The Epic Fail of Squatloosian Troll

[SquatloosianTroll]

The latest village idiot wrote:

Assessment has its authority at 27 Part 70 under the Parallel Table of Authorities.

https://www.law.cornell.edu/cfr/text/27/part-70

No.

The link you provided is a link to Part 70 of title 27 of the Code of Federal Regulations, which involves regulations under the authority of title 27 of the United States Code, relating to intoxicating liquors.

The assessment statutes you cited are found in what is called the Internal Revenue Code, which is separately codified as title 26 of the United States Code. The assessments statutes you provided do not "have their authority" from anything in 27 Part 70 of the Code of Federal Regulations, or from any other provision of any other thing found in the Code of Federal Regulations.

You need a course on legal research.

Assessment "has its authority" from the very Internal Revenue Code provisions you cited -- not from some regulation in title 27 of the Code of Federal Regulations.

Regulations derive their authority from the statutes to which those regulations relate -- not the other way around.

For example, Internal Revenue Code section 6201 ("Assessment authority") is a statute. That means: a law enacted by Congress. The phrase "this title" in section 6201(a) is a reference to the "Internal Revenue Title," which is now called the "Internal Revenue Code of 1986" (formerly called the "Internal Revenue Code of 1954"), and which is separately codified as title 26 of the United States Code.

A regulation issued by the Department of the Treasury under that statute is found at 26 CFR section 301.6201-1. The statute does not "have its authority" (so to speak) from the regulation. Instead, the regulation "has its authority" from the statute.

Similarly, Internal Revenue Code section 6203 ("Method of assessment") is a statute. Again, that means: a law enacted by Congress. A regulation issued by the Department of the Treasury under that statute is found at 26 CFR section 301.6203-1. Again, a statute does not "have its authority" from a regulation. Instead, the regulation "has its authority" from the statute.

The latest village idiot wrote:

No.

The link you provided is a link to Part 70 of title 27 of the Code of Federal Regulations, which involves regulations under the authority of title 27 of the United States Code, relating to intoxicating liquors.

The assessment statutes you cited are found in what is called the Internal Revenue Code, which is separately codified as title 26 of the United States Code. The assessments statutes you provided do not "have their authority" from anything in 27 Part 70 of the Code of Federal Regulations, or from any other provision of any other thing found in the Code of Federal Regulations.

You need a course on legal research.

Assessment "has its authority" from the very Internal Revenue Code provisions you cited -- not from some regulation in title 27 of the Code of Federal Regulations.

Regulations derive their authority from the statutes to which those regulations relate -- not the other way around.

For example, Internal Revenue Code section 6201 ("Assessment authority") is a statute. That means: a law enacted by Congress. The phrase "this title" in section 6201(a) is a reference to the "Internal Revenue Title," which is now called the "Internal Revenue Code of 1986" (formerly called the "Internal Revenue Code of 1954"), and which is separately codified as title 26 of the United States Code.

A regulation issued by the Department of the Treasury under that statute is found at 26 CFR section 301.6201-1. The statute does not "have its authority" (so to speak) from the regulation. Instead, the regulation "has its authority" from the statute.

Similarly, Internal Revenue Code section 6203 ("Method of assessment") is a statute. Again, that means: a law enacted by Congress. A regulation issued by the Department of the Treasury under that statute is found at 26 CFR section 301.6203-1. Again, a statute does not "have its authority" from a regulation. Instead, the regulation "has its authority" from the statute.[/quote]

The ASSESSMENT STATUTES ARE INCLUDED IN 27 PART 70 (did you fail to look at the jpg's I posted???) as those activities; selling, manufacturing, distributing alcohol, are taxed under the INTERNAL REVENUE CODE. 27 USC and you failed to read what was posted along with the jpg's.

[SquatloosianTroll]

So I know wserra and Jay Adkisson are tax experts so I would like to know what items of income are taxable?

[Dr. Caligari]

So I know wserra and Jay Adkisson are tax experts so I would like to know what items of income are taxable?

Read section 61 which was posted above.

[noblepa]

So I know wserra and Jay Adkisson are tax experts so I would like to know what items of income are taxable?

Read section 61 which was posted above.

And do not try to argue that a source of income not included in that list is, therefore, not taxable. At the beginning of the list it explicitly says "all income, from whatever source derived, including (but not limited to)". That means that the list is not intended to be considered as exhaustive.

[NYGman]

Seriously, an 861 argument, we have really gone back in time with that long debunked theory. 861 regulations only apply to 861 code sections which is not applicable in the way you believe it to be.

[Famspear]

......Okay so this is under Subtitle A Income Taxes I think I am right on that point. (yay I'm right about something and posted it here on the infamous quatloos site... just ribbing you all) Okay here goes: Under 26 CFR 1.861-8T(d)(2)(iii)
(iii) Income that is not considered tax exempt. The following items are not considered to be exempt, eliminated, or excluded income and, thus, may have expenses, losses, or other deductions allocated and apportioned to them:

(A) In the case of a foreign taxpayer (including a foreign sales corporation (FSC)) computing its effectively connected income, gross income (whether domestic or foreign source) which is not effectively connected to the conduct of a United States trade or business;

(B) In computing the combined taxable income of a DISC or FSC and its related supplier, the gross income of a DISC or a FSC;

(C) For all purposes under subchapter N of the Code, including the computation of combined taxable income of a possessions corporation and its affiliates under section 936(h), the gross income of a possessions corporation for which a credit is allowed under section 936(a); and

(D) Foreign earned income as defined in section 911 and the regulations thereunder (however, the rules of §1.911-6 do not require the allocation and apportionment of certain deductions, including home mortgage interest, to foreign earned income for purposes of determining the deductions disallowed under section 911(d)(6)).

So 1) Where is compensation for services in the above and 2) If these items of income ARE NOT exempt then one can infer that anything else IS EXEMPT.

OK, that's it? That's your answer?

No, grasshopper. You're repeating what is known as an "861" argument. Indeed, you are citing a reg issued under Internal Revenue Code section 861. Neither section 861 nor the regulation you cited exempts compensation for services from the definition of gross income.

The regulation you are citing deals with how to compute taxable income from sources within the United States and from other sources and activities for purposes of Subchapter N of Chapter 1 of the Internal Revenue Code -- NOT for purposes of determining what is included in gross income under section 61.

You have fallen for the 861 argument.

The ASSESSMENT STATUTES ARE INCLUDED IN 27 PART 70 (did you fail to look at the jpg's I posted???) as those activities; selling, manufacturing, distributing alcohol, are taxed under the INTERNAL REVENUE CODE. 27 USC and you failed to read what was posted along with the jpg's.

No, THE ASSESSMENT STATUTES ARE NOT INCLUDED IN 27 PART 70. YOU did not properly read or understand what I wrote.

The assessment statutes are CITED in 27 Part 70 -- that is, the section numbers are listed in part 70 of title 27 of the Code of Federal Regulations -- or more specifically, in the page from the Federal Register relating to certain regs codified in part 70 of title 27. The actual texts of the sections are not "included in" 27 Part 70.

More to the point, you still don't seem to understand that the assessment statutes have nothing to do with what is included in the definition of gross income. The assessment statutes that you cited in your first posts don't even mention the term "gross income" or the term "taxable activity".

How do you manage to tie your shoes in the morning?

[Famspear]

People have gone to Federal prison for Federal tax crimes because of their reliance on the 861 argument, including Larken Rose and Charles Thomas Clayton.

See:

http://tpgurus.wikidot.com/larken-rose

and

http://tpgurus.wikidot.com/thomas-clayton

Various versions of the 861 argument have been rejected not only in those criminal cases, but also in such cases as:

1. Solomon v. Commissioner, T.C. Memo 1993-509 (1993).

2. Williams v. Commissioner, 114 T.C. 136 (2000).

3. Corcoran v. Commissioner, case no. 2947-01, T.C. Memo. 2002-18 (2002).

4. Loofbourrow v. Commissioner, 208 F. Supp. 2d 698 (S.D. Tex. 2002).

5. United States v. Bell, 238 F. Supp. 2d 696, 2003-1 U.S. Tax Cas. (CCH) paragr. 50,501 (M.D. Pa. 2003), aff'd, 2005-2 U.S. Tax Cas. (CCH) paragr. 50,661 (3d Cir. 2005).

6. Dashiell v. Commissioner, T.C. Memo. 2004-210 (2004).

7. Woods v. Commissioner, T.C. Memo 2006-38 (2006).

8. Buckardt v. Commissioner, T.C. Memo 2010-145 (2010).

9. Aiello v. Commissioner, 69 T.C.M. (CCH) 1765, T.C. Memo 1995-40 (1995).

[Famspear]

Actor Wesley Snipes spent a few years in the Federal prison for his tax crimes related to the 861 argument.

Troll, are you really this naïve?

[Famspear]

For newcomers to Wikipedia Quatloos, Subchapter N of Chapter 1 of the Internal Revenue Code deals in part with delineating sources of income from within the United States and sources of income from outside the United States. Specifically, section 861 (and the related regs) define sources within the U.S. while section 862 (and its regs) define sources outside the U.S.

Section 861 and the related regs do not provide tax exemptions for compensation for services for persons who are U.S. citizens or even for persons who are non-citizen U.S. residents.

What Troll is doing is copying and pasting tax protester garbage he found on the internet. He is doing what Countless Clueless Clucks before him have done.



EDITED: To change reference from "Wikipedia" to "Quatloos".

[notorial dissent]

Isn't our troll du jour confusing the difference between the income tax Title 26 and excise taxes Title 27? Or am I confused.

[Famspear]

Isn't our troll du jour confusing the difference between the income tax Title 26 and excise taxes Title 27? Or am I confused.

Yes, that's part of it. He has copied and pasted from some garbage web site he found. Over the years, we've seen various wackadoosters make these kinds of references to the regs in title 27 of the CFR over and over, in various nonsensical attempts to try to convince someone that their income isn't taxable.

[notorial dissent]

Basically though, the taxes imposed in Title 27 are excise/sales taxes and NOT Income taxes at all, so the item is irrelevant to their argument, but since they don't understand what they are arguing, that is irrelevant as well.

As you say, material from some garbage website, basically parrot regurgitation, which by the by is really nasty stuff.

[AndyK]

So I know wserra and Jay Adkisson are tax experts so I would like to know what items of income are taxable?

That one's quite simple:

ALL income (or items thereof) is taxable unless specifically excluded by law as stated in 26USC.

It is up to the taxpayer to find the law, passed by congress and codified within 26USC, which describes the income situation at question and exempts it from taxation.

We don't have to prove anything. You, on the other hand, are making a claim which requires support by specific, relevant citations of law and/or court decisions.

edited -- typo

[Cpt Banjo]

For newcomers to Wikipedia Quatloos, Subchapter N of Chapter 1 of the Internal Revenue Code deals in part with delineating sources of income from within the United States and sources of income from outside the United States. Specifically, section 861 (and the related regs) define sources within the U.S. while section 862 (and its regs) define sources outside the U.S.

Section 861 and the related regs do not provide tax exemptions for compensation for services for persons who are U.S. citizens or even for persons who are non-citizen U.S. residents.

All one needs to do is read §861:

(a) Gross income from sources within United States The following items of gross income shall be treated as income from sources within the United States...

(3) Personal services Compensation for labor or personal services performed in the United States; except that compensation for labor or services performed in the United States shall not be deemed to be income from sources within the United States if—
(A) the labor or services are performed by a nonresident alien individual temporarily present in the United States for a period or periods not exceeding a total of 90 days during the taxable year,
(B) such compensation does not exceed $3,000 in the aggregate, and
(C) the compensation is for labor or services performed as an employee of or under a contract with—
(i) a nonresident alien, foreign partnership, or foreign corporation, not engaged in trade or business within the United States, or
(ii) an individual who is a citizen or resident of the United States, a domestic partnership, or a domestic corporation, if such labor or services are performed for an office or place of business maintained in a foreign country or in a possession of the United States by such individual, partnership, or corporation.

In addition, compensation for labor or services performed in the United States shall not be deemed to be income from sources within the United States if the labor or services are performed by a nonresident alien individual in connection with the individual’s temporary presence in the United States as a regular member of the crew of a foreign vessel engaged in transportation between the United States and a foreign country or a possession of the United States.

The statute makes it abundantly clear that compensation for personal services is an item of gross income, and §861's own regulation isn't about to contradict the statute by somehow excluding what the statute says is included.

[Famspear]

An Abridged Lesson:
How Section 861 Fits Into The U.S. Federal Income Tax Computation

To understand section 861 and the regulations thereunder, it is helpful to go back to section 61 and then follow the path that leads to section 861. Let’s do that -- but just for individuals. We don't have time or room to look at every Code section, so we'll hit just some of the highlights.

For Federal income tax purposes, gross income is defined in Internal Revenue Code section 61. Generally, gross income is all income from whatever source derived -- except as otherwise provided in Subtitle A of the Internal Revenue Code. The exceptions -- or income “exclusions” or income “exemptions” -- are generally found in sections 101 through 140.

Once gross income is determined, certain subtractions -- called “deductions” -- come into play. Numerous code sections provide information on what is deductible. Through a long, circuitous process, a figure called “taxable income” is computed, under section 63.

Then, for individuals, the section 63 “taxable income” figure is used to compute the basic U.S. Federal income tax -- under section 1. (Certain other subtractions called tax “credits” then come into play, but we’ll ignore tax credits for purposes of discussion. For discussion, we'll also ignore the Code sections imposing certain other U.S. Federal income taxes such as the alternative minimum tax, etc.)

Now, astonishing as it may seem to non-tax practitioners, Internal Revenue Code section 1 generally applies to every human being (that is, every individual) in the universe. Section 1 generally applies to an individual’s “taxable income” regardless of whether the individual is a U.S. citizen or, alternatively, an alien with respect to the U.S., and regardless of whether the individual is a resident of the U.S. or not.

However, we now have to look at Code section 2(d), which states: “In the case of a nonresident alien, the taxes imposed by sections 1 and 55 shall apply only as provided by section 871 or 877.”

For a nonresident alien -- that is, for an individual who is neither a U.S. citizen nor a U.S. resident, the tax imposed by section 1 does apply. But the tax applies only as provided by sections 871 or 877.

For purposes of illustration, let’s ignore section 877 and look at part of section 871.

Section 871(a)(1) provides in part: “[ . . . ] there is hereby imposed for each taxable year a tax of 30 percent of the amount received from sources within the United States by a nonresident alien individual [ . . . ]”. (underlining added).

So, for purposes of the tax imposed on the taxable income of a nonresident alien individual under section 1, section 2(d), and section 871(a)(1), where is the definition of the term “sources within the United States” to be found?

Answer: In section 861(a), which provides in part: “The following items of gross income shall be treated as income from sources within the United States [ . . . ]” (underlining added).

Nothing in section 861 changes the definition of “gross income” as defined in section 61 and sections 101 through 140, etc.

Instead, in relevant part, section 861(a) and the related regs define -- for purposes of the taxation of nonresident aliens under sections 1, 2(d), and 871 -- what is gross income from sources within the United States, while section 862 and the relates regs define what is gross income from sources “without” (that is outside of) the United States.

What the Wackadoosters (excuse me, the tax protesters or tax deniers) tried to do with the various forms of the frivolous “861 argument” was to start at section 861 -- at pretty near the END of the logic chain -- and argue that section 861 and its regs somehow mean something other than what section 861 and the regs actually say, without even understanding the purpose of section 861 or how section 861 relates to section 871, section 2(d), and section 1.

[Burnaby49]

And I thought our Income Tax Act was complicated.

[Famspear]

And I thought our Income Tax Act was complicated.

This discussion also does not include the effect (if any) of tax treaties that the United States might have with other countries. And, I know almost nothing about that part of U.S. tax law.

[Burnaby49]

And I thought our Income Tax Act was complicated.

This discussion also does not include the effect (if any) of tax treaties that the United States might have with other countries. And, I know almost nothing about that part of U.S. tax law.

One part that has a lot of Canadians pissed off is your global tax on US citizens even if they neither reside nor earn money in the US. I have a neighbour who came here when just a baby and has lived here ever since who is expected to pay US tax on his income, none of which is derived from American sources. I told him to renounce. He, like a lot of them, started complaining that he shouldn't have to give up his citizenship over taxes. My comment was that if being a Canadian citizen isn't enough for you tough, live with the consequences. Being a Canadian is great, I've never had the slightest yearning to be an American.

[SquatloosianTroll]

......Okay so this is under Subtitle A Income Taxes I think I am right on that point. (yay I'm right about something and posted it here on the infamous quatloos site... just ribbing you all) Okay here goes: Under 26 CFR 1.861-8T(d)(2)(iii)
(iii) Income that is not considered tax exempt. The following items are not considered to be exempt, eliminated, or excluded income and, thus, may have expenses, losses, or other deductions allocated and apportioned to them:

(A) In the case of a foreign taxpayer (including a foreign sales corporation (FSC)) computing its effectively connected income, gross income (whether domestic or foreign source) which is not effectively connected to the conduct of a United States trade or business;

(B) In computing the combined taxable income of a DISC or FSC and its related supplier, the gross income of a DISC or a FSC;

(C) For all purposes under subchapter N of the Code, including the computation of combined taxable income of a possessions corporation and its affiliates under section 936(h), the gross income of a possessions corporation for which a credit is allowed under section 936(a); and

(D) Foreign earned income as defined in section 911 and the regulations thereunder (however, the rules of §1.911-6 do not require the allocation and apportionment of certain deductions, including home mortgage interest, to foreign earned income for purposes of determining the deductions disallowed under section 911(d)(6)).

So 1) Where is compensation for services in the above and 2) If these items of income ARE NOT exempt then one can infer that anything else IS EXEMPT.

OK, that's it? That's your answer?

No, grasshopper. You're repeating what is known as an "861" argument. Indeed, you are citing a reg issued under Internal Revenue Code section 861. Neither section 861 nor the regulation you cited exempts compensation for services from the definition of gross income.

The regulation you are citing deals with how to compute taxable income from sources within the United States and from other sources and activities for purposes of Subchapter N of Chapter 1 of the Internal Revenue Code -- NOT for purposes of determining what is included in gross income under section 61.

You have fallen for the 861 argument.

The ASSESSMENT STATUTES ARE INCLUDED IN 27 PART 70 (did you fail to look at the jpg's I posted???) as those activities; selling, manufacturing, distributing alcohol, are taxed under the INTERNAL REVENUE CODE. 27 USC and you failed to read what was posted along with the jpg's.

No, THE ASSESSMENT STATUTES ARE NOT INCLUDED IN 27 PART 70. YOU did not properly read or understand what I wrote.

The assessment statutes are CITED in 27 Part 70 -- that is, the section numbers are listed in part 70 of title 27 of the Code of Federal Regulations -- or more specifically, in the page from the Federal Register relating to certain regs codified in part 70 of title 27. The actual texts of the sections are not "included in" 27 Part 70.

More to the point, you still don't seem to understand that the assessment statutes have nothing to do with what is included in the definition of gross income. The assessment statutes that you cited in your first posts don't even mention the term "gross income" or the term "taxable activity".

How do you manage to tie your shoes in the morning?

No, THE ASSESSMENT STATUTES ARE NOT INCLUDED IN 27 PART 70. YOU did not properly read or understand what I wrote.

----- Yes, they are included in the 27 PART 70! Holy Sh*t are you blind? How do you tie your shoes in the morning? The authority to assess taxes on the sale of alcohol are found at 26 USC 6201, 6202 and 6204 which is found on page 2 middle of the page at PART 70 Procedure and Administration (it's even highlighted for those that apparently can't see all that well.




I am no longer going to address S.61. I am talking about assessments and that is all I am going to talk about.

[Dr. Caligari]

I am no longer going to address S.61. I am talking about assessments and that is all I am going to talk about.

You have not even once attempted to address section 61, because it is fatal to your argument.