Pat Shannan's MUSINGS
MUSINGS ----
Deciphering the "News"On February 10th, the following David Cay Johnston article appeared in the New York Times. It was a typical piece of government propaganda designed to instill more fear into the minds of the "Fools of April," who mistakenly believe that they are required to file a form 1040 each year in order to continue earning a living in this country. Mr. Johnston is either 1] a total ignoramus who knows nothing about the details of his own story or 2] another wizard at subterfuge who knows whence his bread is buttered. The correct answer to this dual-choice question is simple. The New York Times does not hire ignoramuses.
Longtime readers of Media Bypass have already learned how to read the white part of their newspapers, but for the benefit of those first time readers, we submit a between-the-lines translation:
(David Cay Johnston's article is in italics):
"I.R.S. Going After Businesses on Withholding Tax"
By DAVID CAY JOHNSTON
The Internal Revenue Service plans to announce next week that it is actively pursuing small-business owners who are bragging on the Internet and in seminars that they do not withhold taxes from their employees' paychecks, arguing that the tax laws do not apply to them.
Why would obeying the law be anything to brag about? We do know of many people who are relieved to have become aware of certain aspects of the IRS statutes that, indeed, do not apply to him or her. About those "plans to announce:" by what tyrannical tactics does the IRS intend to thwart these business owners, each of whom has several unanswered letters on file with the agency, requesting a clarification of the statute?
Dale Hart, the I.R.S. deputy commissioner for small businesses and the self-employed, said the agency was now looking for business owners who have stopped withholding and turning over income, Social Security and Medicare taxes, and was "stepping up" the pressure on them.
Just what kind of "pressure" does she intend to exert? We assume she must mean it to be of the Gestapo type ("De law is vot ve say it dis!") because all - every single one - of the company CEOs of which she speaks have written to the IRS requesting a legal rebuttal presumption of their evidence presented. Every single one is yet to receive a response from the IRS.
Workers at these companies, who Mrs. Hart said "are being scammed by their bosses," will also be pursued and will be assessed penalties unless they send in the taxes that should have been withheld from their paychecks.
Waitaminnit, Frau Hart! Who said that these workers would not send in the taxes "that should have been withheld from their paychecks," if you can show them the law that shows that they owe it? This is not due until next year, anyway, if you can prove it. Are you going to send your goon squad to take it away at gunpoint right now? (Some sixty Indianapolis Baptist Temple workers voluntarily filed and donated every year, but that didn't prevent the eventual heist. This is called " Paying the cannibals to eat you last.")
Some of the business owners, as well as the promoters who advise them, will be prosecuted for tax evasion and other crimes, said Mark E. Matthews, chief of the I.R.S. criminal investigation division. Indictments may take months.
Attaboy, Mark. Nice perpetual fear tactic. Make 'em sweat for months. Evasion, for your information, Chief, is prosecutable when one files a tax form and lies about the amounts. So just what method of deception will you use for evasion when one holds the sincere belief that the law does not require the filing of the form? You will have to come up with something legally better than "evasion," so get to work. We want to see what lie you will tell the court in order to incriminate your fellow Americans who are merely seeking the truth. And if you want to try your worn-out "willful failure to file" sham, let me give you a simpler alternative. Just send a memo to Frau Hart showing the law that requires these workers to file the 1040 form, that she may notify them. I am certain that 100% will want to comply, thereby alleviating the strain of another charade of a phony prosecution and saving your agency $millions in man hours of courtroom time. Doesn't that make sense? Go ahead, look up the law. They don't mind waiting, except that they have been waiting for several decades now. Can you not find it? Hmmm. Not surprising. None of your predecessors could either. However, there is a $50,000 reward awaiting when you do.
In addition, the agency has tightened its procedures for issuing refunds to business owners who say they are exempt from the tax laws, said John Buchanan, the I.R.S. executive responsible for ferreting out sham trusts and similar commercial tax evasion schemes.
Where did you go to school, Bucko? If they don't send anything in, they won't be looking for any refunds, will they? Now about these "sham" trusts you've been demonizing: do you mean the trusts designed by J.P. Morgan, the Warburgs, and Rockefellers et al., which were silently written into the 1913 tax laws to legally exempt the Power Elite? Are these the "shams" you speak of? If you really believe that these are some type of "sham," then you should begin your attack with Ted Kennedy and go on to most of the other senators and congressmen and then proceed to the thousands of trusts being utilized by David Rockefeller, Alan Greenspan, and George Bush. With such a big game hunt confronting you, I imagine you will have little time for "ferreting out similar tax evasion schemes."
The changes, and an effort to encourage workers to turn in bosses who stop withholding taxes, come as proponents of theories that the tax laws are a hoax [and] prepare to meet in Washington.
Johnston, you fear-monger, no one has to "encourage workers to turn in their bosses." The bosses have turned themselves in, by asking the IRS for the legal clarification of their status as "required withholders." All they are asking for is an honest answer.
TheNew York Times reported in an article on Nov. 19 that at least 23 small-business owners had publicly declared on the Internet that they did not withhold taxes from their workers' paychecks. These owners toldThe Times that the I.R.S. was making no effort to make them pay. One company named in the report, the Kristi Tool Company of Magnolia, Mass., advertises that it has not withheld taxes since 1979. Its owner, Dick Celata, said in an interview that the I.R.S. had never tried to make him pay, and he said he took that as proof that he was correct in his belief that he was not required to pay taxes.
It does seem that 22 years would be sufficient time for one to make that assumption.
In recent weeks Dick Simkanin, owner of Arrow Plastics in Bedford, Tex., who maintains a Web site with the names of businesses that say they do not withhold taxes, has added three more businesses to his list. Another business, Jon Peters Plumbing in Omaha, said it stopped withholding nine years ago. The Candleberry Creek Company in Cheona, Ill., stopped withholding in 1998.
I just happened to be lunching with Dick Simkanin on November 20th, the day after the first NY Times story broke. We were visited by FOX-4 reporter Bud Gillett from a Dallas TV station. He did a story about Arrow Plastics on the evening news. In it he interviewed an unnamed IRS spokesman who, with a straight face yet, drifted into this brilliant report from government intelligentsia: "There is no provision in the code that allows people not to pay or withhold income tax." No kidding? Is there no provision that allows people not to drink beer left-handed? Is there no provision that allows people not to walk on the sunny side of the street? How about for not changing a baby's diapers? How many million other things can we think for which there would be no provision allowing people not to do? And FOX puts this clown on the air as an authority? We must also presume that there is no provision allowing us not to expose this subterfuge.
Frank Keith, the senior I.R.S. spokesman, said in November that "with limited resources the I.R.S. must often choose which cases to pursue" and that it focused on those that would generate the most revenue.
Limited resources? Must we give another legal tender seminar here? Suffice it to say the government creates all the (what we use as) money it needs at will. But if Frank really were pursuing those that would generate the most revenue, would he not be going after those Kennedys and Rockefellers et al. previously mentioned?
Several former I.R.S. commissioners, as well as tax policy officials who had served in both Republican and Democratic administrations, said at the time that they were shocked at the failure of the I.R.S. to move against these business owners and warned that unless enforcement action was taken swiftly the movement would grow, threatening the integrity of the income tax system.
As if those "tax policy officials who had served in both R & D administrations" carries with it some stamp of cachet. And the "integrity" of the income tax system? Defined by our dictionary as "honesty, virtue, honor and morality?" Okay boys, let's not threaten the integrity of your system. Let's move swiftly against those business owners by answering their questions. If they required to withhold, then show them the laws they have constantly requested to see. Are they required to file? Then show them the law. Any other threatened "move" reeks of another giant step toward the police state America is fast becoming.
Days before the article was published about 60 business owners gathered in Huntington Beach, Calif., at the invitation of Nick Jesson, owner of N.T.D. Electronics in Huntington Beach, to plan strategies to expand their movement.
Horrors! Jesson wants to expand the truth to the multitudes! The bureaucracy is in dire trouble, indeed.
Next Saturday hundreds of people, including business owners, are expected to meet at the Hilton Hotel in Arlington, Va., to discuss ways to "expose and end the illegal operation of the income tax system," according to the event's sponsor, Robert L. Schulz of the We the People Foundation in Queensbury, N.Y. Among the tactics urged by some of those who have announced they will attend is persuading more business owners to stop income tax withholding, which is the source of more than 80 percent of federal income tax, Social Security and Medicare revenues.
Certainly, Johnson's article had an influence in keeping some attendees away, which was by design. But hiding from the truth out of fear of reprisals does not change anything. These company heads, along with their accountants and tax attorneys, still have not found the law requiring them to withhold pay from workers, and IRS will not show it to them. Can anyone tell us why?
Mrs. Hart, the I.R.S. deputy commissioner, said that arguments like the one that asserts that the income tax applies only to foreign-owned companies operating in the United States are "frivolous claims that have no legal authority" and have been thoroughly rejected by the courts.
Oh really? Three years ago Dave Bossett, an accountant in Florida, discovered that 26 CFR Sec. 1.861-8(f)(1) says it precisely - that the income tax does apply only to foreign-owned corporations and U. S. citizens living and working abroad. He then petitioned the IRS for a refund for some 500 workers and it agreed, returning some $200,000 to Bossett and his workers, with full legal authority. Will Mrs. Hart care to stand on anything legally firmer than her hot air? Her terminology tends to remind us of Algore's earlier utterance about no controlling legal authority.
But she said the agency had concluded it must conduct a public education program, especially for "poorly educated workers" who may tend to accept statements by their employers that income taxes are voluntary.
Oops. Frau Hart has just stuck her foot in her mouth and is now faced with calling her boss, the IRS Commissioner (and most of his predecessors), a "liar." Even the IRS publications have boasted about our "voluntary tax system" and many of the commissioners over the past four decades have stated it publicly. As for those "poorly educated workers," we have to assume that they dropped out of the government schools too soon to be properly "educated." We have recently learned that public school children are now being taught to properly fill out the 1040 form.
She said that while penalties would be assessed against workers who fail to turn over taxes that should have been withheld from their paychecks, an exception might be made for workers who pay but do not file promptly or pay less than they owe.
All of this will apply if the foolish worker files a 1040. The real "exception" will be made for those who have reached the level of understanding that they are not required to donate to the bureaucracy.
"We would have to consider that on a case-by-case basis," Mrs. Hart said.
Darn Right! "Those cases will be differentiated by those who volunteer, over whom we have jurisdiction; and those who do not volunteer, over whom we have only bluff. In both cases, we must instill fear, which was the whole purpose of my consenting to this interview in the first place," Mrs. Hart did not say.
The agency has also tightened scrutiny of requests for withholding tax refunds, said Mr. Buchanan, the I.R.S. executive assigned to police commercial evasion schemes. Two companies that do not withhold taxes, Bosset Partners Marketing in Clearwater, Fla., and N.T.D. Electronics, said the I.R.S. promptly refunded more than $200,000 in withholding tax refunds when they asked for their money back. Mr. Buchanan said the I.R.S. had tightened procedures for processing withholding tax refund claims. "We have pretty good filters to intercept these refund requests and only a handful are getting through," he said. "And those that do get through we are finding posthaste afterward because we now have a mechanism in place" to identify such errors.
Oh! Lo and behold! It was an error to send Bosset and NTD their money back. They just "slipped through." "Well, let them keep it, but nobody else is going to get away with obeying the law! No sir! We have tightened procedures and our `mechanism' always works. We'll just put a couple in jail, blow it all over the news, and the rest of the herd will fall into line. It works every time."
Special Memo to David Cay Johnston:
As a reporter, you have failed miserably. Our readers are wondering if you care a whit about the truth of your stories. Or are you content to be a check-grabbing lackey for those who would continue to deceive us? If you continue to choose the latter, please write and let us know how you manage to sleep at night. Also, please send a picture of yourself suitable for publication to go along with our upcoming story - "Known Liars and Propagandists in the National News Media."