Basis in Law

[David Merrill]

I am not getting it, it still doesn't work. there is inherent value in what you are getting from a second party.

It will take some time to go through your flurry of posts but again, I address the juxtaposition of premise with your initial sentence.

There are 'boxes' in which we are conditioned to think and Treefarmer has already presented an excellent item for another reality check:

I have never heard of the IRS collecting a value tax.

So just to get our heads out of a certain box that you propose to draw consider the sales tax. Sales tax is a burden on the shopkeeper, not the buyer. It would be a buyer's tax if it was intended for the purchaser. It is such an ingrained tradition though, that people are accustomed to paying the sales tax for the shop owner. The shopkeeper should subscribe to the letter of the law and just put the sales tax into the purchase price, in an OCD world, don't you think?

Importing the principle of your 843 Form rebuttal I read yesterday you do not seem capable of seeing over the edge of the teacup and think that is the scope of the horizon here. All you need to do is figure that the Income Tax is a fee on the use of the Fed's private credit. Then you might understand much better how redeeming lawful money by demand (by making your demand) removes the suitor into the still extant currency realm of US notes and coins.


Regards,

David Merrill.


P.S. Your myopia is supported by the facts:

It does work. My experience redeeming thousands of dollars annually in lawful money and paying zero taxes these past 5 years corroborates the truth of what David speaks of. And that's probably why my voice (as Harvester) is now disapproved over at Quatloo.

[David Merrill]

It does work. My experience redeeming thousands of dollars annually in lawful money and paying zero taxes these past 5 years corroborates the truth of what David speaks of. And that's probably why my voice (as Harvester) is now disapproved over at Quatloo.

Moving on to the second sentence:

What ever the form of the value received, it is taxable.

That may be true according to the Sixteenth Amendment - it is just not within the scope of the Federal Reserve Act. Simply think about the Fed Act and the remedy, to be conducting transactions outside the Act:



I like this! You change my style to explain in a more technical form. The bottom document in this file about Section 411 of Title 12 is titled to be about paragraph 203(a) but in processing I discovered paragraph 202 is so much more interesting! This is where by law anybody who endorses private credit may be considered a State Bank!

This introduces somewhat of a revelation to me that since the Average Joe signing endorsement is a state bank he is getting consideration - (not a naked contract) - should Joe be lending out to all his friends and fractionally on the approved Fed rates he finds himself at the center of a run on Poker Night. Joe can simply call up the FDIC and they will send an armored car - well, a cheap suit in sunglasses with a briefcase anyway - to save his reputation as a banker.

The only problem with your posting here is that I cannot seem to get though your first two sentences without running out of time to chat. And my mind wanders into new discoveries like a trimmer 843 Form-based Libel of Review. The LoR is my intellectual property and with my imagination (Planet Merrill) I just find it too amusing that since my intellectual properties have value, that in your New York City G-Man Tax Attorney world you would have it that the IRS can start taxing me? For my thoughts? For sharing my thoughts and others benefitting by getting full refunds of their withholdings? That would be quite contrary for the IRS to give these people Refunds and then Tax me for showing them how! My thoughts have value. So do yours but on Planet Merrill you are a teaching tool.

So I will leave the rest of your posts for the good members and readers here to parse out for the value you bring - which is no small value. It is indeed a privilege to have you here.



Regards,

David Merrill.


P.S. Section 203(a) is an interesting segway into the Secretary being US Governor for the IMF as found in the Amendments to the Bretton Woods Agreements (p. 8).


P.P.S.

[Jethro]

Under the code....

Prove I am "under the code":

[David Merrill]

NYGman says;

That is not proof.


Yet we have been redeeming lawful money in various forms for seven years now.

BTW: I just got my State refund check (over $3,000) , based on the 1040 Line 21 "Lawful Money Demand Reduction". The Federal refund was already successfully applied to back taxes. The other State tax return was also accepted without objection to this reduction. So, "...by the mouth of 2 or 3 witnesses, a matter is confirmed"! Hooray!

That snippet is from my current emails. You will get no proof over the Internet. My favorite examples show contemplation like that though - that the IRS considered it carefully and then cut the check, even to apply it to back taxes. Or closer to home (yours) would be the state tax authority pondering over a tax refund carefully enough to add the School Tax Credit on:





You have a good point. The recipient in New York is a banker for the huge international bank and is a licensed tax preparer. He was at a get together and overheard his co-worker's (the host's) sister, an IRS attorney speaking a bit too candidly, There is a group of people in Colorado who don't pay Income Tax; they are doing it correctly. He figured she meant me but she clammed up to any further conversation about it. She would however speak a little about his returns and at one point, the next year she remarked that she could no longer access his files.

This sort of thing goes on around me all the time. It is not proof to you because like you see, I bounced it back and forth with him until he was comfortable that nobody would figure it was him. But even if you do, what are you going to do? Are you going to call up the NY Tax Authority and gripe about somebody else getting a refund? You would be griping to the people who write the refund check! You would call them up and tell them they made a big mistake?

So we discussed it carefully and found these two docs as sanitized are convincing that they go together and they show contemplation. As you read it, it is not proof - agreed. But you have to admit it is rather convincing.



Regards,

David Merrill.

[Treefarmer]

I am not getting it, it still doesn't work. there is inherent value in what you are getting from a second party. What ever the form of the value received, it is taxable. the fact that you don't consider it valid currency is irrelevant. I get paid in USD, EURO, British Pounds, Canadian Dollars, to name a few. I have also been paid in property for my services. Under all scenarios, the money I was paid, regardless of denomination and form is taxable.

I am just getting a bit frustrated with the lack of authority for this position. I can't find an IRS code section, regulation, or case to support this position. I know you all believe this opinion, and in David, but unless supported by the tax laws, it just doesn't work. David could apply for a PLR present his position to the IRS, and have them rule on it. At least with that the IRS would provide their logic and analysis. The only issue is the IRS will not opine if they believe the argument is not frivolous, and based on some of the case law I have read, that may actually be the case.

NYGMan-Tax, it is indeed a pleasure to have you here.
You bring a new perspective to this discussion forum.
Thank you for joining us.

Earlier today I dug out my searchable copy of the 1986 IRC and searched for the term "value".
"Value" occurs there 3,416,179 times, usually in connection with "interest" or "estate".
Then I searched for "value tax", which occurs not at all, and neither does "taxable value", "tax value" or "inherent value".
Then I searched for "tax on value", which occurs once:
----------------------------------------------------------------------------------------------------
Subtitle F - Procedure and Administration
CHAPTER 62 - TIME AND PLACE FOR PAYING TAX
Subchapter B - Extensions of Time for Payment

-HEAD-
Sec. 6163. Extension of time for payment of estate tax on value of
reversionary or remainder interest in property

-STATUTE-
(a) Extension permitted
If the value of a reversionary or remainder interest in property
is included under chapter 11 in the value of the gross estate, the
payment of the part of the tax under chapter 11 attributable to
such interest may, at the election of the executor, be postponed
until 6 months after the termination of the precedent interest or
interests in the property, under such regulations as the Secretary
may prescribe.
-----------------------------------------------------------------------------------------------------

I find it interesting that you stated that anything of value being received is taxable by the IRS.
Perhaps value is not taxable under the IRC, but pursuant to public policy?
Would you please elaborate on your statements about value being taxable?
Thank you.

As to your curious statement about someone not considering "value received" as "valid currency", this really caught my eye.
You did not appear to be addressing anyone in particular with your statement, so I assume that you were directing your comment at the collective forum members.
A quick forum search revealed that we have never discussed the validity of any currency on this forum, and the word combination of "valid currency" exists exactly once on this forum in your own post.

So while you are at it, would you please also explain how "received value" is "valid currency"?
Thank you, your input here is appreciated.

[Seosaidh]

I guess the question about value pertains to the definition of income; what is it? I know the statutes define it, but I don't have time to refresh my memory right now. Is receiving lawful money receiving income?

[David Merrill]

Speaking for myself I have already refused to be drawn into G's premise about value. It scarcely shows at all in the Code like Treefarmer has shown us.

I will keep it simple about being in contract with the Fed, or not.

[Keyser Soze]

Value is subjective. According to NYG's theory, if I am required to accept FRN's at gunpoint, then I have not placed any value in them, they are therefore not taxable. Thank you to all in this forum, I now place my value in Lawful Money.

[shikamaru]

I guess the question about value pertains to the definition of income; what is it? I know the statutes define it, but I don't have time to refresh my memory right now. Is receiving lawful money receiving income?

Tax is derived from property.
Tax is assessed against the value of something and not the property itself.

[Brian]

Tax is derived from property.
Tax is assessed against the value of something and not the property itself.

The income (gain or profit) is derived from the property (ie: rent from renting a house, gain realized by employing labor combined with capital to produce a product). It is then measured by the $$ amount above and beyond the costs of producing. (The house is the property, The labor is related to the employer/employee relationship or said differently slave master/slave relationship, Capital is also property)

If you have a business that is incorporated you pay a tax on that privilege that is measured by the income (gain or profit measured in dollars). The excise is on the privilege and is measured in dollars.
As the wage maker your labor is part of you. If you use the treasury issued medium of exchange that falls under federal common law and IS a direct tax. However if you use the quasi federal/private Fed script as payment for your labor that is a privileged activity that falls under the excise power of the government via the commerce clause.

[Seosaidh]

The income (gain or profit) is derived from the property (ie: rent from renting a house, gain realized by employing labor combined with capital to produce a product). It is then measured by the $$ amount above and beyond the costs of producing. (The house is the property, The labor is related to the employer/employee relationship or said differently slave master/slave relationship, Capital is also property)

If you have a business that is incorporated you pay a tax on that privilege that is measured by the income (gain or profit measured in dollars). The excise is on the privilege and is measured in dollars.
As the wage maker your labor is part of you. If you use the treasury issued medium of exchange that falls under federal common law and IS a direct tax. However if you use the quasi federal/private Fed script as payment for your labor that is a privileged activity that falls under the excise power of the government via the commerce clause.

Oh, that's right! And direct taxes must be apportioned, therefore no income tax ought to be assessed against income of lawful money. But then the question arises, if someone pays you in FRN's, did you receive private credit?

[David Merrill]

Oh, that's right! And direct taxes must be apportioned, therefore no income tax ought to be assessed against income of lawful money. But then the question arises, if someone pays you in FRN's, did you receive private credit?

More, did you endorse private credit?

Consider the law like a mirror. If you project forgiveness...

PPS: forgot to mention... along with that check I sent certified a copy of my Default Judgment published at county level.

Nickname

----- Original Message -----
From:
To: David Merrill <>
Sent: Thu, 18 Oct 2012 17:03:14 -0000 (UTC)
Subject: mortgage

you may recall, we're very behind in our mortgage payments.
So much so that mortgage co. was sending nasty letters, and even returning a check uncashed because it wasn't for the full amount due. I have been R4C'ing just about everything from them.

Well, today I discover they have cashed our latest check:!
(attached)

Seems we may not be in default after all.

I just love it when somebody applies my intellectual property to save their home from foreclosure.

[NYGMan-Tax]

so much to respond to, this is great, I am really enjoying this discussion. Lets start off with something basic to my question, value.

I am trying to simplify multiple code sections and regulations to make it easier to understand. I could quote a series of code sections, but I am trying to explain it is the most basic way. David provides a general overview of his theory without referring to code sections, regulations and case law, so I figured it was the easiest way to do it. I am a tax lawyer by trade, and know the code and regs quite well. However, I prefer to explain in plain English, in a way I hope all can understand. Sure you can search for value, but you won't find it used in the context I am using it, but it is correct. Think about this, you perform a service for someone. The service you just performed has a value to it, and you expect to be compensated for that value. You assign an amount to the worth of that work, typically this is your salary, or hourly wage. Under the code, the value that is assigned to that work is what is subject to taxation. It would be taxable, unless you are donating time to charity, and do not expect to be paid. You are in effect donating the value of your time. [As an aside, in essence you can think of charity work as earning a dollar value for services rendered, but donating the value of your services, resulting in no income recognition as it is a wash - Income = $100 charitable deduction = -100 : income less charitable deduction = 0 - you can not deduct the cost of your labor against your income to offset, that is not permitted deduction]

Now let's get back to value. I do a job. Let's say I expect to get paid $5,000. At the completion of the job, I have several options:
1) They offer $5,000 in FRN's
2) They offer me a car worth $5,000
3) They offer to pay me in EURO (Aprox 6,500 of them)
4) They offer to give me a corporate bond, face value of $5,000, with 3% interest payment for 10 years
5) They offer to give me a computer worth $5,000
6) They offer me gold, silver, or other like items of value worth $5,000
7) They offer to pay of $5,000 of an existing loan
8) They offer to supply other services back to me, worth $5,000
9) They offer me $5,000 of diamonds
10) They give me a $5,000 gift card
I could go on

In all the above cases, I have income of $5,000. This is attributed to me when the amount is due, and I have control over it, either through actual receipt or constructive receipt. It is the receipt of value that causes the taxable event. Again, actual receipt, or constructive. When I say constructive, it implies you have control over the asset, but it may not be physical control. For example, number 2 above, I have title, but the car is still parked with the person giving it to me, I am in constructive receipt of it, even though I do not have physical possession.

My point here is that when you perform work, you expect to get something of value in exchange for your labor. This value is quantifiable, and typically paid in USD. Now days, this is done mostly via wire transfer (Direct Deposit) or check, but cash also works. [Although I will leave cash out of this, as most people who work for cash do so, to stay unreported, and will not declare that income]. Regardless of how this value is transferred to you, it is taxable income. What ever you do with it after you get it, or what ever form you get it in, it is still taxable to you upon receipt [constructive or actual].

So that is what I don;t understand, converting or redeeming into lawful money, does not change the fact that it is still earned. I am assuming you will now go back to y charitable deduction simplification. You may now agree with my premise on value as taxable, but then sy you are entitled to deduction against redeemed lawful money. This is my problem, I can not find any code section, regulation, or case that supports a deduction for this. Can anyone show me one as part of the tax code or regs. Tax law is derived from the IRS code and regulations, and case law interpretations of those. So far, the only case law I have found does not support Davids position.

As for the proof David posted, of his banker friend. I will tell you, as a Lawyer in NYC, and being subject myself to NYS/NYC withholding, in looking up the withholding rates, the amount of the refund reflects withholding that would indicate this person is not high up in the organization, and is an entry level employee. While this person may be an authorize tax preparer, they are not a CPA or Lawyer. They are a Junior person, with little experience, and I would say a very basic understanding of the tax law. Again, based on the refund amount, I don't think this person earns enough to even be on the radar of the taxing authority. I used a speeding analogy last post, but here is a better one, I think.

Suppose I am a serial killer. I kill 10 people without getting caught. I am good at what I do, and leave no evidence. Using your logic, I could say that Murder is not a crime, because I have done it 10 times before, but have never been caught, or even questioned. Therefore, it must not be illegal. This is the same as you preparing a low value tax return, claiming a fictitious deduction, getting a refund, and saying the deduction was obviously correct, as the IRS paid the refund. Simply getting the refund is not proof of anything. I have stated before, this will increase your audit risk, and that may result in the IRS examining your returns some day, but who knows when that will be. The IRS is more concerned with large dollar tax cheats, than someone who scams a few thousand dollars. They just don't have the resources.

You could ask for a PLR (Private Letter Ruling) in which the IRS reviews your position and provides analysis, however if the IRS does not agree with you, you will still be bound by their decision). You can get a lawyer to write you a legal opinion, or you can do nothing and hope the IRS never catches you.

Another thing I said, and really mean, I would love to legally pay no tax, and if I can find something that is supported in the law, that would absolve me of my tax obligation, I would want to know about it. But I need to be able to support my position with the existing tax law, and here I am having a problem. There is nothing I can find in the tax code, regulations, or tax law that supports this. In fact case law seems to imply that regardless of form, it is taxable, and that FRN's are lawful money, and that all the provision you site is good for is swapping FRN's for FRN's. If you have a $100 bill in bad condition, you can go to the fed and redeem it for a new $100, redeeming you lawful money for more lawful money. However, I don't want to debate that issue, and until now have steered clear of it. Please just focus on part two, and why the act of redemption for lawful money results in that money being nontaxable, when clearly it has value, and what you got, that you are exchanging also had value.

I hope I addressed the points above. I will not entertain the position that the tax law doesn't apply to you. If you reside in any of the 50 states, regardless of citizenship, you are subject to the tax code. Heck, even foreign workers, here on work permits are subject to US tax. And if you think tax only applies to government workers or some limited subset of employees, I will not debate that absurd position. It has been proven wrong, even among people who argue other positions on not being taxable. I also will not entertain the 861 position or the OID scam, all bad positions, and based on a bad reading of the code, and a lack of understanding of legal writings.

I do really want to continue this discussion, as this theory fascinates me, and I would like to understand the basis for the position, although focused more on why the redemption results in a tax benefit.

[Seosaidh]

See, that went right over my head. Whoosh! Lol

[Treefarmer]

Earlier today I dug out my searchable copy of the 1986 IRC and searched for the term "value".
"Value" occurs there 3,416,179 times, usually in connection with "interest" or "estate".
Then I searched for "value tax", which occurs not at all, and neither does "taxable value", "tax value" or "inherent value".
Then I searched for "tax on value", which occurs once:

I just realized that the number 3,416,179 is the total word count of all words in that copy of the 1986 IRC, and that the word counter will not count specific words.
So if a word occurs zero times or only a few times it can be counted manually.
But "value" occurs so may times that there's no way to count it in a practical manner, absent a programmable word counter.

I'm using OpenOffice dot org.
If anyone knows of a word count feature which will count instances of specific words in that software, please let me know.
Thanks.