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Happy N.E.D.!

(originally launched into cyberspace on 04/15/2003)
---

Dear List Subscriber,

Happy National Extortion Day! Enjoy it. It will be the last. (Okay, maybe
I wouldn't bet my life on that quite yet, but I am sticking to that
prediction.)

I hope that whether you are just starting to find out for yourself what the
income tax laws actually say, or whether you are surrendering money you know
you don't owe in self-defense, or whether you are keeping what is yours,
that you have happy (or at least tolerable) day.

I'll keep the message short today (for once), but here's a little
entertaining reading for those who want more:

http://trac.syr.edu/tracirs/index.html

That shows various statistics regarding the trends in enforcement of the
IRS' MISapplication of the law. While the IRS and DOJ are huffing and
puffing as loud as they can (though it will probably calm down a bit after
today), the numbers tell another story. The IRS is falling apart at the
seams, and the "income tax" was already nearly unenforceable BEFORE people
in any serious numbers were learning what the law actually says (and that it
does NOT tax the income of most Americans). The fraud is doomed.

Today is a beautiful day in Pennsylvania, and I'm going for a walk with my
kid. In a few years I expect to be doing the same, and telling her what it
was like to live back when the IRS existed. Victory is very near, so don't
let this day--national disgrace that it is--get you down. Have a nice day.

Sincerely,

Larken Rose
This email address is being protected from spambots. You need JavaScript enabled to view it.
http://www.theft-by-deception.com

Re: on honor and disagreements

(originally launched into cyberspace on 04/15/2003)
---

David Cay Johnston writes:
>
> ...I have never done any about face.

You are delusional. But that's okay. The whole country will still know the
truth. Hmmm... I wonder if Pulitzers ever get revoked.

Here is a quiz (which you will dodge, like before):

1) Did Section 217(a)(3) of the Revenue Act of 1925 mean that the domestic
wages of ALL U.S. citizens are taxable?

Hint: Anyone who can read will answer "NO."

2) Since that is the predecessor of the current 861(a)(3), pick one:
a) the scope of that section of law has been expanded to include the
domestic wages of ALL U.S. citizens.
b) that section STILL does not mean that the domestic income of all
citizens is taxable.

It's either one or the other. So which is it?

Here's another one that should trigger your psychological denial:

3) Does 862(a)(3) mean that the wages of EVERYONE working outside of the
U.S. are subject to the U.S. income tax?

4) Does 861(a)(3) mean that the wages of EVERYONE working inside the U.S.
are subject to the U.S. income tax?

Since the wording of the two sections are almost identical (except one being
"within" and one being "without") your two answers should be the same. But
they can't be, for you to maintain your position, can they?

5) If the "plain language" of 861(a)(3) means that the domestic wages of all
citizens are taxable, why have your buddies at the IRS spent FIVE YEARS
refusing to SAY that? You don't find that curious?

It's because they know more than you do. And I know more than you do. And
soon 280,000,000 other people will know more than you do.

Have a nice day.

Sincerely,

Larken Rose
This email address is being protected from spambots. You need JavaScript enabled to view it.
http://www.theft-by-deception.com

Reporting? Hardly.

(originally launched into cyberspace on 04/15/2003)
---

Dear List Subscriber,

I should have been more clear that my last message was a response to a note
to me from David Cay Johnston, writer for the New York Times. I included it
to this list to show you how biased and irrational the mainstream media can
be. I want to show you his response, to demonstrate how little EVIDENCE and
LOGIC matter to them.

I just received another note from him, doing his usual evasion, assertion,
and accusation routine. Notice what was ASKED, and how he responded.

-----------------------------------
I asked:
-----------------------------------

Here is a quiz (which you will dodge, like before):

1) Did Section 217(a)(3) of the Revenue Act of 1925 mean that the domestic
wages of ALL U.S. citizens are taxable?

Hint: Anyone who can read will answer "NO."

2) Since that is the predecessor of the current 861(a)(3), pick one:
a) the scope of that section of law has been expanded to include the
domestic wages of ALL U.S. citizens.
b) that section STILL does not mean that the domestic income of all citizens
is taxable.

It's either one or the other. So which is it?

Here's another one that should trigger your psychological denial:

3) Does 862(a)(3) mean that the wages of EVERYONE working outside of the
U.S. are subject to the U.S. income tax?

4) Does 861(a)(3) mean that the wages of EVERYONE working inside the U.S.
are subject to the U.S. income tax?

Since the wording of the two sections are almost identical (except one being
"within" and one being "without") your two answers should be the same. But
they can't be, for you to maintain your position, can they?

5) If the "plain language" of 861(a)(3) means that the domestic wages of all
citizens are taxable, why have your buddies at the IRS spent FIVE YEARS
refusing to SAY that? You don't find that curious?

-----------------------------------
David Cay Johnston responded:
-----------------------------------

I have never embraced your position, never said or written anywhere
that it has any merit whatsoever. Indeed, after carefully studying the issue
I have consistently characterized it as nonsense with not a scintilla of
basis in the law.

I have sent you the code language showing that Section 861 explicitly
states that all wages earned for work performed in the US are taxable, with
the minor exceptions cited in subsection (a) (3) (i.e., summer jobs for
foreign college students).

You continue to ignore that language, presumably because you know full
well that it shows that your 861 position is utterly without merit.

Rather than address this fatal flaw in your theory (one of many fatal
flaws) you toss out drivel, asking inane and irrelevant questions.

At no point have I ever embraced your theory and there is an abundant
written record establishing that. For you to state otherwise demonstrates
your reckless disregard for the truth.

-------------------------------

I am not sure if Mr. Johnston can't read, or is intentionally being
dishonest. I never said he agreed with my conclusions. He hasn't. I said
he contradicted his OWN positions, and he just did it AGAIN. HALF the time
he says (as above) that the wages of all Americans is taxable because of
861(a)(3). The OTHER half of the time he insists that 861 has nothing to do
with most Americans. (Both claims are provably incorrect.)

Mr. Johnston is psychologically incapable of accepting the truth, and my
goal is not to try to convince him. The rest of the world will soon know
the truth, and Mr. Johnston will be hiding in some corner, muttering
"frivolous." Ultimately his propaganda will be irrelevant. But in the
meantime, he makes a good example of what we're up against. Look at the
simple logic in what I asked, and his REFUSAL to address it (he has to
insult it instead, calling it "drivel"). The logic there is pretty simple,
and his psychological inability to address it is very telling.

If 217(a)(3) from 1925 did NOT mean that all domestic wages are taxable for
everyone (which is undeniable), and 217(a)(3) is the predecessor of
861(a)(3) (which is also undeniable), then either:

1) The scope of that part of the law has greatly expanded since 1925, or;
2) Section 861(a)(3) STILL does not mean that all domestic wages are taxable
for everyone.

Mr. Johnston obviously believes #2 is false. LOGIC dictates that he must
believe #1. Trouble is, 80 years of regulations and Congressional
commentary show that #1 is FALSE. So what does he do? Does he look for a
way to reconcile this information? Nope. He insults it. How's that for
some quality "reporting"?

He dodged the other questions as well. If he reads 861(a)(3) to mean that
ALL domestic wages are taxable for EVERYONE (with the one unusual
exception), then why doesn't he read the almost identical wording of
862(a)(3) to mean that all FOREIGN wages of everyone are taxable? Because
it doesn't fit his agenda, and doesn't protect the incorrect "common
knowledge."

Finally, if his reading of 861(a)(3) is correct--if it DOES mean that ALL
domestic wages are taxable--then why have his buddies in the IRS refused to
SAY THAT? Mr. Johnston doesn't even care that his own "allies" in this
debate DISAGREE with him. All he cares about is the CONCLUSION: most
Americans HAVE to be taxable, no matter what train of logic or blind leap of
faith is needed to get to that conclusion. It doesn't matter if his
argument matches what IRS Chief Counsel says; it doesn't even matter if it
matches what HE said in his last e-mail (and it doesn't); ALL that matters
it that "conventional wisdom" is defended, whether it's right or not.

Again, I don't care what Mr. Johnston thinks. His irresponsible reporting
(if not intentional lying) is not going to keep the fraud alive. But
understanding how the psychology of the status quo proponents works is
important to overcoming it. If you study HOW peoples' minds shut down to
"uncomfortable" evidence, you can see how to get through it. It also helps
to be able to show people how irrational the status quo defenders can get
when trying to defend conventional wisdom. People expect nationally-known
writers to at least have some interest in evidence, logic, and the truth.
As you can see, that's not always true.

Sincerely,

Larken Rose
This email address is being protected from spambots. You need JavaScript enabled to view it.
http://www.theft-by-deception.com

Do the Math

(originally launched into cyberspace on 04/14/2003)
---

Dear List Subscriber,

After my recent messages about propaganda scare tactics, and about how the
DOJ isn't PROSECUTING those relying on the 861 evidence (just censoring a
few of the loudest proponents), someone just brought to my attention a
recent New York Times story by my favorite spin doctor, David Cay Johnston.
It bemoans the continuing collapse of "income tax" enforcement, and the
increase in people "cheating."

In case any of you still wonder why I would be so looney as to DARE the feds
to prosecute me (as I have been doing for a couple years now), this article
shows why. Poor David Cay Johnston, whose eyes shut involuntarily when
faced with evidence that contradicts his long-held beliefs, is at a complete
loss to explain WHY they haven't gone after me (or others relying on the 861
evidence).

As many of you may recall, Mr. Johnston parrotted the bogus theory from the
DOJ and "Judge"* Conner in Pennsylvania that 26 USC § 861(a)(3) means that
the domestic wages of ALL Americans are taxable. (* Considering what Mr.
Conner actually DID in the case of the injunction against Thurston Bell, I
believe "Cut-and-Paste Conner" is far more accurate than "JUDGE" Conner.)
After being shown irrefutable evidence that Section 861 does NOT mean that
all domestic wages are taxable, Mr. Johnston ran the other way, suddenly
doing a complete about-face (while pretending he hadn't), saying that 861
has nothing to do with most Americans.

Notwithstanding Mr. Johnston's clinical-stage psychological denial, he finds
himself at a loss to explain the very conspicuous ABSENCE of any 861-related
prosecutions. It shows in his recent article, which includes the following
(with my comments added in brackets):

"One leader of the "tax honesty" movement [I don't consider myself that],
Larken Rose, a medical transcriptionist [no I'm not] in Philadelphia [no I'm
not], has repeatedly challenged the Justice Department to prosecute him for
not paying taxes [no, for not paying NON-taxes] since 1997 [since 1996, but
who's counting?] under an argument known as the 861 position, after a
section of the tax law. The Justice Department has brought numerous 861
civil fraud cases and won all of them. [Many are still in litigation, though
I expect the pattern of censorship to continue.] Mr. Rose says Attorney
General John Ashcroft will not indict him out of fear that a jury would
acquit him. [Close enough.] Both the I.R.S. and the Justice Department say
Mr. Rose's claim that Congress has exempted most wages from tax [that's not
quite what I say] is nonsense, but decline to comment on why Mr. Rose has
not been indicted."

Declined to comment, huh? Maybe they're just taking a break? Hardly. They
are going for injunctions all over the place, and are now prosecuting "Judge
Rizzo" (among others). They seem to be REALLY busy: 1) CENSORING those who
mention 861 (which only requires a "judge's" ruling, not a jury, and; 2)
PROSECUTING those who mention everything ELSE (where there WOULD be a jury
making the decision). Is that not slightly curious, in light of the fact
that the DOJ admits that THOUSANDS of people are now relying on the 861
evidence to file claims for refunds or to not file at all? Even Mr.
Johnston can't help but find that odd.

This is PRECISELY why I publicly dared them to prosecute me. Even the lazy,
lap-dog press notices such a thing, and feels the need to mention it, even
if reluctantly, and even if only in their usually slanted "get those darn
cheaters!" theme. Certain patterns of behavior that don't "make sense"
eventually get noticed, even by the most unattentive observors. Mr.
Johnston may be semi-comfortable clinging to his incorrect conventional
wisdom (though he has done some pretty impressive intellectual gymnastics to
avoid the evidence that messes up that "conventional wisdom"), but even he
is noticing that something really strange is going on.

---------------------------------------

In keeping with the "do the math" theme, showing patterns of evidence that
point in strange directions, I thought it would be helpful--for new folks on
this list as well as everyone else--to show the pattern that I've had the
privilege to see first-hand over the past few years.

For a few years now, I've been trying to get the government to decide what
it's OWN position is on two fundamental, painfully relevant and reasonable
points. To paraphrase, the two main questions are: 1) should I use 26 USC §
861(b) and 26 CFR § 1.861-8 to determine my taxable domestic income, and; 2)
do those sections show my income (as a U.S. citizen living and working only
in the 50 states) to be taxable? (I refer to these below as the "two deadly
points.") Every tax professional knows that it is IMPOSSIBLE to determine
what you owe without determining your "taxable income." So knowing the
answers to those questions is absolutely ESSENTIAL to the 100,000,000+
Americans trying to figure out what they owe.

If my income IS taxable, as "conventional wisdom" says, there are only TWO
possible ways to answer the "TWO DEADLY POINTS": 1) "No, you're not supposed
to use 861 (so the second question doesn't matter)," or; 2) "Yes, you should
use those sections, and yes, they show your income to be taxable." It has
to be one or the other, if my income really IS taxable.

Surely the government KNOWS what it's own position is, right? Well, here is
a chronological summary of my experiences in trying to get the government to
decide it's OWN position on those points. (This is part of what the DOJ
doesn't want a jury to see.)

(Actually, the government's own position is found in the Code of Federal
Regulations, which shows that the correct answers are: 1) YES, I should use
those sections (26 CFR §§ 1.861-1(a)(1), 1.861-1(b), 1.861-8(a)(1),
1.862-1(b), 1.863-1(c)), and; 2) NO, they don't show my income to be taxable
(26 CFR §§ 1.861-8(a)(1), 1.861-8(a)(4), 1.861-8(f)(1)), because it's NOT.)

1) I didn't file a return or make any payments to the IRS for 1997. I DID,
however, send them a letter telling them WHY, and asking that they address
the "TWO DEADLY POINTS." I never got a response.

2) The following year, I AGAIN sent a letter, telling what I was doing and
why, and asking for the government's position on the "TWO DEADLY POINTS."
No response.

3) In preparation for an Examination meeting concerning a claim for refund
we filed, I sent the IRS a letter (March of 2000) including the "TWO DEADLY
POINTS," and saying I expected them to be able to address these points at
the meeting. But at that meeting, in response to the first point, here is
the response I got (which is typical of the rest of the meeting):

Cathy Spaulding, IRS Examiner: "I would say section 61 and section 63 are
used to determine gross income and taxable income. As far as the regs, I
can’t answer. I admit, I’m much more familiar with the Code, because that’s
primarily what we use. We do use the regs when it’s... when we have to come
to a decision. But I’m just saying as far as my knowledge right now without
actually doing research..."

Here is the full transcript of that meeting (the above quote is on page 3):
http://www.taxableincome.net/extortion/case1/transcript1.html

Again, they didn't know their OWN position on the "TWO DEADLY POINTS."

4) Since the Examiner didn't know her OWN position, I decided I should send
a request for "technical advice" on the "TWO DEADLY POINTS." Technical
advice is a procedure for sending questions of legal application to the IRS
lawyers. Guess what happened. At each of several levels, they REFUSED to
issue any "technical advice"; the LAWYERS wouldn't say what their own
position was either.

Is this looking suspicious yet?

5) Eventually, we had another Examination meeting (a.k.a "audit") concerning
the fact that we had stopped filing and paying. Again, I sent them a letter
about a MONTH before the scheduled meeting (September of 2000), which
addressed the "TWO DEADLY POINTS," so they could tell me their OWN position.
Having met with me before, I thought maybe they'd know their OWN position at
the meeting. Nope. After explaining the first "DEADLY POINT," and showing
the citations that say I SHOULD use 861, I asked them for their position.
They STILL weren't sure, and we had this little exchange:

L.R. "Do you see what this says [pointing at the handout]?"
C.S. "I do."
L.R. "Do you understand what I just read?"
C.J. "Yeah."
C.S. "Yes."
L.R. "Do you understand why I think what I think?"
C.S. "Yes."
C.J. "Yeah, I... look, I don’t know why there’s... ya know... not more of an
obvious... I think we’re missing something somewhere here under 861."

Immediately after that, after they admitted they still didn't KNOW their own
position, one IRS agent said that IRS District Counsel told them NOT to send
that issue for technical advice.

Here is the full transcript of the meeting:
http://www.taxableincome.net/extortion/case3/transcript1.html

6) Maybe the problem was that I wasn't asking the right IRS officials, or
ENOUGH of them. So in April of 2001, I started "Operation Honest Inquiry,"
in which well over a HUNDRED people sent the "TWO DEADLY POINTS" to the IRS
and well over a HUNDRED Congressional offices. Guess how many people got an
actual ANSWER to any of the questions? Zero.

Here are the results of "Operation Honest Inquiry":
http://www.taxableincome.net/takestand/honestinquiry/responseindex.html

7) Meanwhile, the IRS started widely issuing legally-irrelevant "notices"
mentioning 861. But surprise, surprise... those "notices" very carefully
DID NOT answer either of the "TWO DEADLY POINTS." They STILL weren't saying
what their OWN position was.

8) Meanwhile, the "Tax Court" had issued a few (non-binding) rulings about
861, which also DID NOT answer the "TWO DEADLY POINTS" (though they did lots
of asserting and insulting).

9) So we went to the top, and a friend of mine sent the letter to the IRS'
top attorneys at Chief Counsel in DC, specifically asking about the "TWO
DEADLY POINTS." The IRS sent back form letters, which carefully AVOIDED
both points. After sending the same questions a couple more times, IRS
CHIEF COUNSEL wrote back, saying they had provided all the "general
information" they had on the topic. (In other words, the weren't going to
answer the specific points.)

10) Shortly after a new Assistant Secretary of the Treasury (Pam Olson) took
office (November of 2002), about THREE HUNDRED people asked Ms. Olson a few
questions, including the "TWO DEADLY POINTS." Ms. Olson never responded.

11) In January and February of 2003, OVER THREE HUNDRED more letters were
sent to Ms. Olson, asking the "TWO DEADLY POINTS" (and four other near-fatal
points). Ms. Olson never responded.

12) In late 2002, about TWO HUNDRED people sent a letter to Jim South--one
of the IRS employees orchestrating their nationwide plan for dealing with
those who mention 861--asking just the FIRST of the "TWO DEADLY POINTS" (to
make it easier on them). He never responded.

(I have to point out here that we weren't demanding an argument or debate,
or even proof of anything; we were merely asking what their OWN position is
on two fundamental points, and they either COULD NOT or WOULD NOT say.)

13) Beginning in late February of this year, more than SIX HUNDRED letters
were sent to more than SIX HUNDRED offices of H&R Block, asking just the
FIRST of the "TWO DEADLY POINTS." Surely one of the most widely-used
private industry tax preparation companies would know how THEY determine the
taxable domestic income of their clients. Guess how many responses we got?
Zero. When Peter McCandless called their headquarters (in Kansas City),
they ADMITTED getting a whole bunch of letters, but said it wasn't their
"policy" to answer "such a question." This is H&R Block we're talking
about. WHAT THEY DO is answer questions about tax laws... but not THAT
question.

Suspicious yet?

If I were to include every example of every time someone has asked a
government official or private sector "tax expert" to say what their OWN
POSITION is on the "TWO DEADLY POINTS," there would be literally HUNDREDS of
items on this list. And no answers.

If this pattern doesn't seem suspicious to you--if you don't find it odd
that NO ONE IN THE WHOLE STINKING GOVERNMENT seems to know for sure how YOU
are supposed to DETERMINE YOUR TAXABLE DOMESTIC INCOME (which you have to do
to determine what you owe)--then you probably shouldn't be on this update
list. If, on the other hand, you find that at least a tad strange, you will
be very interested by what happens over the next 12 months.

Sincerely,


Larken Rose
This email address is being protected from spambots. You need JavaScript enabled to view it.
http://www.theft-by-deception.com

(P.S. I really don't TRY to make my messages this enormous. It just
happens.)

KGO 810 AM (California... I think)

(originally launched into cyberspace on 04/14/2003)
---

Dear List Subscriber,

Just after writing my previous near-infinite rant, someone pointed out that
an IRS spokesman and "tax expert" (Jesse Weller) will be appearing on the
radio on April 14th, beginning at 10:00 a.m. on KGO 810 AM (in California...
I think). Here is the info:

http://www.kgoam810.com/upcomingguests.asp

I'm on the other side of world (Pennsylvania), but if any of you are in KGO
territory, and would like to, feel free to call in and give Mr. Weller this
offer (make sure you get the specifics right):

I will give him $3,000 personally--or give $3,000 to the charity of his
choice if he prefers--if he will come on the air on Peter McCandless' radio
show with me some time in the next few months, for ONE hour, and answer and
discuss six questions about what the LAW says about determining taxable
domestic income. I will give him the questions well in advance, or he can
look them up himself at www.taxableincome.net/PamOlson.doc (which you can of
course mention on the air).

Based on the pattern I laid out in the last message, what do you think his
response will be?

Sincerely,

Larken Rose
This email address is being protected from spambots. You need JavaScript enabled to view it.
http://www.theft-by-deception.com

Nota Respectable Topic?

(originally launched into cyberspace on 04/14/2003)
---

Dear List Subscriber,

I'm sure you'll all be shocked (hardly) to learn that even though a bunch of
people tried to get through to the KGO radio show this morning to give Mr.
Weller my $3000 challenge, none was put on the air. (A bunch of others sent
e-mails, which the station acknowledged receiving.) No mention was made on
the show. I guess it's just not something proper people discuss in polite
conversation. Oh well.

We will be doing similar challenges/tauntings in the future, offering
THOUSANDS of dollars to any IRS official (and sometimes tax attorneys), just
to discuss their OWN position on what the law itself says. And we will
almost alway get the same results: silence.

As those of you who had the chance to listen to Peter McCandless' show know,
he offered a prominent Kansas City CPA $500 to be on his show for an hour to
answer a few questions. The guy AGREED, and had a show scheduled,
indicating that any questions would be okay. But Peter wanted him to have
the questions in advance. They were the six questions that Pam Olson now
has over 600 copies of, shown here:

http://www.taxableincome.net/PamOlson2.doc

Just to brag, I told Peter that once the CPA SAW the questions, he would
back out of the deal. He did. Suddenly $500 for 42 minutes of
talking--about something he's supposed to be an EXPERT on--wasn't "worth his
time." Hmmmm.

On Peter's most recent show, the offer was up to $1,500. I wouldn't bother
going much higher for a mere CPA, but for an IRS official, we can keep
sweetening the pot. I offered $3,000 (a lot of which was from pledges from
other people) to Mr. Weller, but the show didn't mention the offer. Someone
else offered to throw in another $1,000 (bringing the totla to $4,000), but
I didn't get the note in time to change the offer for the show. It would be
fun to see how high a reward we could get, just to have some IRS "expert"
let me question him for one hour. We'll be doing more to organizing such a
thing soon. I'll let you know how you can pile on with a "pledge" when the
time comes.

Sincerely,

Larken Rose
This email address is being protected from spambots. You need JavaScript enabled to view it.
http://www.theft-by-deception.com

(P.S. A few of you have told me that you intentionally don't use credit
cards or bank accounts, but want to buy a copy of "Theft By Deception," and
some have specifically asked if we accept e-gold. We finally can, though
not at the web site. If you want to buy videos, the e-gold account is in my
name ("Larken Rose"), and the account number is 810094. If you do buy
videos that way, also send me an e-mail (including your address) to make
sure I get the message quickly so I can send the videos out right away.)