New Arguments...

[John J. Bulten]

It's hard to tell. I still haven't heard you express a view or opinion.

That can be taken many ways, so I'll assume the best one. My view and opinion and legal conclusion is:

For purposes of 26 CFR Part 403 and 27 CFR Part 72, which cover the whole IRC, the term "includes" is expansive, adding to definitions those things in the same general class as the things enumerated.

Since you seem familiar with the basics, I'll simply note that 26 USC 7701(c) and 26 CFR 403.5 both clearly specify a form of inclusion which matches neither of the two ordinary meanings of "includes" (conveniently called "includes only" and "includes also"). This tertium-quid inclusion adds "other things otherwise within the meaning", things "in the same general class". Brigham, a Circuit case dealing specifically with 7701(c), found that an "elector" was "included" in the IRC definition of "beneficiary" even though not specifically listed, with its dictum being that electors were "of like kind and class" as the persons listed, in accord with the statute and regulations. This case clarified more general USSC language such as Neal v Clark and Sims (among several others). A whirlwind of cases uphold the fact that 7701(c) inclusion is expansive, but only a smaller group of cases, such as Brigham, restate the group to which the inclusion expands, already named in the law and regulation.

For purposes of this section, the term "single family residence" includes any manufactured home which has a minimum of 400 square feet of living space and a minimum width in excess of 102 inches and which is of a kind customarily used at a fixed location ....

Does "includes" mean "includes also" (apparently what you call "all inclusive"), or does it mean the tertium quid ("third thing"), something like "but this shall not be deemed to exclude other units otherwise included within such term" (40 SAL 1058)? (Naturally "includes only" is forbidden.) This question is the same as: were extant residences of single families, under 400 square feet, intended? A childish application of "includes also" would dictate that such residences were included; the simplest application of "general class" would indicate that the size restriction establishes a class and such small residences were outside that class. The former view would make the size restriction and other provisions redundant; the latter establishes them. So under a nonredundancy canon, inclusion is expansive, but only to otherwise unspecified units in the same general class as those enumerated. (Of course, no presumption can attach to that which is "neither included nor excluded" by the law, to paraphrase another USSC case which I don't have handy this second.)

If you don't believe these paragraphs constitute a view or opinion, I am misunderstanding you. As I said, there's no "new argument" from the tax honesty movement, since it upholds the law; so my views and opinions are rather boring, being (as far as humanly possible) constrained by the law. I note that you agree with me that the question of whether "includes" is "all inclusive" should be considered childish or pedantic; but that you did not affirm which side of the question you come down on. Please state your view or opinion.

Well, if the argument really does center on the definition of "includes", and whether it is all inclusive, I would have to say that it is a childish argument. I was just hoping that Mr. Bulten would explain this and it would have more meat than that.

[Imalawman]

Unfortunately for Bulten courts don't seem to appreciate his argument.

Hunn's citation of I.R.C. §§ 3121 and 3401, his use of Forms 4852 and so-called "corrected" Forms 1099, the alterations he makes to those forms, and his characterization of Social Security and Medicare taxes as income taxes, all follow a scheme promoted by Peter Hendrickson of Michigan. … Hendrickson claims that under I.R.C. §§ 3121 and 3401, only income received from the federal government is subject to federal tax. Id. Federal courts have uniformly and repeatedly rejected this argument. See, e.g., United States v. Latham, 754 F.2d 747, 750 (7th Cir.1985) (characterizing the argument "that under 26 U.S.C. § 3401(c) the category of 'employee' does not include privately employed wage earners [as] a preposterous reading of the statute."); Abdo v. United States, 234 F.Supp.2d 553, 563 (M.D.N.C.2002) (noting at the claim that wages are not income "has been rejected as many times as it has been asserted."), aff'd 63 Fed. Appx. 163 (4th Cir.2003). (emphasis added)

2006 WL 2663783, *3 (D.Ariz. 2006).

But, yeah, CTC will work for you Bulten because you have the magic decoder ring. Keep telling everyone it will work next time. [/quote]

[Investor]

For purposes of this section, the term "single family residence" includes any manufactured home which has a minimum of 400 square feet of living space and a minimum width in excess of 102 inches and which is of a kind customarily used at a fixed location ....

While not familiar with other definitions of "manufactured homes", if any, existing within the Code, I will admit that this is probably a poorly drafted provision*. The "childish" comment comes in if you are going to take this one (possibly) poorly drafted provision and then claim that "includes" means that all things not listed are not included and therefore my wages are not "included" in Gross Income (even though they are clearly compensation for services, which is "included", but that is not the issue here). This is like saying - "Ha, you didn't put a comma in the right place, I can ignore your law." It would take a person of beyond childish obtuseness to make such a claim.

Not to mention that Sec 61 (which is where I assume you are going with this) clearly states "but is not limited to", which blows the argument out of the water, even assuming your theory on "includes" is correct.

Am I missing something?

* - you are assuming that "manufactured homes" is otherwise within the common parlance of "single family residence". I'm not so sure you are right.

[Nikki]

What you are missing is that JB is a tax evader and will use any excuse imaginable to justify his actions.

[Investor]

What you are missing is that JB is a tax evader and will use any excuse imaginable to justify his actions.

That is what I have found to be the case with many who frequent this board. I was just giving Mr. Bulten the benefit of the doubt. If he is as you say, I'll see it pretty soon.

[John J. Bulten]

The "childish" comment comes in if you are going to take this one (possibly) poorly drafted provision and then claim that "includes" means that all things not listed are not included ....

Ah, thanks. You have judged correctly, I am not going to make that claim. There are several discernible meanings of "includes":

1. "Includes only" ("all things not listed are not included"): ordinary legal meaning; childish if applied to IRC; rejected by Revenue Ruling 2006-18.

2. "Includes also" ("all inclusive"): dictionary meaning; recognized by American Surety v Marotta; but also fails if applied to IRC. (I have only provided one example so far, of course, but I believe further review of the three-million-word IRC will uncover more, equally clear-cut cases.)

3. "IRC 'includes'": since distinguishable from both of the above, we must take it to mean "otherwise within the meaning of the term defined" (code), "same general class" (regulation), and "like kind and class" (case law).

4. Potentially, "FDIC 'includes'": I don't even know what the following statute means, but it sure seems to prove that there are more than two discernible meanings of "includes":

(1) In general. - The terms "includes" and "including" shall not be construed more restrictively than the ordinary usage of such terms so as to exclude any other thing not referred to or described. (2) Rule of construction. - Paragraph (1) shall not be construed as creating any inference that the term "includes" or "including" in any other provision of Federal law may be deemed to exclude any other thing not referred to or described.

Permit me to continue later, I have another post to make. For now you may have comments on distinguishing among the Congressional language in senses 2, 3, and 4, or comments on the effects and lawful interpretation of poorly drafted legislation.

[Investor]

1. "Includes only" ("all things not listed are not included"): ordinary legal meaning;

I absolutely disagree. If I say "includes" in a contract and I mean "includes only", I had better be very sure that my malpractice insurance is paid up - I just goofed big time.

2. "Includes also" ("all inclusive"): dictionary meaning; recognized by American Surety v Marotta; but also fails if applied to IRC. (I have only provided one example so far, of course, but I believe further review of the three-million-word IRC will uncover more, equally clear-cut cases.)

This definition I will agree with. I do not believe that you have provided a very solid example of why this is not what is meant in the Code as of yet.

3. "IRC 'includes'": since distinguishable from both of the above, we must take it to mean "otherwise within the meaning of the term defined" (code), "same general class" (regulation), and "like kind and class" (case law).

I again disagree. See #2 above. The Code, under Sec. 7701 (which you have yourself cited) defines "includes" to mean the same thing as in #2.

4. Potentially, "FDIC 'includes'": I don't even know what the following statute means, but it sure seems to prove that there are more than two discernible meanings of "includes":

I don't know why I would care about the FDIC. However, I read that definition to be the same as your #2, which is the same as under IRC 7701(c), which is the only logical definition of the word(s) in the English language.

I see only one definition of "includes" above, other than your #1, which I think is nonsensical.

[Imalawman]

Bulten's main problem is that when the code says, "term defined" he reads to that mean, "items listed in the definition of the term".

The term defined in 3401(c) is "employee", thus "includes" means anything within the meaning of "employee" not government worker or corporate officer.

[Quixote]

Bulten's misunderstanding stems in part from his acceptance of Hendrickson's baseless assumption that "includes" and any other word the meaning of which is clarified in 7701 can not have its normal meaning. That confusion might have been averted in Congress had not given 7701 the confusing, but legally insignicant title "Definitions". But probably not.

[John J. Bulten]

1. "Includes only" ("all things not listed are not included"): ordinary legal meaning;

I absolutely disagree. If I say "includes" in a contract and I mean "includes only", I had better be very sure that my malpractice insurance is paid up - I just goofed big time.

Do you also disagree with the USSC's overturn of the state supreme court in Montello?

The court also considered that the word 'including' was used as a word of enlargement, the learned court being of the opinion that such was its ordinary sense. With this we cannot concur. It is its exceptional sense, as the dictionaries and cases indicate.

2. "Includes also" ("all inclusive"): dictionary meaning; recognized by American Surety v Marotta; but also fails if applied to IRC. (I have only provided one example so far, of course, but I believe further review of the three-million-word IRC will uncover more, equally clear-cut cases.) [I add: of course this one does apply to clauses like "but not limited to" in IRC 61.]

This definition I will agree with. I do not believe that you have provided a very solid example of why this is not what is meant in the Code as of yet.

Do you also believe that other units, within the common meaning of the phrase "single family residences" but not within the general class specifically described by 26 USC 25(e)(10), are intended to be included in that definition, disagreeing with the USSC's doctrine in Jarecki?

A word is known by the company it keeps (the doctrine of noscitur a sociis). This rule we rely upon to avoid ascribing to one word a meaning so broad that it is inconsistent with its accompanying words, thus giving "unintended breadth to the Acts of Congress."

3. "IRC 'includes'": since distinguishable from both of the above, we must take it to mean "otherwise within the meaning of the term defined" (code), "same general class" (regulation), and "like kind and class" (case law).

I again disagree. See #2 above. The Code, under Sec. 7701 (which you have yourself cited) defines "includes" to mean the same thing as in #2.

Do you also disagree with the USSC principle in Gould that expansion in tax cases does not extend beyond the named class, i.e., the regulatory "same general class" as the "things ... enumerated"?

In the interpretation of statutes levying taxes it is the established rule not to extend their provisions, by implication, beyond the clear import of the language used, or to enlarge their operations so as to embrace matters not specifically pointed out. In case of doubt they are construed most strongly against the government, and in favor of the citizen.

4. Potentially, "FDIC 'includes'": I don't even know what the following statute means, but it sure seems to prove that there are more than two discernible meanings of "includes":

I don't know why I would care about the FDIC. However, I read that definition to be the same as your #2, which is the same as under IRC 7701(c), which is the only logical definition of the word(s) in the English language.

Do you also believe that the heavy additional verbiage in both cases (which you hold as synonymous with "'includes' is not limiting") is thereby extraneous and redundant, against the USSC doctrine of Menasche?

It is our duty "to give effect, if possible, to every clause and word of a statute," Montclair v. Ramsdell, 107 U.S. 147, 152, rather than to emasculate an entire section, as the Government's interpretation requires.

Investor, since you appear to be able to cakewalk through such torturous passages as 12 USC 1813(t) while simultaneously being unable to locate my own views and opinions, could you please clarify the application of these cases to your interpretations of inclusion in these four contexts?

Bulten's misunderstanding stems in part from his acceptance of Hendrickson's baseless assumption that "includes" and any other word the meaning of which is clarified in 7701 can not have its normal meaning.

Quixote, do you disagree with the USSC axiom of Meese v Keene, or perhaps do you claim that "the terms 'includes' and 'including'" do not have "definitions"?

It is axiomatic that the statutory definition of the term excludes unstated meanings of that term. Colautti v. Franklin, 439 U.S. 379, 392, and n. 10 (1979).

[Imalawman]

[banging head against wall muttering "context, context, context"]

[Famspear]

Dear John: For Federal income tax purposes, nobody really cares about cases like Montello Salt Co. v. Utah, 221 U.S. 452 (1911), and the other cases you cited - nobody, that is, except tax protesters and the people who prosecute those tax protesters. The prosecutors could very well use your citations to a case like Montello Salt -- a case that has little or nothing to do with tax law -- as evidence that you were fully aware of your tax law obligations, and that you simply have a disagreement with a tax law of which you are fully aware. Disagreement with the law is not a valid defense. As I have said before, your strongly held Bulten Belief -- that the law is what you say it is -- might or might not be considered by a jury as being a "Cheek Doctrine" actual good faith belief based on a misunderstanding caused by the complexity of the Internal Revenue Code.

I'm just curious about a few things. First, what do YOU think your chances of being prosecuted (e.g., 10%, 50%, 90%, whatever)?

Second, if prosecuted, what would be your game plan in court?

Third, would you try to retain a lawyer?

Fourth, what do you think your approximate chances of conviction would be? --Famspear

[Famspear]

Dear Mr. John Bulten:

Oh, the other questions I wanted to ask: (1) How did you report compensation on your income tax returns before you discovered Cracking the Code, etc. (did you just report pay as fully taxable like most people do)? (2) For approximately how many years had you been filing returns before you discovered the Hendrickson, etc., theories? (3) Do I understand correctly that although you failed to file for some years, you now file returns (albeit, reporting under the "Cracking the Code" system)?

In the interest of fairness (since I'm asking you personal questions), I'll volunteer my own personal information: (A) I have been filing Federal income tax returns for over 30 years. (B) I always report the gross amount of pay as fully taxable.

--Famspear

[Famspear]

Dear John Bulten:

Regarding this question I asked above: "Second, if prosecuted, what would be your game plan in court?"

I should elaborate. What I mean by the question is: Would you try to argue the Cracking the Code theories?

The court generally will not allow you introduce information about CtC to prove to the jury that the law is what CtC says the law is.

However, the court MIGHT allow you to use the CtC theory to try to persuade the jury that you had a good faith belief based on a MISUNDERSTANDING (although the burden of persuasion is of course on the prosecution, not on you). However, under this strategy, you would essentially be admitting that the IRS/DOJ interpretation of the tax law is correct, and that CtC is incorrect. Your argument here would be that because you had a good faith misunderstanding, you lacked "knowledge" of the law, and therefore were not willful.

So, what do you think you would do? --Famspear

[Investor]

Do you also disagree with the USSC's overturn of the state supreme court in Montello?

First off, I do not know Utah law, I do not care about Utah law and I do not know what Utah state law could possibly have to do with federal income taxes. Therefore, I will not waste my time reading Montello v. UT, in which the USSC was interpreting state law. So, I have no answer to the Montello question because I do not know what it has to do with the price of tea in China.

Do you also believe that other units, within the common meaning of the phrase "single family residences" but not within the general class specifically described by 26 USC 25(e)(10), are intended to be included in that definition, disagreeing with the USSC's doctrine in Jarecki?

I believe that you jump to conclusions as pertains to IRC 25(e)(10). You assume that Congress considers manufactured homes, in general, to be within in the definition of “single family residence” and narrows the definition to exclude manufactured homes of less than a certain size. I am not convinced of this and believe that Congress did not consider manufactured homes to fall within the general definition of single family residences and was broadening the definition to include certain manufactured homes, specifically, those of a certain size or larger. Please note that some states treat manufactured homes like motor vehicles for purposes of title and lien perfection. This is not inconsistent with the definition of “include(s)” found in IRC 7701(c), nor is it inconsistent with the common English usage of “include(s)”.

Please explain the relevance of Jarecki v. Searle, keeping in mind that I am yet to see two inconsistent meanings of “include(s)”, and that the meaning of “include(s)” for our purposes is set by statute in IRC 7701(c).

Do you also disagree with the USSC principle in Gould that expansion in tax cases does not extend beyond the named class, i.e., the regulatory "same general class" as the "things ... enumerated"?

Let’s leave Gould until the other issues are ironed out, as it’s relevance hinges on the resolution of other matters.

Do you also believe that the heavy additional verbiage in both cases (which you hold as synonymous with "'includes' is not limiting") is thereby extraneous and redundant, against the USSC doctrine of Menasche?

I see no inconsistencies in the use of “include(s)” in the two statutes, and further, I don’t care about FDIC. If you are suggesting that every time a similar or synonymous concept is contained within different pieces of legislation, that Menasche requires the language to be exact mirrors of one another, then I will disagree with you.

Investor, since you appear to be able to cakewalk through such torturous passages as 12 USC 1813(t) while simultaneously being unable to locate my own views and opinions, could you please clarify the application of these cases to your interpretations of inclusion in these four contexts?

I still do not see your view or your opinion. You are focusing on one small argument without disclosing what relevance it has in your grand theory of why you do not have taxable income. It seems to me that what you are doing is trying to bait people into answering questions with no context in order to spring the context on them and declare that they must agree with you due to the answers to the earlier questions. I have seen TP’s use this same technique to justify every theory imaginable.

[Investor]

I actually disagree w/ you captain kickback. John's point (which is still wrong BTW) is that the Code is using the word "includes" as a means by which to shrink a class of items, and thereby creating inconsistent uses of "include(s)". He is saying that this provision is limiting the inclusion of manufactured homes in the definition of "single family residence" to large manufactured homes:

c. For a straightforward example, 26 USC 25(e)(10) wrote:
For purposes of this section, the term "single family residence" includes any manufactured home which has a minimum of 400 square feet of living space and a minimum width in excess of 102 inches and which is of a kind customarily used at a fixed location ....

As I state, he is incorrect. I feel that Congress recognized that manufactured homes are considered personal property in many states, and they were clarifying that, despite the fact that manufactured homes are generally not within the scope of "single family residence", those of at least a certain size are within that definition for purposes of that section of the Code.

More importantly, if Mr. Bulten were correct about this passage (which I do not believe him to be) the consequences are not that the definition of "include(s)" in IRC 7701(c)(1) is void - the consequence would be that Congress inadvertantly included many manufactured homes in the definition of "single family residence". Nothing more.

[Quixote]

5. Quixote wrote:

Bulten's misunderstanding stems in part from his acceptance of Hendrickson's baseless assumption that "includes" and any other word the meaning of which is clarified in 7701 can not have its normal meaning.

Quixote, do you disagree with the USSC axiom of Meese v Keene, or perhaps do you claim that "the terms 'includes' and 'including'" do not have "definitions"?

Meese v Keene, 481 US 465 wrote:

It is axiomatic that the statutory definition of the term excludes unstated meanings of that term. Colautti v. Franklin, 439 U.S. 379, 392, and n. 10 (1979).

I fully agree with that dicta from Meese v Keene and with the footnote from Colautti cited in Meese: "As a rule, "[a] definition which declares what a term 'means' . . . excludes any meaning that is not stated." 2A C. Sands, Statutes and Statutory Construction § 47.07 (4th ed. Supp. 1978)." Colautti v. Franklin, 439 U.S. 379, n. 10 (1979). How is either relevant to PH's absurd assumption?

[John J. Bulten]

I still do not see your view or your opinion. You are focusing on one small argument without disclosing what relevance it has in your grand theory of why you do not have taxable income. It seems to me that what you are doing is trying to bait people into answering questions with no context in order to spring the context on them and declare that they must agree with you due to the answers to the earlier questions. I have seen TP’s use this same technique to justify every theory imaginable.

I do agree with your comments elsewhere about the necessity for avoiding leading questions, and I apologize if I have lapsed into such. The context, as I said, was http://www.losthorizons.com/comment/The ... ItSays.pdf .

[Investor]

LOL, I just got a formal warning on Losthorizons.com for "not wanting the members to know the law". Very open minded of you Mr. Bulten. Anyone who does not agree with you is a Troll and must be warned to walk the line or be banned. Oh the irony of the "Truth Movement".

You can sleep tight, I won't taint your flock over there. I signed on as a member of Losthorizons only to defend myself against the mininformation surrounding my Brushaber analysis.

[webhick]

For anyone wondering what John said publicly in that post (font colors were retained - yeah, that Red is all John):

Moderator note (please read carefully):
- Since this thread is way out of hand (for which I apologize), these authoritative corrections must be brief.
- The law and the term "includes" are explained by CtC at http://www.losthorizons.com/comment/The ... ItSays.pdf .
- Recall that Investor, jg8, and Dr. Caligari do not wish you to understand the law as explained by CtC.
- Remuneration that does not constitute wages most likely refers to contractor pay and the like.
- Cryer's memo is not to be taken as an authoritative statement of law.
- The USSC (cited in CtC) affirms "income" is undefined in the IRC.
- However, "income" is limited by the Constitution to objects properly reached only by indirect tax.
- "Wages" are "income" only because both are specially defined to be indirectly taxable objects.
- CtC makes clear that earnings do not always constitute "income derived from compensation"; wages do.
- Former Section 233 corporate income such as "salary income" is telling, but does not prove what we want.
- A pitbull is not automatically otherwise within the meaning of a term defined only by boxers. See context.
- Section 7701(c) was demonstrably added for other reasons than protest arguments. See "Law Library" for hint.
- There is no evidence Congress meant "employee" to include classes not similar to the items enumerated.
- 7701(c) properly applies to the whole Code solely by virtue of "when used in this title" language.
- Officers were not added to "employee" class after protest; they WERE the class since SS tax began in 1935.
- The income tax taxes all gains, not specifically exempted, which Congress has authority to tax.
- No court has ever ruled that the 26 USC definition of State means NC, AL, TX, or the other union states.
- Authority for Eagle (that definitions exclude unstated meanings) is Meese v Keene and Colautti v Franklin.
- Investor, before posting again, please review http://www.losthorizons.com/Forum3/topi ... IC_ID=1559 .
- Formal warnings and thread lockings will be handed out at my convenience.

I loved the part about the pitbull, since the context was:

It says "includes", not "includes only". If I say that the word "dog" includes boxers, this is a true statement. Does that mean that pitbulls are not dogs? Of course not.