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The truth about the federal income tax.

You can join the petition drive to end the income tax by scrolling to bottom of page.

Please read this information.  Most of it is background information leading to a Petition you can sign to end the Income Tax!

The Original Intent of the Sixteenth Amendment Was Only to Allow the Federal Government to Impose a Tax on the Profits of the Rich Corporations and their Shareholders; Not a Tax on Everything that Everyone Earns. This Amendment Has Never Been Changed Since Its Inception. This Means that the Original Intent of the Sixteenth Amendment Still Applies Today - That the Federal Income Tax is Only Supposed to be a Tax on the Profits of the Rich Corporations and Their Shareholders.

Everyone knows that the Sixteenth Amendment to the Constitution of the United States authorized the federal government to impose a federal Income Tax (although there are many who argue that the Sixteenth Amendment was never properly ratified), but few realize that the original intent of the Sixteenth Amendment was only to allow for a tax on the profits of the rich in this country, especially the rich corporations. And if the original intent of the Sixteenth Amendment (which is only one sentence long) was only to allow for a tax on the profits of the rich, (and that Amendment has never been altered, changed, or amended since its inception in 1913), then the only item subject to an Income Tax pursuant to the Sixteenth Amendment today is still the profits of the rich.

However, over time, people forgot about the original intent of the Sixteenth Amendment, which allowed the Government to get away with convincing people that the federal Income Tax could be imposed on anyone. Below, I will provide you with a tremendous amount of evidence proving that the original intent of the Sixteenth Amendment was only to allow for a tax on the profits of the rich and that those profits should be the only items subject to an Income Tax today.

Remember that during the early days of the United States, we were really an agricultural, agrarian society—a country of farmers and those living off the land. Sure, there were many tradesmen who provided services to others, but there was nothing like the huge corporations that we see today (even though the concept of incorporating businesses predates the founding of this country).

Then as the country grew larger and more people immigrated here, discoveries were made, inventions were developed, labor became plentiful, mills and factories were built, and the United States witnessed the Industrial Revolution. This country, in a relatively short period of time, transformed from an agricultural, agrarian nation to an industrial, manufacturing one. And along with this transformation to an industrial nation came tremendous profits to the corporations involved in the Industrial Revolution.

Now remember, back during this time period there was no Income Tax. Therefore, these wealthy corporations were not filing any Income Tax returns and the Government knew very little about them, especially since they were incorporated in individual states rather than with the federal Government. They and their stockholders were making vast fortunes due to the Industrial Revolution, however the Government was not receiving a penny in taxes, nor did it have any oversight or control over them.

The vast majority of taxes in those days came from internal excise taxes on products such as alcohol and tobacco, as well as from tariffs and duties on products coming into this country.

Because these tariffs and duties actually raised the cost of consumer items and because many of the taxes were internal excise taxes on alcohol and tobacco, many people felt that they were paying a disproportionate amount of the taxes needed to maintain the Government and that these wealthy corporations were not paying their fair share. These feelings led to major disputes in this country between the less affluent agrarian and laboring classes and the more affluent Eastern industrial class. These disputes led to the less affluent demanding that a tax be imposed on the profits of the rich, which in turn, led to the Sixteenth Amendment and a federal Income Tax.

Actually, the first Income Tax was imposed during the Civil War. It only lasted for ten years and it was repealed in 1871. Even though it was probably unconstitutional (remember, the Constitution had to be amended in order to allow for an Income Tax), it was only imposed as an emergency tax during war-time and it was repealed, so not too much of a fuss was ever made about it. As a matter of fact, this is where the term "tax return" came from. The Government hired tax collectors to collect Income Taxes from the people who owed them. These tax collectors would be issued lists of people who owed the tax, they would collect it, and then they would "return" the lists and the taxes back to the Government. Thus the phrase "tax return".

The next push for an Income Tax came about in 1893 as a result of the Government’s first federal budget deficit in twenty-eight years. On December 4, 1893, President Cleveland called for "a small tax upon certain corporate investments"¹ in order to pay off the federal budget deficit which had arisen as a result of the Panic of 1893. The Panic of 1893 was caused by the Government irresponsibly increasing silver coinage pursuant to the Bland-Allison and Sherman Silver Purchase Acts of 1878 and 1890. These acts caused this country to experience high rates of inflation. These high rates of inflation were finally stopped in 1893 with the repeal of the Sherman Act, but the damage to the country had already been done.

It is apparent from the Congressional debates leading up to the Income Tax Act of 1894 that Congress perceived of an income tax as a tax on wealth itself. For example, in the final debate on the income tax bill in the House of Representatives, Congressman Crisp, speaking for the majority party, stated:

"We propose in this new system simply to put part of the burden of the support of this Government upon wealth, and to take off a portion of the burden from consumption."²

Along the same lines, Congressman Lane stated:

"We are confronted with a deficit of revenue, and the question is presented whether it is best to put a light income tax on the rich man’s income or to tax the poor man’s sugar."³

And Congressman Bretz considered it as a means to—

" . . . emancipate the people of this country from an unjust system of taxation . . . (and hailed) with welcome the demand of the American people that the accumulated wealth of the land be taxed."⁴

Congressman Hudson of Kansas stated:

"This method (the income tax) lays the burdens on those possessing the ability to pay, and compels those who reap the harvests . . . to give more of that harvest for the common good. I know that many wealthy men are generous and charitable . . . On the other hand, the majority of the very wealthy are haughty, overbearing, autocratic, mean, and it is that class in particular that the income tax is designed to reach."⁵

It is obvious that this newly proposed Income Tax was only meant to be a tax on the rich of this country and upon no one else.

So President Cleveland’s request in 1893 led to Congress passing the Income Tax Act of 1894. Then in 1895, in one of the best decisions ever handed down by the Supreme Court of the United States, (Pollock v. Farmer’s Loan and Trust Co. 157 U.S. 429, 158 U.S. 601), the Supreme Court ruled that the Income Tax of 1894 was unconstitutional because it constituted a Direct Tax which wasn’t apportioned according to the taxing clauses of the Constitution regarding Direct Taxes.

Many people thought that the Supreme Court was simply acting as a protector of the rich. Typical press reaction against the Pollock decision were two editorials in the New York World newspaper. One of them stated that the Pollock decision was "the triumph of selfishness over patriotism." The other one said that "If the Constitution really prevents equal and just taxation, the people can amend the Constitution. And they will!"

However, other newspapers such as the New York Tribune declared that the Pollock decision preserved the Consitution against an assault by Communism.  In any event, after the Supreme Court rendered the Pollock decision, the battle lines were drawn between those who favored an Income Tax on the rich and those who did not.

After the Income Tax of 1894 was deemed to be unconstitutional by the Supreme Court, real public agitation for an Income Tax began in earnest. In the Presidential campaign of 1896, the Democrat Party became the first political party to endorse an Income Tax on the profits of the rich. They were soon followed that year by the Populist Party, the middle-of-the-road Populists, the Farmers’ Alliance and Industrial Union, the Socialist Labor Party and the Silver Republicans, as well as Democratic Presidential candidate William Jennings Bryan.

In the ensuing years, there were more calls for an Income Tax on the profits of the rich. President Theodore Roosevelt raised the issue himself in his message to Congress in 1906 and again in 1907. In 1908, the platform of the Democrat Party again called for—

"a constitutional amendment specifically authorizing Congress to levy and collect a tax upon individual and corporate incomes, to the end that wealth may bear its proportionate share of the burdens of government."⁶

It is important to note here that in those days (as shown by the above quote from the Democrat Party platform), the word "income" actually referred to the profits of the rich, as opposed to today where the word "income" has come to mean "anything that comes in" or "anything that anyone earns". This shows how the meaning of words can change over time. However, if the word "income" as used in the Sixteenth Amendment only referred to the profits of the rich at the time that that amendment was adopted, the word "income" with respect to the Sixteenth Amendment and the federal Income Tax must still have that same meaning today.

To continue on with the history of the Sixteenth Amendment and the federal Income Tax, in 1909 it appeared as though the Democrats in Congress were about to pass an Income Tax on the profits of wealthy corporations. They believed a different U.S. Supreme Court from the one which ruled in 1895 that an Income Tax was unconstitutional would find this tax constitutional because of a ruling in 1904 which allowed for certain excise taxes on corporate "privileges"⁷.

In order to circumvent the Democrats from passing this Income Tax on corporate profits and claiming all of the credit for themselves, Republican President Taft and the Republican Senate leadership recommended an amendment to the Constitution allowing for an Income Tax on the profits of the rich and a separate excise tax on corporations to be measured according to their profits. Both of these new measures were passed by Congress. The excise tax became the Corporation Excise Tax of 1909 and the proposed Constitutional amendment (which later became the Sixteenth Amendment) was sent out to the states for ratification.

As mentioned earlier, the citizens of the United States were very much in favor of amending the Constitution in order to allow for an Income Tax on the profits of the rich because there was a widely-held belief that these entities were not paying their fair share of taxes. The citizens of the country had been assured that the Income Tax was only going to be imposed upon the profits of the rich.

The language of the Sixteenth Amendment itself proves that the federal Income Tax was only meant to be a tax on profits. It reads "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States and without regard to any census or enumeration." The operative phrase denoting that this is only to be a tax on profits is "on incomes, from whatever source derived." This phrase shows that there are two items involved here. "Income" and the "source" from which the income is derived. In order to understand the meaning of the Sixteenth Amendment, one has to realize that there is a difference between "income" and the "source" from which it is derived.

The only way that "income" as that term is used in the Sixteenth Amendment can be derived from (or separated from) its "source" is if it is funneled through a business’ Profit and Loss Statement. First, the business delineates its Gross Revenue; then it deducts all of its operating expenses and overhead from its Gross Revenue; and what is left over is "income" (or, more correctly, "profit"). This is what the phrase in the Sixteenth Amendment "income, from whatever source derived" refers to—profits.

As further proof that the Sixteenth Amendment only pertains to a tax on profits, every once in a while there will be a story in the news about some giant corporation who might have had billions of dollars in revenue in any given year, but it didn’t pay any Income Taxes. The reason that it didn’t pay any Income Taxes is because it didn’t have any profits. And many people involved in businesses know that their business doesn’t pay an Income Tax on its income—its gross revenue. It only pays an Income Tax if it earns a profit. So, if a business only pays an Income Tax if it earns a profit, it is obviously not an Income Tax—it is a Profits Tax.  And the Internal Revenue Code doesn't say that the word "income" means one thing for a business and that it means something else for an individual.  If the word "income" in the Internal Revenue Code means "profit" with respect to a business, it means the same thing with respect to an individual.

So the amendment to the Constitution allowing the Government to impose an Income Tax on the profits of the rich was sent to the individual states of the union for ratification in 1909. By 1913, three-quarters of the states had ratified it (although there is a tremendous amount of evidence that it was never properly ratified) and it became the Sixteenth Amendment to the Constitution of the United States. Thereafter, Congress wrote the laws themselves imposing the Income Tax on the profits of the rich.

The original Income Tax statutes were only fourteen pages long and exempted anyone with less than $4000 in annual profits from having to pay it. For comparison, the average annual family income in 1913 was only $500 per year. So the original Income Tax didn’t kick in until one earned profits equaling eight times the average family income. ( When I use the word "income" here, I am using it in its generic sense, meaning anything that one earns, rather than it its legal sense, meaning profits.)

The original Income Tax itself began with a 1% tax imposed on $4000 or more in profits and was graduated as follows:

$4,000 to $20,000 in profits…………1% Income Tax
$20,000 to $50,000 in profits………..2% Income Tax
$50,000 to $75,000 in profits………..3% Income Tax
$75,000 to $100,000 in profits………4% Income Tax
$100,000 to $250,000 in profits……..5% Income Tax
$250,000 to $500,000 in profits……..6% Income Tax
Over $500,000 in profits………......….7% Income Tax

It is interesting to note that the Sixteenth Amendment to the Constitution is only one sentence long. It reads, "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment and without regard to any census or enumeration." It is also interesting to note that there is nothing in the Sixteenth Amendment which specifically restricts it to only being a tax on the profits of the rich. However, this is what the term "income" meant at that time as was shown in the history leading up to the Sixteenth Amendment and the Income Tax as I discussed earlier. Everyone at that time understood "income" to mean only "the profits of the rich" and that is the way that the original tax laws were written after the amendment was adopted.

The Supreme Court Weighs In on the Definition of "Income"

Over the next few years, there were also a number of Supreme Court decisions regarding the meaning of the word "income" as used in the Sixteenth Amendment. Some of those decisions are addressed below.

First of all, the word "income" is not defined in the Internal Revenue Code. This fact was stated by a U.S. Circuit Court of Appeals in the case of United States v. Ballard, 535 F2d 400, 404 (1940) when it observed "The general term ‘income’ is not defined in the Internal Revenue Code."

The reason why the word "income" is not defined in the Internal Revenue Code and why Congress is not able to provide its definition was explained by the United States Supreme Court in the case of Eisner v. Macomber, 252 U.S.189, 206 when it stated—

"In order, therefore, that the clauses cited from Article I of the Constitution have proper force and effect . . . it becomes essential to distinguish between what is and is not ‘income’ . . . Congress cannot by any definition it may adopt conclude the matter, since it cannot by legislation alter the Constitution."

The only way that the Constitution can be altered is by Congress passing an amendment to the Constitution, which then must be ratified by three-quarters of the States.

Because the word "income" is included in the Sixteenth Amendment to the Constitution of the United States ("Congress shall have the power to collect a tax on incomes, from whatever source derived . . ."), it was up to the federal courts to determine the definition of "income". This is because only the federal courts can determine the meaning of the provisions of the Constitution of the United States and the amendments to it.

Between 1913 and 1921, there were numerous U.S. Supreme Court decisions which dealt with the meaning of "income". The first case was Stratton’s Independence v. Howbert, 231 US 406, when the Supreme Court stated on pages 414-415—

"And, however the operation shall be described, the transaction is indubitably ‘business’ within the fair meaning of the act of 1909; and the gains derived from it are properly and strictly the income from that business; for ‘income’ may be defined as the gain derived from capital, from labor, or from both combined, and here we have combined operations of capital and labor." (emphasis added)

Notice that "income" referred to by the Supreme Court above is not everything that comes in or is earned, but is rather a "gain". The Court also might have used the word "profit" since they both mean the same thing. In this case, the tax was not applied ON labor, but rather it was applied to the gain derived from the use or employment of labor by a business. The meaning of "income, derived from labor" is the gain or profit achieved through the hiring or employing the labor of others, not the money received from the sale or exchange of one’s own labor.

The "act of 1909" referred to above is the Corporation Excise Tax Act of 1909. On page 414 of this same decision, the Supreme Court stated—

"As has been repeatedly remarked, the Corporation Excise Tax Act of 1909 was not intended to be and is not in any proper sense an income tax law. This court has decided in the Pollock Case that the income tax law of 1894 amounted in effect to a direct tax on property, and was invalid because not apportioned according to population as prescribed by the Constitution. The act of 1909 avoided this difficulty by imposing not an income tax, but an excise tax upon the conduct of corporate activity, measuring, however, the amount of tax by the income of the corporation, with certain qualifications prescribed by the Act itself." (emphasis added)

As one can see from the above quote, the Corporation Excise Tax Act of 1909 did not pertain to income taxes, but only dealt with an excise tax based upon "corporate activity".

The Supreme Court again addressed the meaning of "income" in 1918 in the case of Doyle v. Mitchell Brothers Company, 247 US 179 when it stated—

"Whatever difficulty there may be about a precise and scientific definition of ‘income’ it imports, as used here, something entirely distinct from principle or capital as a subject of taxation or as a measure of the tax; conveying rather the idea of gain or increase arising from increase corporate activities. As was said in Stratton’s Independence v. Howbert, 231 U.S. 399, 415: ‘Income may be defined as the gain derived from capital, from labor, or from both combined.’" (emphasis added)

Again, the U.S. Supreme Court is stating that the word "income" only pertains to corporate activities, i.e., profits.

In another case in 1918, Towne v. Eisner, 245 US 418, the Supreme Court dealt with the issue of whether a stock dividend constituted "income". In this case, the Court on page 426 overruled the lower courts and declared that a stock dividend was not "income" by stating—

"A stock dividend really takes nothing from the property of the corporation, and adds nothing to the interest of the shareholders. Its property is not diminished and their interests are not increased . . ."

What the Court was pointing out was that since there was no "gain" to the recipient of the stock dividend, there was no "income" which could have been taxable by an Income Tax.

In yet another Supreme Court case in 1918, Southern Pacific v. Lowe, 247 US 330, theCourt again overruled the lower courts as to what constituted "income" when it stated on page 335—

"We must reject in this case, as we have rejected in cases arising under the Corporation Excise Tax Act of 1909 (Doyle v. Mitchell Brothers Co., ante, 179, and Hays v. Gauley Mountain Coal Co., ante, 189) the broad contention submitted in behalf of the Government that all receipts—everything that comes in—are income within the proper definition of the term ‘gross income’, and that the entire proceeds of a conversion of capital assets, in whatever form and under whatever circumstances accomplished, should be treated as gross income. Certainly the term ‘income’ has no broader meaning in the 1913 Act than in that of 1909 (see Stratton’s Independence v. Howbert, 231 U.S. 399, 416, 417), and for the present purpose we assume that there is no difference in its meaning as used in the two acts."

Here the Court ruled that "income" is not everything that comes in and that the term "income" has no broader meaning in the 1913 Act (the Income Tax Act of 1913 which became the 16^th Amendment) than it did in the Corporation Excise Tax Act of 1909, i.e., profits.

In a case in 1920, Eisner v. Macomber, 252 US 189, the U.S. Supreme Court gave its most comprehensive definition of "income" when it stated on pages 207 and 208—

"After examining dictionaries in common use (Bouv. L.D.; Standard Dict.; Webster’s Internat. Dict.; Century Dict.), we find little to add to the succinct definition adopted in two cases arising under the Corporation Tax Act of 1909 (Stratton’s Indepen-dence v. Howbert, 231 U.S. 399, 415; Doyle v. Mitchell Bros. Co. 247 U.S. 179, 185)—"Income may be defined as the gain derived from capital, from labor, or from both combined." Provided it be understood to include profit gained through the sale or conversion of capital assets, to which it was applied in the Doyle Case (pp. 183, 185).

"Brief as it is, this indicates the characteristic and distinguishing attribute of income essential to a correct solution of the present controversy. The government (though basing its argument on the definition as quoted) placed chief emphasis upon the word "gain" (extended to include a variety of meanings) while the significance of "gain derived from capital" was either overlooked or misconceived. "Derived-from-capital";—"the gain-derived-from-capital." etc. Here we have the essential matter—not a gain accruing to capital, not a growth or increment of value in the investment; but, a gain, a profit, something of exchangeable value proceeding from the property, severed from the capital however invested or employed, and coming in, being "derived", that is received or drawn by the recipient (the taxpayer) for his separate use, benefit and disposal;—that is income derived from property. Nothing else answers the description.

"The same fundamental conception is clearly set forth in the Sixteenth Amendment—"income from whatever source derived"—the essential thought being expressed with a conciseness and lucidity entirely in harmony with the form and style of the Constitution." (emphasis not added)

Again, the Supreme Court stated that "income" means a gain or profit, something which only a business or corporation might receive.

In 1921, in the case of Merchant’s Loan and Trust Company v. Smietanka, 255 US 509, the U.S. Supreme Court gave its most complete and all-inclusive definition of "income" when it stated on pages 518 and 519 that—

"It is obvious that these decisions in principle rule the case at bar if the word "income" has the same meaning in the Income Tax Act of 1913 that it had in the Corporation Excise Tax Act of 1909, and that it has the same scope of meaning was in effect decided in Southern Pacific Co. v. Lowe, 247 U.S. 330, 335, where it was assumed for the purposes of decision that there was no difference in its meaning as used in the Act of 1909 and of 1909 and in the Income Tax Act of 1913. There can be no doubt that the word must be given the same meaning and content in the Income Tax Acts of 1916 and 1917 that it had in the Act of 1913. When to this we add that in Eisner v. Macomber, supra, a case arising under the same Income Tax Act of 1916 which is here involved, the definition of "income" which was applied was adopted from Stratton’s Independence v. Howbert, supra, arising under the Corporation Excise Tax Act of 1909, with the addition that it should include "profit gained through the sale or conversion of capital assets," there would seem to be no room to doubt that the word must be given the same meaning in all of the Income Tax Acts of Congress that was given to it in the Corporation Excise Tax Act and that what that meaning is has now become definitely settled by decisions of this court."

So, the Supreme Court is saying that "income" has the same meaning in all of the Income Tax Acts of Congress that it had in the Corporation Excise Tax Act of 1909 ("the gain (or profit) derived from capital, from labor, or from both combined", i.e., a business or corporate profit) and that what that meaning is has now become definitely settled by decisions of the U.S. Supreme Court

I believe that the court cases cited above are the definitive United States Supreme Court determinations as to the legal, constitutional definition of the word "income" as used in the Sixteenth Amendment to the Constitution of the United States—gains or profits earned from corporate activity. In other words, "income" as used in the Sixteenth Amendment only refers to "the profits of the rich".

People Would Not Amend the Constitution in Order to Institute a New Tax Upon Themselves

As further proof that the Sixteenth Amendment only provided for a tax on the profits of the rich, I would argue that no matter what point in history you choose, the people probably felt that they were paying enough in taxes and many of them probably felt that they were paying too much. Take our own time period for instance. It is said that we pay more in taxes than we pay for food, clothing, shelter and transportation combined. And that we have to work well into the month of May each year before we begin earning money for ourselves. Up until May, all of the money we earn goes toward paying taxes!

I cannot imagine the people banding together in order to impose another tax upon themselves and I certainly cannot imagine them going through the time, effort, and expense of amending the Constitution in order to do so. It just seems so contrary to basic human nature. But I can imagine them banding together in order to amend the Constitution and impose an Income Tax on someone or something other than themselves—the profits of the rich corporations, for instance. And this is what they did, even though the Government today would have us believe that the Constitution was amended so that the people could impose a new Income Tax on every penny that they themselves earned. Does anyone really believe that this is what happened? I don’t think so.

How Do We Put an End to the Federal Income Tax? We Can Exercise Our First Amendment Right to Petition the Government for the Redress of Grievances.

So how do we make the Government realize that the federal Income Tax as it is imposed today is contrary to the original intent of the Sixteenth Amendment and get them to stop imposing it? I believe that one way is to exercise our First Amendment Right to Petition the Government for Redress of Grievances. That is why I have come up with a petition to do just that, which I hope everyone will help me with.

I would like to get thousands of signatures from American citizens who realize that the Federal Income Tax is not being imposed in accordance with the Sixteenth Amendment and deliver these Petitions to our "leaders" and elected officials. To sign this Petition, you can do so online and I will collect and deliver them. You can also print out this Petition, make copies, and get as many other people as you can to sign it.

The Petition shall be delivered to the President of the United States; the Vice President of the United States; the Speaker of the House of Representatives; the President of the Senate; the Senate Majority Leader; the Senate Finance Committee; Congress’ Joint Committee on Taxation; your Individual Senators and Congressmen; and the Supreme Court of the United States.

To sign this Petition online, just click here. To print out the Petition so that you can make copies, just click here. Please send the printed Petitions to Steven A. Swan, P.O. Box 453, Auburn, NH 03032. Also, if you know the names and Washington, D.C. addresses of your U.S. Senators and Congressman, please email them to me or include them on the back of the Petition.

To gather and process all of these Petitions is going to be very time consuming and labor intensive. If you would like to help defray some of the costs involved by making a contribution, you can do so by clicking here, or by sending a check or money order to Steven A. Swan, P. O. Box 453, Auburn, NH 03032

I would also encourage you to contact your elected representatives on your own and let them know how you feel about this issue. The more input they receive, the more quickly we will be able to get rid of the Federal Income Tax. You can find the e-mail addresses of your elected representatives by clicking here.  Thank you for your effort and support.

Other Methods of Making the Federal Government Realize that the Income Tax is a Fraud. Stopping the Payment of Income Taxes While Doing So.

There are other methods of attempting to make the Federal Government realize that the federal Income Tax is a fraud because it is not imposed in accordance with the original intent of the Sixteenth Amendment. Some people just stop filing tax returns and refuse to pay the tax. As a matter of fact, the Government estimates that there are 30 million Americans who are not paying Income Taxes. Most of these people have just stopped filing. Of course, some people have been prosecuted in the past for not filing tax returns (even though these prosecutions were illegal because the Income Tax is a fraud), so this course of action seems a little risky. In addition, if they had money withheld from their pay, they have no way of asking for and receiving a refund.

There are many other people who have overwhelming evidence that the Sixteenth Amendment is null and void because it was never properly ratified by the requisite number of states. These people are also petitioning the Government to conduct an investigation into this matter based upon their information and research.

And then there are hundreds of thousands of other people who do file Income Tax returns stating that they do not owe Income Taxes and asking for refunds of everything that they had withheld from their pay or that they paid in estimated payments last year. At last count, there were between 250,000 and 500,000 of them! And many of them do receive refunds! I have been doing this for 5 years myself. One of my seminar attendees last year received a refund of $69,500.00 using this method. Some people have been using this method for up to 10 years and not one person has been prosecuted by the Government.

It seems that, in addition to the fact that the Income Tax is not imposed in accordance with the Sixteenth Amendment, there are no laws making the federal Income Tax mandatory. Some people say that this is because, if the Income Tax were mandatory, it would be unconstitutional because it constitutes a Direct Tax which must be apportioned in order to be constitutional, as was declared by the Supreme Court in the Pollock decision in 1895 mentioned earlier.

However, it might also be the case that the people involved in perpetrating this massive fraud on the American people did so by creating an Internal Revenue Code so complicated that no one could understand it. Then all they had to do was entice corrupt or incompetent Federal judges to always rule in favor of the Government regarding Income Tax matters. Whatever the case, there seems to be no law making the federal Income Tax mandatory. Evidence of this can be shown by the following:

The law doesn’t state that a person must pay Income Taxes; it states that a person must pay any tax that he is "liable" for. And the enforcement provisions of the law do not state that the Government can seize a person’s property if he does not pay Income Taxes. The enforcement provisions of the law state that the Government can seize a person’s property if he does not pay any tax that he is "liable" for. However, there is no law establishing a "liability" for Income Taxes! This can be proven by the following:

For all of the different types of federal taxes in the Internal Revenue Code (Alcohol Taxes, Tobacco Taxes, Firearms Taxes, Gasoline Taxes, Estate Taxes, Gift Taxes, Income Taxes, etc.), there is a statute which "imposes" the tax and another statute which states who shall be "liable" for that tax. Except for the Income Tax. There is no law establishing a "liability" for Income Taxes. There is a law "imposing" the tax. But there is no law establishing a "liability for it. Well, if the law says that a person only has to pay any tax he is "liable" for, and there is no law establishing a "liability" for federal Income Taxes, then obviously no one is required to pay them.

In addition to the fact that there is no law establishing a "liability" for the federal Income Tax, there is also no regulation having the force and effect of law with respect to it.

So there are between 250,000 and 500,000 Americans who have legally stopped paying Income Taxes, some of them for up to 10 years, because there is no law establishing a liability for Income Taxes (a prerequisite before anyone would owe them) and because they do not receive any "income" according to its original meaning in the Sixteenth Amendment—"profits of the rich"—as discussed earlier.

These people file what is called a Zero Return. They take a regular Form 1040 and declare that they had no "income" for the previous year (because of its original meaning in the Sixteenth Amendment). They also declare that they had no Income Tax "liability" because there is no law establishing a "liability" for it. They then attach a 2-3 page statement to the tax return explaining why they do not owe Income Taxes. Because they earned no "income" nor did they have an Income Tax "liability", they owe no Income Tax and are due a full refund of everything that they had withheld from their pay or that they paid in to the I.R.S. in estimated payments.

Now, not everyone who asks for a refund gets it, so people are encouraged to stop the money from coming out of their pay if they are an employee or, if they are self-employed, to stop making estimated payments. An employee can stop the money from coming out of his pay by filing a new Form W-4 with his employer stating that he is "exempt" from withholding. The law (Internal Revenue Code Section 3402(n)) actually allows him to do this.

It states that if a person was not "liable" for Income Taxes last year and doesn’t believe that he will be "liable" for Income Taxes this year, he can file a new Form W-4 with his employer stating that he is "exempt" from withholding and the employer is not to withhold any Income Taxes from his pay. Since there is no law establishing a "liability" for Income Taxes, anyone can honestly state that he was not "liable" last year and that he is not going to be "liable" this year. And even though he might have paid Income Taxes last year, he wasn’t "liable" for those taxes because there is no law establishing a "liability" for them.

Learning How Anyone Can Legally Stop Paying Income Taxes.

If you would like to learn more about this information, I have been conducting seminars for the past four years teaching people how they can legally stop paying Income Taxes. I have taught hundreds of people. And many of them have received refunds. I have also helped people who have been having problems with the I.R.S. for previous years.

I currently have a 3-hour video seminar available which explains in greater detail the thing that I have mentioned here, as well as many other facets of how the taxing clauses of the Constitution and the Sixteenth Amendment have been misconstrued and how anyone can legally stop paying Income Taxes.

To order a video-tape of my 3-hour Income Tax Seminar, just click here or send a check or money for $49.95 plus $5.00 for shipping and handling to Steven A. Swan, P.O. Box 453, Auburn, NH 03032.  

Before I assist anyone in preparing the Zero Return with the 2-3 page attachment, they must first watch my video seminar. This is because I want them to know exactly how the taxing clauses of the Constitution and the Sixteenth Amendment have been misconstrued and exactly why they can legally stop paying Income Taxes before they attempt to do so. I also want them to understand that there are no laws establishing a "liability" for Income Taxes; stating how they are to be paid; or imposing a penalty for not paying them. I want people to understand that there are no regulations having the force and effect of law with respect to Income Taxes. And I want them to know that I.R.S. agents have absolutely no authority with respect to Income Taxes. How could they when the tax is not imposed in accordance with the original intent of the Sixteenth Amendment in the first place?

If anyone has any questions, you can e-mail me at stevenswan@earthlink.net or call me at (603) 483-0550. If anyone would like to make a much-needed contribution to help me disseminate this information to others, they can do so by clicking here or by sending me a check or money order at the above address.

Thank you for your support and for your assistance.

Constitutionally yours,

Steven A. Swan
                   

¹26 Cong. Rec.,Part 1, 53^rd Congress, 2^nd Session, pages 2, 9.
²26 Cong. Rec. Part 2, 53^rd Congress, 2^nd Session, page 1791
³Ibid., page 1753
⁴Ibid., page 1709
⁵26 Cong. Rec., Part 9, 53^rd Congress, 2^nd Session, page 1714
⁶Official Proceedings of the Democratic Convention (1896), pages 252-253
⁷A History of the Presidency From 1897 to 1909 (1912), by Edward Stanwood, pages 32-33

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