Pete and Doreen may have not filed correct amended returns

[Dezcad]

Previously, Pete and Doreen Hendrickson were ordered to file correct amended tax returns, were held in contempt, incurred contempt fines and, just prior to being incarcerated for contempt, ultimately filed allegedly correct amended returns. The government has now filed a Motion stating that the amended returns that were filed are still incorrect and improper.

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
UNITED STATES OF AMERICA,
Plaintiff,
-vs.- Civil Action No. 06-11753
Hon. Nancy G. Edmunds
PETER ERIC HENDRICKSON and
DOREEN M. HENDRICKSON,
Defendants.
___________________________________/
UNITED STATES’ MOTION FOR ORDER REQUIRING DEFENDANTS TO FILE VALID AMENDED TAX RETURNS FOR 2002 AND 2003

The United States moves for an order requiring the Defendants, Peter Hendrickson and Doreen Hendrickson, to file valid and proper amended tax returns for 2002 and 2003 as ordered by this Court on May 2, 2007 (docket no. 34) and June 10, 2010 (docket no. 68). On June 26, 2010, the Defendants filed purported amended tax returns for 2002 and 2003. However, in violation of the Court’s order, the Hendricksons altered the jurats with the words “under duress” and an asterisk which referred to statements that the Hendricksons attached as page 3 of the returns. The statements purport to void the jurats and deny the income amounts reported on the returns. Not only did this violate the Court’s order, but the Internal Revenue Service is unable to process these returns because they are not valid federal tax returns. Therefore, the United States requests that the Court order the Hendricksons to file valid 2002 and 2003 amended returns in accordance with the Court’s prior orders.

A. The Amended Returns that the Hendricksons Provided on June 26, 2010 did Not Comply with the Court’s Order.

Pursuant to the Court’s May 28, 2010 Order Accepting and Adopting Magistrate Judge’s Report and Recommendation(docket no 61) and the April 16, 2010 Report and Recommendation (docket no. 55), the Defendants were permitted to file a separate statement with the amended tax returns. Specifically, the Court stated:

If [the Hendricksons’] intransigence is based on a matter of conscience–that they fear they would somehow be conceding the correctness of the government’s position–then they may submit with their returns a separate written statement expressing their disagreement. However, the amended returns themselves must be completely executed and signed, with no extraneous material or comments contained on the Form 1040 or any pertinent schedules.

The Court made clear that the Defendants were not permitted to include extraneous materials on the returns and that the returns must be completely executed and signed. A review of the
Defendants’ amended 2002 and 2003 tax returns, attached as Exhibits A and B, respectively, shows that the Defendants did not comply with these guidelines. Rather than include a "separate written statement expressing their disagreement,” the Hendricksons incorporated a written statement disavowing their signatures and the correctness of everything reported on the returns. This statement was incorporated into the returns as page three, and by including an asterisk in the jurat on page one of the returns referring to the statement, captioned “Statement Controlling Signatures On Form 1040X For 2002 [2003] Bearing the Names of Peter Eric Hendrickson and/or Doreen Marie Hendrickson.” That caption itself demonstrates that the Hendricksons violated the Court’s order because it is a statement controlling the Hendricksons’ signatures, rather than a separate statement as permitted by the Court. In addition to including an asterisk in the jurat linking to the statement, the Hendricksons also wrote “Under Duress” over their signatures, making their signatures nearly illegible and violating the Court’s order that there be “no extraneous material or comments contained on the Form 1040.” On page two of the returns, the Hendricksons again wrote that the returns were prepared “under duress” and that the amounts were reported “as dictated by Fed. Judge Nancy
Edmunds.” Therefore, the returns violate the Court’s order and the Hendricksons should be required to file amended returns for 2002 and 2003 that comply with the Court’s directive.

B. The Amended Returns that the Hendricksons Provided on June 26, 2010 are Not Legally Valid and Cannot be Processed by the IRS.

Not only did the Hendricksons’ returns not comply with the Court’s order, but the alteration of the jurat and extraneous materials incorporated into the returns render the returns legally invalid and, thus, incapable of being accepted and processed by the IRS. Since the Hendricksons provided these returns in June, the Government has attempted to internally resolve this matter without judicial action. However, the purported amended returns do not constitute valid returns under the law and simply cannot be processed.
Courts have formulated criteria for determining whether a tax return is valid. “First, there must be sufficient data to calculate tax liability; second, the document must purport to be a return;
third, there must be an honest and reasonable attempt to satisfy the requirements of the tax law; and fourth, the taxpayer must execute the return under penalties of perjury.” Beard v. Comm’r, 82 T.C. 766, 777 (Tax Ct. 1984), aff’d, 793 F.2d 139 (6th Cir. 1986) (discussing the Supreme Court standard for what constitutes a valid return for purposes of the statute of limitations). Where a taxpayer does not modify the specific language of the jurat, but rather adds certain words or phrases such as “under protest,” the return may be considered valid. See Todd v. United States 849 F.2d 365, 367 (9th Cir. 1988) (finding a return to be “complete and accurate” where the return was completed but the taxpayer added the phrase “signed involuntarily under penalty of statutory punishment” under the jurat).
However, where a taxpayer alters the jurat or includes an attachment that invalidates the jurat, even if the return is otherwise complete, accurate, and signed, the return is not valid. See Sloan v. Comm’r., 53 F.3d 799, 800 (7th Cir. 1995) (finding a return to be invalid where the
taxpayer attached a disclaimer denying that the taxpayer was liable or made liable for any 1040 income tax for the tax year at issue disclaiming liability for any tax shown on the return); Williams v. Comm’r, 114 T.C. 136, 142-143 (Tax Ct. 2000) (finding a return invalid where an attached disclaimer “at a minimum calls into question the veracity, accuracy, and completeness of the disclaimer 1040 and can be construed as a denial of the jurat altogether. Although petitioner physically signed the return below the jurat, his disclaimer, in effect, vitiated his verification of the truthfulness of the return as required by the regulations prescribed by the Secretary and by section 6065”); Ledbetter v. Comm’r, 837 F.2d 708, 709-10 (5th Cir. 1988) (deletion of the phrase “under penalty of perjury” invalidated the tax return); United States v. Moore, 627 F.2d 830, 834 (7th Cir. 1980) (obliteration of the jurat invalidated the return); Schmidt v. United States, 140 B.R. 571, 572 (Bankr. W.D. Okla. 1992) (concluding that the addition of the words “Signed Under Duress, See Statement Attached” invalidated a return); Letscher v. United States, Case no. 99 Civ. 2602(NRB), 2000 WL 1290864, *3 (S.D. N.Y. Sep. 11, 2000) (finding a return invalid where the taxpayer not only wrote “without prejudice” beneath the jurat, but attached statements calling into question the truthfulness and accuracy of his return and “whether his return was truly made and signed under penalties of perjury”).
Additionally, courts have deferred to the IRS’s construal of alterations of the jurat against
the taxpayer when there is doubt or ambiguity concerning the effect of a taxpayer’s inclusion of
additional statements on the jurat. See Sloan, 53 F.3d at 800; Williams, 114 T.C. at 142 (“We refuse to require [the IRS] to engage in guessing games to determine what disclaimers like this
one mean. To require such would drastically hinder the [IRS’s] ability to process returns effectively and efficiently.”); United States v. Davis, 603 F.3d 303, 307 (5th Cir. 2010).
As discussed above, the Hendricksons included the words “under duress” under the jurat
on their 2002 and 2003 amended returns and included an asterisk leading to a statement included
as part of the returns and numbered as page 3. On the “Statement Controlling” their signatures, the Hendricksons proclaim that the signatures on their returns are “null and void” and state that they “categorically deny the accuracy of anything said” on Forms W-2 and 1099. The Hendricksons further state that they do not admit to receiving income, wages or compensation as reported on their tax returns. Hence, the Hendricksons substantially altered the jurat and attached a statement nullifying the jurat and, as a result, did not sign the returns under penalty of perjury. Therefore, the returns are invalid and cannot be processed by the IRS. The IRS has rejected the Hendricksons’ purported 2002 and 2003 amended tax returns on this basis.

Therefore, the United States requests that the Court order the Defendants to file amended
tax returns for 2002 and 2003 that are “completely executed and signed, with no extraneous
material or comments contained on the Form 1040 or any pertinent schedules,” including the
jurat. Pursuant to the Court’s order, the Defendants may submit “a separate written statement
expressing their disagreement.” (emphasis added.) However, that statement may not be
incorporated as part of the tax return and may not be used to disclaim the amounts reported on the returns and their signatures made under penalty of perjury.

Conclusion
For the foregoing reasons and because the Hendricksons failed to file valid amended tax returns for 2002 and 2003, the Court should enter an order requiring the Defendants to file amended tax returns for 2002 and 2003 that are consistent with the Court’s order that no extraneous materials be included on the returns, the returns be completely executed and signed, and that the Defendants may include a statement separate from the return, not as part of the return
as an additional page and/or attached to the return or referenced by the return in any manner. The Court should further warn the Defendants that failure to do so within 30 days of the order could subject Defendants to further sanctions for civil contempt.


Dated: October 25, 2010
Respectfully submitted,
BARBARA L. MCQUADE
United States Attorney
s/ Daniel A. Applegate
DANIEL A. APPLEGATE (P70452)
Trial Attorney, Tax Division
U. S. Department of Justice
P.O. Box 7238, Ben Franklin Station
Washington, D.C. 20044
Telephone: (202) 353-8180
Fax: (202) 514-6770
Daniel.A.Applegate@usdoj.gov

(bolding added)

[Quixote]

Pete should do what I do, cross his fingers when he signs his return. I haven't tested it in court, but I guy I know whose brother used to work for a lawyer is pretty sure that voids the jurat.

Edited to correct pesky possessive pronoun.

[.]

Time to criminally prosecute the equally idiotic and stubborn Doreen, she having demonstrated at great length that she is at least as delusional as PH.

How stupid and/or ignorant do you have to be to intentionally slap the DoJ and a District Court judge square in the face?

Would even Skankbeat, in his most delusional moment, think that this was a good idea?

[LPC]

If [the Hendricksons’] intransigence is based on a matter of conscience–that they fear they would somehow be conceding the correctness of the government’s position–then they may submit with their returns a separate written statement expressing their disagreement. However, the amended returns themselves must be completely executed and signed, with no extraneous material or comments contained on the Form 1040 or any pertinent schedules.

This "intransigence" is what we call the "Black Knight delusion" that allows you to believe that you haven't really lost until you've admitted that you've lost.

More importantly, if the Hendrickson's returns violated an explicit provision of the court's order, then I'm surprised that the government didn't go directly to an order to show cause why Doreen should not be incarcerated for civil contempt.

[Dezcad]

The 2002 Amended Tax return and accompanying statement was attached as Exhibit A and can be found here. .

The 2003 is identical (aside from some differences in numbers).

[LPC]

The 2002 Amended Tax return and accompanying statement was attached as Exhibit A and can be found here. .

Yep, the attached statement really negates the jurat, no doubt about it.

I think that Judge Edmunds will be particularly interested in the reference to "police-state threats."

Despite the government's relatively gentle approach, the judge has the power to impose penalties for civil contempt sua sponte, and the reference to "police-state threats" could inspire the judge to do just that.

[silversopp]

Pete brought this on himself as he had plenty of opportunities to make this right.

1) He could have brought up vague and non-existence Common Law principles and quoted Hammurabi's Code in its entirity.
2) He could have pressed charges against his motor scooter
3) He could have filed special forms to gain access to his super secret Treasury Direct account and used the millions there to just pay the taxes
4) He could have captured the leader of the lizard-people and held her hostage in exchange for dropping all charges
5) He could have bought my new book "Live as a Free Patriot On The Sovereign Land in 54 Easy Steps" or attended one of my seminars at a nearby trailer park.
6) He could have threatened to expose the Jewish-Mormon-Catholic-Masonic-Royal Family-Henry Winkler conspiracy.

It's a shame that he picked the one option that had no chance to work.

[LPC]

The 2002 Amended Tax return and accompanying statement was attached as Exhibit A and can be found here. .

The attachment deserves full text disclosure (there may be typos due to OCR process):

STATEMENT CONTROLLING SIGNATURES ON FORM 1040X FOR 2002 BEARlNG THE NAMES OF PETER ERIC HENDRICKSON AND/OR DOREEN MARIE HENDRICKSON

The documents to which this statement is constructively attached, being any and all federal taxrelated documents concerning the year 2002 completed in 2010 and bearing the signatures of: and/or other identifying information regarding, Peter Eric Hendrickson and/or Doreen Marie Hendricksons together with all documents associated or associable therewith, are completed under duress and protest and, as dictated, being contrary to law. are categorically not believed by us. The fact that figures appear in certain places on those documents. and are associated with certain labels or designations, and the fact that any figures appear on the forms at all, and/or that our names and/or identifying information appear on those forms, and/or that our signatures appear on those forms is solely because we have been coerced under threat of imprisonment into putting figures we believe are not indicated by law, and which are maliciously specified by other persons into those places and onto those documents.

The association of any form created by any other person such as a "Form W-2" or "Form 1099-MISC", or the contents of such forms. with any document described above is not an endorsement or adoption by us of anything said on such form, and in fact. we specifically and categorically deny the accuracy of anything said on such forms.

Nothing appearing on any document described above is to be taken as an admission of the receipt of any "income", "wages" "self-employment income", "non-employee compensation", "net earnings from self-employment" or anything else taxable or reflecting the conduct of any taxable activities, or happening of any taxable event under any other name, label or characterization It is not such an admission, invitation or authorization.

Due to police-state threats, the signatures or even mere provision of on any documents described above/attached hereto are null and void except as qualified by all provisions and declarations of this statement.

It is especially hypocritical and insulting to all law-abiding Americans that the aforementioned Stalinist coercive ~ demanding that we sign a document we don't believe in, was crafted by minions of Treasury Secretary Timothy Geithner, a known, serial, never-prosecuted income tax cheat of the most brazen sort.

[webhick]

You guys have missed the most important parts:

Doreen is using an alias (I assume her maiden name) to earn $3700 as a TUTOR and traveled 10,600 miles doing it. Let's be overly fair and say that she traveled at 60 MPH for each of those miles. And let's say that she earned $10/hr for tutoring, which is probably low-balling it. Bear with me. She essentially drove 177 hours for 370 hours of work - putting her squarely in the range of "I spend half an hour driving for every hour I work" camp. If she earned more per hour then it only looks worse. And she's edumacating people. For pay.

Not only that, but she did not provide a date as to when she started using her car for business and instead said "WHEN I BOUGHT IT," which makes me laugh. That's really the only reason I brought it up.

Petey, on the other hand, earned $10k as a consultant, lost 20% to bad debt, and 20% to legal fees. When the customers who don't pay you amount to 20% of your income, and you spend 20% on legal fees, it's time to consider the fact that you're not looking like a very competent "consultant".

And BTW, where are the book sales?

[.]

constructively attached

"Constructively" is such a neat word, even if you don't have a clue, isn't it?

Never mind that it was actually in the same envelope as your "returns," probably stapled to them.

How's all of that working out for you?

[grixit]

Time to criminally prosecute the equally idiotic and stubborn Doreen, she having demonstrated at great length that she is at least as delusional as PH.

How stupid and/or ignorant do you have to be to intentionally slap the DoJ and a District Court judge square in the face?

Slapped with a wet fish, even.

[Nikki]

And not yet a word from any of the LoserHeads on this

[Imalawman]

That return is bogus even if they signed under penalty of perjury. As mentioned, there's no reported book sales (was this before he started selling his book?) and the expense figures for both business are bogus.

I'm having trouble remembering why they're having to submit returns? I've lost civil cases before and my client was not ordered to submit a corrected return, that amount was then just assessed or the assessment upheld. I'm too lazy to go back and look, why does the IRS care about getting a signed return? Why not just audit them and assess them at this point?

[webhick]

That return is bogus even if they signed under penalty of perjury. As mentioned, there's no reported book sales (was this before he started selling his book?) and the expense figures for both business are bogus.

I think I read somewhere that he put up the website after first publishing the book. Whois says the site was started in 1997. This return is for 2002.

I'm having trouble remembering why they're having to submit returns? I've lost civil cases before and my client was not ordered to submit a corrected return, that amount was then just assessed or the assessment upheld. I'm too lazy to go back and look, why does the IRS care about getting a signed return? Why not just audit them and assess them at this point?

Maybe it was part of a deal wherein Doreen gets to stay on the outside IF they provide amended returns. That would be a good compromise so the kids don't get displaced.

[Famspear]

.....I'm having trouble remembering why they're having to submit returns? I've lost civil cases before and my client was not ordered to submit a corrected return, that amount was then just assessed or the assessment upheld. I'm too lazy to go back and look, why does the IRS care about getting a signed return? Why not just audit them and assess them at this point?

Umm.... because this way it's more fun?



Personally, I just love the mental picture of Pete and Doreen writhing in agony over being ordered to file tax returns "the old-fashioned way" rather than the "CtC-educated way".

And all the agony that Doreen claimed she suffered back in June will have been for naught. She and her Blowhard did not comply after all.

Something just struck me last night while reading these two "tax returns" -- something that had never quite hit me to quite this extent before, in all the reading of the things the Hendricksons have written, on their web site, in court filings, etc.:

---------->These two people really exude evil.

These two people really exhibit what happens when a political philosophy (in this particular case, libertarianism) is warped and taken to an irrational -- and criminal -- extreme.

No, they've obviously done things nowhere nearly as bad as have murderers, etc. I would assume that to some extent they're good parents and that they contribute positively to their community. They're not "all bad". But they exhibit an intransigence, a recalcitrance, a refusal to follow certain rules, a refusal to even accept that certain rules are the rules, that seems to go way beyond "normal" in a psychological sense (caveat lector: I am not a psychologist).

These people insist on trying to make and follow their own rules on the subject of federal income tax. They cannot avoid the pain imposed on them under our legal system -- under the real law -- and unfortunately they are hurting their family and other people in the process.

[LPC]

I'm having trouble remembering why they're having to submit returns? I've lost civil cases before and my client was not ordered to submit a corrected return, that amount was then just assessed or the assessment upheld.

I'm not sure whether or not this is the principal (or even a contributing) reason, but if the IRS prepares a substitute for return, then they'd have to give a notice of deficiency and the Hendrickson's could file a Tax Court petition, delaying assessment. But if the Hendrickson's file a return, then the tax can be assessed immediately.

In other words, the IRS could be wanting to bypass any chance of a petition to Tax Court.

[LOBO]

Not only that, but she did not provide a date as to when she started using her car for business and instead said "WHEN I BOUGHT IT," which makes me laugh. That's really the only reason I brought it up.

That was my favorite part. So much for her vehicle expenses.

I noticed there were other items they didn't use to lower their tax legitimately. Weren't both of their kids young enough at the time to claim the child tax credit? That's $2,000.00 right there. Even without that, and whatever else they may have been able to claim, they would have gotten a $400.00 refund instead of owing anything.

But no, greed and stupidity...

[Imalawman]

I'm having trouble remembering why they're having to submit returns? I've lost civil cases before and my client was not ordered to submit a corrected return, that amount was then just assessed or the assessment upheld.

I'm not sure whether or not this is the principal (or even a contributing) reason, but if the IRS prepares a substitute for return, then they'd have to give a notice of deficiency and the Hendrickson's could file a Tax Court petition, delaying assessment. But if the Hendrickson's file a return, then the tax can be assessed immediately.

In other words, the IRS could be wanting to bypass any chance of a petition to Tax Court.

So, in other words, we don't know? That was my only thought, too. I was thinking about this last night (yeah, my evening was that slow). Would I just sit back and be happy that the IRS is making my client file a return the way that they want after losing? I think I'd fight it (though I've never had this happen, so if there's a rule or provision for this, I wouldn't bother).

That said, I LOVE the fact that they're forcing Petey to file this way. You know it just eats at them.

[webhick]

That said, I LOVE the fact that they're forcing Petey to file this way. You know it just eats at them.

I'm surprised they haven't tried a "cruel and unusual punishment" argument to try to wiggle out of that one. DOING THINGS I DON'T LIKE IS TOO TRAUMATIC. CONSTITUTIONAL VIOLATION!

If they do that, I'm going to file a case on behalf of anyone that has been forced to deal with Darth's followers. I'm alleging mental and emotional abuse. I might throw kidnapping in there too. If you've ever been trapped in your office while a TP gives you what-for and blocked from leaving, you know that you were KIDNAPPED AND TORTURED. Clear violations of the Geneva convention or something. I'm sure you guys will find a way to make it stick. Oh, you didn't realize that you were volunteered for this? Well, you are. It doesn't pay anything, except the wonderful feeling that you'll be the voice for a class of people who have been repeatedly victimized with no hope for justice.

[Gregg]

I('m just mean enough to think they need to be audited so the IRS can ask 'What about those book sales?" and "What about any donations for your legal fees?" etc... get a good forensic accountant to go into bank statements and see if a guy who says he only made $10,000 a year maybe deposited a few dollars more than that into the bank and ask why. A little creativity and Pete's own gift for making a bad situtation much worse and he could end up getting a life sentence on a tax charge.