Why do the current opinions direct this clause to refer to slaves to the exclusion of Bound whites brought by the thousands to the north? Seems to be a small issue or intentional exclusion?
U.S. Constitution - Article 1 Section 9
Article 1 - The Legislative Branch
Section 9 - Limits on Congress<<Back | Table of Contents | Next>>
The Migration or Importation of such Persons as any of the States now existing shall think proper to admit, shall not be prohibited by the Congress prior to the Year one thousand eight hundred and eight, but a tax or duty may be imposed on such Importation, not exceeding ten dollars for each Person.
The privilege of the Writ of Habeas Corpus shall not be suspended, unless when in Cases of Rebellion or Invasion the public Safety may require it.
No Bill of Attainder or ex post facto Law shall be passed.
(No capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.) (Section in parentheses clarified by the 16th Amendment.)
No Tax or Duty shall be laid on Articles exported from any State.
No Preference shall be given by any Regulation of Commerce or Revenue to the Ports of one State over those of another: nor shall Vessels bound to, or from, one State, be obliged to enter, clear, or pay Duties in another.
No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.
No Title of Nobility shall be granted by the United States: And no Person holding any Office of Profit or Trust under them, shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince or foreign State.
Notes for this section:
FAQ: What can't Congress do?
FAQ: What is habeas corpus?
16th Amendment
U.S. Constitution - Article 1 Section 9
Article 1 - The Legislative Branch
Section 9 - Limits on Congress<<Back | Table of Contents | Next>>
The Migration or Importation of such Persons as any of the States now existing shall think proper to admit, shall not be prohibited by the Congress prior to the Year one thousand eight hundred and eight, but a tax or duty may be imposed on such Importation, not exceeding ten dollars for each Person.
The privilege of the Writ of Habeas Corpus shall not be suspended, unless when in Cases of Rebellion or Invasion the public Safety may require it.
No Bill of Attainder or ex post facto Law shall be passed.
(No capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.) (Section in parentheses clarified by the 16th Amendment.)
No Tax or Duty shall be laid on Articles exported from any State.
No Preference shall be given by any Regulation of Commerce or Revenue to the Ports of one State over those of another: nor shall Vessels bound to, or from, one State, be obliged to enter, clear, or pay Duties in another.
No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.
No Title of Nobility shall be granted by the United States: And no Person holding any Office of Profit or Trust under them, shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince or foreign State.
Notes for this section:
FAQ: What can't Congress do?
FAQ: What is habeas corpus?
16th Amendment
The Taxing Power,
The Sixteenth Amendment,
And the Meaning of 'Incomes'
By Erik M. Jensen
I. The 1894 Income Tax and Its Predecessor
Whatever its intellectual justification, the Civil War tax expired because by the early 1870s tariffs were bringing in enough to keep the country going. But good economic times didn't last. The period between the 1872 expiration of the Civil War tax and the enactment of the 1894 income tax saw several panics and depressions, including one in 1893 (which gave a sense of immediacy to the 1894 debates). That period nevertheless also saw an astonishing accumulation of wealth by some very visible Americans. The contrast between wealth and suffering was one of the reasons several radical political parties, including the People's (Populist) Party, were created in the late nineteenth century.
The 1894 income tax is often called a populist measure,15 and the People's Party was in the forefront of the income tax movement. In 1892, the platform of the party proclaimed, "We demand a graduated income tax."16 The reason for the plank was obvious: Populists thought the wealthy weren't paying their fair share under the tariff regime. Populist Senator William Peffer of Kansas said bluntly: "We propose to equalize taxation as far as it is possible to do so, and we propose to make the wealth of the country bear its just and fair proportion of the taxes of the country."
The income tax had populist antecedents and populist support; no similar plank had appeared in the Democratic and Republican platforms. But the People's party didn't have enough power to get its way without help, and the idea of an explicitly graduated tax fell by the wayside quickly. The allure of an income tax was nevertheless unmistakable to many members of the old-line parties, particularly Democrats, who had taken control of both Houses of Congress and who saw an opportunity for party realignment.18 Consumption taxes like tariffs were thought to be shifted to purchasers,19 and, if that was right, a poor man bore the same tax burden in buying a bag of sugar as did a rich man. The tax burdens, that is, had nothing to do with respective abilities to pay the taxes, and that wasn't fair.
Democratic Representatives Benton McMillin of Tennessee, chairman of the Ways and Means Subcommittee on Internal Revenue and a longtime proponent of income taxation, and the already legendary William Jennings Bryan of Nebraska recommended a 2 percent tax on incomes of $4,000 or more. That proposal, with differences in detail, in many ways mirrored the Civil War income tax, and it survived the subsequent legislative wrangling as an amendment to a major tariff revision bill.
The difference between an income tax and a consumption tax -- one's consistent with ability to pay, one's not -- was stressed throughout the debates. McMillin explained the legislation in this way:
I ask of any reasonable person whether it is unjust to expect that a small per cent of this enormous revenue shall be placed upon the accumulated wealth of the country instead of placing all upon the consumption of the people. . . . And yet when it is proposed to shift this burden from those who can not bear it to those who can; to divide it between consumption and wealth; to shift it from the laborer who has nothing but his power to toil and sweat, to the man who has a fortune made or inherited, we hear a hue and cry raised by some individuals that it is unjust and inquisitorial in its nature.
The wealthy weren't paying their share because of the form American taxation had taken -- taxes on consumption. High- and low- income people who, McMillin posited, spend about the same on necessities "pay the same taxes to the Government, because taxes are to be paid upon what they consume!"
Many other congressmen, like Senator Henry Teller of Colorado, made the same questionable point, that the rich were paying no more than the poor under the tariff system: "The man who holds millions of dollars' worth of property pays no more, perhaps, under the general taxes levied upon consumption than the man who has not any property."23 Other income tax supporters went further, suggesting the rich might even have been paying less than the poor. Populist Senator Omer Ken of Nebraska, for example, compared a poor man who consumes his entire income providing necessities for his family to a miser who owns a thousand times as much property but spends almost nothing:
Since each is taxed in proportion to the amount he consumes, it can readily be seen that this poor man will contribute ten times as much to the support of the Government as this old bachelor millionaire, although the latter receives from the Government protection for one thousand times as much property as the former. . . . Should not this burden be shifted from the shoulders of the man who is struggling to feed, clothe, and educate his family to the shoulders of the financial giant who is more than able to bear it?
(Hmmm.. “From each according to their ability. To each according to their NEED” – Karl Marx)
It's hard to imagine that on the average, the rich weren't paying far more in tariffs than the poor, something opponents of the income tax pointed out.25 But, silliness aside -- opponents provided their absurd examples, too26 -- the income tax supporters made an important point: A rich man with 10 times the income or wealth of a poor man might pay more in consumption taxes, but he probably didn't pay anything close to 10 times as much.27 Assuming the burden of tariffs was shifted to consumers, the poor man almost certainly paid a higher percentage of his income and wealth in taxes than did the rich, as Senator Sherman had posited in 1872. And, said McMillin, the relative burdens on the poor had been growing: "The taxes having continually increased upon consumption, and no corresponding increase having been placed upon accumulation, we see such colossal fortunes amassed as were never concentrated in any other age or in any other country of the world.
Having the wealthy pay more to support the government was thought to be fair in itself, but there were other reasons why tax obligations should be connected with ability to pay. For one thing, income tax supporters believed the rich were rich because of what government had done, and it was payback time to Uncle Sam. Stated Michigan Representative George Richardson: "I favor the income tax because it is asking a contribution of those citizens of the country who have accumulated great wealth and enjoy large incomes by reason of special privileges afforded by legislation."29 Moreover, the wealthy received more from government -- the value of protecting property, for example, goes up with the value of property protected, or so it was said -- and income tax proponents argued that the wealthy should have to pay for the extra services.
Finally, the case for an income tax had a civic-virtue component. Some thought participation in politics by the wealthy was skewed by their disproportionately low tax bills. As Representative Josiah Patterson of Tennessee not very persuasively explained:
It would be ideally just and equitable to make the separate incomes of all the citizens contribute accordingly as they have prospered, to make up at least in part the aggregate income required to maintain the Government. . . . Under the system now existing, where all revenues of the Government are raised by means of taxes imposed on articles of daily consumption, the reverse is the case. Those who own wealth are not only exempt from the imposition of public burdens, but they are reckless and extravagant in all public expenditures.
If the wealthy had to pay more in taxes, the argument went, they would pay more attention to government and help curb its excesses.
( 2015: $18+T in Debt; and over $100+T in Unfunded liabilities. Yup! It worked out great!)
The constant theme advanced by income tax supporters was that, to conform to ability-to-pay standards, tax law had to relieve burdens on consumption. The Ways and Means Committee report made the point like this: "The wealth of this country amounts to more than $65,000,000,000, and the question arises whether it is not just and fair that a portion of this money should be raised by a tax on the earnings of wealth instead of imposing it all, or nearly all, on consumption."
The evidence is overwhelming. Populist Representative T. J. Hudson of Kansas argued, for example, that the income tax "relieves from taxation very largely the necessities consumed by the poor and struggling masses and places at least a portion of the burdens upon superfluity." The governing principle is that "superfluous wealth, instead of the necessities of life, shall pay the taxes necessary to support the Govenrment [sic].
(Reminder: The Populist party is today’s socialistCommunist or Democrat Party)
It's possible to lose the income-tax-versus-consumption-tax thread in the 1894 debates because there was a lot of bombast, some of it downright personal and nasty,39 and some of it (on both sides) conjuring images of class warfare and revolution. For example, South Dakota Senator James Kyle, an independent of Populist bent, condemned the "thirty years with Shylock in power," noting that "[r]evolutions have occured [sic] with less ferment than we see in the United States to-day. . . . [T]he capitalistic press of the United States to-day jeer and taunt the efforts of the bond-burdened serfs on the farms and in the workshops who attempt to rise from their pitiful condition."4
II. On to the Sixteenth Amendment
(Capitalistic press”? WOW! Was that a long time ago! All this was going on back in the 1890s. I’m moving fwd…)
II. On to the Sixteenth Amendment
The Supreme Court struck down the 1894 income tax in the Income Tax Cases. The reaction in many quarters was outrage, and some even urged impeachment of the "nullifying judges."61 The decision was particularly suspect, critics said, because by the barest majority (5-4) the Court had rejected a century's worth of jurisprudence.62 Professor Brownlee is convinced Pollock actually "stimulated some support for income taxation."
The possibility of a constitutional amendment that would clearly permit an unapportioned income tax was raised soon after the Court handed down its decisions in 1895, but little of significance happened until 1909. Because the Court began to nibble away at the scope of its decisions,64 some held out hope no amendment would be necessary. In the meantime, Congress had found alternative means of raising revenue, lessening any sense of urgency about an income tax.65 And throughout this period, the attention of progressives was focused on other matters, like antitrust.
But hopes that the Court might unequivocally repudiate Pollock were dashed. There was an obvious chicken-and-egg problem. If the Court were going to reconsider the constitutionality of an unapportioned income tax, Congress would have to enact such a tax, and, with Pollock on the books, that would be a bold step. But if Congress didn't act, the Court wouldn't have the opportunity to reexamine its decisions -- even though many observers thought the Court was ready to do just that.
(A SCOTUS w/ integrity! WOW! That was a looong time ago too!)
Democratic Representative Cordell Hull of Tennessee introduced income tax legislation in 1907, and the Democratic party called for an income tax amendment in its 1908 platform:
[W]e favor an income tax as part of our revenue system, and we urge the submission of a constitutional amendment specifically authorizing congress to levy and collect a tax upon individual and corporate incomes, to the end that wealth may bear its proportionate share of the burdens of the federal government.
Support for an income tax had been building among Republicans as well. In 1906 President Theodore Roosevelt stated that a "graduated income tax of the proper type would be a desirable feature of federal taxation, and it is to be hoped that one may be devised which the supreme court will declare constitutional.
(There it is. Ds and Rs on common ground – w/ he 16th.)
As I had mentioned, I had condensed it. You can read some of the arguments and debates, and read all the footnotes/sources at:
http://www.taxhistory.org/thp/readings.nsf/ArtWeb/736DB4705B4EE21D8...
I. The 1894 Income Tax and Its Predecessor
Whatever its intellectual justification, the Civil War tax expired because by the early 1870s tariffs were bringing in enough to keep the country going. But good economic times didn't last. The period between the 1872 expiration of the Civil War tax and the enactment of the 1894 income tax saw several panics and depressions, including one in 1893 (which gave a sense of immediacy to the 1894 debates). That period nevertheless also saw an astonishing accumulation of wealth by some very visible Americans. The contrast between wealth and suffering was one of the reasons several radical political parties, including the People's (Populist) Party, were created in the late nineteenth century.
The 1894 income tax is often called a populist measure,15 and the People's Party was in the forefront of the income tax movement. In 1892, the platform of the party proclaimed, "We demand a graduated income tax."16 The reason for the plank was obvious: Populists thought the wealthy weren't paying their fair share under the tariff regime. Populist Senator William Peffer of Kansas said bluntly: "We propose to equalize taxation as far as it is possible to do so, and we propose to make the wealth of the country bear its just and fair proportion of the taxes of the country."
The income tax had populist antecedents and populist support; no similar plank had appeared in the Democratic and Republican platforms. But the People's party didn't have enough power to get its way without help, and the idea of an explicitly graduated tax fell by the wayside quickly. The allure of an income tax was nevertheless unmistakable to many members of the old-line parties, particularly Democrats, who had taken control of both Houses of Congress and who saw an opportunity for party realignment.18 Consumption taxes like tariffs were thought to be shifted to purchasers,19 and, if that was right, a poor man bore the same tax burden in buying a bag of sugar as did a rich man. The tax burdens, that is, had nothing to do with respective abilities to pay the taxes, and that wasn't fair.
Democratic Representatives Benton McMillin of Tennessee, chairman of the Ways and Means Subcommittee on Internal Revenue and a longtime proponent of income taxation, and the already legendary William Jennings Bryan of Nebraska recommended a 2 percent tax on incomes of $4,000 or more. That proposal, with differences in detail, in many ways mirrored the Civil War income tax, and it survived the subsequent legislative wrangling as an amendment to a major tariff revision bill.
The difference between an income tax and a consumption tax -- one's consistent with ability to pay, one's not -- was stressed throughout the debates. McMillin explained the legislation in this way:
I ask of any reasonable person whether it is unjust to expect that a small per cent of this enormous revenue shall be placed upon the accumulated wealth of the country instead of placing all upon the consumption of the people. . . . And yet when it is proposed to shift this burden from those who can not bear it to those who can; to divide it between consumption and wealth; to shift it from the laborer who has nothing but his power to toil and sweat, to the man who has a fortune made or inherited, we hear a hue and cry raised by some individuals that it is unjust and inquisitorial in its nature.
The wealthy weren't paying their share because of the form American taxation had taken -- taxes on consumption. High- and low- income people who, McMillin posited, spend about the same on necessities "pay the same taxes to the Government, because taxes are to be paid upon what they consume!"
Many other congressmen, like Senator Henry Teller of Colorado, made the same questionable point, that the rich were paying no more than the poor under the tariff system: "The man who holds millions of dollars' worth of property pays no more, perhaps, under the general taxes levied upon consumption than the man who has not any property."23 Other income tax supporters went further, suggesting the rich might even have been paying less than the poor. Populist Senator Omer Ken of Nebraska, for example, compared a poor man who consumes his entire income providing necessities for his family to a miser who owns a thousand times as much property but spends almost nothing:
Since each is taxed in proportion to the amount he consumes, it can readily be seen that this poor man will contribute ten times as much to the support of the Government as this old bachelor millionaire, although the latter receives from the Government protection for one thousand times as much property as the former. . . . Should not this burden be shifted from the shoulders of the man who is struggling to feed, clothe, and educate his family to the shoulders of the financial giant who is more than able to bear it?
(Hmmm.. “From each according to their ability. To each according to their NEED” – Karl Marx)
It's hard to imagine that on the average, the rich weren't paying far more in tariffs than the poor, something opponents of the income tax pointed out.25 But, silliness aside -- opponents provided their absurd examples, too26 -- the income tax supporters made an important point: A rich man with 10 times the income or wealth of a poor man might pay more in consumption taxes, but he probably didn't pay anything close to 10 times as much.27 Assuming the burden of tariffs was shifted to consumers, the poor man almost certainly paid a higher percentage of his income and wealth in taxes than did the rich, as Senator Sherman had posited in 1872. And, said McMillin, the relative burdens on the poor had been growing: "The taxes having continually increased upon consumption, and no corresponding increase having been placed upon accumulation, we see such colossal fortunes amassed as were never concentrated in any other age or in any other country of the world.
Having the wealthy pay more to support the government was thought to be fair in itself, but there were other reasons why tax obligations should be connected with ability to pay. For one thing, income tax supporters believed the rich were rich because of what government had done, and it was payback time to Uncle Sam. Stated Michigan Representative George Richardson: "I favor the income tax because it is asking a contribution of those citizens of the country who have accumulated great wealth and enjoy large incomes by reason of special privileges afforded by legislation."29 Moreover, the wealthy received more from government -- the value of protecting property, for example, goes up with the value of property protected, or so it was said -- and income tax proponents argued that the wealthy should have to pay for the extra services.
Finally, the case for an income tax had a civic-virtue component. Some thought participation in politics by the wealthy was skewed by their disproportionately low tax bills. As Representative Josiah Patterson of Tennessee not very persuasively explained:
It would be ideally just and equitable to make the separate incomes of all the citizens contribute accordingly as they have prospered, to make up at least in part the aggregate income required to maintain the Government. . . . Under the system now existing, where all revenues of the Government are raised by means of taxes imposed on articles of daily consumption, the reverse is the case. Those who own wealth are not only exempt from the imposition of public burdens, but they are reckless and extravagant in all public expenditures.
If the wealthy had to pay more in taxes, the argument went, they would pay more attention to government and help curb its excesses.
( 2015: $18+T in Debt; and over $100+T in Unfunded liabilities. Yup! It worked out great!)
The constant theme advanced by income tax supporters was that, to conform to ability-to-pay standards, tax law had to relieve burdens on consumption. The Ways and Means Committee report made the point like this: "The wealth of this country amounts to more than $65,000,000,000, and the question arises whether it is not just and fair that a portion of this money should be raised by a tax on the earnings of wealth instead of imposing it all, or nearly all, on consumption."
The evidence is overwhelming. Populist Representative T. J. Hudson of Kansas argued, for example, that the income tax "relieves from taxation very largely the necessities consumed by the poor and struggling masses and places at least a portion of the burdens upon superfluity." The governing principle is that "superfluous wealth, instead of the necessities of life, shall pay the taxes necessary to support the Govenrment [sic].
(Reminder: The Populist party is today’s socialistCommunist or Democrat Party)
It's possible to lose the income-tax-versus-consumption-tax thread in the 1894 debates because there was a lot of bombast, some of it downright personal and nasty,39 and some of it (on both sides) conjuring images of class warfare and revolution. For example, South Dakota Senator James Kyle, an independent of Populist bent, condemned the "thirty years with Shylock in power," noting that "[r]evolutions have occured [sic] with less ferment than we see in the United States to-day. . . . [T]he capitalistic press of the United States to-day jeer and taunt the efforts of the bond-burdened serfs on the farms and in the workshops who attempt to rise from their pitiful condition."4
II. On to the Sixteenth Amendment
(Capitalistic press”? WOW! Was that a long time ago! All this was going on back in the 1890s. I’m moving fwd…)
II. On to the Sixteenth Amendment
The Supreme Court struck down the 1894 income tax in the Income Tax Cases. The reaction in many quarters was outrage, and some even urged impeachment of the "nullifying judges."61 The decision was particularly suspect, critics said, because by the barest majority (5-4) the Court had rejected a century's worth of jurisprudence.62 Professor Brownlee is convinced Pollock actually "stimulated some support for income taxation."
The possibility of a constitutional amendment that would clearly permit an unapportioned income tax was raised soon after the Court handed down its decisions in 1895, but little of significance happened until 1909. Because the Court began to nibble away at the scope of its decisions,64 some held out hope no amendment would be necessary. In the meantime, Congress had found alternative means of raising revenue, lessening any sense of urgency about an income tax.65 And throughout this period, the attention of progressives was focused on other matters, like antitrust.
But hopes that the Court might unequivocally repudiate Pollock were dashed. There was an obvious chicken-and-egg problem. If the Court were going to reconsider the constitutionality of an unapportioned income tax, Congress would have to enact such a tax, and, with Pollock on the books, that would be a bold step. But if Congress didn't act, the Court wouldn't have the opportunity to reexamine its decisions -- even though many observers thought the Court was ready to do just that.
(A SCOTUS w/ integrity! WOW! That was a looong time ago too!)
Democratic Representative Cordell Hull of Tennessee introduced income tax legislation in 1907, and the Democratic party called for an income tax amendment in its 1908 platform:
[W]e favor an income tax as part of our revenue system, and we urge the submission of a constitutional amendment specifically authorizing congress to levy and collect a tax upon individual and corporate incomes, to the end that wealth may bear its proportionate share of the burdens of the federal government.
Support for an income tax had been building among Republicans as well. In 1906 President Theodore Roosevelt stated that a "graduated income tax of the proper type would be a desirable feature of federal taxation, and it is to be hoped that one may be devised which the supreme court will declare constitutional.
(There it is. Ds and Rs on common ground – w/ he 16th.)
As I had mentioned, I had condensed it. You can read some of the arguments and debates, and read all the footnotes/sources at:
http://www.taxhistory.org/thp/readings.nsf/ArtWeb/736DB4705B4EE21D8...
History of the 16th Amendment Overview
By W. Cleon Skousen. History of the 16th Amendment.
Strange as it may seem, the Sixteenth Amendment (which gave the American people the affliction of confiscatory income taxes) was never supposed to have passed. It was introduced by the Republicans as part of a political scheme to trick the Democrats, but it backfired.
Background
The Founding Fathers had rejected income taxes (or any other direct taxes) unless they were apportioned to each state according to population. Nevertheless, an income tax was levied during the Civil War and upheld by the Supreme Court on somewhat tenuous reasoning. When another income tax was enacted in 1893, the Supreme Court found it unconstitutional. In connection with the two Pollock cases reviewed in 1895, the Court declared that the act violated Article I, section 9 of the Constitution.
During the following decade, however, the complexion of the Court changed somewhat, and so did public sentiment. There was great social unrest and the idea of a tax to “soak the rich” began to take root among liberals in both major parties. Several times the Democrats introduced bills to provide a tax on higher incomes but each time the conservative branch of the Republican party killed it in the Senate. The Democrats used this as evidence that the Republicans were the “party of the rich” and should be thrown out of power, forcing President William Howard Taft to acknowledge in political speeches that income taxes might be all right “in principle”, but it was well known among close associates that he was strongly opposed to such a tax.
The Bailey Bill
In April 1909, Senator Joseph W. Bailey, a conservative Democrat from Texas who was also opposed to income taxes, decided to further embarrass the Republicans by forcing them to openly oppose an income tax bill similar to those which had been introduced in the past. He introduced his bill expecting it to get the usual opposition. However, to his amazement, Teddy Roosevelt and a growing element of liberals in the Republican party came out in favor of the bill and it looked as though it was going to pass.
Not only was Bailey surprised, but Senator Nelson W. Aldrich of Rhode Island, the Republican floor leader, frantically met with Senator Henry Cabot Lodge of Massachusetts and President Taft to work out a strategy to demolish the Bailey tax bill. Their own party was split too widely to permit a direct confrontation, so the strategy was to pull a political end run. They announced that they favored an income tax but only if it were an amendment to the Constitution. Within their own circle, they discussed how it might get approval of the House and the Senate, but they were quite certain that it could be defeated in the more conservative states-three-fourths of which were required in order to ratify the amendment.
Thus, the Democrats were off guard when President Taft unexpectedly sent a message to Congress on June 16th, 1909, recommending the passage of a constitutional amendment to legalize federal income tax legislation.
The strategy threw the liberals into an uproar. At the very moment when their Bailey bill was about to pass, the Republicans were coming out for an amendment to the Constitution which would probably be defeated by the states.
Reaction to the Amendment
Congressman Cordell Hull (D-Tenn., and later Secretary of State under FDR) saw exactly what was happening. He took the floor to excoriate the Republican leaders. Said he:
“No person at all familiar with the present trend of national legislation will seriously insist that these same Republican leaders are over-anxious to see the country adopt an income tax…What powerful influence, what new light and deepseated motive suddenly moves these political veterans to ‘about face’ and pretend to warmly embrace this doctrine which they have heretofore uniformly denounced?”
He went on to expose what he considered to be a political trick. He needn’t have been so concerned. The slogan of “soak the rich” automatically aroused Pavlovian salivation among politicians both in Washington and the states. The Senate approved the Sixteenth Amendment with an astonishing unanimity of 77-0! The House approved it by a vote of 318-14.
When Republican Congressman Sereno E. Payne of New York, who had introduced the amendment in the House, saw that this end run was turning into a winning touchdown for the opposition, he was horrified. He went to the floor and openly denounced the bill he had sponsored. Said he:
“As to the general policy of an income tax, I am utterly opposed to it. I believe with Gladstone that it tends to make a nation of liars. I believe it is the most easily concealed of any tax that can be laid, the most difficult of enforcement, and the hardest to collect; that it is, in a word, a tax upon the income of honest men and an exemption, to a greater or lesser extent, of the income of rascals; and so I am opposed to any income tax in time of peace…I hope that if the Constitution is amended in this way the time will not come when the American people will ever want to enact an income tax except in time of war.”
The end run of the Republican leadership did indeed backfire. State after state ratified this “soak the rich” amendment until it went into full force and effect on February 12, 1913.
Did it Soak the Rich?
Certain writers such as Alfred Hinsey Kelly and Winfred Audif Harbison (authors of “The American Constitution: Origins” [New York: Norton, 1970]) rejoiced that this amendment “shifted the growing burden of federal finance to the wealthy.”{3} Nothing could be further from the truth!
The wealthy, especially the super-wealthy, had anticipated this development and had created a clever device to protect their riches. It was called a “charitable foundation”. The idea was to co-sign the ownership of wealth, including stocks and securities, to a foundation and then get Congress and the state legislatures to declare all such charitable institutions exempt from taxes. By setting up boards which were under the control of these wealthy benefactors they could escape the tax and still maintain control over the disposition of these fabulous fortunes.
Long before the federal income tax was in place, multimillionaires such as John D. Rockefeller (who once said “I want to own nothing and control everything”), J.P. Morgan and Andrew Carnegie had their foundations set up and operating. The next step was to make certain that the new tax bill passed by Congress contained a provision specifically exempting their treasure houses from taxation.
The tax bill which the Sixteenth Amendment authorized was introduced as House Resolution 3321 on October 3, 1913. It turned out to be somewhat of a legislative potpourri for tax attorneys, accountants and the federal courts. In the ensuing years, untold millions of dollars have been spent trying to figure out exactly what this tax law, and those which followed it, were intended to provide. However, tucked away in its inward parts was that precious key which safely locked up the riches of the super wealthy. Here are the magic words under Section 2, paragraph G:
“Provided, however, that nothing in this section shall apply…to any corporation or association organized and operated exclusively for religious, charitable, scientific or educational purposes.”
All of the foundations of the super-rich were designed to qualify under one or more of these categories.
How the Cute Little Monkey Grew into a Gorilla
When the first income tax was sent out to the people, the Congress chortled confidently that “all good citizen will willingly and cheerfully support and sustain this, the fairest and cheapest of all taxes.” That was the cute little monkey part. After all, the first tax ranged from merely 1% on the first $20,000 of taxable income and was only 7% on incomes above $500,000. Who could complain? (Ed. note: Expressed in 1994 dollars this sentence would read, “the first tax ranged from merely 1% on the first $298,000 of taxable income and was only 7% on incomes above $7,460,000.”)
At first, scarcely anyone did. Little did they know that before the tinkering was done in Washington, this system would be described by many Americans as the most unfair and expensive tax in the history of the nation. Within a few years, it had become the principal source of income for the federal government.
In the beginning, hardly anyone had to file a tax return because the tax did not apply to the vast majority of America’s work-a-day citizens. For example, in 1939, 26 years after the Sixteenth Amendment was adopted, only 5% of the population, counting both taxpayers and their dependents, was required to file returns. Today, more than 80% of the population is under the income tax.
Withholding Taxes
The collection process was greatly facilitated in 1943 by a device created by FDR to pay the costs of WWII. It was called “withholding from wages and salaries”. In other words, the tax was collected at the payroll window before it was even due to be paid by the taxpayer. Economists point out that this device, more than any other single factor, shifted the tax from its original design as a tax on the wealthy to a tax on the masses–mostly the middle class.
Investigations disclosed that the truly wealthy pay relatively little or no income tax at all.
Some idea of how the cute little monkey grew into a gorilla is perceived from the fact that nearly half of all federal revenue is now raised by income taxes. Furthermore, the higher brackets are literally confiscatory–but by “due process”, of course, under the Sixteenth Amendment. Rates have been as high as 94% in the upper brackets during wartime, and even in peacetime they are presently 50%. Medium income people up through the upper middle class pay between 12 & 35%. Nevertheless, at all levels it has become sufficiently burdensome to discourage the attainment of basic economic advantage which most Americans seek.
Weaknesses of the System
The most damaging aspect of the Sixteenth Amendment is the fact that it vitiated the unalienable rights provided in the 4th Amendment. This is the amendment which protects privacy–privacy of the home, business, personal papers and personal affairs of the private citizen. None of these are disturbed by a poll (head or capitation) tax because it is so much per person regardless of the circumstances, but when the tax is based on income, the IRS is assigned the most unpleasant task of making certain that everyone pays his fair share. This task is physically impossible without prying into the private papers, private business and personal affairs of the individual citizens. By any standard, it is a miserable assignment. Furthermore, it is impossible to run audits and surveys of all taxpayers and so the audits seldom check more than 2% of them.
There are many things wrong with this approach. Worst of all, it puts the government tax collectors in the gorilla role and intimidates citizens who are unlucky enough to be audited with the feeling that they are “victims” of an unfair system.
The IRS also finds it difficult to avoid the attitude that each taxpayer is a cheat, even a criminal, who must somehow be cornered and caught. This has brought the structure of the entire income tax collection process into question.
For example, the underground economy of monetary transactions (which is conducted without records) is well known. It is estimated that losses in federal revenues from this underground economy are at least $100 billion per year. Obviously, this is not fair to those who are paying their share. Then there is an estimated $65 billion per year which is lost because it is not reported. This is considered unfair. There is a lot of padding on expense accounts, which is estimated to reduce the tax total by another $18 billion. Other operations, both legal and illegal, jumps the total up a few billion more.
There has also been extensive criticism of the prosecution of tax cases. The appeal is through a system of tax courts which are without juries. In order to get a tax case into a regular court where there is a jury, the citizen must pay the tax and then sue the government.
Thousands of complaints have also poured into the IRS concerning the tactics used by some of its agents. Citizens feel they are treated as criminals rather than suspects who are innocent until proven guilty.
Is there a better way? Here is one answer by a former head of the IRS.
A Former IRS Commissioner’s Statement
T. Coleman Andrews served as commissioner of IRS for nearly 3 years during the early 1950s. Following his resignation, he made the following statement:
“Congress [in implementing the Sixteenth Amendment] went beyond merely enacting an income tax law and repealed Article IV of the Bill of Rights, by empowering the tax collector to do the very things from which that article says we were to be secure. It opened up our homes, our papers and our effects to the prying eyes of government agents and set the stage for searches of our books and vaults and for inquiries into our private affairs whenever the tax men might decide, even though there might not be any justification beyond mere cynical suspicion.”
“The income tax is bad because it has robbed you and me of the guarantee of privacy and the respect for our property that were given to us in Article IV of the Bill of Rights. This invasion is absolute and complete as far as the amount of tax that can be assessed is concerned. Please remember that under the Sixteenth Amendment, Congress can take 100% of our income anytime it wants to. As a matter of fact, right now it is imposing a tax as high as 91%. This is downright confiscation and cannot be defended on any other grounds.”
“The income tax is bad because it was conceived in class hatred, is an instrument of vengeance and plays right into the hands of the communists. It employs the vicious communist principle of taking from each according to his accumulation of the fruits of his labor and giving to others according to their needs, regardless of whether those needs are the result of indolence or lack of pride, self-respect, personal dignity or other attributes of men.”
“The income tax is fulfilling the Marxist prophecy that the surest way to destroy a capitalist society is by steeply graduated taxes on income and heavy levies upon the estates of people when they die.”
[As matters now stand, if our children make the most of their capabilities and training, they will have to give most of it to the tax collector and so become slaves of the government. People cannot pull themselves up by the bootstraps anymore because the tax collector gets the boots and the straps as well.]
“The income tax is bad because it is oppressive to all and discriminates particularly against those people who prove themselves most adept at keeping the wheels of business turning and creating maximum employment and a high standard of living for their fellow men.”
“I believe that a better way to raise revenue not only can be found but must be found because I am convinced that the present system is leading us right back to the very tyranny from which those, who established this land of freedom, risked their lives, their fortunes and their sacred honor to forever free themselves…”
REFERENCES:
Congressional Record-House, July 12, 1909, p.4404
Congressional Record-House, July 12, 1909, p.4390
Original edition, p.626
The Utah Independent, March 29, 1973
Strange as it may seem, the Sixteenth Amendment (which gave the American people the affliction of confiscatory income taxes) was never supposed to have passed. It was introduced by the Republicans as part of a political scheme to trick the Democrats, but it backfired.
Background
The Founding Fathers had rejected income taxes (or any other direct taxes) unless they were apportioned to each state according to population. Nevertheless, an income tax was levied during the Civil War and upheld by the Supreme Court on somewhat tenuous reasoning. When another income tax was enacted in 1893, the Supreme Court found it unconstitutional. In connection with the two Pollock cases reviewed in 1895, the Court declared that the act violated Article I, section 9 of the Constitution.
During the following decade, however, the complexion of the Court changed somewhat, and so did public sentiment. There was great social unrest and the idea of a tax to “soak the rich” began to take root among liberals in both major parties. Several times the Democrats introduced bills to provide a tax on higher incomes but each time the conservative branch of the Republican party killed it in the Senate. The Democrats used this as evidence that the Republicans were the “party of the rich” and should be thrown out of power, forcing President William Howard Taft to acknowledge in political speeches that income taxes might be all right “in principle”, but it was well known among close associates that he was strongly opposed to such a tax.
The Bailey Bill
In April 1909, Senator Joseph W. Bailey, a conservative Democrat from Texas who was also opposed to income taxes, decided to further embarrass the Republicans by forcing them to openly oppose an income tax bill similar to those which had been introduced in the past. He introduced his bill expecting it to get the usual opposition. However, to his amazement, Teddy Roosevelt and a growing element of liberals in the Republican party came out in favor of the bill and it looked as though it was going to pass.
Not only was Bailey surprised, but Senator Nelson W. Aldrich of Rhode Island, the Republican floor leader, frantically met with Senator Henry Cabot Lodge of Massachusetts and President Taft to work out a strategy to demolish the Bailey tax bill. Their own party was split too widely to permit a direct confrontation, so the strategy was to pull a political end run. They announced that they favored an income tax but only if it were an amendment to the Constitution. Within their own circle, they discussed how it might get approval of the House and the Senate, but they were quite certain that it could be defeated in the more conservative states-three-fourths of which were required in order to ratify the amendment.
Thus, the Democrats were off guard when President Taft unexpectedly sent a message to Congress on June 16th, 1909, recommending the passage of a constitutional amendment to legalize federal income tax legislation.
The strategy threw the liberals into an uproar. At the very moment when their Bailey bill was about to pass, the Republicans were coming out for an amendment to the Constitution which would probably be defeated by the states.
Reaction to the Amendment
Congressman Cordell Hull (D-Tenn., and later Secretary of State under FDR) saw exactly what was happening. He took the floor to excoriate the Republican leaders. Said he:
“No person at all familiar with the present trend of national legislation will seriously insist that these same Republican leaders are over-anxious to see the country adopt an income tax…What powerful influence, what new light and deepseated motive suddenly moves these political veterans to ‘about face’ and pretend to warmly embrace this doctrine which they have heretofore uniformly denounced?”
He went on to expose what he considered to be a political trick. He needn’t have been so concerned. The slogan of “soak the rich” automatically aroused Pavlovian salivation among politicians both in Washington and the states. The Senate approved the Sixteenth Amendment with an astonishing unanimity of 77-0! The House approved it by a vote of 318-14.
When Republican Congressman Sereno E. Payne of New York, who had introduced the amendment in the House, saw that this end run was turning into a winning touchdown for the opposition, he was horrified. He went to the floor and openly denounced the bill he had sponsored. Said he:
“As to the general policy of an income tax, I am utterly opposed to it. I believe with Gladstone that it tends to make a nation of liars. I believe it is the most easily concealed of any tax that can be laid, the most difficult of enforcement, and the hardest to collect; that it is, in a word, a tax upon the income of honest men and an exemption, to a greater or lesser extent, of the income of rascals; and so I am opposed to any income tax in time of peace…I hope that if the Constitution is amended in this way the time will not come when the American people will ever want to enact an income tax except in time of war.”
The end run of the Republican leadership did indeed backfire. State after state ratified this “soak the rich” amendment until it went into full force and effect on February 12, 1913.
Did it Soak the Rich?
Certain writers such as Alfred Hinsey Kelly and Winfred Audif Harbison (authors of “The American Constitution: Origins” [New York: Norton, 1970]) rejoiced that this amendment “shifted the growing burden of federal finance to the wealthy.”{3} Nothing could be further from the truth!
The wealthy, especially the super-wealthy, had anticipated this development and had created a clever device to protect their riches. It was called a “charitable foundation”. The idea was to co-sign the ownership of wealth, including stocks and securities, to a foundation and then get Congress and the state legislatures to declare all such charitable institutions exempt from taxes. By setting up boards which were under the control of these wealthy benefactors they could escape the tax and still maintain control over the disposition of these fabulous fortunes.
Long before the federal income tax was in place, multimillionaires such as John D. Rockefeller (who once said “I want to own nothing and control everything”), J.P. Morgan and Andrew Carnegie had their foundations set up and operating. The next step was to make certain that the new tax bill passed by Congress contained a provision specifically exempting their treasure houses from taxation.
The tax bill which the Sixteenth Amendment authorized was introduced as House Resolution 3321 on October 3, 1913. It turned out to be somewhat of a legislative potpourri for tax attorneys, accountants and the federal courts. In the ensuing years, untold millions of dollars have been spent trying to figure out exactly what this tax law, and those which followed it, were intended to provide. However, tucked away in its inward parts was that precious key which safely locked up the riches of the super wealthy. Here are the magic words under Section 2, paragraph G:
“Provided, however, that nothing in this section shall apply…to any corporation or association organized and operated exclusively for religious, charitable, scientific or educational purposes.”
All of the foundations of the super-rich were designed to qualify under one or more of these categories.
How the Cute Little Monkey Grew into a Gorilla
When the first income tax was sent out to the people, the Congress chortled confidently that “all good citizen will willingly and cheerfully support and sustain this, the fairest and cheapest of all taxes.” That was the cute little monkey part. After all, the first tax ranged from merely 1% on the first $20,000 of taxable income and was only 7% on incomes above $500,000. Who could complain? (Ed. note: Expressed in 1994 dollars this sentence would read, “the first tax ranged from merely 1% on the first $298,000 of taxable income and was only 7% on incomes above $7,460,000.”)
At first, scarcely anyone did. Little did they know that before the tinkering was done in Washington, this system would be described by many Americans as the most unfair and expensive tax in the history of the nation. Within a few years, it had become the principal source of income for the federal government.
In the beginning, hardly anyone had to file a tax return because the tax did not apply to the vast majority of America’s work-a-day citizens. For example, in 1939, 26 years after the Sixteenth Amendment was adopted, only 5% of the population, counting both taxpayers and their dependents, was required to file returns. Today, more than 80% of the population is under the income tax.
Withholding Taxes
The collection process was greatly facilitated in 1943 by a device created by FDR to pay the costs of WWII. It was called “withholding from wages and salaries”. In other words, the tax was collected at the payroll window before it was even due to be paid by the taxpayer. Economists point out that this device, more than any other single factor, shifted the tax from its original design as a tax on the wealthy to a tax on the masses–mostly the middle class.
Investigations disclosed that the truly wealthy pay relatively little or no income tax at all.
Some idea of how the cute little monkey grew into a gorilla is perceived from the fact that nearly half of all federal revenue is now raised by income taxes. Furthermore, the higher brackets are literally confiscatory–but by “due process”, of course, under the Sixteenth Amendment. Rates have been as high as 94% in the upper brackets during wartime, and even in peacetime they are presently 50%. Medium income people up through the upper middle class pay between 12 & 35%. Nevertheless, at all levels it has become sufficiently burdensome to discourage the attainment of basic economic advantage which most Americans seek.
Weaknesses of the System
The most damaging aspect of the Sixteenth Amendment is the fact that it vitiated the unalienable rights provided in the 4th Amendment. This is the amendment which protects privacy–privacy of the home, business, personal papers and personal affairs of the private citizen. None of these are disturbed by a poll (head or capitation) tax because it is so much per person regardless of the circumstances, but when the tax is based on income, the IRS is assigned the most unpleasant task of making certain that everyone pays his fair share. This task is physically impossible without prying into the private papers, private business and personal affairs of the individual citizens. By any standard, it is a miserable assignment. Furthermore, it is impossible to run audits and surveys of all taxpayers and so the audits seldom check more than 2% of them.
There are many things wrong with this approach. Worst of all, it puts the government tax collectors in the gorilla role and intimidates citizens who are unlucky enough to be audited with the feeling that they are “victims” of an unfair system.
The IRS also finds it difficult to avoid the attitude that each taxpayer is a cheat, even a criminal, who must somehow be cornered and caught. This has brought the structure of the entire income tax collection process into question.
For example, the underground economy of monetary transactions (which is conducted without records) is well known. It is estimated that losses in federal revenues from this underground economy are at least $100 billion per year. Obviously, this is not fair to those who are paying their share. Then there is an estimated $65 billion per year which is lost because it is not reported. This is considered unfair. There is a lot of padding on expense accounts, which is estimated to reduce the tax total by another $18 billion. Other operations, both legal and illegal, jumps the total up a few billion more.
There has also been extensive criticism of the prosecution of tax cases. The appeal is through a system of tax courts which are without juries. In order to get a tax case into a regular court where there is a jury, the citizen must pay the tax and then sue the government.
Thousands of complaints have also poured into the IRS concerning the tactics used by some of its agents. Citizens feel they are treated as criminals rather than suspects who are innocent until proven guilty.
Is there a better way? Here is one answer by a former head of the IRS.
A Former IRS Commissioner’s Statement
T. Coleman Andrews served as commissioner of IRS for nearly 3 years during the early 1950s. Following his resignation, he made the following statement:
“Congress [in implementing the Sixteenth Amendment] went beyond merely enacting an income tax law and repealed Article IV of the Bill of Rights, by empowering the tax collector to do the very things from which that article says we were to be secure. It opened up our homes, our papers and our effects to the prying eyes of government agents and set the stage for searches of our books and vaults and for inquiries into our private affairs whenever the tax men might decide, even though there might not be any justification beyond mere cynical suspicion.”
“The income tax is bad because it has robbed you and me of the guarantee of privacy and the respect for our property that were given to us in Article IV of the Bill of Rights. This invasion is absolute and complete as far as the amount of tax that can be assessed is concerned. Please remember that under the Sixteenth Amendment, Congress can take 100% of our income anytime it wants to. As a matter of fact, right now it is imposing a tax as high as 91%. This is downright confiscation and cannot be defended on any other grounds.”
“The income tax is bad because it was conceived in class hatred, is an instrument of vengeance and plays right into the hands of the communists. It employs the vicious communist principle of taking from each according to his accumulation of the fruits of his labor and giving to others according to their needs, regardless of whether those needs are the result of indolence or lack of pride, self-respect, personal dignity or other attributes of men.”
“The income tax is fulfilling the Marxist prophecy that the surest way to destroy a capitalist society is by steeply graduated taxes on income and heavy levies upon the estates of people when they die.”
[As matters now stand, if our children make the most of their capabilities and training, they will have to give most of it to the tax collector and so become slaves of the government. People cannot pull themselves up by the bootstraps anymore because the tax collector gets the boots and the straps as well.]
“The income tax is bad because it is oppressive to all and discriminates particularly against those people who prove themselves most adept at keeping the wheels of business turning and creating maximum employment and a high standard of living for their fellow men.”
“I believe that a better way to raise revenue not only can be found but must be found because I am convinced that the present system is leading us right back to the very tyranny from which those, who established this land of freedom, risked their lives, their fortunes and their sacred honor to forever free themselves…”
REFERENCES:
Congressional Record-House, July 12, 1909, p.4404
Congressional Record-House, July 12, 1909, p.4390
Original edition, p.626
The Utah Independent, March 29, 1973
ADOPTION AND RATIFICATION HISTORY OF THE 16TH
On June 16, 1909, President William Howard Taft, in an address to Congress, proposed a 2% federal income tax on corporations by way of an excise tax and a constitutional amendment to allow the previously enacted income tax.
Upon the privilege of doing business as an artificial entity and of freedom from a general partnership liability enjoyed by those who own the stock.
An income tax amendment to the Constitution was first proposed by Senator Norris Brown of Nebraska. He submitted two proposals, Senate Resolutions Nos. 25 and 39. The amendment proposal finally accepted was Senate Joint Resolution No. 40, introduced by Senator Nelson W. Aldrich of Rhode Island, the Senate majority leader and Finance Committee Chairman.
On July 12, 1909, the resolution proposing the Sixteenth Amendment was passed by the Sixty-first Congress and was submitted to the state legislatures. Support for the income tax was strongest in the western and southern states and opposition was strongest in the northeastern states. Supporters of the income tax believed that it would be a much better method of gathering revenue than tariffs, which were the primary source of revenue at the time. From well before 1894, Democrats, Progressives, Populists and other left-oriented parties argued that tariffs disproportionately affected the poor, interfered with prices, were unpredictable, and were an intrinsically limited source of revenue.[citation needed] The South and the West tended to support income taxes because their residents were generally less prosperous, more agricultural and more sensitive to fluctuations in commodity prices. A sharp rise in the cost of living between 1897 and 1913 greatly increased support for the idea of income taxes, including in the urban Northeast.
A growing number of Republicans also began supporting the idea, notably Theodore Roosevelt and the "Insurgent" Republicans (who would go on to form the Progressive Party). These Republicans were driven mainly by a fear of the increasingly large and sophisticated military forces of Japan, Britain and the European powers, their own imperial ambitions and the perceived need to defend American merchant ships. Moreover, these progressive Republicans were, as the name suggests, convinced that central governments could play a positive role in national economies. A bigger government and a bigger military, of course, required a correspondingly larger and steadier source of revenue to support it.
Opposition to the Sixteenth Amendment was led by establishment Republicans because of their close ties to wealthy industrialists, although not even they were uniformly opposed to the general idea of a permanent income tax. In 1910, New York Governor Charles Evans Hughes, shortly before becoming a Supreme Court Justice, spoke out against the income tax amendment. While he supported the idea of a federal income tax, Hughes believed the words "from whatever source derived" in the proposed amendment implied that the federal government would have the power to tax state and municipal bonds. He believed this would excessively centralize governmental power and "would make it impossible for the state to keep any property".
Between 1909 and 1913, several conditions favored passage of the Sixteenth Amendment. Inflation was high and many blamed Federal tariffs for the rising prices. The Republican Party was divided and weakened by the loss of Roosevelt and the Insurgents who joined the Progressive party, a problem that blunted opposition even in the Northeast. The Democrats won both houses and the Presidency in 1912 and the country was generally in a left-leaning mood, with the Socialist Party winning a seat in the House in 1910 and polling six percent of the popular presidential vote in 1912.
Three advocates for a federal income tax ran in the presidential election of 1912. On February 25, 1913, Secretary of State Philander Knox proclaimed that the amendment had been ratified by three-fourths of the states and so had become part of the Constitution. The Revenue Act of 1913 was enacted shortly thereafter.
According to the United States Government Printing Office, the following states ratified the amendment:
Upon the privilege of doing business as an artificial entity and of freedom from a general partnership liability enjoyed by those who own the stock.
An income tax amendment to the Constitution was first proposed by Senator Norris Brown of Nebraska. He submitted two proposals, Senate Resolutions Nos. 25 and 39. The amendment proposal finally accepted was Senate Joint Resolution No. 40, introduced by Senator Nelson W. Aldrich of Rhode Island, the Senate majority leader and Finance Committee Chairman.
On July 12, 1909, the resolution proposing the Sixteenth Amendment was passed by the Sixty-first Congress and was submitted to the state legislatures. Support for the income tax was strongest in the western and southern states and opposition was strongest in the northeastern states. Supporters of the income tax believed that it would be a much better method of gathering revenue than tariffs, which were the primary source of revenue at the time. From well before 1894, Democrats, Progressives, Populists and other left-oriented parties argued that tariffs disproportionately affected the poor, interfered with prices, were unpredictable, and were an intrinsically limited source of revenue.[citation needed] The South and the West tended to support income taxes because their residents were generally less prosperous, more agricultural and more sensitive to fluctuations in commodity prices. A sharp rise in the cost of living between 1897 and 1913 greatly increased support for the idea of income taxes, including in the urban Northeast.
A growing number of Republicans also began supporting the idea, notably Theodore Roosevelt and the "Insurgent" Republicans (who would go on to form the Progressive Party). These Republicans were driven mainly by a fear of the increasingly large and sophisticated military forces of Japan, Britain and the European powers, their own imperial ambitions and the perceived need to defend American merchant ships. Moreover, these progressive Republicans were, as the name suggests, convinced that central governments could play a positive role in national economies. A bigger government and a bigger military, of course, required a correspondingly larger and steadier source of revenue to support it.
Opposition to the Sixteenth Amendment was led by establishment Republicans because of their close ties to wealthy industrialists, although not even they were uniformly opposed to the general idea of a permanent income tax. In 1910, New York Governor Charles Evans Hughes, shortly before becoming a Supreme Court Justice, spoke out against the income tax amendment. While he supported the idea of a federal income tax, Hughes believed the words "from whatever source derived" in the proposed amendment implied that the federal government would have the power to tax state and municipal bonds. He believed this would excessively centralize governmental power and "would make it impossible for the state to keep any property".
Between 1909 and 1913, several conditions favored passage of the Sixteenth Amendment. Inflation was high and many blamed Federal tariffs for the rising prices. The Republican Party was divided and weakened by the loss of Roosevelt and the Insurgents who joined the Progressive party, a problem that blunted opposition even in the Northeast. The Democrats won both houses and the Presidency in 1912 and the country was generally in a left-leaning mood, with the Socialist Party winning a seat in the House in 1910 and polling six percent of the popular presidential vote in 1912.
Three advocates for a federal income tax ran in the presidential election of 1912. On February 25, 1913, Secretary of State Philander Knox proclaimed that the amendment had been ratified by three-fourths of the states and so had become part of the Constitution. The Revenue Act of 1913 was enacted shortly thereafter.
According to the United States Government Printing Office, the following states ratified the amendment:
|
Alabama (August 10, 1909)
Kentucky (February 8, 1910) South Carolina (February 19, 1910) Illinois (March 1, 1910) Mississippi (March 7, 1910) Oklahoma (March 10, 1910) Maryland (April 8, 1910) Georgia (August 3, 1910) Texas (August 16, 1910) Ohio (January 19, 1911) Idaho (January 20, 1911) Oregon (January 23, 1911) Washington (January 26, 1911) Montana (January 27, 1911) Indiana (January 30, 1911) California (January 31, 1911) Nevada (January 31, 1911) South Dakota (February 1, 1911) Nebraska (February 9, 1911) |
Nebraska (February 9, 1911)
North Carolina (February 11, 1911) Colorado (February 15, 1911) North Dakota (February 17, 1911) Michigan (February 23, 1911) Iowa (February 24, 1911) Kansas (March 2, 1911) Missouri (March 16, 1911) Maine (March 31, 1911) Tennessee (April 7, 1911) Arkansas (April 22, 1911), after having previously rejected the amendment Wisconsin (May 16, 1911) New York (July 12, 1911) Arizona (April 3, 1912) Minnesota (June 11, 1912) Louisiana (June 28, 1912) West Virginia (January 31, 1913) Delaware (February 3, 1913) |
Ratification (by the requisite 36 states) was completed on February 3, 1913 with the ratification by Delaware. The amendment was subsequently ratified by the following states, bringing the total number of ratifying states to forty-two of the forty-eight then existing:
37. New Mexico (February 3, 1913)
38. Wyoming (February 3, 1913)
39. New Jersey (February 4, 1913)
40. Vermont (February 19, 1913)
41. Massachusetts (March 4, 1913)
42. New Hampshire (March 7, 1913), after rejecting the amendment on March 2, 1911
The legislatures of the following states rejected the amendment without ever subsequently ratifying it:
Connecticut
Rhode Island
Utah
Virginia
The legislatures of the following states never considered the proposed amendment:
Florida
Pennsylvania
http://en.wikipedia.org/wiki/Sixteenth_Amendment_to_the_United_States_Constitution
37. New Mexico (February 3, 1913)
38. Wyoming (February 3, 1913)
39. New Jersey (February 4, 1913)
40. Vermont (February 19, 1913)
41. Massachusetts (March 4, 1913)
42. New Hampshire (March 7, 1913), after rejecting the amendment on March 2, 1911
The legislatures of the following states rejected the amendment without ever subsequently ratifying it:
Connecticut
Rhode Island
Utah
Virginia
The legislatures of the following states never considered the proposed amendment:
Florida
Pennsylvania
http://en.wikipedia.org/wiki/Sixteenth_Amendment_to_the_United_States_Constitution
Defects in Ratification of the 16th Amendment
"If you...examined [The 16th Amendment] carefully, you would find that a sufficient number of states never ratified that amendment." ~U.S. District Court Judge James C. Fox 2003.
What the IRS website and the Government in general refuse to recognize is that the Sixteenth Amendment to the Constitution of the United States was never ratified by a majority of the States. Only two or less States properly ratified the proposed Amendment. In February 1913 Secretary of State Knox falsely declared the 16th Amendment ratified and the government has been unlawfully demanding taxes ever since.
The 16th Amendment allegedly entitled the government to collect uneven taxes. The U.S. Constitution does not preclude taxation it dictates that tax be uniform for everyone, except Indians, and apportioned equally across all the States:
Article I, Section 2: "..Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three fifths of all other Persons. The actual Enumeration shall be made within three Years after the first Meeting of the Congress of the United States, and within every subsequent Term of ten Years, in such Manner as they shall by Law direct."
The 16th Amendment is claimed by the federal government in the federal territory of Washington, D.C. to authorize their private collection company, the IRS, to collect "income tax". However if the 16th was not properly ratified the IRS has no legal authority to collect tax. The same applies to local County and State tax collectors who are also bound by the U.S. Constitution.
After an exhaustive year long search of legislative records in 48 sovereign States conducted by Bill Benson, (Alaska & Hawaii were not admitted into the Union until after 1913). the only record of the 16th Amendment ever having been confirmed was a fraudulent proclamation made by the Secretary of State Philander Knox on February 25, 1913, wherein he simply declared it to be "in effect", but never stated that it was lawfully ratified. Bill Benson's has an excellent website, support him: The Law That Never Was
Even if the 16th Amendment were properly ratified, according to Article 1, Section 9 of the Constitution, it has always been unconstitutional for the U.S. Federal Government to directly tax "We the People" in their property, wages, salaries, or earnings. U.S. Supreme Court Judges repeatedly rejected any claims that the 16th Amendment changed the constitutional limits on direct taxes: Brushaber v. Union Pacific R.R. Co., 240 U.S. 1, The Supreme Court ruled that the 16th "created no new power of taxation" and that it "did not change the constitutional limitations which forbid any direct taxation of individuals". This and other similar cases have never been overturned.
An argument often made by judges attempting to ignore the fact of the failure to ratify the 16th, is that precedence under Common Law now exists because the IRS has been mugging the public for so long and this somehow legalizes the IRS and the local County Tax collector. However, the U.S. Constitution is higher law than the precedence of Common Law, which in itself represents the will of the people and not the will of the government. Article I, Section 2 of the Constitution dictates that the IRS and the local County Tax collector are collecting tax unlawfully.
Bill Benson's exhaustive investigation of the history of the 16th Amendment revealed the following defects and prove the 16th horribly failed to receive the necessary three-fourths of the States approval. To have been ratified 36 of the 48 States would have had to properly ratify the 16th Amendment. Naturally for something as significant as the U.S. Constitution, ratification of an Amendment is extremely important and serious, typos, spelling and anything that is not an exact copy of the Amendment is utterly unacceptable, this is no pre-school project.
Record of Failed Ratification of 16th Amendment As Recorded By Secretary Of State SEE:
KEY:
01- Not ratified by state legislature, and so reported
02- Not ratified by state legislature, but reported as ratified
03- Missing or incomplete evidence of ratification, but reported as ratified
04- Failure of Governor or other official to sign, although required by State Constitution
05- Other violation of State Constitution in ratification process
06- Other procedural irregularity making ratification doubtful
07- Approval, but with change in wording, accepted as ratification of original version
08- Approval, but with change in spelling, accepted as ratification of original version
09- Approval, but with change in capitalization, accepted as ratification of original version
10- Approval, but with change in punctuation, accepted as ratification of original version
What the IRS website and the Government in general refuse to recognize is that the Sixteenth Amendment to the Constitution of the United States was never ratified by a majority of the States. Only two or less States properly ratified the proposed Amendment. In February 1913 Secretary of State Knox falsely declared the 16th Amendment ratified and the government has been unlawfully demanding taxes ever since.
The 16th Amendment allegedly entitled the government to collect uneven taxes. The U.S. Constitution does not preclude taxation it dictates that tax be uniform for everyone, except Indians, and apportioned equally across all the States:
Article I, Section 2: "..Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three fifths of all other Persons. The actual Enumeration shall be made within three Years after the first Meeting of the Congress of the United States, and within every subsequent Term of ten Years, in such Manner as they shall by Law direct."
The 16th Amendment is claimed by the federal government in the federal territory of Washington, D.C. to authorize their private collection company, the IRS, to collect "income tax". However if the 16th was not properly ratified the IRS has no legal authority to collect tax. The same applies to local County and State tax collectors who are also bound by the U.S. Constitution.
After an exhaustive year long search of legislative records in 48 sovereign States conducted by Bill Benson, (Alaska & Hawaii were not admitted into the Union until after 1913). the only record of the 16th Amendment ever having been confirmed was a fraudulent proclamation made by the Secretary of State Philander Knox on February 25, 1913, wherein he simply declared it to be "in effect", but never stated that it was lawfully ratified. Bill Benson's has an excellent website, support him: The Law That Never Was
Even if the 16th Amendment were properly ratified, according to Article 1, Section 9 of the Constitution, it has always been unconstitutional for the U.S. Federal Government to directly tax "We the People" in their property, wages, salaries, or earnings. U.S. Supreme Court Judges repeatedly rejected any claims that the 16th Amendment changed the constitutional limits on direct taxes: Brushaber v. Union Pacific R.R. Co., 240 U.S. 1, The Supreme Court ruled that the 16th "created no new power of taxation" and that it "did not change the constitutional limitations which forbid any direct taxation of individuals". This and other similar cases have never been overturned.
An argument often made by judges attempting to ignore the fact of the failure to ratify the 16th, is that precedence under Common Law now exists because the IRS has been mugging the public for so long and this somehow legalizes the IRS and the local County Tax collector. However, the U.S. Constitution is higher law than the precedence of Common Law, which in itself represents the will of the people and not the will of the government. Article I, Section 2 of the Constitution dictates that the IRS and the local County Tax collector are collecting tax unlawfully.
Bill Benson's exhaustive investigation of the history of the 16th Amendment revealed the following defects and prove the 16th horribly failed to receive the necessary three-fourths of the States approval. To have been ratified 36 of the 48 States would have had to properly ratify the 16th Amendment. Naturally for something as significant as the U.S. Constitution, ratification of an Amendment is extremely important and serious, typos, spelling and anything that is not an exact copy of the Amendment is utterly unacceptable, this is no pre-school project.
Record of Failed Ratification of 16th Amendment As Recorded By Secretary Of State SEE:
KEY:
01- Not ratified by state legislature, and so reported
02- Not ratified by state legislature, but reported as ratified
03- Missing or incomplete evidence of ratification, but reported as ratified
04- Failure of Governor or other official to sign, although required by State Constitution
05- Other violation of State Constitution in ratification process
06- Other procedural irregularity making ratification doubtful
07- Approval, but with change in wording, accepted as ratification of original version
08- Approval, but with change in spelling, accepted as ratification of original version
09- Approval, but with change in capitalization, accepted as ratification of original version
10- Approval, but with change in punctuation, accepted as ratification of original version
KEY:
01- Not ratified by state legislature, and so reported
02- Not ratified by state legislature, but reported as ratified
03- Missing or incomplete evidence of ratification, but reported as ratified
04- Failure of Governor or other official to sign, although required by State Constitution
05- Other violation of State Constitution in ratification process
06- Other procedural irregularity making ratification doubtful
07- Approval, but with change in wording, accepted as ratification of original version
08- Approval, but with change in spelling, accepted as ratification of original version
09- Approval, but with change in capitalization, accepted as ratification of original version
10- Approval, but with change in punctuation, accepted as ratification of original version
In the above table, the line "Additional" are the number of States for which that defect is in addition to previously indicated defects, and "Ratification Failures Accumulated" is a running total of States with defects, from Defect 01 through 10.
Since 36 states were required to ratify, the failure of 13 to ratify would be fatal to the amendment, and this occurs within the first three defects, arguably the most serious. Even if we were to ignore defects of spelling, capitalization, and punctuation, we would still have only two states which successfully ratified.
Note that in the above we are counting Ohio as a State, even though it was not admitted into the Union until 1953 (retroactively, which is expost facto, and unconstitutional). We are not counting the failure to designate the Income Tax Amendment as the "XVII" amendment, since there was arguably a 13th Amendment that was ratified but which is not published in official copies of the Constitution with Amendments, and the number is not necessarily part of the amendment (It wasn't part of the first 10.).
The authority usually cited for the criticality of ratification without errors of spelling, capitalization, or punctuation, is from DOCUMENT NO. 97-120, of the 97TH CONGRESS, 1st Session, entitled How Our Laws Are Made, written by Edward F. Willett, Jr. Esq., Law Revision Counsel of the United States House of Representatives, in which the comparable exactitude in which bills must be concurred under federal legislative rules is detailed:
. Each amendment must be inserted in precisely the proper place in the bill, with the spelling and punctuation exactly the same as it was adopted by the House. Obviously, it is extremely important that the Senate receive a copy of the bill in the precise form in which it passed the House. The preparation of such a copy is the function of the enrolling clerk. (at 34) (emphasis added)
When the bill has been agreed to in identical form by both bodies - either without amendment by the Senate, or by House concurrence in the Senate amendments, or by agreement in both bodies to the conference report - a copy of the bill is enrolled for presentation to the President.
The preparation of the enrolled bill is a painstaking and important task since it must reflect precisely the effect of all amendments, either by deletion, substitution, or addition, agreed to by both bodies. The enrolling clerk ... must prepare meticulously the final form of the bill, as it was agreed to by both Houses, for presentation to the President.... each (amendment) must be set out in the enrollment exactly as agreed to, and all punctuation must be in accord with the action taken. (at 45) (emphasis added)
In his report on the failure of ratifications of the Income Tax Amendment to then Secretary of State Philander Knox, the Solicitor of the Department of State recognized and acknowledged the defects of ratification. Knox failed to demand mandatory corrective action by the States.
Knox had plenty of clues to the problems in the ratifications, sufficient to justify that he inquire into the matter further and demand corrective action by the States. Because he failed to do so means that we now have adopted and enforced legislation for more than 80 years that is plainly unconstitutional, requiring not only that it be repealed, but that all the funds collected be refunded.
The 16th is not ratified, has not been ratified and is not law.
Even if the 16th Amendment were properly ratified, according to Article 1, Section 9 of the Constitution, it has always been unconstitutional for the U.S. Federal Government to directly tax We the People in their property, wages, salaries, or earnings. The U.S. Supreme Court rejected any claims that the 16th Amendment changed the constitutional limits on direct taxes in Brushaber v. Union Pacific R.R. Co., 240 U.S. 1, and ruled that the 16th "created no new power of taxation" and that it "did not change the constitutional limitations which forbid any direct taxation of individuals".
By law the entities that have unlawfully taken money from individuals and corporations must return that money, the money has in effect been stolen.
Either the U.S. is a nation of laws or it is a lawless nation. And if the latter is the case then why pay a corrupt and criminal government? In such a case should not one take up 2nd Amendment arms and defend the right to freedom just as the Founding Fathers did?
see Bill Benson's site: http://www.thelawthatneverwas.com
See Also: IRS Suffering Repeated Defeats http://www.libertyforlife.com/tax/irs_suffering_repeated_defeats.htm
The IRS website lists a Brief History of IRS: [This information is no longer available on the website!!]
Origin (As reported on the IRS Website)
The roots of IRS go back to the Civil War when President Lincoln and Congress, in 1862, created the position of commissioner of Internal Revenue and enacted an income tax to pay war expenses. The income tax was repealed 10 years later. Congress revived the income tax in 1894, but the Supreme Court ruled it unconstitutional the following year.
16th Amendment (As reported on the IRS Website)
In 1913, Wyoming ratified the 16th Amendment, providing the three-quarter majority of states necessary to amend the Constitution. The 16th Amendment gave Congress the authority to enact an income tax. That same year, the first Form 1040 appeared after Congress levied a 1 percent tax on net personal incomes above $3,000 with a 6 percent surtax on incomes of more than $500,000.
In 1918, during World War I, the top rate of the income tax rose to 77 percent to help finance the war effort. It dropped sharply in the post-war years, down to 24 percent in 1929, and rose again during the Depression. During World War II, Congress introduced payroll withholding and quarterly tax payments.
A New Name (As reported on the IRS Website)
In the 50s, the agency was reorganized to replace a patronage system with career, professional employees. The Bureau of Internal Revenue name was changed to the Internal Revenue Service. Only the IRS commissioner and chief counsel are selected by the president and confirmed by the Senate.
Today’s IRS Organization (As reported on the IRS Website)
The IRS Restructuring and Reform Act of 1998 prompted the most comprehensive reorganization and modernization of IRS in nearly half a century. The IRS reorganized itself to closely resemble the private sector model of organizing around customers with similar needs.
The IRS Code says that compliance to their tax is "voluntary" - 26 CFR Ch. 1(4-2-03 Edition)
"Your income tax is a 100% voluntary tax, and your liquor tax is a 100% enforced tax. The situation is as different as night and day." ~ Dwight E. Avis. Head of Alcohol and Tobacco Tax Division. Bureau of Internal Revenue.
"The only difference between a tax man and a taxidermist is that the taxidermist leaves the skin." - Mark Twain
"I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is now controlled by its system of credit. We are no longer a government by free opinion, no longer a government by conviction and the voter of the majority, but a government by the opinion and duress of a small group of dominant men." ~ President Woodrow Wilson 1919.
"People have been brainwashed. People have been told that you need this income tax system to fund government, which is absolutely ridiculous. My question is that if that is true, then how did we fund government from 1776 to 1913" ~ Peter Gibbons, Tax Attorney
Paying for schools? As foolish as it is to allow the government to educate your kids (separation of State and School is vastly more important than separation of Church and State), property tax pays form the great majority of schools.
Paying for highways? Tax you pay at the gas pump for gasoline pays for the highways.
The amount of money the government spends on the military, in violation of U.S. Constitution, Article. I., Section 8. Clause 12, always mysteriously equals what the government collects from corporate tax.
"The main purpose of the income tax is not to raise revenue, but to redistribute wealth and control society." -"It's actually very simple. Congress tried to enact an income tax in 1894. The Supreme Court said that was unconstitutional. If the Supreme Court says something is unconstitutional it's un-unconstitutional. They tried again in 1913 and the Supreme Court said "The 16th Amendment conferred no new power of taxation". So if they didn't have it then, and they didn't get it. They don't have it. There is no constitutional basis for tax on the wages of Americans living and working in the fifty States of the Union. Period. End of argument." ~ G. Edward Griffin. Author, Creature From Jekyll Island.
"In substance, the [Supreme] Court holds that the Sixteenth Amendment did not empower the Federal Government to levy a new tax." - New York Times, January 25, 1916
President Ronald Reagan's Blue Ribbon Panel Grace Commission setup to investigate income tax reported: "100% of what is collected is absorbed solely on the interest of the federal debt . All individual income tax revenues are gone before one nickel paid on the services tax payers collect on the government."
"I believe that in both spirit and substance our tax system has become un-American. Death and taxes may be inevitable. But unjust taxes are not." ~ President Ronald Reagan.
The IRS and local County Tax Collector Are Law Breakers, they Are Criminals committing Fraud:
The income that is a direct tax which is not apportioned amongst the States as demanded by the U.S. Constitution, making the income tax and property taxes, and sales tax and every other tax levied against citizens of the U.S. unconstitutional and therefore unlawful.
Apportioned = to divide equally amongst the people.
http://libertyforlife.com/constitution/us-16th-failed-ratification.htm
THE LINKS THEREIN:
http://www.thelawthatneverwas.com
http://libertyforlife.com/law/law-understanding_law.htm
http://libertyforlife.com/tax/irs_suffering_repeated_defeats.htm
http://libertyforlife.com/military-war/us-war.html
More info on failure to ratify:
http://libertyforlife.com/constitution/failure_to_ratify_the_16th-details.html
01- Not ratified by state legislature, and so reported
02- Not ratified by state legislature, but reported as ratified
03- Missing or incomplete evidence of ratification, but reported as ratified
04- Failure of Governor or other official to sign, although required by State Constitution
05- Other violation of State Constitution in ratification process
06- Other procedural irregularity making ratification doubtful
07- Approval, but with change in wording, accepted as ratification of original version
08- Approval, but with change in spelling, accepted as ratification of original version
09- Approval, but with change in capitalization, accepted as ratification of original version
10- Approval, but with change in punctuation, accepted as ratification of original version
In the above table, the line "Additional" are the number of States for which that defect is in addition to previously indicated defects, and "Ratification Failures Accumulated" is a running total of States with defects, from Defect 01 through 10.
Since 36 states were required to ratify, the failure of 13 to ratify would be fatal to the amendment, and this occurs within the first three defects, arguably the most serious. Even if we were to ignore defects of spelling, capitalization, and punctuation, we would still have only two states which successfully ratified.
Note that in the above we are counting Ohio as a State, even though it was not admitted into the Union until 1953 (retroactively, which is expost facto, and unconstitutional). We are not counting the failure to designate the Income Tax Amendment as the "XVII" amendment, since there was arguably a 13th Amendment that was ratified but which is not published in official copies of the Constitution with Amendments, and the number is not necessarily part of the amendment (It wasn't part of the first 10.).
The authority usually cited for the criticality of ratification without errors of spelling, capitalization, or punctuation, is from DOCUMENT NO. 97-120, of the 97TH CONGRESS, 1st Session, entitled How Our Laws Are Made, written by Edward F. Willett, Jr. Esq., Law Revision Counsel of the United States House of Representatives, in which the comparable exactitude in which bills must be concurred under federal legislative rules is detailed:
. Each amendment must be inserted in precisely the proper place in the bill, with the spelling and punctuation exactly the same as it was adopted by the House. Obviously, it is extremely important that the Senate receive a copy of the bill in the precise form in which it passed the House. The preparation of such a copy is the function of the enrolling clerk. (at 34) (emphasis added)
When the bill has been agreed to in identical form by both bodies - either without amendment by the Senate, or by House concurrence in the Senate amendments, or by agreement in both bodies to the conference report - a copy of the bill is enrolled for presentation to the President.
The preparation of the enrolled bill is a painstaking and important task since it must reflect precisely the effect of all amendments, either by deletion, substitution, or addition, agreed to by both bodies. The enrolling clerk ... must prepare meticulously the final form of the bill, as it was agreed to by both Houses, for presentation to the President.... each (amendment) must be set out in the enrollment exactly as agreed to, and all punctuation must be in accord with the action taken. (at 45) (emphasis added)
In his report on the failure of ratifications of the Income Tax Amendment to then Secretary of State Philander Knox, the Solicitor of the Department of State recognized and acknowledged the defects of ratification. Knox failed to demand mandatory corrective action by the States.
Knox had plenty of clues to the problems in the ratifications, sufficient to justify that he inquire into the matter further and demand corrective action by the States. Because he failed to do so means that we now have adopted and enforced legislation for more than 80 years that is plainly unconstitutional, requiring not only that it be repealed, but that all the funds collected be refunded.
The 16th is not ratified, has not been ratified and is not law.
Even if the 16th Amendment were properly ratified, according to Article 1, Section 9 of the Constitution, it has always been unconstitutional for the U.S. Federal Government to directly tax We the People in their property, wages, salaries, or earnings. The U.S. Supreme Court rejected any claims that the 16th Amendment changed the constitutional limits on direct taxes in Brushaber v. Union Pacific R.R. Co., 240 U.S. 1, and ruled that the 16th "created no new power of taxation" and that it "did not change the constitutional limitations which forbid any direct taxation of individuals".
By law the entities that have unlawfully taken money from individuals and corporations must return that money, the money has in effect been stolen.
Either the U.S. is a nation of laws or it is a lawless nation. And if the latter is the case then why pay a corrupt and criminal government? In such a case should not one take up 2nd Amendment arms and defend the right to freedom just as the Founding Fathers did?
see Bill Benson's site: http://www.thelawthatneverwas.com
See Also: IRS Suffering Repeated Defeats http://www.libertyforlife.com/tax/irs_suffering_repeated_defeats.htm
The IRS website lists a Brief History of IRS: [This information is no longer available on the website!!]
Origin (As reported on the IRS Website)
The roots of IRS go back to the Civil War when President Lincoln and Congress, in 1862, created the position of commissioner of Internal Revenue and enacted an income tax to pay war expenses. The income tax was repealed 10 years later. Congress revived the income tax in 1894, but the Supreme Court ruled it unconstitutional the following year.
16th Amendment (As reported on the IRS Website)
In 1913, Wyoming ratified the 16th Amendment, providing the three-quarter majority of states necessary to amend the Constitution. The 16th Amendment gave Congress the authority to enact an income tax. That same year, the first Form 1040 appeared after Congress levied a 1 percent tax on net personal incomes above $3,000 with a 6 percent surtax on incomes of more than $500,000.
In 1918, during World War I, the top rate of the income tax rose to 77 percent to help finance the war effort. It dropped sharply in the post-war years, down to 24 percent in 1929, and rose again during the Depression. During World War II, Congress introduced payroll withholding and quarterly tax payments.
A New Name (As reported on the IRS Website)
In the 50s, the agency was reorganized to replace a patronage system with career, professional employees. The Bureau of Internal Revenue name was changed to the Internal Revenue Service. Only the IRS commissioner and chief counsel are selected by the president and confirmed by the Senate.
Today’s IRS Organization (As reported on the IRS Website)
The IRS Restructuring and Reform Act of 1998 prompted the most comprehensive reorganization and modernization of IRS in nearly half a century. The IRS reorganized itself to closely resemble the private sector model of organizing around customers with similar needs.
The IRS Code says that compliance to their tax is "voluntary" - 26 CFR Ch. 1(4-2-03 Edition)
"Your income tax is a 100% voluntary tax, and your liquor tax is a 100% enforced tax. The situation is as different as night and day." ~ Dwight E. Avis. Head of Alcohol and Tobacco Tax Division. Bureau of Internal Revenue.
"The only difference between a tax man and a taxidermist is that the taxidermist leaves the skin." - Mark Twain
"I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is now controlled by its system of credit. We are no longer a government by free opinion, no longer a government by conviction and the voter of the majority, but a government by the opinion and duress of a small group of dominant men." ~ President Woodrow Wilson 1919.
"People have been brainwashed. People have been told that you need this income tax system to fund government, which is absolutely ridiculous. My question is that if that is true, then how did we fund government from 1776 to 1913" ~ Peter Gibbons, Tax Attorney
Paying for schools? As foolish as it is to allow the government to educate your kids (separation of State and School is vastly more important than separation of Church and State), property tax pays form the great majority of schools.
Paying for highways? Tax you pay at the gas pump for gasoline pays for the highways.
The amount of money the government spends on the military, in violation of U.S. Constitution, Article. I., Section 8. Clause 12, always mysteriously equals what the government collects from corporate tax.
"The main purpose of the income tax is not to raise revenue, but to redistribute wealth and control society." -"It's actually very simple. Congress tried to enact an income tax in 1894. The Supreme Court said that was unconstitutional. If the Supreme Court says something is unconstitutional it's un-unconstitutional. They tried again in 1913 and the Supreme Court said "The 16th Amendment conferred no new power of taxation". So if they didn't have it then, and they didn't get it. They don't have it. There is no constitutional basis for tax on the wages of Americans living and working in the fifty States of the Union. Period. End of argument." ~ G. Edward Griffin. Author, Creature From Jekyll Island.
"In substance, the [Supreme] Court holds that the Sixteenth Amendment did not empower the Federal Government to levy a new tax." - New York Times, January 25, 1916
President Ronald Reagan's Blue Ribbon Panel Grace Commission setup to investigate income tax reported: "100% of what is collected is absorbed solely on the interest of the federal debt . All individual income tax revenues are gone before one nickel paid on the services tax payers collect on the government."
"I believe that in both spirit and substance our tax system has become un-American. Death and taxes may be inevitable. But unjust taxes are not." ~ President Ronald Reagan.
The IRS and local County Tax Collector Are Law Breakers, they Are Criminals committing Fraud:
The income that is a direct tax which is not apportioned amongst the States as demanded by the U.S. Constitution, making the income tax and property taxes, and sales tax and every other tax levied against citizens of the U.S. unconstitutional and therefore unlawful.
Apportioned = to divide equally amongst the people.
http://libertyforlife.com/constitution/us-16th-failed-ratification.htm
THE LINKS THEREIN:
http://www.thelawthatneverwas.com
http://libertyforlife.com/law/law-understanding_law.htm
http://libertyforlife.com/tax/irs_suffering_repeated_defeats.htm
http://libertyforlife.com/military-war/us-war.html
More info on failure to ratify:
http://libertyforlife.com/constitution/failure_to_ratify_the_16th-details.html
COURT CASES UNDER THE 16TH
Prior to the Supreme Court's decision in Pollock v. Farmers' Loan & Trust Co., all income taxes had been considered indirect taxes imposed without respect to geography, unlike direct taxes, that must be apportioned among the states according to population.
The Pollock case
In 1894, an amendment was attached to the Wilson–Gorman Tariff Act that attempted to impose a federal tax of 2% on incomes over $4,000 (equal to $106,000 in 2012).[6] The income tax law was strongly favored in the South and moderately supported in the eastern North Central states but heavily opposed in the West and the Northeast (with the exception of New Jersey).[14] Derided as "un-Democratic, inquisitorial, and wrong in principle,"[15] it was challenged in federal court.
In Pollock v. Farmers' Loan & Trust Co., the Supreme Court declared certain taxes on incomes — such as those on property under the 1894 Act — to be unconstitutionally unapportioned direct taxes. The Court reasoned that a tax on income from property should be treated as a tax on "property by reason of its ownership" and so should be required to be apportioned. The reasoning was that taxes on the rents from land, the dividends from stocks and so forth burdened the property generating the income in the same way that a tax on "property by reason of its ownership" burdened that property.
After Pollock, while income taxes on wages (as indirect taxes) were still not required to be apportioned by population, taxes on interest, dividends and rent income were required to be apportioned by population. The Pollock ruling made the source of the income (e.g., property versus labor, etc.) relevant in determining whether the tax imposed on that income was deemed to be "direct" (and thus required to be apportioned among the states according to population) or, alternatively, "indirect" (and thus required only to be imposed with geographical uniformity).
In his dissent to the Pollock decision, Justice John Marshall Harlan stated:
When, therefore, this court adjudges, as it does now adjudge, that Congress cannot impose a duty or tax upon personal property, or upon income arising either from rents of real estate or from personal property, including invested personal property, bonds, stocks, and investments of all kinds, except by apportioning the sum to be so raised among the States according to population, it practically decides that, without an amendment of the Constitution — two-thirds of both Houses of Congress and three-fourths of the States concurring — such property and incomes can never be made to contribute to the support of the national government.
Members of Congress responded to Pollock by expressing widespread concern that many of the wealthiest Americans had consolidated too much economic power.
The Sixteenth Amendment overruled the Pollock decision. That means the Congress may impose taxes on income from any source without having to apportion the total dollar amount of tax collected from each state according to each state's population in relation to the total national population.
In Wikoff v. Commissioner, the United States Tax Court said:
It is immaterial, with respect to Federal income taxes, whether the tax is a direct or an indirect tax. Mr. Wikoff [the taxpayer] relied on the Supreme Court's decision in Pollock v. Farmers' Loan & Trust Co. but the effect of that decision has been nullified by the enactment of the 16th Amendment.
In Abrams v. Commissioner, the Tax Court said:
Since the ratification of the Sixteenth Amendment, it is immaterial with respect to income taxes, whether the tax is a direct or indirect tax. The whole purpose of the Sixteenth Amendment was to relieve all income taxes when imposed from [the requirement of] apportionment and from [the requirement of] a consideration of the source whence the income was derived.
Case law
The federal courts' interpretations of the Sixteenth Amendment have changed considerably over time and there have been many disputes about the applicability of the amendment.
The Brushaber case
In Brushaber v. Union Pacific Railroad, 240 U.S. 1 (1916), the Supreme Court ruled that (1) the Sixteenth Amendment removes the Pollock requirement that certain income taxes (such as taxes on income "derived from real property" that were the subject of the Pollock decision), be apportioned among the states according to population; the federal income tax statute does not violate the Fifth Amendment's prohibition against the government taking property without due process of law; the federal income tax statute does not violate the Article I, Section 8, Clause 1 requirement that excises, also known as indirect taxes, be imposed with geographical uniformity.
The Kerbaugh-Empire Co. case
In Bowers v. Kerbaugh-Empire Co., 271 U.S. 170 (1926), the Supreme Court, through Justice Pierce Butler, stated:
It was not the purpose or the effect of that amendment to bring any new subject within the taxing power. Congress already had the power to tax all incomes. But taxes on incomes from some sources had been held to be "direct taxes" within the meaning of the constitutional requirement as to apportionment. The Amendment relieved from that requirement and obliterated the distinction in that respect between taxes on income that are direct taxes and those that are not, and so put on the same basis all incomes "from whatever source derived". "Income" has been taken to mean the same thing as used in the Corporation Excise Tax of 1909 (36 Stat. 112), in the Sixteenth Amendment, and in the various revenue acts subsequently passed. After full consideration, this court declared that income may be defined as gain derived from capital, from labor, or from both combined, including profit gained through sale or conversion of capital.
The Glenshaw Glass case
In Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955), the Supreme Court laid out what has become the modern understanding of what constitutes 'gross income' to which the Sixteenth Amendment applies, declaring that income taxes could be levied on "accessions to wealth, clearly realized, and over which the taxpayers have complete dominion." Under this definition, any increase in wealth — whether through wages, benefits, bonuses, sale of stock or other property at a profit, bets won, lucky finds, awards of punitive damages in a lawsuit, qui tam actions — are all within the definition of income, unless the Congress makes a specific exemption, as it has for items such as life insurance proceeds received by reason of the death of the insured party, gifts, bequests, devises and inheritances, and certain scholarships.
Income taxation of wages, etc.
Federal courts have ruled that the Sixteenth Amendment allows a direct tax on "wages, salaries, commissions, etc. without apportionment."
The Penn Mutual case
Although the Sixteenth Amendment is often cited as the "source" of the Congressional power to tax incomes, at least one court has reiterated the point made in Brushaber and other cases that the Sixteenth Amendment itself did not grant the Congress the power to tax incomes, a power the Congress had since 1789, but only removed the possible requirement that any income tax be apportioned among the states according to their respective populations. In Penn Mutual Indemnity, the United States Tax Court stated:
In dealing with the scope of the taxing power the question has sometimes been framed in terms of whether something can be taxed as income under the Sixteenth Amendment. This is an inaccurate formulation... and has led to much loose thinking on the subject. The source of the taxing power is not the Sixteenth Amendment; it is Article I, Section 8, of the Constitution.
The United States Court of Appeals for the Third Circuit agreed with the Tax Court, stating:
It did not take a constitutional amendment to entitle the United States to impose an income tax. Pollock v. Farmers' Loan & Trust Co., 157 U. S. 429, 158 U. S. 601 (1895), only held that a tax on the income derived from real or personal property was so close to a tax on that property that it could not be imposed without apportionment. The Sixteenth Amendment removed that barrier. Indeed, the requirement for apportionment is pretty strictly limited to taxes on real and personal property and capitation taxes.
It is not necessary to uphold the validity of the tax imposed by the United States that the tax itself bear an accurate label. Indeed, the tax upon the distillation of spirits, imposed very early by federal authority, now reads and has read in terms of a tax upon the spirits themselves, yet the validity of this imposition has been upheld for a very great many years.
It could well be argued that the tax involved here [an income tax] is an "excise tax" based upon the receipt of money by the taxpayer. It certainly is not a tax on property and it certainly is not a capitation tax; therefore, it need not be apportioned. We do not think it profitable, however, to make the label as precise as that required under the Food and Drug Act. Congress has the power to impose taxes generally, and if the particular imposition does not run afoul of any constitutional restrictions then the tax is lawful, call it what you will.
The Murphy case
On December 22, 2006, a three-judge panel of the United States Court of Appeals for the District of Columbia Circuit vacated its unanimous August 2006 opinion in Murphy v. Internal Revenue Service and United States. In an unrelated matter, the court had also granted the government's motion to dismiss Murphy's suit against the "Internal Revenue Service." Under federal sovereign immunity, a taxpayer may sue the federal government, but not a government agency, officer, or employee (with few exceptions). The court stated:
Insofar as the Congress has waived sovereign immunity with respect to suits for tax refunds under 28 U.S.C. § 1346(a)(1), that provision specifically contemplates only actions against the "United States." Therefore, we hold the IRS, unlike the United States, may not be sued eo nomine in this case.
An exception to federal sovereign immunity is in the United States Tax Court, where a taxpayer may sue the Commissioner of Internal Revenue. The original three-judge panel then agreed to rehear the case itself. In its original decision, the Court had ruled that 26 U.S.C. § 104(a)(2) was unconstitutional under the Sixteenth Amendment to the extent that the statute purported to tax, as income, a recovery for a non-physical personal injury for mental distress and loss of reputation not received in lieu of taxable income such as lost wages or earnings.
Because the August 2006 opinion was vacated, the full court did not hear the case en banc.
On July 3, 2007, the Court (through the original three-judge panel) ruled (1) that the taxpayer's compensation was received on account of a non-physical injury or sickness; (2) that gross income under section 61 of the Internal Revenue Code does include compensatory damages for non-physical injuries, even if the award is not an "accession to wealth," (3) that the income tax imposed on an award for non-physical injuries is an indirect tax, regardless of whether the recovery is restoration of "human capital," and therefore the tax does not violate the constitutional requirement of Article I, Section 9, Clause 4, that capitations or other direct taxes must be laid among the states only in proportion to the population; (4) that the income tax imposed on an award for non-physical injuries does not violate the constitutional requirement of Article I, Section 8, Clause 1, that all duties, imposts and excises be uniform throughout the United States; (5) that under the doctrine of sovereign immunity, the Internal Revenue Service may not be sued in its own name.
The Court stated that "although the 'Congress cannot make a thing income which is not so in fact,' it can label a thing income and tax it, so long as it acts within its constitutional authority, which includes not only the Sixteenth Amendment but also Article I, Sections 8 and 9." The court ruled that Ms. Murphy was not entitled to the tax refund she claimed, and that the personal injury award she received was "within the reach of the congressional power to tax under Article I, Section 8 of the Constitution"—even if the award was "not income within the meaning of the Sixteenth Amendment". See also the Penn Mutual case cited above.
http://en.wikipedia.org/wiki/Sixteenth_Amendment_to_the_United_States_Constitution
The Pollock case
In 1894, an amendment was attached to the Wilson–Gorman Tariff Act that attempted to impose a federal tax of 2% on incomes over $4,000 (equal to $106,000 in 2012).[6] The income tax law was strongly favored in the South and moderately supported in the eastern North Central states but heavily opposed in the West and the Northeast (with the exception of New Jersey).[14] Derided as "un-Democratic, inquisitorial, and wrong in principle,"[15] it was challenged in federal court.
In Pollock v. Farmers' Loan & Trust Co., the Supreme Court declared certain taxes on incomes — such as those on property under the 1894 Act — to be unconstitutionally unapportioned direct taxes. The Court reasoned that a tax on income from property should be treated as a tax on "property by reason of its ownership" and so should be required to be apportioned. The reasoning was that taxes on the rents from land, the dividends from stocks and so forth burdened the property generating the income in the same way that a tax on "property by reason of its ownership" burdened that property.
After Pollock, while income taxes on wages (as indirect taxes) were still not required to be apportioned by population, taxes on interest, dividends and rent income were required to be apportioned by population. The Pollock ruling made the source of the income (e.g., property versus labor, etc.) relevant in determining whether the tax imposed on that income was deemed to be "direct" (and thus required to be apportioned among the states according to population) or, alternatively, "indirect" (and thus required only to be imposed with geographical uniformity).
In his dissent to the Pollock decision, Justice John Marshall Harlan stated:
When, therefore, this court adjudges, as it does now adjudge, that Congress cannot impose a duty or tax upon personal property, or upon income arising either from rents of real estate or from personal property, including invested personal property, bonds, stocks, and investments of all kinds, except by apportioning the sum to be so raised among the States according to population, it practically decides that, without an amendment of the Constitution — two-thirds of both Houses of Congress and three-fourths of the States concurring — such property and incomes can never be made to contribute to the support of the national government.
Members of Congress responded to Pollock by expressing widespread concern that many of the wealthiest Americans had consolidated too much economic power.
The Sixteenth Amendment overruled the Pollock decision. That means the Congress may impose taxes on income from any source without having to apportion the total dollar amount of tax collected from each state according to each state's population in relation to the total national population.
In Wikoff v. Commissioner, the United States Tax Court said:
It is immaterial, with respect to Federal income taxes, whether the tax is a direct or an indirect tax. Mr. Wikoff [the taxpayer] relied on the Supreme Court's decision in Pollock v. Farmers' Loan & Trust Co. but the effect of that decision has been nullified by the enactment of the 16th Amendment.
In Abrams v. Commissioner, the Tax Court said:
Since the ratification of the Sixteenth Amendment, it is immaterial with respect to income taxes, whether the tax is a direct or indirect tax. The whole purpose of the Sixteenth Amendment was to relieve all income taxes when imposed from [the requirement of] apportionment and from [the requirement of] a consideration of the source whence the income was derived.
Case law
The federal courts' interpretations of the Sixteenth Amendment have changed considerably over time and there have been many disputes about the applicability of the amendment.
The Brushaber case
In Brushaber v. Union Pacific Railroad, 240 U.S. 1 (1916), the Supreme Court ruled that (1) the Sixteenth Amendment removes the Pollock requirement that certain income taxes (such as taxes on income "derived from real property" that were the subject of the Pollock decision), be apportioned among the states according to population; the federal income tax statute does not violate the Fifth Amendment's prohibition against the government taking property without due process of law; the federal income tax statute does not violate the Article I, Section 8, Clause 1 requirement that excises, also known as indirect taxes, be imposed with geographical uniformity.
The Kerbaugh-Empire Co. case
In Bowers v. Kerbaugh-Empire Co., 271 U.S. 170 (1926), the Supreme Court, through Justice Pierce Butler, stated:
It was not the purpose or the effect of that amendment to bring any new subject within the taxing power. Congress already had the power to tax all incomes. But taxes on incomes from some sources had been held to be "direct taxes" within the meaning of the constitutional requirement as to apportionment. The Amendment relieved from that requirement and obliterated the distinction in that respect between taxes on income that are direct taxes and those that are not, and so put on the same basis all incomes "from whatever source derived". "Income" has been taken to mean the same thing as used in the Corporation Excise Tax of 1909 (36 Stat. 112), in the Sixteenth Amendment, and in the various revenue acts subsequently passed. After full consideration, this court declared that income may be defined as gain derived from capital, from labor, or from both combined, including profit gained through sale or conversion of capital.
The Glenshaw Glass case
In Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955), the Supreme Court laid out what has become the modern understanding of what constitutes 'gross income' to which the Sixteenth Amendment applies, declaring that income taxes could be levied on "accessions to wealth, clearly realized, and over which the taxpayers have complete dominion." Under this definition, any increase in wealth — whether through wages, benefits, bonuses, sale of stock or other property at a profit, bets won, lucky finds, awards of punitive damages in a lawsuit, qui tam actions — are all within the definition of income, unless the Congress makes a specific exemption, as it has for items such as life insurance proceeds received by reason of the death of the insured party, gifts, bequests, devises and inheritances, and certain scholarships.
Income taxation of wages, etc.
Federal courts have ruled that the Sixteenth Amendment allows a direct tax on "wages, salaries, commissions, etc. without apportionment."
The Penn Mutual case
Although the Sixteenth Amendment is often cited as the "source" of the Congressional power to tax incomes, at least one court has reiterated the point made in Brushaber and other cases that the Sixteenth Amendment itself did not grant the Congress the power to tax incomes, a power the Congress had since 1789, but only removed the possible requirement that any income tax be apportioned among the states according to their respective populations. In Penn Mutual Indemnity, the United States Tax Court stated:
In dealing with the scope of the taxing power the question has sometimes been framed in terms of whether something can be taxed as income under the Sixteenth Amendment. This is an inaccurate formulation... and has led to much loose thinking on the subject. The source of the taxing power is not the Sixteenth Amendment; it is Article I, Section 8, of the Constitution.
The United States Court of Appeals for the Third Circuit agreed with the Tax Court, stating:
It did not take a constitutional amendment to entitle the United States to impose an income tax. Pollock v. Farmers' Loan & Trust Co., 157 U. S. 429, 158 U. S. 601 (1895), only held that a tax on the income derived from real or personal property was so close to a tax on that property that it could not be imposed without apportionment. The Sixteenth Amendment removed that barrier. Indeed, the requirement for apportionment is pretty strictly limited to taxes on real and personal property and capitation taxes.
It is not necessary to uphold the validity of the tax imposed by the United States that the tax itself bear an accurate label. Indeed, the tax upon the distillation of spirits, imposed very early by federal authority, now reads and has read in terms of a tax upon the spirits themselves, yet the validity of this imposition has been upheld for a very great many years.
It could well be argued that the tax involved here [an income tax] is an "excise tax" based upon the receipt of money by the taxpayer. It certainly is not a tax on property and it certainly is not a capitation tax; therefore, it need not be apportioned. We do not think it profitable, however, to make the label as precise as that required under the Food and Drug Act. Congress has the power to impose taxes generally, and if the particular imposition does not run afoul of any constitutional restrictions then the tax is lawful, call it what you will.
The Murphy case
On December 22, 2006, a three-judge panel of the United States Court of Appeals for the District of Columbia Circuit vacated its unanimous August 2006 opinion in Murphy v. Internal Revenue Service and United States. In an unrelated matter, the court had also granted the government's motion to dismiss Murphy's suit against the "Internal Revenue Service." Under federal sovereign immunity, a taxpayer may sue the federal government, but not a government agency, officer, or employee (with few exceptions). The court stated:
Insofar as the Congress has waived sovereign immunity with respect to suits for tax refunds under 28 U.S.C. § 1346(a)(1), that provision specifically contemplates only actions against the "United States." Therefore, we hold the IRS, unlike the United States, may not be sued eo nomine in this case.
An exception to federal sovereign immunity is in the United States Tax Court, where a taxpayer may sue the Commissioner of Internal Revenue. The original three-judge panel then agreed to rehear the case itself. In its original decision, the Court had ruled that 26 U.S.C. § 104(a)(2) was unconstitutional under the Sixteenth Amendment to the extent that the statute purported to tax, as income, a recovery for a non-physical personal injury for mental distress and loss of reputation not received in lieu of taxable income such as lost wages or earnings.
Because the August 2006 opinion was vacated, the full court did not hear the case en banc.
On July 3, 2007, the Court (through the original three-judge panel) ruled (1) that the taxpayer's compensation was received on account of a non-physical injury or sickness; (2) that gross income under section 61 of the Internal Revenue Code does include compensatory damages for non-physical injuries, even if the award is not an "accession to wealth," (3) that the income tax imposed on an award for non-physical injuries is an indirect tax, regardless of whether the recovery is restoration of "human capital," and therefore the tax does not violate the constitutional requirement of Article I, Section 9, Clause 4, that capitations or other direct taxes must be laid among the states only in proportion to the population; (4) that the income tax imposed on an award for non-physical injuries does not violate the constitutional requirement of Article I, Section 8, Clause 1, that all duties, imposts and excises be uniform throughout the United States; (5) that under the doctrine of sovereign immunity, the Internal Revenue Service may not be sued in its own name.
The Court stated that "although the 'Congress cannot make a thing income which is not so in fact,' it can label a thing income and tax it, so long as it acts within its constitutional authority, which includes not only the Sixteenth Amendment but also Article I, Sections 8 and 9." The court ruled that Ms. Murphy was not entitled to the tax refund she claimed, and that the personal injury award she received was "within the reach of the congressional power to tax under Article I, Section 8 of the Constitution"—even if the award was "not income within the meaning of the Sixteenth Amendment". See also the Penn Mutual case cited above.
http://en.wikipedia.org/wiki/Sixteenth_Amendment_to_the_United_States_Constitution
Tax protester Sixteenth Amendment Arguments
Tax protester Sixteenth Amendment arguments are assertions that the imposition of the U.S. federal income tax is illegal because the Sixteenth Amendment to the United States Constitution, which reads "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," was never properly ratified, or that the amendment provides no power to tax income. Proper ratification of the Sixteenth Amendment is disputed by tax protesters who argue that the quoted text of the Amendment differed from the text proposed by Congress, or that Ohio was not a State during ratification. Sixteenth Amendment ratification arguments have been rejected in every court case where they have been raised and have been identified as legally frivolous.
Some protesters have argued that because the Sixteenth Amendment does not contain the words "repeal" or "repealed", the Amendment is ineffective to change the law. Others argue that due to language in Stanton v. Baltic Mining Co., the income tax is an unconstitutional direct tax that should be apportioned (divided equally amongst the population of the various states). Several tax protesters assert that the Congress has no constitutional power to tax labor or income from labor, citing a variety of court cases. These arguments include claims that the word "income" as used in the Sixteenth Amendment cannot be interpreted as applying to wages; that wages are not income because labor is exchanged for them; that taxing wages violates individuals' right to property, and several others. Another argument raised is that because the federal income tax is progressive, the discriminations and inequalities created by the tax should render the tax unconstitutional under the 14th Amendment, which guarantees equal protection under the law. Such arguments have been ruled without merit under contemporary jurisprudence.
Sixteenth Amendment ratification
Many tax protesters contend that the Sixteenth Amendment to the United States Constitution was never properly ratified (see, e.g., Devvy Kidd).
The "non-ratification" argument was presented by defendant James Walter Scott in the 1975 case of United States v. Scott, some sixty-two years after the ratification. In Scott, the defendant -- who called himself a "national tax resistance leader" -- had been convicted of willful failure to file federal income tax returns for the years 1969 through 1972, and the conviction was upheld by the United States Court of Appeals for the Ninth Circuit. In the 1977 case of Ex parte Tammen, the United States District Court for the Northern District of Texas noted testimony in the case to the effect that taxpayer Bob Tammen had become involved with a group called "United Tax Action Patriots," a group that took the position "that the Sixteenth Amendment was improperly passed and therefore invalid...." The specific issue of the validity of the ratification of the Amendment was neither presented to nor decided by the court in the Tammen case.
After the Scott and Tammen decisions, two lines of court cases eventually developed. The first group of cases deals with the claims of William J. Benson, co-author of the book The Law That Never Was (1985). The second line of cases involves the contention that Ohio was not a state in 1913 at the time of the ratification.
Benson contentions
The William J. Benson contention is essentially that the legislatures of various states passed ratifying resolutions in which the quoted text of the Amendment differed from the text proposed by Congress in terms of capitalization, spelling of words, or punctuation marks (e.g. semi-colons instead of commas), and that these differences made the ratification invalid. Benson makes other assertions including claims that one or more states rejected the Amendment and that the state or states were falsely reported as having ratified the Amendment. As explained below, the Benson arguments have been rejected in every court case where they have been raised, and were explicitly ruled to be fraudulent in 2007.
Benson contended that in Kentucky, the legislature acted on the amendment without having received it from the governor, and that the governor of the state was to transmit the proposed amendment to the state legislature. Benson also contended that the version of the amendment that the Kentucky legislature made up and acted upon omitted the words "on income" from the text, and that the legislature therefore was not even voting on an income tax. Benson asserted that once this error was corrected, the Kentucky senate rejected the amendment, although Philander Knox counted Kentucky as having approved it.
Benson also contended that in Oklahoma, the legislature changed the wording of the amendment so that its meaning was virtually the opposite of what was intended by Congress, and that this was the version they sent back to Knox. Benson alleged that Knox counted Oklahoma as having approved it, despite a memo from his chief legal counsel, Reuben Clark, that states were not allowed to change the proposal in any way.
Benson argued that attorneys who studied the subject had agreed that Kentucky and Oklahoma should not have been counted as approvals by Philander Knox, and that if any state could be shown to have violated its own state constitution or laws in its approval process, then that state's approval would have to be thrown out.
The earliest reported court cases where Benson's arguments were actually raised appear to be United States v. Wojtas and United States v. House. Benson testified in the House case to no avail. The Benson contention was comprehensively addressed by the Seventh Circuit Court of Appeals in United States v. Thomas.
Thomas is a tax protester, and one of his arguments is that he did not need to file tax returns because the sixteenth amendment is not part of the constitution. It was not properly ratified, Thomas insists, repeating the argument of W. Benson & M. Beckman, The Law That Never Was (1985). Benson and Beckman review the documents concerning the states' ratification of the sixteenth amendment and conclude that only four states ratified the sixteenth amendment; they insist that the official promulgation of that amendment by Secretary of State Knox in 1913 is therefore void.
Benson and Beckman did not discover anything; they rediscovered something that Secretary Knox considered in 1913. Thirty-eight states ratified the sixteenth amendment, and thirty-seven sent formal instruments of ratification to the Secretary of State. (Minnesota notified the Secretary orally, and additional states ratified later; we consider only those Secretary Knox considered.
Only four instruments repeat the language of the sixteenth amendment exactly as Congress approved it. The others contain errors of diction, capitalization, punctuation, and spelling. The text Congress transmitted to the states was: "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." Many of the instruments neglected to capitalize "States," and some capitalized other words instead. The instrument from Illinois had "remuneration" in place of "enumeration"; the instrument from Missouri substituted "levy" for "lay"; the instrument from Washington had "income" not "incomes"; others made similar blunders.
Thomas insists that because the states did not approve exactly the same text, the amendment did not go into effect. Secretary Knox considered this argument. The Solicitor of the Department of State drew up a list of the errors in the instruments and — taking into account both the triviality of the deviations and the treatment of earlier amendments that had experienced more substantial problems — advised the Secretary that he was authorized to declare the amendment adopted. The Secretary did so.
Although Thomas urges us to take the view of several state courts that only agreement on the literal text may make a legal document effective, the Supreme Court follows the "enrolled bill rule." If a legislative document is authenticated in regular form by the appropriate officials, the court treats that document as properly adopted. Field v. Clark, 143 U.S. 649, 36 L.Ed. 294, 12 S.Ct. 495 (1892). The principle is equally applicable to constitutional amendments. See Leser v. Garnett, 258 U.S. 130, 66 L.Ed. 505, 42 S.Ct. 217 (1922), which treats as conclusive the declaration of the Secretary of State that the nineteenth amendment had been adopted. In United States v. Foster, 789 F.2d. 457, 462-463, n.6 (7th Cir. 1986), we relied on Leser, as well as the inconsequential nature of the objections in the face of the 73-year acceptance of the effectiveness of the sixteenth amendment, to reject a claim similar to Thomas's. See also Coleman v. Miller, 307 U.S. 433, 83 L. Ed. 1385, 59 S. Ct. 972 (1939) (questions about ratification of amendments may be nonjusticiable). Secretary Knox declared that enough states had ratified the sixteenth amendment. The Secretary's decision is not transparently defective. We need not decide when, if ever, such a decision may be reviewed in order to know that Secretary Knox's decision is now beyond review. —United States v. Thomas
Read more.....http://en.wikipedia.org/wiki/Tax_protester_Sixteenth_Amendment_arguments
Some protesters have argued that because the Sixteenth Amendment does not contain the words "repeal" or "repealed", the Amendment is ineffective to change the law. Others argue that due to language in Stanton v. Baltic Mining Co., the income tax is an unconstitutional direct tax that should be apportioned (divided equally amongst the population of the various states). Several tax protesters assert that the Congress has no constitutional power to tax labor or income from labor, citing a variety of court cases. These arguments include claims that the word "income" as used in the Sixteenth Amendment cannot be interpreted as applying to wages; that wages are not income because labor is exchanged for them; that taxing wages violates individuals' right to property, and several others. Another argument raised is that because the federal income tax is progressive, the discriminations and inequalities created by the tax should render the tax unconstitutional under the 14th Amendment, which guarantees equal protection under the law. Such arguments have been ruled without merit under contemporary jurisprudence.
Sixteenth Amendment ratification
Many tax protesters contend that the Sixteenth Amendment to the United States Constitution was never properly ratified (see, e.g., Devvy Kidd).
The "non-ratification" argument was presented by defendant James Walter Scott in the 1975 case of United States v. Scott, some sixty-two years after the ratification. In Scott, the defendant -- who called himself a "national tax resistance leader" -- had been convicted of willful failure to file federal income tax returns for the years 1969 through 1972, and the conviction was upheld by the United States Court of Appeals for the Ninth Circuit. In the 1977 case of Ex parte Tammen, the United States District Court for the Northern District of Texas noted testimony in the case to the effect that taxpayer Bob Tammen had become involved with a group called "United Tax Action Patriots," a group that took the position "that the Sixteenth Amendment was improperly passed and therefore invalid...." The specific issue of the validity of the ratification of the Amendment was neither presented to nor decided by the court in the Tammen case.
After the Scott and Tammen decisions, two lines of court cases eventually developed. The first group of cases deals with the claims of William J. Benson, co-author of the book The Law That Never Was (1985). The second line of cases involves the contention that Ohio was not a state in 1913 at the time of the ratification.
Benson contentions
The William J. Benson contention is essentially that the legislatures of various states passed ratifying resolutions in which the quoted text of the Amendment differed from the text proposed by Congress in terms of capitalization, spelling of words, or punctuation marks (e.g. semi-colons instead of commas), and that these differences made the ratification invalid. Benson makes other assertions including claims that one or more states rejected the Amendment and that the state or states were falsely reported as having ratified the Amendment. As explained below, the Benson arguments have been rejected in every court case where they have been raised, and were explicitly ruled to be fraudulent in 2007.
Benson contended that in Kentucky, the legislature acted on the amendment without having received it from the governor, and that the governor of the state was to transmit the proposed amendment to the state legislature. Benson also contended that the version of the amendment that the Kentucky legislature made up and acted upon omitted the words "on income" from the text, and that the legislature therefore was not even voting on an income tax. Benson asserted that once this error was corrected, the Kentucky senate rejected the amendment, although Philander Knox counted Kentucky as having approved it.
Benson also contended that in Oklahoma, the legislature changed the wording of the amendment so that its meaning was virtually the opposite of what was intended by Congress, and that this was the version they sent back to Knox. Benson alleged that Knox counted Oklahoma as having approved it, despite a memo from his chief legal counsel, Reuben Clark, that states were not allowed to change the proposal in any way.
Benson argued that attorneys who studied the subject had agreed that Kentucky and Oklahoma should not have been counted as approvals by Philander Knox, and that if any state could be shown to have violated its own state constitution or laws in its approval process, then that state's approval would have to be thrown out.
The earliest reported court cases where Benson's arguments were actually raised appear to be United States v. Wojtas and United States v. House. Benson testified in the House case to no avail. The Benson contention was comprehensively addressed by the Seventh Circuit Court of Appeals in United States v. Thomas.
Thomas is a tax protester, and one of his arguments is that he did not need to file tax returns because the sixteenth amendment is not part of the constitution. It was not properly ratified, Thomas insists, repeating the argument of W. Benson & M. Beckman, The Law That Never Was (1985). Benson and Beckman review the documents concerning the states' ratification of the sixteenth amendment and conclude that only four states ratified the sixteenth amendment; they insist that the official promulgation of that amendment by Secretary of State Knox in 1913 is therefore void.
Benson and Beckman did not discover anything; they rediscovered something that Secretary Knox considered in 1913. Thirty-eight states ratified the sixteenth amendment, and thirty-seven sent formal instruments of ratification to the Secretary of State. (Minnesota notified the Secretary orally, and additional states ratified later; we consider only those Secretary Knox considered.
Only four instruments repeat the language of the sixteenth amendment exactly as Congress approved it. The others contain errors of diction, capitalization, punctuation, and spelling. The text Congress transmitted to the states was: "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." Many of the instruments neglected to capitalize "States," and some capitalized other words instead. The instrument from Illinois had "remuneration" in place of "enumeration"; the instrument from Missouri substituted "levy" for "lay"; the instrument from Washington had "income" not "incomes"; others made similar blunders.
Thomas insists that because the states did not approve exactly the same text, the amendment did not go into effect. Secretary Knox considered this argument. The Solicitor of the Department of State drew up a list of the errors in the instruments and — taking into account both the triviality of the deviations and the treatment of earlier amendments that had experienced more substantial problems — advised the Secretary that he was authorized to declare the amendment adopted. The Secretary did so.
Although Thomas urges us to take the view of several state courts that only agreement on the literal text may make a legal document effective, the Supreme Court follows the "enrolled bill rule." If a legislative document is authenticated in regular form by the appropriate officials, the court treats that document as properly adopted. Field v. Clark, 143 U.S. 649, 36 L.Ed. 294, 12 S.Ct. 495 (1892). The principle is equally applicable to constitutional amendments. See Leser v. Garnett, 258 U.S. 130, 66 L.Ed. 505, 42 S.Ct. 217 (1922), which treats as conclusive the declaration of the Secretary of State that the nineteenth amendment had been adopted. In United States v. Foster, 789 F.2d. 457, 462-463, n.6 (7th Cir. 1986), we relied on Leser, as well as the inconsequential nature of the objections in the face of the 73-year acceptance of the effectiveness of the sixteenth amendment, to reject a claim similar to Thomas's. See also Coleman v. Miller, 307 U.S. 433, 83 L. Ed. 1385, 59 S. Ct. 972 (1939) (questions about ratification of amendments may be nonjusticiable). Secretary Knox declared that enough states had ratified the sixteenth amendment. The Secretary's decision is not transparently defective. We need not decide when, if ever, such a decision may be reviewed in order to know that Secretary Knox's decision is now beyond review. —United States v. Thomas
Read more.....http://en.wikipedia.org/wiki/Tax_protester_Sixteenth_Amendment_arguments
Tax Protester Constitutional Arguments
Tax protester constitutional arguments are assertions that the imposition of the federal income tax violates the United States Constitution. These kinds of tax protester arguments are distinguished from related statutory arguments and conspiracy arguments, which presuppose the constitutionality of the income tax. Although the most frequent Constitutional arguments are directed towards the validity and effect of the Sixteenth Amendment, arguments exist that the income tax violates some other provision of the Constitution; or that some other provision, that would prevent the assessment of the income tax, was ratified but wrongfully excluded from the Constitution.
Other constitutional amendment arguments have been raised by tax protesters. Some argue that imposition of the income tax violates the First Amendment freedom of speech and freedom of religion. Protesters argue that the income tax violates the Fifth Amendment right against self-incrimination, the Takings Clause, or the right that no person shall be "deprived of life, liberty, or property, without due process of law". Tax protesters have argued that income taxes impose involuntary servitude in violation of the Thirteenth Amendment. Some tax protesters argue that Americans are citizens of the individual states as opposed to citizens of the United States, as the Fourteenth Amendment was not properly ratified. Another argument is a missing amendment to the Constitution, known as the Titles of Nobility Amendment, which precedes the current Thirteenth Amendment. Another argument raised is that because the federal income tax is progressive, the discriminations and inequalities created by the tax should render the tax unconstitutional. These arguments have been rejected by the courts.
The authority of the federal government has been challenged by protesters, arguing that they should be immune from federal income taxation because they are sovereign individuals or natural individuals, have not requested a privilege or benefit from the government, or are outside the "federal zone" (D.C. and various federal enclaves such as military bases). Neither the U.S. Supreme Court nor any other federal court has ruled that an income tax imposed under the Internal Revenue Code of 1986 is unconstitutional. Under the Supreme Court ruling in Cheek v. United States, a defendant in a tax evasion prosecution who has made arguments that the federal income tax laws are unconstitutional may have the arguments turned against him (or her). Such arguments, even if based on honestly held beliefs, may constitute evidence that helps the prosecutor prove willfulness, one of the elements of tax evasion.
First Amendment
Some protesters argue that imposition of income taxes violates the First Amendment freedom of speech because it requires the subject of the tax to write information on a tax return; or violates freedom of religion if the subject of the tax claims some religious objection to the payment of taxes, particularly if the subject styles himself or herself as a Reverend, Minister, or other religious office-holder. While the Internal Revenue Code makes an exemption for churches and other religious institutions, it makes only special tax codes and deductions, not exceptions, for religious professionals. The United States Supreme Court held in 1878 Reynolds v. United States, that a religious belief, however strongly held, does not exempt the believer from adhering to general laws.
Fifth Amendment
Self incrimination
Other protesters argue that the Fifth Amendment right against self-incrimination allows an individual to refuse to file an income tax return calling for information that could lead to a conviction for criminal acts from which the income was derived, or for the crime of not paying the tax itself. In response, the courts generally refer to the case of United States v. Sullivan, where Justice Oliver Wendell Holmes wrote:
If the form of return provided called for answers that the defendant was privileged from making he could have raised the objection in the return, but could not on that account refuse to make any return at all.... It would be an extreme if not an extravagant application of the Fifth Amendment to say that it authorized a man to refuse to state the amount of his income because it had been made in crime. But if the defendant desired to test that or any other point he should have tested it in the return so that it could be passed upon. He could not draw a conjurer's circle around the whole matter by his own declaration that to write any word upon the government blank would bring him into danger of the law.
—Oliver Wendell Holmes, United States v. Sullivan
Takings Clause
Some protesters have argued that the income tax is a prohibited "takings" under the Fifth Amendment's Takings Clause, and cannot be imposed unless the taxpayer receives just compensation. The United States Supreme Court rejected this argument in Brushaber v. Union Pacific Railroad. The takings argument and variations of this argument have been officially identified as legally frivolous federal tax return positions for purposes of the $5,000 frivolous tax return penalty imposed under Internal Revenue Code section 6702(a).
Other arguments
Protesters argue that the income tax violates the Fifth Amendment right that no person shall be "deprived of life, liberty, or property, without due process of law". However, people can be deprived of life, liberty, or property with due process of law — this is what the courts do. Legal commentator Daniel B. Evans describes:
Every time a court finds a defendant guilty, the court has deprived the defendant of life or liberty, and every time a court rules in favor of a plaintiff or defendant, the court has deprived either the plaintiff or the defendant of some property. So saying that a court has deprived someone of life, liberty, or property is not particularly interesting unless you can explain exactly what the court did (or did not do) that deprived that particular someone of due process. Similarly, the general proposition that every man has the right to his own labor does not necessarily lead to the conclusion that the government cannot tax the "common right" of labor. If the government could never impose a tax that took away someone’s rights to their property, then the government could never tax anyone for anything. So the claim that a tax deprives someone of "property" or a "right" is pretty much meaningless. —Daniel B. Evans
Fifth Amendment "due process" arguments by tax protesters were rejected by the United States Court of Appeals for the Third Circuit in Kahn v. United States, by the United States Court of Appeals for the Fifth Circuit in Anderson v. United States, by the United States Court of Appeals for the Seventh Circuit in Cameron v. Internal Revenue Serv., by the United States Court of Appeals for the Eighth Circuit in Baskin v. United States, by the United States Court of Appeals for the Ninth Circuit in Jolly v. United States, and by the United States Court of Appeals for the Tenth Circuit in Martinez v. Internal Revenue Serv.
Thirteenth Amendment
An early protester, Arthur J. Porth, argued that the Sixteenth Amendment to the U.S. Constitution should itself be declared unconstitutional. His theory was that the income taxes under the Internal Revenue Code of 1939 imposed "involuntary servitude" in violation of the Thirteenth Amendment. That argument was ruled to be without merit in Porth v. Brodrick, United States Collector of Internal Revenue for the State of Kansas. The involuntary servitude argument, and variations of this argument, have been officially identified as legally frivolous federal tax return positions for purposes of the $5,000 frivolous tax return penalty imposed under Internal Revenue Code section 6702(a).
Fourteenth Amendment
Some tax protesters argue that all Americans are citizens of individual states as opposed to citizens of the United States, and that the United States therefore has no power to tax citizens or impose other federal laws outside of Washington D.C. and other federal enclaves. The first sentence of Section 1 of the Fourteenth Amendment states:
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.
Notably, some tax protesters contend that the Fourteenth Amendment itself was never properly ratified, under the theory that the governments of southern states that supported the post-Civil War amendments were not representative of the people.
Courts have uniformly held that this argument that the Fourteenth Amendment divested state citizens of U.S. citizenship is plainly incorrect. In Kantor v. Wellesley Galleries, Ltd., the court explained that "[w]hile the Fourteenth Amendment does not create a national citizenship, it has the effect of making that citizenship 'paramount and dominant' instead of 'derivative and dependent' upon state citizenship".[22] See also United States v. Ward, Fox v. Commissioner, and United States v. Baker.
Sixteenth Amendment
Main article: Tax protester Sixteenth Amendment arguments
Seventeenth Amendment
An argument raised in the case of Trohimovich v. Commissioner is that the Seventeenth Amendment to the United States Constitution was not properly ratified, and that all laws passed by Congress since the year 1919 (which was not the year of ratification) are invalid. The Trohimovich case involved a criminal contempt charge against the taxpayer in connection with a failure to obey a subpoena to produce books and records needed for the trial of the case. The United States Tax Court stated:
The [taxpayer's] petition in this case, while rambling and lengthy, appears to rely primarily on arguments that neither the Internal Revenue Service nor this Court has authority to determine petitioner's tax liability because the Seventeenth Amendment to the Constitution, which changed the method of electing senators to the U.S. Congress, was improperly proposed and/or adopted, and therefore all laws enacted by Congress (and the Senate) subsequent to at least 1919 are invalid. This included the Internal Revenue Code and the legislation which established this Court.
The court rejected the taxpayer's arguments, and ordered that "he be imprisoned for 30 days as punishment" for criminal contempt in failing to obey court orders or subpoenas.
Read more…..http://en.wikipedia.org/wiki/Tax_protester_constitutional_arguments
Other constitutional amendment arguments have been raised by tax protesters. Some argue that imposition of the income tax violates the First Amendment freedom of speech and freedom of religion. Protesters argue that the income tax violates the Fifth Amendment right against self-incrimination, the Takings Clause, or the right that no person shall be "deprived of life, liberty, or property, without due process of law". Tax protesters have argued that income taxes impose involuntary servitude in violation of the Thirteenth Amendment. Some tax protesters argue that Americans are citizens of the individual states as opposed to citizens of the United States, as the Fourteenth Amendment was not properly ratified. Another argument is a missing amendment to the Constitution, known as the Titles of Nobility Amendment, which precedes the current Thirteenth Amendment. Another argument raised is that because the federal income tax is progressive, the discriminations and inequalities created by the tax should render the tax unconstitutional. These arguments have been rejected by the courts.
The authority of the federal government has been challenged by protesters, arguing that they should be immune from federal income taxation because they are sovereign individuals or natural individuals, have not requested a privilege or benefit from the government, or are outside the "federal zone" (D.C. and various federal enclaves such as military bases). Neither the U.S. Supreme Court nor any other federal court has ruled that an income tax imposed under the Internal Revenue Code of 1986 is unconstitutional. Under the Supreme Court ruling in Cheek v. United States, a defendant in a tax evasion prosecution who has made arguments that the federal income tax laws are unconstitutional may have the arguments turned against him (or her). Such arguments, even if based on honestly held beliefs, may constitute evidence that helps the prosecutor prove willfulness, one of the elements of tax evasion.
First Amendment
Some protesters argue that imposition of income taxes violates the First Amendment freedom of speech because it requires the subject of the tax to write information on a tax return; or violates freedom of religion if the subject of the tax claims some religious objection to the payment of taxes, particularly if the subject styles himself or herself as a Reverend, Minister, or other religious office-holder. While the Internal Revenue Code makes an exemption for churches and other religious institutions, it makes only special tax codes and deductions, not exceptions, for religious professionals. The United States Supreme Court held in 1878 Reynolds v. United States, that a religious belief, however strongly held, does not exempt the believer from adhering to general laws.
Fifth Amendment
Self incrimination
Other protesters argue that the Fifth Amendment right against self-incrimination allows an individual to refuse to file an income tax return calling for information that could lead to a conviction for criminal acts from which the income was derived, or for the crime of not paying the tax itself. In response, the courts generally refer to the case of United States v. Sullivan, where Justice Oliver Wendell Holmes wrote:
If the form of return provided called for answers that the defendant was privileged from making he could have raised the objection in the return, but could not on that account refuse to make any return at all.... It would be an extreme if not an extravagant application of the Fifth Amendment to say that it authorized a man to refuse to state the amount of his income because it had been made in crime. But if the defendant desired to test that or any other point he should have tested it in the return so that it could be passed upon. He could not draw a conjurer's circle around the whole matter by his own declaration that to write any word upon the government blank would bring him into danger of the law.
—Oliver Wendell Holmes, United States v. Sullivan
Takings Clause
Some protesters have argued that the income tax is a prohibited "takings" under the Fifth Amendment's Takings Clause, and cannot be imposed unless the taxpayer receives just compensation. The United States Supreme Court rejected this argument in Brushaber v. Union Pacific Railroad. The takings argument and variations of this argument have been officially identified as legally frivolous federal tax return positions for purposes of the $5,000 frivolous tax return penalty imposed under Internal Revenue Code section 6702(a).
Other arguments
Protesters argue that the income tax violates the Fifth Amendment right that no person shall be "deprived of life, liberty, or property, without due process of law". However, people can be deprived of life, liberty, or property with due process of law — this is what the courts do. Legal commentator Daniel B. Evans describes:
Every time a court finds a defendant guilty, the court has deprived the defendant of life or liberty, and every time a court rules in favor of a plaintiff or defendant, the court has deprived either the plaintiff or the defendant of some property. So saying that a court has deprived someone of life, liberty, or property is not particularly interesting unless you can explain exactly what the court did (or did not do) that deprived that particular someone of due process. Similarly, the general proposition that every man has the right to his own labor does not necessarily lead to the conclusion that the government cannot tax the "common right" of labor. If the government could never impose a tax that took away someone’s rights to their property, then the government could never tax anyone for anything. So the claim that a tax deprives someone of "property" or a "right" is pretty much meaningless. —Daniel B. Evans
Fifth Amendment "due process" arguments by tax protesters were rejected by the United States Court of Appeals for the Third Circuit in Kahn v. United States, by the United States Court of Appeals for the Fifth Circuit in Anderson v. United States, by the United States Court of Appeals for the Seventh Circuit in Cameron v. Internal Revenue Serv., by the United States Court of Appeals for the Eighth Circuit in Baskin v. United States, by the United States Court of Appeals for the Ninth Circuit in Jolly v. United States, and by the United States Court of Appeals for the Tenth Circuit in Martinez v. Internal Revenue Serv.
Thirteenth Amendment
An early protester, Arthur J. Porth, argued that the Sixteenth Amendment to the U.S. Constitution should itself be declared unconstitutional. His theory was that the income taxes under the Internal Revenue Code of 1939 imposed "involuntary servitude" in violation of the Thirteenth Amendment. That argument was ruled to be without merit in Porth v. Brodrick, United States Collector of Internal Revenue for the State of Kansas. The involuntary servitude argument, and variations of this argument, have been officially identified as legally frivolous federal tax return positions for purposes of the $5,000 frivolous tax return penalty imposed under Internal Revenue Code section 6702(a).
Fourteenth Amendment
Some tax protesters argue that all Americans are citizens of individual states as opposed to citizens of the United States, and that the United States therefore has no power to tax citizens or impose other federal laws outside of Washington D.C. and other federal enclaves. The first sentence of Section 1 of the Fourteenth Amendment states:
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.
Notably, some tax protesters contend that the Fourteenth Amendment itself was never properly ratified, under the theory that the governments of southern states that supported the post-Civil War amendments were not representative of the people.
Courts have uniformly held that this argument that the Fourteenth Amendment divested state citizens of U.S. citizenship is plainly incorrect. In Kantor v. Wellesley Galleries, Ltd., the court explained that "[w]hile the Fourteenth Amendment does not create a national citizenship, it has the effect of making that citizenship 'paramount and dominant' instead of 'derivative and dependent' upon state citizenship".[22] See also United States v. Ward, Fox v. Commissioner, and United States v. Baker.
Sixteenth Amendment
Main article: Tax protester Sixteenth Amendment arguments
Seventeenth Amendment
An argument raised in the case of Trohimovich v. Commissioner is that the Seventeenth Amendment to the United States Constitution was not properly ratified, and that all laws passed by Congress since the year 1919 (which was not the year of ratification) are invalid. The Trohimovich case involved a criminal contempt charge against the taxpayer in connection with a failure to obey a subpoena to produce books and records needed for the trial of the case. The United States Tax Court stated:
The [taxpayer's] petition in this case, while rambling and lengthy, appears to rely primarily on arguments that neither the Internal Revenue Service nor this Court has authority to determine petitioner's tax liability because the Seventeenth Amendment to the Constitution, which changed the method of electing senators to the U.S. Congress, was improperly proposed and/or adopted, and therefore all laws enacted by Congress (and the Senate) subsequent to at least 1919 are invalid. This included the Internal Revenue Code and the legislation which established this Court.
The court rejected the taxpayer's arguments, and ordered that "he be imprisoned for 30 days as punishment" for criminal contempt in failing to obey court orders or subpoenas.
Read more…..http://en.wikipedia.org/wiki/Tax_protester_constitutional_arguments
Below are older posts regarding the 16th Amendment.
The 16th Amendment follows closely to strengthen the 14th and provide the revenues necessary to maintain and grow this new and far encompassing federal government. For instance, the 16th Amendment has led us to the current debt crisis, debt ceiling raises, borrowing from our kids future, causing monetary insolvency that threatens the national security of our nation, deadlock in Washington over how much they will tax us additionally, how they will choose to spend it, how they refuse to budget or cut waste and unnecessary programs, our Congress and it’s spending practices are out-of-control and because if they continue to refuse to address it….we must! They can no longer function if we cut off the money. All necessary programs will be much better decided upon, funded and over-seen at the State level.
The original language of the Constitution grants the Congress with the “power to lay and collect taxes, duties, and imposts and excises, to pay the debts and provide for the common defense and the general welfare of the United states, but all duties imposts and excises shall be uniform throughout the United States.” The original apportionment of tax burden was by “head-count”, the 16th amendment will give the power to Congress to lay a “direct tax” on everyone and decide the level of taxation without guarantee of equality as well as to derive it from whatever source it deemed necessary.
The year is 1909. It has been 41 years since the ratification of the 14th amendment. We are now a Nation of 46 states, the last being Oklahoma after the land rush and settlement.
It has taken years to re-construct the South (that work is still being done). Great expense and compounded with the growing swells of humanity (immigrants) and the expansion West, as well as the growing industrialization in the nation, local, city, state and federal governments and the services/office/agencies/and bureaucracies they have developed- need revenue. The 14th shifted the balance of power - as well as the balance of responsibility to the centralized government the people were turning more and more of their reliance upon. Slowly and surely the People are turning their liberty over to the source that will provide on one hand and take with the other. The shift is subtle and profound.
The expansion of America as a Nation, as a People, and as an industrialized and capitalist economy is so fast changing and growing that the government struggles to keep pace. It is also at this time that a new political movement and attitude is beginning. It is called the Progressive Movement and it will shape the National consciousness from this point forward. Many of our national democratic leaders today, say they are “a progressive”, and believe in the progressive agenda. We also see the rise of Socialists and Communist theories entered into the debate. We have the moral duties of municipalities to deal with the class struggle (the “haves and the have-nots”), poverty and slums, the woman’s suffrage movement, the National Birth Control League, drugs and alcohol abuses in society, racism and civil rights abuses (founding of the NAACP-lynching), poor factory conditions and workers rights (labor disputes and cooperate regulation). The founding of the Food and Drug Administration and the National Conservation Movement are also born in this time.
Persons to note:
Margaret Sager (National Birth control League)
Theodore Roosevelt (at the age of 42 became the president after the attempted assassination of William McKinley and his sub-sequent death)
William Howard Taft (followed Roosevelt as president)
Ida Wells-Barnett (crusaded against lynching)
Booker T. Washington (one of the Nation’s foremost and early black leaders)
W.E.B. Du Bois (America’s first black Ph.D.)
There is much more and involved historical relevance during this period. We have only touched on several highlights. This background sets the table for the 16th amendment to be served. The federal government needs more revenue, it passes amendment legislation that changes the original intent of the Founders and devises the brilliant, all encompassing, and ultimate enforcement to take what it demands from the People in order to fund all the laws and programs it passes, at its discretion. It further decides how it re-allocate those funds back to the People for the public use.
Other issues exist because of the 16th Amendment. It created the IRS, it allows Congress to determine winners and to make others’ losers, and it is about social engineering. It is allowing Congress to spend and borrow without limits, allows taxes to be hidden in business tax, but paid by the poor. The 16th provides Congress with the power over industries and business through funding and regulation. It creates the environment of influence by special interests with specific agendas, it creates the environment “of big money” for campaigns and state rewards for legislators who cast their vote in favor of such interests. It also keeps people in office for decades as they get special treatment for their districts [pork]. In addition, it provides the money to bribe voting blocks and funds the government UNIONS!
We see no need to elaborate on the largess of an out-of-control-government than stated above; the opportunity for power and greed and influence to be bought or corrupt, fiscal cliffs and debt ceilings, and tax reform. You are as well aware and informed as we are.
The 16th Amendment is the meal that feeds the ever growing federal beast. We are the hunter-gatherers…they will take all that they demand and require before….they allow us to dine on the fruits of our own labors and provide for our own. This federal beast is forever hungry and as it grows larger and larger everyday, we grow leaner and weaker to provide and protect ourselves against it with each and every “more” thing we give it. The Civil War taught us that unlawful protest is an un-productive and ultimately harmful method of contradiction. We have been given the lawful and peaceful means by which to accomplish what we must…Article V. Revoke the 16th and starve the beast.
AMENDMENT XVI
Passed by Congress July 2, 1909. Ratified February 3, 1913.
Note: Article I, section 9, of the Constitution was modified by amendment 16.
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.
Additionally, Senator Tom Coburn (R - OK), always a “hawk” on government waste, fraud and abuse has published reports on the aforementioned as listed on the buttons below:
The original language of the Constitution grants the Congress with the “power to lay and collect taxes, duties, and imposts and excises, to pay the debts and provide for the common defense and the general welfare of the United states, but all duties imposts and excises shall be uniform throughout the United States.” The original apportionment of tax burden was by “head-count”, the 16th amendment will give the power to Congress to lay a “direct tax” on everyone and decide the level of taxation without guarantee of equality as well as to derive it from whatever source it deemed necessary.
The year is 1909. It has been 41 years since the ratification of the 14th amendment. We are now a Nation of 46 states, the last being Oklahoma after the land rush and settlement.
It has taken years to re-construct the South (that work is still being done). Great expense and compounded with the growing swells of humanity (immigrants) and the expansion West, as well as the growing industrialization in the nation, local, city, state and federal governments and the services/office/agencies/and bureaucracies they have developed- need revenue. The 14th shifted the balance of power - as well as the balance of responsibility to the centralized government the people were turning more and more of their reliance upon. Slowly and surely the People are turning their liberty over to the source that will provide on one hand and take with the other. The shift is subtle and profound.
The expansion of America as a Nation, as a People, and as an industrialized and capitalist economy is so fast changing and growing that the government struggles to keep pace. It is also at this time that a new political movement and attitude is beginning. It is called the Progressive Movement and it will shape the National consciousness from this point forward. Many of our national democratic leaders today, say they are “a progressive”, and believe in the progressive agenda. We also see the rise of Socialists and Communist theories entered into the debate. We have the moral duties of municipalities to deal with the class struggle (the “haves and the have-nots”), poverty and slums, the woman’s suffrage movement, the National Birth Control League, drugs and alcohol abuses in society, racism and civil rights abuses (founding of the NAACP-lynching), poor factory conditions and workers rights (labor disputes and cooperate regulation). The founding of the Food and Drug Administration and the National Conservation Movement are also born in this time.
Persons to note:
Margaret Sager (National Birth control League)
Theodore Roosevelt (at the age of 42 became the president after the attempted assassination of William McKinley and his sub-sequent death)
William Howard Taft (followed Roosevelt as president)
Ida Wells-Barnett (crusaded against lynching)
Booker T. Washington (one of the Nation’s foremost and early black leaders)
W.E.B. Du Bois (America’s first black Ph.D.)
There is much more and involved historical relevance during this period. We have only touched on several highlights. This background sets the table for the 16th amendment to be served. The federal government needs more revenue, it passes amendment legislation that changes the original intent of the Founders and devises the brilliant, all encompassing, and ultimate enforcement to take what it demands from the People in order to fund all the laws and programs it passes, at its discretion. It further decides how it re-allocate those funds back to the People for the public use.
Other issues exist because of the 16th Amendment. It created the IRS, it allows Congress to determine winners and to make others’ losers, and it is about social engineering. It is allowing Congress to spend and borrow without limits, allows taxes to be hidden in business tax, but paid by the poor. The 16th provides Congress with the power over industries and business through funding and regulation. It creates the environment of influence by special interests with specific agendas, it creates the environment “of big money” for campaigns and state rewards for legislators who cast their vote in favor of such interests. It also keeps people in office for decades as they get special treatment for their districts [pork]. In addition, it provides the money to bribe voting blocks and funds the government UNIONS!
We see no need to elaborate on the largess of an out-of-control-government than stated above; the opportunity for power and greed and influence to be bought or corrupt, fiscal cliffs and debt ceilings, and tax reform. You are as well aware and informed as we are.
The 16th Amendment is the meal that feeds the ever growing federal beast. We are the hunter-gatherers…they will take all that they demand and require before….they allow us to dine on the fruits of our own labors and provide for our own. This federal beast is forever hungry and as it grows larger and larger everyday, we grow leaner and weaker to provide and protect ourselves against it with each and every “more” thing we give it. The Civil War taught us that unlawful protest is an un-productive and ultimately harmful method of contradiction. We have been given the lawful and peaceful means by which to accomplish what we must…Article V. Revoke the 16th and starve the beast.
AMENDMENT XVI
Passed by Congress July 2, 1909. Ratified February 3, 1913.
Note: Article I, section 9, of the Constitution was modified by amendment 16.
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.
Additionally, Senator Tom Coburn (R - OK), always a “hawk” on government waste, fraud and abuse has published reports on the aforementioned as listed on the buttons below:
SHORT AND SWEET
The WHY
|
OUR PROPOSAL
Propose a Twenty-eighth Amendment* 1. The fourteenth, the sixteenth, and the seventeenth articles of amendment to the Constitution of the United States are hereby repealed. 2. The articles shall be inoperative unless it shall have been ratified as an amendment to the Constitution by the conventions in several states, as provided in the Constitution, within seven years from the date of submission hereof, to the States by the Congress. So simple and it's done! *We seek to have the Item 1 above which is 20 words of the 28th amendment voted on in each of the 50 States' legislatures. * We seek to have all States legislative members educated to our SO SIMPLE AMENDMENT That RESTORE STATES' RIGHTS AND POWERS. *We believe that THE FEDERAL GOVERNMENT IS BROKEN AND IN DEBT - 125 years OF ELECTIONS HAVE NOT CHANGED the GROWTH OF POWERS IN WASHINGTON. *We believe that... WE THE PEOPLE... HAVE LOST CONFIDENCE IN GOVERNMENT - 77% OF THE POPULATION ACCORDING TO GALLOP (today) BELIEVE THAT DC- CANNOT - AND WILL NOT - CHANGE. |
