Posted on 01/23/2003 9:38:02 AM PST by Middle Man
SAN FRANCISCO -- A federal appeals court has ruled the Internal Revenue Service committed fraud and acted deceptively after giving secret deals to two pilots in return for their testimony against 1,300 pilots who bought into the same tax shelters.
The 9th U.S. Circuit Court of Appeals on Friday overturned a previous ruling against the pilots who were found guilty of tax evasion and were ordered to pay more than $2 billion in penalties.
To remedy the IRS misconduct, the court ordered that all the pilots should receive the same deal that one of the pilots received.
As part of the secret deal, pilot John Thompson escaped paying the taxes he owed and received a $60,000 refund through falsified tax returns prepared with help from the IRS. Thompson used the refund to pay his legal fees. He also collected $20,000 in interest, according to the ruling. The second pilot, John Cravens, also received a secret deal.
IRS lawyers Kenneth McWade and William Sims, who prosecuted the case, never revealed to the tax court that the two pilots' cases had been settled, much less revealed the settlement's conditions.
The appeals court said the lawyers' silence turned into misconduct when, during a trial, it became apparent that Thompson was going to testify about his settlement and McWade shifted his question to unrelated topics.
The ruling requires the IRS to pay tens of million of dollars in tax refunds, interest and legal fees to the pilots who paid the disputed taxes more than 20 years ago.
The court criticized the IRS for not taking serious action against the lawyers who tried the case. McWade and Sims were suspended for two weeks without pay.
The group of pilots participated in a tax shelter designed by now-deceased Honolulu businessman Henry Kersting, which enabled participants to claim interest deductions on their individual tax returns, according to the court.
The IRS discovered the scheme in 1981 and did not allow the deductions, then sent bills to the pilots for additional taxes and penalties.
The ruling will require the IRS to pay tens of millions of dollars in tax refunds, interest and legal fees, said Michael Louis Minns, a Houston tax lawyer who represented some of the pilots. One pilot, who paid the disputed taxes more than two decades ago and then took the IRS to tax court, is due about $6 million, Minns said.
Some pilots who did not pay the taxes will receive nothing but will have tax liens removed from their homes, Minns said.
IRS spokesman Terry Lemons said over the weekend that the agency had no comment.
"I hope to get the money back, but I'm not holding my breath," said Terry Owens, a retired Continental Airlines pilot who lives on the Hawaiian island of Oahu.
Owens said he expects the IRS to appeal, and if the U.S. Supreme Court hears the case, it will be another year before he'll know what sort of settlement he'll receive.
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FreeRepublic , LLC PO BOX 9771 FRESNO, CA 93794
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What is this world coming to!
I also stated when I first heard the ruling that the IRS will never pay a dime. Funny caveat though......Everyone is in an uproar over "fraud" committed by the IRS? Hello? Where has everyone been?
I wonder if they will ever act on the IRS practice of recording conversations between attorney/client when IRS reps leave a conference room, hoping to get some juicy chat?
In all fairness to the IRS, they do have a few good souls. There is a lady down in Atlanta that is the only person I will speak with. She has resolved several costly issues for me that were making the desk to desk shuffle tour.(keeps piling penalties and interest). I have her direct number and she has acted professionally, compassionately, and sees each issue all the way to resolution. Sure I may not love writing a check, but it's not as bad when the person you are dealing with is honest, competent, and thorough.
More IRS scandal ping.
So go to the real root of the problems (Congress) and demand they get rid of the income/payroll tax system and the IRS.
John Linder (R Texas) offers a comprehensive bill to kill all income and payroll taxes outright, and provide a IRS free replacement:
H.R.2525
SPONSOR: Rep Linder, John (introduced 07/17/2001)
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.
Refer: http://www.fairtax.org & http://www.salestax.org
Banister, in his speeches, tells how on his first day on the job as a Special Agent in the Criminal Investigation Division (CID), he had not been given any assignments yet and casually started reading through the IRS codebook. A supervisor spotted him and promptly came over and slammed the book shut on his desk, reprimanding him for bothering to look at the actual law.
The great service that Banister and others are doing is exposing the culture of lying and deception the IRS has been engaged in since its inception.
Next time you have a close encounter with an IRS agent, ask to see their pocket commission and see if the badge number is preceded by an "A" or an "E". If it's preceded by an "A", that means the person you're dealing with has NO enforcement authority -- either delegated or statutory -- to make you do anything with respect to income taxes.
John Turner and Sherry Jackson both testified that they never knew while they were in the service that their "non-enforcement" pocket commissions didn't give them any power to intimidate and threaten people into paying a tax those hapless victims didn't owe. The difference is, that they had enough integrity to stop abusing their authority once they discovered the hoax.
How many other IRS agents do you suppose are at this moment terrorizing Americans and destroying families, lives and businesses with powers they don't have?
They also seem to target those of us who cannot afford a good tax attorney and know we have just enough available equity to hit us up. Under ten grand and an attorney will cost just as much. Now the IRS knows that $50,000 knock-over's will meet with resistance and a good attorney.
Once an employer has three to four years pass, just try to get them to assist you? The IRS knows this too.
The difference is, that they had enough integrity to stop abusing their authority once they discovered the hoax.
Interesting then than folks like Bannister, who recommends William T. Conklin as an tax authority, are not above perpetrating their own sort of hoax on people encouraging them into the IRS meat grinder.
Found this at nettaxs.com, Under their FAQ page regarding Conklin
"William T. Conklin claims to be successful in fighting the IRS, and has described himself as a "known tax protester like Jesus Christ, Thomas Jefferson, Benjamin Franklin and George Washington." Conklin v. United States, KTC 1994-259, Case No. 89-N-1514 (D. Col. 1994). Unfortunately, his claims of success are contradicted by the public record, because he has lost every case on record. See, e.g., Conklin v. Commissioner, 91 T.C. 41 (1988); Church of World Peace, Inc. v. Commissioner, T.C. Memo 1992-318; Church of World Peace, Inc. v. Commissioner, T.C. Memo 1994-87.
Cases claimed as wins by William T. Conklin:
Church of World Peace, Inc. v IRS, 715 F.2d 492
United States v. Church of World Peace, 775 F.2d 265
Conklin v. United States, 812 F.2d 1318
Conklin v. C.I.R., 897 F.2d 1032
Tavery v. United States, 897 F.2d 1027
Tavery v. United States, Civ. No. 87-Z-180, USDC Colorado "
I Recommend reading Otto Skinner's research into Bannister, and Conklin. Gives a good summary of the Conklin cases and he will even send you copies of the case filings and judgements for your own review for the cost of printing and mailing them to you.
http://ottoskinner.com/a-banister.html
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There is alot more but I'm sure you will get the picture.
How many other IRS agents do you suppose are at this moment terrorizing Americans and destroying families, lives and businesses with powers they don't have?
Bannister's definitely one. Using Conklin's spielf to set up people for one big fall if they rely on his misleading and false claims.
Eicher v. United States, 774 F.2d 27 (1st Cir. 1985)
Argued that the Fifth Amendment allowed him to withhold all financial information from his income tax return.It is well-settled that a taxpayer may not assert a blanket claim of Fifth Amendment privilege to avoid providing any financial information on an income tax return. Betz v. United States, 753 F.2d 834 (10th Cir.1985); Heitman v. United States, 753 F.2d 33 (6th Cir.1984); Brennan v. Commissioner, 752 F.2d 187 (6th Cir.1984); Martinez v. I.R.S., 744 F.2d 71 (10th Cir.1984); Baskin v. United States, 738 F.2d 975 (8th Cir.1984). While the privilege can be invoked in response to particular questions--in proper circumstances where the taxpayer can demonstrate a real danger of incrimination--it cannot be used, in effect, to excuse filing of a return.
United States v. Heise, 709 F.2d 449 (6th Cir. 1983)
Argued that his failure to file proper returns constituted a valid exercise of his Fifth Amendment privilege against compulsory self-incrimination.The gravamen of this appeal is Heise's argument that he is protected by the fifth amendment from disclosing the information requested and may not be subjected to prosecution for the exercise of that right. The Supreme Court has held that the fifth amendment privilege against compulsory self-incrimination, if validly exercised, is a defense to a s 7203 prosecution. Garner v. United States, 424 U.S. 648, 662, 96 S.Ct. 1178, 1186, 47 L.Ed.2d 370 (1976).
The court also has held that the privilege does not justify an outright refusal to file an income tax return. United States v. Sullivan, 274 U.S. 259, 263, 47 S.Ct. 607, 71 L.Ed. 1037 (1927).
In the present case, Heise asserted the privilege in response to each specific question; however, he did so on such a wholesale basis as to deny the Internal Revenue Service any information with respect to his income for the years 1976 and 1977. This Circuit has held that a tax return which contains no information from which tax liability can be calculated does not constitute a tax return within the meaning of the Internal Revenue Code. See [cites ommitted].
Other circuits also have held that the failure to provide any information in a tax return is tantamount to failure to file any return at all. See, [cites ommitted]. Therefore, Heise's failure to provide the proper financial data on his tax returns amounted to a total failure to file a return. This cannot be justified under the fifth amendment.
United States v. Drefke, 707 F.2d 978 (8th Cir. 1983)
Argued that he was a "nontaxpayer" because he did not enter a contract for government services, that the district court had no jurisdiction, and that the tax code violated his Fifth and Thirteenth Amendment rights.Drefke argues that 26 U.S.C. ss 7203 and 7205 giving rise to his conviction constitute punishment for failure to give self-incriminating information. Both the Supreme Court and the Eighth Circuit have held that the Fifth Amendment right against self-incrimination does not authorize individuals to refuse to disclose information concerning their income. United States v. Sullivan, 274 U.S. 259, 47 S.Ct. 607, 71 L.Ed. 1037 (1927); United States v. Russell, 585 F.2d 368 (8th Cir.1978).
"In United States v. Sullivan, 274 U.S. 259 (1927), the Court held that the privilege against compulsory self-incrimination is not a defense to prosecution for failing to file a return at all. But the Court indicated that the privilege could be claimed against specific disclosures sought on a return, saying:
- "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."
"In summary, we conclude that since Garner made disclosures instead of claiming the privilege on his tax returns, his disclosures were not compelled incriminations. 21 He therefore was foreclosed from invoking the privilege when such information was later introduced as evidence against him in a criminal prosecution.
The judgment is
- Affirmed."
UNITED STATES v. SULLIVAN, 274 U.S. 259 (1927)
"As the defendant's income was taxed, the statute of course required a return. See United States v. Sischo, 262 U.S. 165 , 43 S. Ct. 511. In the decision that this was contrary to the Constitution we are of opinion that the protection of the Fifth Amendment was pressed too far. 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. We are not called on to decide what, if anything, he might have withheld. Most of the items warranted no compaint. It would be an extreme if not an extravagant application [274 U.S. 259, 264] 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. Mason v. United States, 244 U.S. 362 , 37 S. Ct. 621; United States ex rel. Vajtauer v. Commissioner of Immigration ( January 3, 1927) , 47 S. Ct. 302. In this case the defendant did not even make a declaration, he simply abstained from making a return. See further the decision of the Privy Council, Minister of Finance v. Smith (1927) A. C. 193.
That image of Hans Brinker trying to plug all the leaks in the dike keeps coming to mind. ;^)
With TP guru's in the starring role of Saddam Hussein, & DOJ just chomping at the bit:
http://www.freerepublic.com/focus/news/822146/posts
IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF PENNSYLVANIA UNITED STATES Plaintiff v. THURSTON BELL Defendant CIVIL NO. 1:CV-01-2159 (Judge Conner) Filed Harrisburg, PA January 10, 2003 ORDER AND NOW, this 10th day of January, 2003, in accordance with the accompanying memorandu, it is hereby ORDERED that plaintiffs motion for preliminar injuction (Doc.34) is GRANTED. It is further ORDERED that:
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Read the tax law and you will learn (well you can learn) that the adverage American does not owe income tax in the first place.
You are right, the average american meaning most, (i.e. children, unemployed, low income retired, students, welfare clients street people, etc.) don't. They are below the personal exemption/deduction threshold for filing.
That is why we have abit of a problem implementing your
fix to the problem is to cut government programs PERIOD. There are only a few things the government is responsible for. Few things to cut out, welfare programs, DEA, FBI, IRS, BATF, and much more.
"Representative DeMint is concerned about the steady growth of a welfare/entitlement state that extends well beyond the poor and is forcing millions of middle income Americans into dependency.
There has been a shift in the relationship between individuals and government, he argues, such that fewer and fewer are paying taxes at the same time that more and more are receiving increasingly generous benefits. If it becomes the case that most voters do not bear a financial burden for this largess, then there will be little to restrain--and significant political incentives to encourage--the continued growth of government. And at that point, DeMint warns, we have reached a major crisis in our democracy."
Milton Friedman as quoted by Northwest Florida Daily News, 10-16-2000:
Walter Williams, World Net Daily, 10-25-2000
According to the most recent U.S. Treasury Department figures, in 1997 the top 1 percent of income-earners (those with income of $250,000 and higher) paid 33 percent of all federal income taxes. The top 5 percent of income-earners ($108,000 and over) paid 52 percent, and the top 50 percent ($36,000 and over) paid 96 percent of income taxes. Guess what the bottom 50 percent of income earners paid?
If you're among those who pay little or no federal income taxes, what do you care about tax cuts? Moreover, if you think tax cuts pose a threat to government handout programs, you might be openly hostile and support Al Gore's silly "risky scheme" talk. So many Americans paying little or no federal taxes makes for a natural spending constituency. It's like me in the restaurant: What do I care about extravagance if you're footing the bill?
To remove taxation of the individual, is to remove the goad which assures accountability of government to the electorate. Federal tax rates are high because a majority of the electorate do not share proportionately in the burden their demand for largesse imposes on the minority of citizens.
The siren call for representation without taxation is the formula that got us where we are at today. The ability to hide or disguise taxation from the view of large sectors of the electorate allows the Congress to get away with the creation of the evergrowing monster that it fosters.
A government which robs Peter to pay Paul can always depend on the support of Paul.
-George Bernard Shaw
Liberty and freedom have a price, responsibility. If that price is avoided there are no brakes on the growth of government, the ultimate result is the end of freedom through creeping socialism.
Right now the bottom 60% perceive little to no "Individual Income Tax" burden,(in many cases even a handout) and 70% of the voting public clamors for more from government looking for the top 40% of income earners/producers to foot the bill. That perception continues to grow ever stronger by eliminating even more participants from the Federal Individual Income Tax rolls as proposed in the tax reduction proposals through changes in personal exemption limits and other mechanisms such as the EITC.
What you want is for us to jump out of the pan and into the first with a national sales tax.
Darned right, everyone should be required to participate in the tax system to assure that all perceive the burden of largess that is imposed upon the nation. As long as a majority of the electorate does not perceive the cost to themselves, you can be guaranteed that government will do nothing but grow and become ever more dictatorial:
Sir Alex Fraser Tytler (1742-1813). Scottish jurist and historian:
"A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largess from the public treasury. From that time on the majority always votes for the candidates promising the most benefits from the public treasury, with the results that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.
Secondly, it makes no sense whatsoever to tax on the basis of one's productivity, taxes should be laid on the basis of what benefit one derives from the nation.
- It is fairer to tax people on what they extract from the economy, as roughly measured by their consumption, than to tax them on what they produce for the economy, as roughly measured by their income.
"As a matter of fact, what the income tax does and this is the debate that I think we always try to get into in order to let you and him fight, see and the people of this country are led down a path where the actual control of their resources, which in the end is the control over their will, is handed off to the government."
. . .
"The government then manipulates that will in order to destroy the freedom of our electoral system through the income tax structure, and we call the resulting slavery a free system."
"In point of fact, it is not as the founders understood, and the only way to restore real freedom is to give people back control over the income that they earn so that they wont, at the voting booth and in other phony issues, be subject to that manipulation."
- KEYES TRANSCRIPT (01/28/02)
We wonder why over 60% of the voters PERCEIVE no problem with the taxrates and vote for polidiots that promise to bring home the most bacon because they are the only ones that benefit from higher taxes with more spending on socialistic "gimme" programs. As this continues under Bush or anyone else for that matter, expect a liberal tax and waste congress for many years to come.
We are all paying through the nose, rich and poor while politicians play the tune of envy and resentment that Americans continue to respond to not understanding the full picture what is happening to them. The NRST is a means to open VOTERS eyes to the reality.
Is it any wonder that Alan Keyes refers to the income tax as the slave tax and supports a National Retail sales tax to replace it?
The Original Intent of the individual income tax is for political and social control not revenue collection. The Individual Income tax is maintained to establish and hold every person in the country perpetual legal jeopardy. That is a situation that must end with the repeal of the income tax from the statutes, and the prohibition of its use by Constitutional amendment that future generations will not face the same manner of manipulation and interference in their lives.
Folks, something else these IRS-friendly posters won't tell you about our court system and their figures is the common practice of prosecutors in big-time drug cases (where they bust people who operate methamphetamine labs or dealers caught with 1,000 pounds of pot) getting the defendant to plead guilty to "income tax" evasion with a promise of no extra jail time. This is done all the time so the government can inflate and distort its own statistics on the "income tax" for the sole purpose of keeping the populace in fear and subjugation.
Remember, this is "tax season" and the mainstream media gears up hand-in-hand with the government PR machines every year -- same time, same station -- to keep you down!
So we've got proof (as if we needed more) from this article that the government routinely engages in forgery, perjury, mail fraud and extortion.
We also have a great deal of evidence that TP gurus engage in the same practices as well as sell their wares to the gullible and and easily influenced.
Patriot Beware!
by Thomas R. Eddlem
http://www.thenewamerican.com/tna/1997/vo13no04/vo13no04_patriot.htm
Remember, this is "tax season" and the mainstream media gears up hand-in-hand with the government PR machines every year -- same time, same station -- to keep you down!
Agiprop is what they call a statement such as yours.
However, the real solution is to end all income and payroll taxes, corporate and individual.
Patrick Henry, Virginia Ratifying Convention June 12, 1788:
- "the oppression arising from taxation, is not from the amount but, from the mode -- a thorough acquaintance with the condition of the people, is necessary to a just distribution of taxes. The whole wisdom of the science of Government, with respect to taxation, consists in selecting the mode of collection which will best accommodate to the convenience of the people."
- It is fairer to tax people on what they extract from the economy, as roughly measured by their consumption, than to tax them on what they produce for the economy, as roughly measured by their income
[Montesquieu wrote in Spirit of the Laws, XIII,c.14:]
- "A capitation is more natural to slavery; a duty on merchandise is more natural to liberty, by reason it has not so direct a relation to the person."
--Thomas Jefferson: copied into his Commonplace Book.James Wilson, Pennsylvania Ratifying Convention
4 Dec. 1787 Elliot 2:466--68
- No man is obliged to consume more than he pleases, and each buys in proportion only to his consumption. The price of the commodity is blended with the tax, and the person is often not sensible of the payment
The Records of the Federal Convention of 1787
(Farrand's Records)
James Mchenry before the Maryland House of Delegates.
Maryland Novr. 29th 1787--
Appendix A, CXLVIa, page 149, S9.
- "Convention have also provided against any direct or Capitation Tax but according to an equal proportion among the respective States: This was thought a necessary precaution though it was the idea of every one that government would seldom have recourse to direct Taxation, and that the objects of Commerce would be more than Sufficient to answer the common exigencies of State and should further supplies be necessary, the power of Congress would not be exercised while the respective States would raise those supplies in any other manner more suitable to their own inclinations --"
John Linder (R Texas) offers a comprehensive bill to kill all income and payroll taxes outright, and provide a IRS free replacement:
H.R.2525
SPONSOR: Rep Linder, John (introduced 07/17/2001)
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.
Refer: http://www.fairtax.org & http://www.salestax.org
Why haven't we seen your plan for an appropriate and constitutional replacement?
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