Some
maintain that they are not a “person” as defined
by the Internal Revenue Code, and thus not subject to the
federal income tax laws. This argument is based on a tortured
misreading of the Code.
The
Internal Revenue Code clearly defines “person”
and sets forth which persons are subject to federal taxes.
Section 7701(a)(14) defines “taxpayer” as any
person subject to any internal revenue tax and section 7701(a)(1)
defines “person” to include an individual, trust,
estate, partnership, or corporation. Arguments that an individual
is not a “person” within the meaning of the Internal
Revenue Code have been uniformly rejected. A similar argument
with respect to the term “individual” has also
been rejected.
Relevant Case Law:
United States v. Karlin, 785 F.2d 90, 91 (3d Cir. 1986), cert.
denied, 480 U.S. 907 (1987) – the court affirmed Karlin’s
conviction for failure to file income tax returns and rejected
his contention that he was “not a ‘person’
within meaning of 26 U.S.C. § 7203” as “frivolous
and requir[ing] no discussion.”
McCoy v. Internal Revenue Service, 88 A.F.T.R.2d (RIA) 5909,
2001 U.S. Dist. LEXIS 15113, at *21, 22 (D. Col. Aug. 7, 2001)
– the court dismissed the taxpayer’s complaint,
which asserted that McCoy was a nonresident alien and not
subject to tax, describing the taxpayer’s argument as
“specious and legally frivolous.”
United States v. Rhodes, 921 F. Supp. 261, 264 (M.D. Pa. 1996)
– the court stated that “[a]n individual is a
person under the Internal Revenue Code.”
Biermann v. Commissioner, 769 F.2d 707, 708 (11th Cir.), reh’g
denied, 775 F.2d 304 (11th Cir. 1985) – the court said
the claim that Biermann was not “a person liable for
taxes” was “patently frivolous”
and, given the Tax Court’s warning to Biermann that
his positions would never be sustained in any court, awarded
the government double costs, plus attorney’s fees.
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Some individuals argue that they have rejected citizenship
in the United States in favor of state citizenship; therefore,
they are relieved of their federal income tax obligations.
A variation of this argument is that a person is a free born
citizen of a particular state and thus was never a citizen
of the United States. The underlying theme of these arguments
is the same: the person is not a United States citizen and
is not subject to federal tax laws because only United States
citizens are subject to these laws.
The
Fourteenth Amendment to the United States Constitution defines
the basis for United States citizenship, stating that “[a]ll
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.” The Fourteenth
Amendment therefore establishes simultaneous state and federal
citizenship. Claims that individuals are not citizens of the
United States but are solely citizens of a sovereign state
and not subject to federal taxation have been uniformly rejected
by the courts.
Relevant Case Law:
O'Driscoll v. I.R.S., 1991 U.S. Dist. LEXIS 9829, at *5-6
(E.D. Pa. 1991) – the court stated, “despite
[taxpayer’s] linguistic gymnastics, he is a citizen
of both the United States and Pennsylvania, and liable for
federal taxes.”
United States v. Sloan, 939 F.2d 499, 500 (7th Cir. 1991),
cert. denied, 502 U.S. 1060, reh’g denied, 503 U.S.
953 (1992) – the court affirmed a tax evasion conviction
and rejected Sloan’s argument that the federal tax laws
did not apply to him because he was a “freeborn, natural
individual, a citizen of the State of Indiana, and a ‘master’
– not ‘servant’ – of his government.”
United States v. Ward, 833 F.2d 1538, 1539 (11th Cir. 1987),
cert. denied, 485 U.S. 1022 (1988) – the court found
Ward’s contention that he was not an “individual”
located within the jurisdiction of the United States to be
“utterly without merit”
and affirmed his conviction for tax evasion.
United States v. Sileven, 985 F.2d 962 (8th Cir. 1993) –
the court rejected the argument that the district court lacked
jurisdiction because the taxpayer was not a federal citizen
as “plainly frivolous.”
United States v. Gerads, 999 F.2d 1255, 1256 (8th Cir. 1993)
– the court rejected the Gerads’ contention that
they were “not citizens of the United States, but rather
‘Free Citizens of the Republic of Minnesota’ and,
consequently, not subject to taxation” and imposed sanctions
“for bringing this frivolous appeal based
on discredited, tax-protestor arguments.”
Solomon v. Commissioner, T.C. Memo. 1993-509, 66 T.C.M. (CCH)
1201, 1202-03 (1993) – the court rejected Solomon’s
argument that as an Illinois resident his income was from
outside the United States, stating, “[he]
attempts to argue an absurd proposition, essentially that
the State of Illinois is not part of the United States. His
hope is that he will find some semantic technicality which
will render him exempt from Federal income tax, which applies
generally to all U.S. citizens and residents. [His] arguments
are no more than stale tax protester contentions long dismissed
summarily by this Court and all other courts which have heard
such contentions.”
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Some
argue that the United States consists only of the District
of Columbia, federal territories (e.g., Puerto Rico, Guam,
etc.), and federal enclaves (e.g., American Indian reservations,
military bases, etc.) and does not include the “sovereign”
states. According to this argument, if a taxpayer does not
live within the “United States,” as so defined,
he is not subject to the federal tax laws.
The
Internal Revenue Code imposes a federal income tax upon all
United States citizens and residents, not just those who reside
in the District of Columbia, federal territories, and federal
enclaves.
In
United States v. Collins, 920 F.2d 619, 629 (10th Cir. 1990),
cert. denied, 500 U.S. 920 (1991), the court cited Brushaber
v. Union Pac. R.R., 240 U.S. 1, 12-19 (1916), and noted the
United States Supreme Court has recognized that the “sixteenth
amendment authorizes a direct nonapportioned tax upon United
States citizens throughout the nation, not just in federal
enclaves. This frivolous contention has been uniformly rejected
by the courts."
Relevant Case Law:
In re Becraft, 885 F.2d 547, 549-50 (9th Cir. 1989) –
the court, observing that Becraft’s claim that federal
laws apply only to United States territories and the District
of Columbia “has no semblance of merit,”
and noting that this attorney had previously litigated cases
in the federal appeals courts that had “no
reasonable possibility of success,” imposed
monetary damages and expressed the hope “that
this assessment will deter Becraft from asking this and other
federal courts to expend more time and resources on patently
frivolous legal positions.”
United States v. Ward, 833 F.2d 1538, 1539 (11th Cir. 1987),
cert. denied, 485 U.S. 1022 (1988) – the court rejected
as a “twisted conclusion”
the contention “that the United States has jurisdiction
over only Washington, D.C., the federal enclaves within the
states, and the territories and possessions of the United
States,” and affirmed a tax evasion conviction.
Barcroft v. Commissioner, T.C. Memo. 1997-5, 73 T.C.M. (CCH)
1666, 1667, appeal dismissed, 134 F.3d 369 (5th Cir. 1997)
– noting that Barcroft’s statements “contain
protester-type contentions that have been rejected by the
courts as groundless,” the court sustained
penalties for failure to file returns and failure to pay estimated
income taxes.
Once I have time to link all the foregoing cases and post
them to this site for your review, you will note that these
cases tend to have a common thread. The appeals are filed
pro se; no self respecting lawyer would walk into a federal
court and make these ridiculous arguments.
I
welcome your comments,
questions and suggestions.
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