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Tax Protester Told to Stop Giving Advice
Associated Press ^ | Mon, Jan. 13, 2003 | MARC LEVY

Posted on 01/13/2003 1:26:05 PM PST by heyhey

Edited on 04/13/2004 3:30:09 AM PDT by Jim Robinson. [history]

HARRISBURG, Pa. - A tax protester who allegedly promotes a bogus legal loophole to convince people they owe no taxes was ordered by a federal judge to stop the practice and turn over his clients' records.

The order came Friday in the government's effort to force Thurston Bell of Hanover to stop giving clients allegedly false tax advice and charging large fees for filing tax returns.


(Excerpt) Read more at bayarea.com ...


TOPICS: Business/Economy; Constitution/Conservatism; Crime/Corruption; Foreign Affairs; Front Page News; Government; Miscellaneous; News/Current Events; US: Pennsylvania
KEYWORDS: anlper; taxes; taxreform
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1 posted on 01/13/2003 1:26:05 PM PST by heyhey
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2 posted on 01/13/2003 1:27:30 PM PST by Anti-Bubba182
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To: heyhey
So is Bell going to comply with the court order or is he going to jail? The article doesn't say.
3 posted on 01/13/2003 1:29:58 PM PST by Catspaw
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To: heyhey
And if I sell medical or legal advice, whether correct or not, I am in violation of the law; as I am neither a doctor or a lawyer.
4 posted on 01/13/2003 1:30:26 PM PST by Hodar
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To: heyhey
What is section #861, and what band of grifters in the political elite was it meant to exempt. The story may be the guy doing this, but I find the story of section #861 a bit more concerning. I mean we all share equally in the burden of paying taxes don't we???????
5 posted on 01/13/2003 1:31:02 PM PST by blackdog
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To: *Taxreform
http://www.freerepublic.com/perl/bump-list
6 posted on 01/13/2003 1:31:09 PM PST by Free the USA
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To: heyhey
If you don't pay taxes you do go to jail if caught but the tax protestors are quite correct the 16th wasn't properly ratified.
7 posted on 01/13/2003 1:32:16 PM PST by weikel (Mercy to the Guilty is Cruelty to the Innocent)
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To: Taxman; ancient_geezer
fyi
8 posted on 01/13/2003 1:36:48 PM PST by Free the USA
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To: heyhey
He is right that your wages are exempt and you owe no income tax on them. However, being right about this amoounts to nothing - you will still go to jail. Note that he asked them to show him what was wrong in what he said - rather than respond they said it was "frivolous". He has some specific legal points he is making that are substantiated by the code. They will not respond becasue they can't prove he is wrong. That is his whole point. They feel they don't need to prove anything because they have power and you go to jail if you don't believe.
9 posted on 01/13/2003 1:38:45 PM PST by artios
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To: blackdog
26 U.S.C. 861.
10 posted on 01/13/2003 1:40:53 PM PST by aristeides
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To: artios
Quite right. This order amounts to the judicial branch violating his first amendment rights.
11 posted on 01/13/2003 2:37:15 PM PST by HaveGunWillTravel
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To: artios
They will not respond becasue they can't prove he is wrong.

If they can't prove him wrong then that makes him right.

12 posted on 01/13/2003 2:41:27 PM PST by MosesKnows
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To: weikel
If you don't pay taxes you do go to jail if caught but the tax protestors are quite correct the 16th wasn't properly ratified.

If you use the tax protestor's arguments on the rest of the Constitution, then Constitution itself and all of its amendments prior to about 1960 (when Xerox machines became common) were properly ratified.

13 posted on 01/13/2003 2:44:39 PM PST by Poohbah (When you're not looking, this tag line says something else.)
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To: blackdog
What is section #861, and what band of grifters in the political elite was it meant to exempt.

Nonresident aliens who do not have receive income from any source inside the United States. In other words, if you live in Pakistan, are not a US citizen, and do not receive income from any source within the United States, you don't owe US income taxes.

And that is the totality of Thurston Bell's "strategery." You simply claim that you are a nonresident alien with no income from any source inside the United States.

That's kind of hard to explain when you live in, say, Topeka, Kansas, and own/operate some sort of enterprise in Topeka, where you do your business.

14 posted on 01/13/2003 2:51:36 PM PST by Poohbah (When you're not looking, this tag line says something else.)
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To: artios
Bingo. Same old story. The government has bigger guns and being right doesn't afford you any rights...
15 posted on 01/13/2003 2:56:03 PM PST by ApesForEvolution ((communism is a rash that needs to be scraped off of the planet))
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To: artios
Hmmm ... isn't there a conspiracy to deprive others of there civil rights (1st amendment) charge that could theoretically be laid at this judge's feet ?
16 posted on 01/13/2003 3:02:47 PM PST by Centurion2000 (Darth Crackerhead)
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To: aristeides
Thanks! Kind of a dumb claim. Interesting though! You would think the code would rip everyone. Glad to see that Saudi Nationals living here don't need to pay taxes.
17 posted on 01/13/2003 3:11:18 PM PST by blackdog
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To: MosesKnows
If they can't prove him wrong then that makes him right.

If you say the planet Pluto is populated by green eye lizards and I am unable to prove you wrong, it does not mean the planet Pluto is populated by green eye lizards.

Whether I agree with what this guy is doing or saying, you statement is incorrect.

18 posted on 01/13/2003 3:12:05 PM PST by dpa5923 (Tag line (optional, printed after your name on post):)
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To: Centurion2000
Hmmm ... isn't there a conspiracy to deprive others of there civil rights (1st amendment) charge that could theoretically be laid at this judge's feet ?

He can spout off for free. He's being enjoined from taking money for his advice, because he's a fraud.

19 posted on 01/13/2003 3:15:34 PM PST by Poohbah (When you're not looking, this tag line says something else.)
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To: blackdog
Glad to see that Saudi Nationals living here don't need to pay taxes.

The only way that happens is if the foreign national (it doesn't just apply to Saudis) is legally nonresident AND the income only comes from outside the US.

20 posted on 01/13/2003 3:18:27 PM PST by Poohbah (When you're not looking, this tag line says something else.)
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To: PatrickHenry
Patrick, didn't you write an essay on tax protesters a few years ago? Do you still have it?
21 posted on 01/13/2003 3:27:57 PM PST by jennyp (http://crevo.bestmessageboard.com)
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To: jennyp
http://www.freerepublic.com/forum/a38cad9c905cc.htm
22 posted on 01/13/2003 3:36:43 PM PST by Poohbah (When you're not looking, this tag line says something else.)
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To: heyhey
I am one of those citizens that the IRS labels a PDT (Potentialy dangerous Taxpayer). From personal experience I can state that you will NOT win trying to take on the IRS, because the IRS does NOT follow the law. Bell's position however, is the only one that has been out there for more than a few years and has not been challenged in court by the IRS as far as I know. If you want to get details about the 861 argument, go to Bell's website at www.taxgate.com. In a nut shell the 861 argument is that sec. 861 lists all of the "other sources" of income that produce income that is taxable. The argument is actually very strong.
23 posted on 01/13/2003 3:40:34 PM PST by ANTIROCKEFELLER
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To: Hodar
I wasn't aware of licensing requirements for dispensing tax advice. Is it against the law for me to do people's taxes for them?
24 posted on 01/13/2003 3:42:36 PM PST by SoDak
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To: SoDak
I wasn't aware of licensing requirements for dispensing tax advice. Is it against the law for me to do people's taxes for them?

Depends. If you sell your services as a means of avoiding ALL income taxes, based on a frivolous interpretation of the Internal Revenue Code, then you're setting yourself up for fraud charges--and you CAN be legally enjoined from continuing to defraud people.

25 posted on 01/13/2003 4:11:25 PM PST by Poohbah (When you're not looking, this tag line says something else.)
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To: ANTIROCKEFELLER; Poohbah
Bell's position however, is the only one that has been out there for more than a few years and has not been challenged in court by the IRS as far as I know.

Thanks to Poohbah for the link to the huge Tax Protester FAQ.

AR, I counted 13 decisions regarding § 861 here, along with a clear explanation of why it's a bogus claim. (Unfortunately.) I'd post the explanation here, but it's very long.

26 posted on 01/13/2003 4:12:14 PM PST by jennyp (http://crevo.bestmessageboard.com)
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To: artios; heyhey

He is right that your wages are exempt and you owe no income tax on them.

Stratton's Independence, LTD. v. Howbert(1913), 231 U.S. 399:

 

Lane Co. v. Oregon (1868), 74 U.S. [7 Wall.] 71:

 

COOK v. TAIT, 265 U.S. 47 (1924)

 

Lucas v. Earl(1930), 281 U.S. 111:

U.S. v. CONSTANTINE, 296 U.S. 287 (1935)

 

Charles C. Stewart Machine Co. v. Davis (1937), 301 U.S. 548:

House Congressional Record, March 27, 1943, pg. 2580:

 

They will not respond becasue they can't prove he is wrong.

Sure they can't. /sarcasm

United States v. Melton, No. 94-5535 (4th Cir. 1996)
ARGUED: Lowell Harrison Becraft, Jr.[one of Schulz & Co. legal beagles], Huntsville, Alabama, for Appellants.

The jury heard not only the United States's evidence against the Meltons, but also the brothers' defense that they believed they were not "persons liable" for federal income tax. The jury rejected the excuse, however, and convicted them on nearly all counts.

  • [Subtitle A] "Section 1 of the Internal Revenue Code imposes a federal tax on the taxable income of every individual.
    26 U.S.C. s 1."
  • [Subtitle A] "Section 63 defines "taxable income" as gross income minus allowable deductions."
    26 U.S.C. s 63.
  • [Subtitle A] Section 61 states that "gross income means all income from whatever source derived," including compensation for services.
    26 U.S.C. s 61.
  • [Subtitle F] Sections 6001 and 6011 provide that a person must keep records and file a tax return for any tax for which he is liable.
    26 U.S.C. ss 6001
    26 U.S.C. ss 6011.
  • Finally, section 6012 provides that every individual having gross income that equals or exceeds the exemption amount in a taxable year shall file an income tax return.
    26 U.S.C. s 6012.

The duty to pay federal income taxes therefore is "manifest on the face of the statutes, without any resort to IRS rules, forms or regulations." United States v. Bowers, 920 F.2d 220, 222 (4th Cir.1990). The rarely recognized proposition that, "where the law is vague or highly debatable, a defendant--actually or imputedly--lacks the requisite intent to violate it," Mallas, 762 F.2d at 363 (quoting United States v. Critzer, 498 F.2d 1160, 1162 (4th Cir.1974)), simply does not apply here.

Each Melton brother had gross income in excess of the amount requiring the filing of a return in each of the years at issue. Therefore, each was a "person liable."

26 USC 7805(a) Rules and regulations
(a) Authorization - … the Secretary [of the Treasury] shall prescribe all needful rules and regulations for the enforcement of this title [Title 26]…" [26 USC § 7805]

Thus under amplifying Treasury regulations for 26 USC 1, 26 CFR 1.1-1(a),(b)

Sec. 1.1-1 Income tax on individuals.

(a) General rule. (1) Section 1 of the Code imposes an income tax on the income of every individual who is a citizen or resident of the United States and, to the extent provided by section 871(b) or 877(b), on the income of a nonresident alien individual.

(b) Citizens or residents of the United States liable to tax. In general, all citizens of the United States, wherever resident, and all resident alien individuals are liable to the income taxes imposed by the Code whether the income is received from sources within or without the United States.

And in Regard to 26 USC 861

TITLE 26 - INTERNAL REVENUE CODE
Sec. 861. Income from sources within the United States
(a) Gross income from sources(activities) within United States
The following items of gross income shall be treated as
income from sources
(activities) within the United States:

(3) Personal services
Compensation for labor or personal services performed in the United States;

EXCEPT that compensation for labor or services
performed in the United States
shall not be deemed to be income
from sources within the United States if -

(A) the labor or services are performed by a nonresident
alien
individual temporarily present in the United States for a
period or periods not exceeding a total of 90 days during the
taxable year,
(B) such compensation does not exceed $3,000 in the
aggregate, and
(C) the compensation is for labor or services performed as an
employee of or under a contract with

(i) a nonresident alien, foreign partnership, or foreign
corporation
, not engaged in trade or business within the
United States, or
(ii) an individual who is a citizen or resident of the
United States
, a domestic partnership, or a domestic
corporation, if such labor or services are performed for an office or place of business maintained in a foreign country
or in a possession of the United States by such individual,
partnership, or corporation.
In addition, except for purposes of sections 79 and 105 and
subchapter D, compensation for labor or services performed in the
United States shall not be deemed to be income from sources
within the United States if the labor or services are performed
by a nonresident alien individual in connection with the
individual's temporary presence in the United States as a regular
member of the crew of a foreign vessel engaged in transportation
between the United States and a foreign country or a possession
of the United States.

In Summary, if you are a United States citizen, and receive compensation for labor or services in the United States you are subject to income taxes.

 

A tax levied as an excise or duty on an activity of commerce, the exchange of labor or services for compensation with another person.

A LAW DICTIONARY
by John Bouvier, Revised Sixth Edition, 1856:

WAGES,
contract. A compensation given to a hired person for his or her services.

KNOWLTON v. MOORE, 178 U.S. 41 (1900)

BROMLEY v. MCCAUGHN, 280 U.S. 124 (1929)

Tyler v. U.S. 281 U.S. 497, 502 (1930)


27 posted on 01/13/2003 4:24:12 PM PST by ancient_geezer
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To: jennyp
Patrick, didn't you write an essay on tax protesters a few years ago? Do you still have it?

Loads of them. This thread I started is almost 3 years old, but a lot of the links are still good: ALL "TAX PROTESTER" ARGUMENTS TOTALLY DEBUNKED .

28 posted on 01/13/2003 4:49:11 PM PST by PatrickHenry (PH is really a great guy!)
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To: PatrickHenry
True Conservatives, would be rooting for people to get around the IRS, not attacking them for it.

There's nothing noble about taxation. It is in fact, evil.

29 posted on 01/13/2003 4:49:57 PM PST by DAnconia55
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To: DAnconia55
Voluntary Alternatives to Taxation
The Hawaii Reporter ^ | April 16, 2002 (what a date!) | Stuart K. Hayashi
Posted on 01/11/2003 7:34 PM PST by ultimate_robber_baron
Voluntary Alternatives to Taxation
http://www.freerepublic.com/focus/news/821162/posts
30 posted on 01/13/2003 4:53:21 PM PST by Libertarianize the GOP
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To: DAnconia55
True Conservatives, would be rooting for people to get around the IRS, not attacking them for it. There's nothing noble about taxation. It is in fact, evil.

Of course. But I don't want to see conservatives march into a meat grinder because they've been given horribly bad advice. The only way to fix the system is to abolish the IRS, repeal the Code, and amend the Constitution. It's just foolish to imagine that there's some secret argument you can buy at some seminar that will win for you in court, which is ballyhooed all over the internet, and which Congress somehow never gets around to fixing.

31 posted on 01/13/2003 4:53:54 PM PST by PatrickHenry (PH is really a great guy!)
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To: weikel
This whole issue ignores the crux of our terrible Constitutional crisis: The Missing 13th Amendment specifies that any law written after 1822 by any lawyer is void and invalid. Therefore, traffic stops, the income tax, parking fees, property taxes, Social Security, all illegal! < /sarc>
32 posted on 01/13/2003 5:04:16 PM PST by Cultural Jihad
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To: Cultural Jihad
I'd settle for invaliadating any law enacted after Woodrow Wilson was inaugurated( excepting the Coolidge administration).
33 posted on 01/13/2003 5:05:55 PM PST by weikel (Mercy to the Guilty is Cruelty to the Innocent)
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To: DAnconia55
Is it evil to tell someone up on the high dive, as they're jumping on the board, ready to do a Triple Lundy, that there's no frickin' water in the pool?
34 posted on 01/13/2003 5:07:32 PM PST by Poohbah (When you're not looking, this tag line says something else.)
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To: DAnconia55; PatrickHenry; Kevin Curry; Roscoe

And this drivel from a self-professed Libertarian who claims that possession of child pornography should be perfectly legal and protected by the full force of L.P. Brown Shirt law.

35 posted on 01/13/2003 5:09:17 PM PST by Cultural Jihad
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To: heyhey
"Every time Bell convinces another individual to file false tax returns ... the internal revenue laws are thwarted," Conner said. "The court will not countenance such impropriety."

What the hell does that mean? That Bell is right? If there is a huge loophole in the law complain to Congress, judge.

If he is wrong, the IRS could collect huge fines and late payments, right? What are they squawking about? Hmmm...I need to look this Bell guy up.

36 posted on 01/13/2003 5:13:46 PM PST by hattend ("I have a cunning plan" - Baldrick)
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To: hattend
What the hell does that mean?

It means that when Bell, using his bogus arguments, convinces someone to file a false tax return, the IRS has to go off after the guy filing the return

That Bell is right?

No. It does not mean that at all. It means JUST THE OPPOSITE.

BTW, what's your take on English being the official language of the USA? Oppose, or favor?

If there is a huge loophole in the law complain to Congress, judge.

There isn't. That's why he's saying the laws are THWARTED.

If he is wrong,

He is.

the IRS could collect huge fines and late payments, right?

Yes, they can. Do you think that that is a GOOD THING?

What are they squawking about? Hmmm...I need to look this Bell guy up.

And another guy jumps off the diving board on Bell's statement of "The pool's not empty, it just LOOKS empty."

37 posted on 01/13/2003 5:18:34 PM PST by Poohbah (When you're not looking, this tag line says something else.)
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To: hattend
What the hell does that mean? That Bell is right?

If I convince you that sex with children is legal, and you go out and seduce a child, the law protecting children has been thwarted. Got it?

38 posted on 01/13/2003 5:24:04 PM PST by PatrickHenry (PH is really a great guy!)
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To: Kathleen; Neets
Gosh,do we know anyone like this??
39 posted on 01/13/2003 5:26:51 PM PST by habs4ever (Do you think he's a LePer??lol)
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To: aristeides
It sure seems that paragraph 3 CLEARLY states that income from services for labor is taxable.
40 posted on 01/13/2003 5:30:29 PM PST by PatrioticAmerican (Let's all pay our fair share...make the poor pay taxes! They pay nothing!)
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To: blackdog
"we all share equally in the burden of paying taxes don't we???????"

No, actually we don't. Top 50% of wage earners pay 96+% of income taxes. Source: IRS
41 posted on 01/13/2003 5:30:55 PM PST by jaugust
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To: jaugust

Something the tax-and-spend liberals do not like to admit come tax reform time.

42 posted on 01/13/2003 5:34:00 PM PST by Cultural Jihad
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To: heyhey

Seems to me that the burden of proof should lie with the Government. If he's so bad then it shouldn't be any trouble to prove it, right?

43 posted on 01/13/2003 5:36:31 PM PST by Jhoffa_ (We have vays of making you zee the movie, mister Cmsgop.. You vill buy da action figures also.)
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To: SoDak
Is it against the law for me to do people's taxes for them?

The key word here is 'selling'. Unless you are a certified public accountant, or licensed to do so ... you may be sued for your efforts. The issue is 'selling' your talents. Whether it's a haircut, oil change, or even recommending a stock. You have to be licensed.

44 posted on 01/13/2003 5:39:10 PM PST by Hodar
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To: weikel

There's a pressing issue which will certainly resonate with about .025% of lucid voters. ;)

45 posted on 01/13/2003 5:42:21 PM PST by Cultural Jihad
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To: Hodar
So unless you are willing to do it the way the Government dictates you have no right to be in business?
46 posted on 01/13/2003 5:45:00 PM PST by The Obstinate Insomniac
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To: Jhoffa_
Seems to me that the burden of proof should lie with the Government. If he's so bad then it shouldn't be any trouble to prove it, right?

Try reading the article again. Bell is in court. The judge has issued the order. Presumably, the gov't has already presented a sufficient case for the judge to do so, because judges just don't issue orders like that on their personal whim. Just because Bell tells the press that he's innocent (as everyone being prosecuted is known to do) is no reason for you to take his word that there's no evidence against him.

47 posted on 01/13/2003 5:48:26 PM PST by PatrickHenry (PH is really a great guy!)
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To: jaugust
It was a joke....Sorry
48 posted on 01/13/2003 5:48:31 PM PST by blackdog
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To: Cultural Jihad
"Something the tax-and-spend liberals do not like to admit come tax reform time."

And which is why the BIG THREE networks, which still has a loud voice in America are better at getting the liberal message out about "tax breaks for the rich." Don't know how many times I've had to dispell stories heard by my colleagues at work over something they've heard from RatherJenningsBrokaw that was either only partly true or not true at all. It is to weep, sometimes.
49 posted on 01/13/2003 5:52:03 PM PST by jaugust
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To: blackdog
"It was a joke....Sorry"

No apologies needed...I'm tired and cranky so it went over my head...way over, in fact. So my apologies to you.
Cheers!
50 posted on 01/13/2003 5:54:27 PM PST by jaugust
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