Otto Skinner

[david]

I think some people don't give appropriate credit to Otto. I got a copy of his last book "The Biggest Tax Loophole of All" . I'm not sure of the dates right now for what follows.
Late '97 or early '98 I got bored one evening and started reading the first chapter. Half hour later I went to bed. After 2 hours of tossin and turnin I got up and finished it. Either Otto was trying to get me to commit a crime or I had been continually robed by the U. S. government since '64. After a couple of days of contemplation, I took Otto's advice, 1st chapter, 1st heading, "Do not assume" to heart, decided not to assume he knew what he was talking about, and commenced my own investigation beginning with his cited stuff and detouring to a lot of other citations, all at my local public law library. That resulted in a large travel expense, a big copying bill, a huge pile of copied citations, I nearly lost my girlfriend, and a certified mail, return receipt requested letter to the U. S. Secretary of the Treasury, very similar to Otto's, rescinding my signature on every document I had ever signed which implied I was subject to or liable for any so-called income tax or so-called social security tax.
About a month later, I received a letter from my bank informing me the IRS had imposed a backup-withholding tax of 31%????????????????. I immediately ran to the bank and cleared out all but a couple dollars, then went home, took a deep breath, and finished reading the letter.
31% of the interest earned on my checking account. Oh.
I put my money back into my account and began a process of letters with the bank seeking a copy of the IRS order. I finally got it after a month of hassle.
That letter began with "It has been determined...". Using parts of Otto's "request for information letter", I sent a letter to Chief, Collections Branch, IRS under the Freedom of Information Act and "Personal Information Act?", politely requesting to know when the determination hearing was, where was it, who was the presiding officer, who was the plaintiff, what was the complaint, and why wasn't I invited. I got back a nasty letter informing me that was none of my business and threatening me with 5 years in jail and a $25,000. dollar fine if I declared under penalty of perjury that I was not subject to back-up withholding. I politely told that office to stuff it's threats and give me the information please.
After about 60 days with no response, I wrote a letter to the Freedom of Information Act Officer explaining the situation and then politely requesting, under the Freedom of Information Act and the Personal Info Act, when was the determination hearing, where was it, who was the presiding officer, who was the plaintiff, what was the complaint, and why wasn't I invited.
The day I received my "return receipt", I also received a very super apologetic letter, signed by chief, collections branch, that the IRS had made a mistake, I wasn't subject to the so-called backup-withholding, they would inform my bank, and I could recover the money with held when I filed my 1040, about $0.30. I let the IRS keep it. Although I never got the information requested, at that time I had no clue how to pursue it in court. I have improved my knowledge since.
Since that letter, I have filed no 1040's with the U. S., State, or local government.
Since that letter, I have grossed about maybe $2 million, give or take a handful.
Since that letter, I have at times had several thousands of dollars in a local bank account under my name.
Everything was done by Certified Mail, Return Receipt Requested. I believe I still have all my copies of everything.
There's more current positive history if anyone's interested. This is my first time ever posting like this, soooo,,,,,, lets see what happens.
Thank you Otto and anyone else for reading anyway, David Kelley

[The Observer]

I copied this thread from the "New Articles from Contributors" section since (1) it is a very interesting topic based on the work of a tax denial promoter who has faded somewhat into the background, and (2) because the author, one David Kelley, invited responses to his article - and the claims made therein.

Welcome, Mr. Kelley, to Quatloos.

[JamesVincent]

Thank you Observer. Welcome Mr. Kelley. What year did you stop filing?

[The Observer]

I think it is only fair to advise david that there is a rule here on Quatloos for people who wish to come here and make claims about a particular "de-tax" method being successful: you have to be able to prove the substance of your claims. It is very easy to make such claims, but the standard of proof is a great deal more than simply saying that the government hasn't come after you. There are a great number of simple reasons why any person, whether a tax defier or not, may not have the government interested in their not paying taxes; most of the time this is because the person has fallen off the radar due to low income or lack of assets, the person was overlooked because government does not have the time, manpower or resources, or the person may not being telling the entire truth as to why the government is not dealing with them.

Of course, some people come up with a number of excuses as to why they won't offer such proof here, including the fact that they don't wish their tax information to be disclosed here on the site. Our answer to that is that we can arrange for a more discreet way to provide such information to our experts' satisfaction. Oh, and the other objection is that they fear that they will be reported to the government and be prosecuted. Our answer to that is that if the method is legal and successful, then the argument should win in court.

In all of the years that I have been at Quatloos (13 years and counting) I have yet to see one person to provide such proof. Perhaps david will be the first...but I am not holding my breath.

[Famspear]

I think some people don't give appropriate credit to Otto. I got a copy of his last book "The Biggest Tax Loophole of All" .

[ . . . ]

That resulted in a large travel expense, a big copying bill, a huge pile of copied citations, I nearly lost my girlfriend, and a certified mail, return receipt requested letter to the U. S. Secretary of the Treasury, very similar to Otto's, rescinding my signature on every document I had ever signed which implied I was subject to or liable for any so-called income tax or so-called social security tax.....

[ . . . ]

The day I received my "return receipt", I also received a very super apologetic letter, signed by chief, collections branch, that the IRS had made a mistake, I wasn't subject to the so-called backup-withholding, they would inform my bank, and I could recover the money with held when I filed my 1040, about $0.30. I let the IRS keep it. Although I never got the information requested, at that time I had no clue how to pursue it in court. I have improved my knowledge since.
Since that letter, I have filed no 1040's with the U. S., State, or local government.
Since that letter, I have grossed about maybe $2 million, give or take a handful.
Since that letter, I have at times had several thousands of dollars in a local bank account under my name.

Dear David: Welcome to Quatloos!

I notice that nothing in the text of your post constitutes a definitive, declaratory statement about what you believe to be the state of the U.S. federal income tax law.

So, let's be clear:

If you are a U.S. citizen (or even a non-citizen residing within the United States), you are subject to the U.S. federal income tax. (Indeed, even if you were not a citizen of the U.S. and you were not a resident of the U.S., you could still be subject to the U.S. federal income tax in some cases.)

Nothing in the material you posted demonstrates otherwise.

Otto Skinner was wrong.

EDIT: PS: If you work as an employee, for an employer, or if you are self-employed, your compensation is subject to the U.S. Social Security and Medicare taxes as well.

[Famspear]

If you swallow the nonsense of Skinner,
You may find that your wallet grows thinner.
So, let this be your motto:
"Rely Not On Otto!"
What he fed you ain't much of a dinner!

[Lambkin]

Show us the letter.

[Arthur Rubin]

Show us the letter.

We don't expect you (Otto) to post your SSN. That and other personal information may be redacted. However, we'll expect to your name, and sufficient information that an IRS agent could verify that the letter is real. This may be more information than you are willing to reveal, but it is Quatloos policy that that type of claim needs to be substantiated by verifiable evidence.

[Kestrel]

Why does david's personal information beside the first post say,

david
Member of Dark Forces United
Posts: 0

Shouldn't it at least say:

david
Just Washed Ashore in Quatloosia
Posts: 1

[david]

WOW!! After my not being able to find one person I could talk with about what I'd learned and done based on my research of Otto Skinners 3 books and additional studies, this looks like a jackpot to me. All of your responses seem intelligent and reasonable, so,, I will ignore Otto's instruction "Do Not Assume", and engage. Oh yes, thanks for getting back to me so fast.

First, James Vincent, I stopped filing State and fed.1040's in 1998 I believe.
Next, the Observer, Arthur Ruben, and Lambkin, I am in Jamaica until the first of April. I do not have a copy of my letter to the US Sec. Tres. on this computer. I will publish it as soon as practical after April 4, /14. As far as I am concerned, ALL correspondence with the IRS should be available under the Freedom of Information Act. If you need to see the basic of that letter right now, open Otto's "The Biggest Tax Loophole of All", find his suggested letter to rescind, and that's basically what I sent. If you would like, I will also include the entire process of letters between me, my bank, and the IRS that began a month later.

""Excises are "taxes laid upon the manufacture, sale or
consumption of commodities within a country, upon
licenses to pursue certain occupations, and upon corporate
privileges." Cooley, Const. Lim., 7th ed., 680.
Flint v. Stone Tracy Co., 220 U.S. 107, at 15 1 (191 1).""

I firmly believe every person subject to and liable for taxes ON [with regard to] incomes should pay the taxes due and in full. However one has to become subject to income taxes first. Personally, I believe I must first be licensed by the US Gov. before I become liable for any taxes ON [with regard to] my income. (I'm still not too computer literate yet but I am now trying to copy my last correspondence with the IRS next. hoping for luck)
Darn, no luck. If one of you guys could help me get a series of 3 scans out of my sky cloud account I'd appreciate it.
First one will be a signed letter from a Debra Hurst, operations manager, IRS to me asking why I hadn't responded to a previous unsigned form letter demanding I file a 1040. 11/22/2011
Second one will be my response stating that "I am not licensed by the US Gov. to engage in any activities at this time so I am not required to file any returns with the US Gov.. 11/29/2011
Third one will be a letter signed by a Vickie L. Smith, Operations Manager, IRS, agreeing with me and stating that no further action will be taken. 6/28/2012
The letter number of reference is: 4283996043
I firmly believe taxes are a necessary cost to pay for municipal, state and fed. government employees to do their part to attempt to protect our inalienable rights, liberties, and the stuff we collect in an innocent and harmless manner along the way. I pay every darn tax I am subject to and liable for. I believe the only tax I pay to the US is the road fuel tax and I'm not the one that does the actual payment, the road fuel vender is because that person is the one licensed to sell it. If I use that taxed fuel in my boat, a non-taxed activity, I can recover that 16 cents or so from the US Gov. by asking for it back, with some sort of proof. Opps, cigarette taxes, but I'm not the person licensed to sell them. The person licensed to sell cigarettes is the one liable for the tax.
Every year I pay a tax ON [with regard to] my income to the state. That is my license fee to the state which gives me a document establishing my right to harvest certain species of shellfish in specific manners. Also, by that license, I claim responsibility for the healthful quality of that shellfish and promise to sell it to a properly licensed wholesale shellfish buyer. I make a return to the state every month showing every day that I shellfish, how many hours, roughly where, how it was harvested, with what equipment, each species, the quantity, and the wholesaler that bought it. No question of money, none of the state's business anyway, that's a private exchange of property between two private persons.
Sorry, I got off the track a little bit.
I had a major struggle with the definition of the word ON when relating to taxes. Finally I realized that I had never touched, tasted, smelled, or seen a thing called a tax. I'm intimately familiar with tax bills, tax receipts, tax stamps, tax laws, tax collectors, but never a thing called a tax. I can't find one to put in my hand or on the table or on the floor or on the road.
So tax must be a descriptive word like an adjective or adverb or something. After poking into several dictionaries, I concluded that on must be defined as WITH REGARD TO when dealing with tax, tax with regard to income.
The 16th amendment is correct and compatible with the US Const. Congress always had the authority to impose taxes with regard to incomes, the 16th Amendment merely cleared some confusion.
I guess my definitive statement is " I am not licensed by the US Gov. to engage in any income producing activities, therefore, I am not required to file any returns with the US Gov., including 1040"s. Any of you guys licensed by the US Gov. to engage in ANY activities? If so, please quote the law so I can check it out, I might be mistaken in my opinion.

And Famspear, ""If you are a U.S. citizen (or even a non-citizen residing within the United States), you are subject to the U.S. federal income tax. (Indeed, even if you were not a citizen of the U.S. and you were not a resident of the U.S., you could still be subject to the U.S. federal income tax in some cases.)"" Where did you get this information?

As I said, I'll try to get you copies of the entire process of my letter to the Sec. Tres. in April. Until then, any help getting my files out of sky cloud would be helpful.

Did any of you guys even read any of Otto Skinner's three books? I thought his Best Kept Secret was a little shrill, red faced, finger waggling, foot stomping, burp and fart, and hard to comprehend but his next two were much better.
Till next time, David

[webhick]

Why does david's personal information beside the first post say,

david
Member of Dark Forces United
Posts: 0

Shouldn't it at least say:

david
Just Washed Ashore in Quatloosia
Posts: 1

Glitch that caused this first post to not increment his post count. I fixed his post count.

[wserra]

WOW!! After my not being able to find one person I could talk with about what I'd learned and done based on my research of Otto Skinners 3 books and additional studies, this looks like a jackpot to me.

Welcome to Quatloos. I am interested to see how long that feeling lasts.

However one has to become subject to income taxes first. . . . And Famspear, ""If you are a U.S. citizen (or even a non-citizen residing within the United States), you are subject to the U.S. federal income tax. (Indeed, even if you were not a citizen of the U.S. and you were not a resident of the U.S., you could still be subject to the U.S. federal income tax in some cases.)"" Where did you get this information?

Famspear makes several assertions in that quote, all of them quite correct. You do not identify the one for which you wish authority. I assume - since you appear to be a U.S. citizen - that it's the first. Authority for the proposition that all U.S. citizens are subject to the federal income tax is legion. Two examples out of the many readily available:

“All individuals, natural or unnatural, must pay federal income tax on their wages, regardless of whether they received any ‘privileges’ from the government”. Lovell v. United States, 755 F.2d 517, 519 (7th Cir. 1984).

"Plaintiff, therefore, along with being a citizen of the state of Washington, is a United States citizen because he was born in Washington State to parents who were United States citizens.... As a United States citizen, plaintiff is required to pay federal income tax.” Betz v. United States, 40 Fed.Cl. 286, 294-296 (1998).

I guess my definitive statement is " I am not licensed by the US Gov. to engage in any income producing activities, therefore, I am not required to file any returns with the US Gov., including 1040"s.

As you put it, "where did you get this information" that only those with some sort of federal license are required to file? And I don't mean something like, "Well, I figured it out". After all, people have "figured out" perpetual motion machines since the dawn of invention, and none of them have ever worked. Please cite something authoritative, something that a court would accept.

As I said, I'll try to get you copies of the entire process of my letter to the Sec. Tres. in April.

That would be great. However, because we really don't like to edit posts, allow me to restate the one rule around here: most simply stated, if something is offered as proof, it must be verifiable. "Non-verifiable proof" is an oxymoron. After all, given a little time, I could create an official-looking document declaring myself Emperor of the Galaxy. Redact SS number? Sure. Redact name and address? Nope. We have had experience with folks posting some redacted document claiming it to be one thing, while the unredacted document shows it to be something else entirely.

See my sig for the theory.

[Famspear]

""Excises are "taxes laid upon the manufacture, sale or consumption of commodities within a country, upon licenses to pursue certain occupations, and upon corporate privileges." Cooley, Const. Lim., 7th ed., 680.
Flint v. Stone Tracy Co., 220 U.S. 107, at 15 1 (191 1).""

That definition of "excise" is one that generally fits what are sometimes called "statutory excises" under what are now Subtitles D and E of the Internal Revenue Code.

The term "excise" also has a different meaning -- a constitutional law meaning. For constitutional law purposes, the term "excise" is often used to mean "indirect tax" (duties, imposts and excises). An indirect tax is, logically enough, any tax that is not a direct tax.

For constitutional law purposes, there are two kinds of direct taxes: taxes on property by reason of ownership, and capitations. The Federal income tax is neither a tax on property by reason of its ownership nor a capitation.

There is no provision of the U.S. Constitution, no provision of any statute, and no ruling by any court whatsoever that the U.S. Federal income tax is in any way limited to the exercise of any privileges - corporate or otherwise.

I firmly believe every person subject to and liable for taxes ON [with regard to] incomes should pay the taxes due and in full. However one has to become subject to income taxes first. Personally, I believe I must first be licensed by the US Gov. before I become liable for any taxes ON [with regard to] my income.

You are wrong. The imposition of the U.S. federal income tax is in no way limited to those persons who have a "license by the US Gov."

From the U.S. Court of Appeals for the Seventh Circuit, regarding an argument in a federal income tax case (by a litigant named Holder):

in Holder's world[,] excises may be imposed only on "government granted privileges." Because Holder believes that he is exercising no special privileges, he thinks he may not be taxed. These are tired arguments.

from Coleman v. Commissioner, 791 F.2d 68 (7th Cir. 1986). The Court rejected Holder's argument.

The argument that an individual who received Form W-2 wages or other compensation is not subject to federal income tax because the individual has "neither requested, obtained, nor exercised any privilege from an agency of government" was ruled frivolous by the United States Court of Appeals for the First Circuit in Sullivan v. United States, 788 F.2d 813, 86-1 U.S. Tax Cas. (CCH) paragr. 9343 (1st Cir. 1986) (per curiam), and again in Kelly v. United States, 789 F.2d 94, 86-1 U.S. Tax Cas. (CCH) paragr. 9388 (1st Cir. 1986). See also United States v. Buras (argument that the taxpayer can be subject to an excise tax only if he benefits from a "privilege extended by a government agency" was rejected), 633 F.2d 1356 (9th Cir. 1980). See also Nichols v. United States, 575 F.Supp. 320 (D. Minn. 1983), and Olson v. United States, 760 F.2d 1003 (9th Cir. 1985) (per curiam).

Furthermore, there is no legal requirement that the imposition of the U.S. federal income tax be limited to some sort of "activity."

I guess my definitive statement is " I am not licensed by the US Gov. to engage in any income producing activities, therefore, I am not required to file any returns with the US Gov., including 1040"s.

You are wrong. And, if you try to make that argument in a court of law, your argument will be rejected by the court. Your argument is legally frivolous.

And Famspear, ""If you are a U.S. citizen (or even a non-citizen residing within the United States), you are subject to the U.S. federal income tax. (Indeed, even if you were not a citizen of the U.S. and you were not a resident of the U.S., you could still be subject to the U.S. federal income tax in some cases.)"" Where did you get this information?

I get that information from the law itself. It's called the "Internal Revenue Code." For example, non-resident aliens are subject to the U.S. Federal income tax under either section 871 or 877 of the Internal Revenue Code. How do I know that? Here's how:

(d) Nonresident Aliens.--In the case of a nonresident alien individual, the taxes imposed by sections 1 and 55 shall apply only as provided by sections 871 or 877.

--Internal Revenue Code section 2(d). See also Internal Revenue Code section 7701(b)(1)(B).

Section 1 of the Code imposes the federal income tax on the "taxable income" of individuals.

If the federal income tax were limited to persons exercising a government privilege or holding a "license" from the government, then the tax would not apply to those who steal. Yet, under the Internal Revenue Code, if Billy Bob embezzles someone else's money, Billy Bob is liable for the federal income tax on the receipt of that money -- even though it's not Billy Bob's money, and even though Billy Bob is later forced pay it back to its rightful owner. The receipt of that money is INCOME to Billy Bob under the Internal Revenue Code.

No, david, you are quite wrong.

[AndyK]

Otto received one of the earliest Quatloos writeups -- http://www.quatlosers.com/otto_skinner.htm

It's worth reading. But even if troll du jour erads it, there will be a major WOOOOOOSH

[Pottapaug1938]

I miss seeing the Quatlosers Hall of Fame on a regular basis. We could add so many deserving people to it....

[david]

Man I love this, intelligent conversation. I wish I had memorized all my stuff before engaging with you guys. Thanks for helping me.
Webhick, thanks for making the correction to that thing on the side.
Famspear and wserra, what's your definition of ON? Also, ""Since the right to receive income or earnings is a right belonging to every person, this right cannot be taxed as privilege."" Jack Cole v McFarland, 337 S.W.2d, 453, at 456, 206 Tenn. 694 (1960)
And, ""The income tax is, therefore, not a tax on
income as such. It is an excise tax with respect
to certain activities and privileges which is
measured by reference to the income which they
produce. The income is not the subject of the
tax: it is the basis for determining the amount of
tax.
House Congressional Record, 3-37-43, page
2580."" "If You Are the Defendant, p.48" by Otto Skinner (1996). Maybe the word "excise" is just a handy more official looking way of referring to "indirect tax"?
Thank you for your references, I will check them out. Thank goodness for Google Scholar, I haven't found any discrepancies comparing it's citations with my hard copy so far.
Just to let you all know, I am a citizen of the town of Chatham, the Commonwealth of Massachusetts, and of the United States. I am a registered voter. And, I am collectively responsible for the consequences of the actions of my town, state, and fed. government employees. And now I will be personally locatable when I return to Chatham April 4/14. I'm in Jamaica right now hiding from winter. I guess that's called TRUST in your intentions. That might have been stooped, however, I do recognize that only I am responsible for the consequences of my actions.
I might not return for a day or two, I'll be researching the citation and statutes I was referred. Plus I'll be trying to stumble thru how to post my previous earlier mentioned latest correspondence with the IRS. Doesn't seem like anybody wants to help me out with that.
I'm really enjoying this. David
Just for curiosity, has any one else here challenged the US or State gov.?

[Famspear]

Since the right to receive income or earnings is a right belonging to every person, this right cannot be taxed as privilege."" Jack Cole v McFarland, 337 S.W.2d, 453, at 456, 206 Tenn. 694 (1960)..

David, that's a Tennessee Supreme Court decision regarding a Tennessee state tax, not the federal income tax. The issue in that case was whether the Tennessee state tax violated Article II, Section 28, of the Tennessee state constitution. Tennessee state courts do not have the authority to decide the validity of U.S. federal income taxes. Further, the U.S. federal income tax was not at issue in that Tennessee case -- indeed, the federal income tax wasn't even mentioned.

The statement you quoted from F. Morse Hubbard in the Congressional Record (of March 27, 1943) is an incorrect statement about the U.S. federal income tax. It is quoted over and over and over and over and over and over again by tax protesters. You simply copied and pasted that material from a tax protester web site.

The Congressional Record is full of statements, some of which are correct, others of which are incorrect. However, the text of the Congressional Record is not the law. You made a mistake that no first year law student would make.

The federal income tax is indeed a tax on income. It is not a tax "with respect to certain activities and privileges". Hubbard was wrong.

Let's stick to the subject at hand: the U.S. federal income tax.

[Pottapaug1938]

david, like you, I am a citizen of Massachusetts and of the United States.

I am also a citizen of Boston, not Chatham; but that is not the only difference between us. I happen to believe that the constitutionality of the income tax federal and state) is beyond reasonable dispute, because a long train of definitive appellate court decisions say so. People can offer contrary opinions; but unless and until they can get an appellate court to hand down an unreversed opinion to the contrary, I am not interested in the assertions of Otto Skinner, Irwin Schiff or any of their ilk.

[Famspear]

...Just for curiosity, has any one else here challenged the US or State gov.?

Your question is vague. If you mean, has anyone here represented individuals or businesses, etc., in dealings with the U.S. government or state governments involving disputes over the meaning or application of federal or state income tax laws, then the answer is most definitely yes.

When the taxing authority says that the law is one way and you say no, the taxing authority is wrong, then you are definitely challenging the taxing authority.

[Famspear]

By the way, F. Morse Hubbard was a U.S. Treasury Department lawyer, and should have known better than to assert that the Federal income tax was not a tax on income as such.

Attorney and legal commentator Daniel B. Evans has written:

Hubbard seems to have been laboring under the misconception that, if Congress imposed a tax “on” income, and if the taxpayer spent the income before Congress could collect the tax, then Congress would be unable to collect the tax at all. But that is nonsense. As noted elsewhere, it is perfectly clear that the taxpayer who earns the income is personally liable for the tax, and I.R.C. section 6321 even imposes a lien for the amount of any tax that is assessed and unpaid on all of the property of the taxpayer, not just the income itself. So Hubbard’s semantic hair-splitting was completely unnecessary.

[ . . . ]

What about the idea that the income taxes enacted following the ratification of the 16th Amendment are not taxes “on” income but taxes on “certain activities and privileges”? The Internal Revenue Code does not identify any “activity or privilege” being taxed other than the receipt of the income itself. And the Supreme Court has confirmed that it is the realization (or receipt) of income that creates a tax liability....

[ . . . ]

To summarize, Hubbard’s characterization of the income tax is based on a faulty premise, is contradicted by one of the authors of the first income tax, and is inconsistent with the opinions of the Supreme Court. There is no getting around the fact that Hubbard was simply wrong.

--from Daniel B. Evans, The Tax Protester FAQ (italics in original), at:

http://evans-legal.com/dan/tpfaq.html