. Buckner,

Is rain wet?
The default answer is yes.

By Anonymous, at 10/08/2005 8:44 AM

Thank you Mr. Buckner for agreeing with me that "rain is wet".

By Anonymous, at 10/09/2005 10:05 AM

My reply to Mr. JG's post

BTW Mr. G, I'm still awaiting your reply to this post.

You made a naked assertion and then "took a break".

By Anonymous, at 10/09/2005 10:10 AM

Trial Logs

Wednesday, October 05, 2005

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