United States v. Me, Part 2

Larken Rose 

larken@taxableincome.net 

http://www.861.info 

http://www.theft-by-deception.com 

At the bottom of the infamous 1040 form is the signature line, under which it says that by signing the return, you're swearing under penalty of perjury that the return is correct to the best of your knowledge. Because the tax laws are insanely complicated, it makes sense that it's not a crime to make an innocent mistake on a return; it's only a crime to "willfully" do something other than what you believe the law requires. Here is what the Supreme Court says about the issue: 

"A good-faith misunderstanding of the law or a good-faith belief that one is not violating the law negates willfulness, whether or not the claimed belief or misunderstanding is objectively reasonable. Statutory willfulness, which protects the average citizen from prosecution for innocent mistakes made due to the complexity of the tax laws, [citation omitted] is the voluntary, intentional violation of a known legal duty." [Cheek v. United States, 498 U.S. 192 (1991)] 

In other words, if you do what you understand the law to require, even if you're wrong, then you have committed no crime. For example, Mr. Cheek 
(the guy who the above case was about) believed a theory about the tax laws that I, and the Supreme Court justices, think is dead wrong. But they made it clear that if he believed that his actions were in accordance with the law, then no crime was committed. 

My own case can be summed up as this: the government is portraying me as a nasty, evil "tax cheat," and is alleging that I did something OTHER than what I believe the law requires of me. In other words, at trial they have to prove that I don't REALLY believe what I SAY I believe. Let's look at a few specifics of what I "believe" about the law, and you can make up your own mind. (Bear with me here; if you can survive a few sections of "legalese," it will be worth it.) 

There are some basic things about the tax laws that just about everyone agrees on. For example, the tax applies only to "taxable income," and not all income is taxable. The tax code specifically lists some things (like gifts, life insurance proceeds, interest on certain municipal bonds) that are not subject to the tax. 

But then we start to get into my frivolous, fraudulent "scheme" beliefs 
(at least that's what the government calls them): 

I believe--or, as the government would like you to think, I am just PRETENDING to believe--that in addition to the kinds of income specifically exempted by statute, some OTHER kinds of income are also exempt from federal income taxes because of the Constitution itself 
(a.k.a. "fundamental law"). How did I reach such a zany, frivolous belief? Was it through a complex, tortuous theory about constitutional law? Well, no. It was because I found the federal law books saying this: 

"What excluded from gross income.-Gross income excludes the items of income specifically exempted by the statute and also certain other kinds of income by statute or fundamental law free from tax. Such tax-free income should not be included in the return of income and need not be mentioned in the return, unless information regarding it is specifically called for, as in the case, for example, of interest on municipal bonds." 

The actual section can be seen here: http://www.861evidence.com/pdfs/1924/Art%2071u.pdf 

That section doesn't tell us what those "certain other kinds of income" are, but whatever it is referring to, notice that the government's regulations are telling us that such exempt income "SHOULD NOT BE INCLUDED" on a tax return. So I'd better find out if any of my income is in that category, because I wouldn't want to report it as taxable when the law says I'm NOT SUPPOSED TO. 

Since the term "fundamental law" is a term people don't usually hear, and since some people might not know that "fundamental law" means the Constitution, another section was nice enough to explain it in more common terms: 

"Exemptions; exclusions from gross income Certain items of income specified in section 22(b) are exempt from tax and may be excluded from gross income. ... No other items may be excluded from gross income except (a) those items of income which are, under the Constitution, not taxable by the Federal Government; (b) those items of income which are exempt from tax on income under the provisions of any act of Congress still in effect..." 

Here is the whole section: http://www.861evidence.com/pdfs/1939/39.22%20(b)-1.pdf 

Once again, in ADDITION to the types of income specifically exempted by statute, other income is supposed to be "excluded from gross income" because of the Constitution itself. Again, we haven't yet seen what income that is referring to, but it must refer to something. 

Okay, let's take a breather from our brief trip into legalese-land, and consider some really basic points. 

1) Life insurance proceeds are specifically exempted by a section of the tax code (26 USC 101). Question: Is it "unpatriotic," or "fraudulent," or "frivolous," or immoral, or illegal, to fail to report tax-exempt life insurance proceeds on your income tax return? Answer: No. Reporting exempt income as if it's taxable is a MISTAKE. Unless you think there's something noble or patriotic about filing a false return, or MISapplying the law, this is a no-brainer. With that in mind... 

2) Some kinds of income (though not exempted by any statute) are still excluded from income taxation because of the Constitution itself. Question: Is it "unpatriotic," or "fraudulent," or "frivolous," or immoral, or illegal, to fail to report tax-exempt income on your income tax return? Answer: No. Reporting exempt income as if it's taxable is a MISTAKE. The law itself says you're NOT SUPPOSED to report exempt income on your return. Unless you think there's something noble or patriotic about filing a false return, or MISapplying the law, this is a no-brainer. 

We haven't yet seen WHAT is exempt because of the Constitution, but whatever it is, if YOU have that kind of income, you're NOT SUPPOSED to report it on your return. It's not taxable. So far the concept is pretty darn simple, isn't it? It's time for a painfully easy quiz: 

1) Is it "frivolous" to believe that some income is exempt because of the Constitution? 

2) Before today, did you know that some income was excluded because of the Constitution itself? 

3) Do you know what income it's talking about? 

4) Might it be reasonable to ask the government which income is excluded because of the Constitution? 

5) Would you find it somewhat odd if those in government refused to answer such a question? 

6) Is it immoral, selfish, unpatriotic, and/or criminal to fail to report EXEMPT income on your tax return? 

7) So far, does this discussion look like a "fraudulent scheme" to you? Does it look like something criminal? Does it look like something that someone should be prosecuted for? 

Okay, that's enough for today. I'll continue my nasty, frivolous, fraudulent, criminal scheming tomorrow. 

Sincerely, 

Larken Rose larken@taxableincome.net

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