Challenge to Ducky

[Ducky]

Dear Ducky: Maybe this will help.

Employee.

A person in the service of another under any contract of hire, express or implied, oral or written, where the employer has the power or right to control and direct the employee in the material details of how the work is to be performed. [. . . ] One who works for an employer; a person working for salary or wages.

--Black's Law Dictionary, p. 471 (5th Ed. 1979).

Employer.

One who employs the services of others; one for whom employees work and who pay their wages or salaries. The correlative of "employee."

--Black's Law Dictionary, p. 471 (5th Ed. 1979).

Now read 26 USC 7701(c):

The terms “includes” and “including” when used in a definition contained in this title [meaning the Internal Revenue Title, which is codified as title 26 of the United States Code] shall not be deemed to exclude other things otherwise within the meaning of the term defined.

(bolding added). Now, re-read the Black's Law Dictionary definitions.

Now, read 26 USC 3401(c):

For purposes of this chapter [Ducky, "this chapter" does not mean the entire Internal Revenue Title; it means Chapter 24 of the IRC, which relates ONLY to the withholding obligation of the EMPLOYER], the term “employee” includes [Ducky: read it; it does not say "means," it says "includes"] an officer, employee, or elected official of the United States, a State, or any political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing. The term “employee” also includes an officer of a corporation.

Thus, for purposes of the EMPLOYER'S obligation to WITHHOLD, the term "employee" is EXPANDED to include officer of the United States, etc., etc.

As if all that were not enough, I want to reiterate that nothing in section 3401 (or in any other section of Chapter 24 of the Code) defines "gross income" for purposes of determining whether wages (or salary, or anything else) are taxable to the employee. Chapter 24 imposes only the withholding obligation of the employer, not the federal income tax liability of the employee.

the Irc is not refferring to the definitions of the legal terms from BLD.

The word games being deployed are by the IRC, this, I understand no one will recognize, that is fine.(although it does boggle my mind) but it is clear that includes does not have its common meaning.

The terms “includes” and “including” when used in a definition contained in this title [meaning the Internal Revenue Title, which is codified as title 26 of the United States Code] shall not be deemed to exclude other things otherwise within the meaning of the term defined

so let's dissect this. shall not be deemed to exclude=double negative so it means includes. other things otherwise within the meaning of the TERM defined. The use of TERM here is the lynchpin. The IRC is not referring to BLD TERM, it is referring to the TERM defined in the IRC.

So applying the this to the definition of employee

the term “employee” includes [Ducky: read it; it does not say "means," it says "includes"] an officer, employee, or elected official of the United States, a State, or any political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing. The term “employee” also includes an officer of a corporation.

The TERM is what you see above not the TERM from BLD. Thus includes or including, includes other things within the meaning of that TERM (from the IRC)defined. It is both expanding and limiting. it expands the list to those within the same general class, limits this expansion to that class and only that class.

just look at the previous definition that was provided:
an older definition of “includes” from
26 CFR 170.59, the terms "includes and including" do not exclude things not enumerated which are in the same general class”.


Why didn't they clearly say that includes and including as used in this title are not limiting?

As you indicated before Attorneys are very careful with words, this proves to be another cleverly constructed TERM.

In fact looking at Dan's FAQ regarding including one can see that he is also very careful.

Section 7701(c) of the Internal Revenue Code confirms this usage of “include” because it expressly states that using the word “includes” in a definition does not exclude anything that would otherwise be included in the meaning of the word being defined. So a definition of “employee” to include government employees does not exclude non-government employees, and a definition of “state” to include the District of Columbia does not mean that the states of the United States are no longer considered to be states, and yet tax protesters insist that the word “employees” mean only government employees, and “United States” does not include any of the states of the United States.

No Dan it is TERM and there is a big difference when using the two. One refers to the common meaning of the word, the other refers to an already defined legal TERM. I suspect that you already know this though.

what do you have to say about the letter from Barbara Keneely, which states:

"In your letter you asked if section 3(a) of H.R. 97 defining the word state, and 26 U.S. Code 3121 (e) are the same. I have checked with Legislative Counsel and the Congressional Research Service about the definition. According to these legal experts the definitions are not the same. The term state in 26 U.S. Code 3121 (e) specifically includes only the named U.S. territories and possesion of the District of Columbia, Puerto Rico, the Virgin Islands, Guam and American Samoa."

[Demosthenes]

Now, re-read the Black's Law Dictionary definitions.

Why? Black's Law Dictionary isn't the law.

[Imalawman]

Ducky, I would say that government and corporate officer employees are within the same general class. So, you have more weasel wording to do in order to show that somehow all the many other types employees are not similar to the ones listed. Pete's mind is the only source for drawing a distinction between federally-connected non-federally-connected employees (whatever that even means).

But Ok, and here's my question that I have now asked you 3 times! Let's say you're right. Let's make that leap of faith. How does that do anything more than make you exempt from having your wages withheld? Compensation for services rendered is still taxed under IRC 61. What exempts that income from taxation?

Here's another one to think about - Why would 3401, which, as you say so clearly limits the term employee to public sector employment, list private sector employee examples within the text of 3401? If this section only applies to the public sector, why give a list of private sector jobs that are not subject to withholding?

[RyanMcC]

what do you have to say about the letter from Barbara Keneely, which states:

"In your letter you asked if section 3(a) of H.R. 97 defining the word state, and 26 U.S. Code 3121 (e) are the same. I have checked with Legislative Counsel and the Congressional Research Service about the definition. According to these legal experts the definitions are not the same. The term state in 26 U.S. Code 3121 (e) specifically includes only the named U.S. territories and possesion of the District of Columbia, Puerto Rico, the Virgin Islands, Guam and American Samoa."

Dan does cover it in his FAQ.

“Citing 26 U.S.C. § 3121(e)(1) & (2), the respondent argues that the IRS was without territorial jurisdiction to issue the summons in this case because the Internal Revenue Code only applies to individuals living in one of the territories specifically mentioned in that rule. Unfortunately, the respondent has misinterpreted the statute. This rule, appearing in the ‘definitions’ section, says that the ‘term “State” includes the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, or American Samoa’ (emphasis added). This is a rule of inclusion, not exclusion. Nowhere in this rule does it exclude the fifty United States from the definition of ‘State’ under the Internal Revenue Code. To interpret the rule this way would be absurd.”

United States v. Teresa Hopper, 2005 TNT 215-10, No. 05-MC-172 (U.S.D.C. E.D.N.Y. 10/29/2005).

See also, Depew v. United States, 50 F. Supp. 2d 1009,1015 (D. Colo. 1999) (finding arguments that plaintiff was neither a “person” nor a “taxpayer” within federal income tax laws based upon his nonresident status frivolous).

[Ducky]

what do you have to say about the letter from Barbara Keneely, which states:

"In your letter you asked if section 3(a) of H.R. 97 defining the word state, and 26 U.S. Code 3121 (e) are the same. I have checked with Legislative Counsel and the Congressional Research Service about the definition. According to these legal experts the definitions are not the same. The term state in 26 U.S. Code 3121 (e) specifically includes only the named U.S. territories and possesion of the District of Columbia, Puerto Rico, the Virgin Islands, Guam and American Samoa."

Dan does cover it in his FAQ.

“Citing 26 U.S.C. § 3121(e)(1) & (2), the respondent argues that the IRS was without territorial jurisdiction to issue the summons in this case because the Internal Revenue Code only applies to individuals living in one of the territories specifically mentioned in that rule. Unfortunately, the respondent has misinterpreted the statute. This rule, appearing in the ‘definitions’ section, says that the ‘term “State” includes the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, or American Samoa’ (emphasis added). This is a rule of inclusion, not exclusion. Nowhere in this rule does it exclude the fifty United States from the definition of ‘State’ under the Internal Revenue Code. To interpret the rule this way would be absurd.”

United States v. Teresa Hopper, 2005 TNT 215-10, No. 05-MC-172 (U.S.D.C. E.D.N.Y. 10/29/2005).

See also, Depew v. United States, 50 F. Supp. 2d 1009,1015 (D. Colo. 1999) (finding arguments that plaintiff was neither a “person” nor a “taxpayer” within federal income tax laws based upon his nonresident status frivolous).

Wait, where did the She or her staffer was wrong part go? Ryan

I have checked with Legislative Counsel and the Congressional Research Service about the definition. According to these legal experts

I see you deleted that, Why?

[RyanMcC]

Because I considered other possibilities:

A) The author of the letter assumed nobody would be silly enough to actually think "State" excluded every State in the United States.

B) It was possible the bill HR 97 included more territory than listed in 3121.

Either way it is irrelevant, because I checked with decided court cases, and found that arguement is a loser. Unless you have evidence to the contrary.

---

Actually HR 97 states:

For the purposes of this Act, the term `State' shall be deemed to include the District of Columbia and any United States territory or possession.

Full text of bill here.

The bill also states:

(a) IN GENERAL- On application of the Governor of a State and the chief executive officer of the affected local government or governments (or, in the case of the District of Columbia, the mayor) and upon finding that the occurrence of criminal activity in a particular jurisdiction is being exacerbated by the interstate flow of drugs, guns, and criminals, the Deputy Assistant Director may deploy on a temporary basis a unit of the Rapid Deployment Force of an appropriate number of law enforcement officers to the jurisdiction to assist State and local law enforcement agencies in the investigation of criminal activity. For the purposes of this Act, the term `State' shall be deemed to include the District of Columbia and any United States territory or possession.

So clearly she couldn't have been endorsing the "includes" arguement you push, and clearly the intent of this bill is not to protect only DC and the territories to the exclusion of the rest of the United States.

---

Copy of the letter from Barbara Kennelly.

[Famspear]

Now, re-read the Black's Law Dictionary definitions.

Why? Black's Law Dictionary isn't the law.

Actually, Demo, it's OK, because Black's Law Dictionary is what we call "secondary authority." I would not usually cite Black's Law Dictionary when I'm writing a brief (I would look first to primary authority, such as statutes, case law, and so on). It's OK for me to quote from Black's Law Dictionary when I'm instructing Ducky, because I know what I'm doing.

It's not OK for Ducky, and for tax protesters in general, to cite or quote from Black's Law Dictionary and other secondary sources; Ducky and the protesters don't know what they're doing.

The quotations from Black's Law Dictionary were provided to Ducky with the intent that Ducky clear up his/her muddled thinking. As evidenced by Ducky's response (i.e., just more word games), and as I expected, it didn't work.

Dear Ducky; As to the latest iteration of your word games: Sell it to Peter Hendrickson. The law is what I and other Quatloos regulars say the law is. The law is not what Cracking the Code says the law is. Go back and read my post again, and think about it. Don't fight it. Just absorb it. Take your time.

[Famspear]

Ducky wrote:

the Irc [Internal Revenue Code] is not refferring [sic] to the definitions of the legal terms from BLD [Black's Law Dictionary].

Ducky, don't get hung up on the fact that the quote is from Black's Law Dictionary. You would be correct to say that the IRC does not expressly incorporate definitions from Black's Law Dictionary. In this particular case, the IRC is indeed using the term "employer" in the general sense of a common law employer -- the definition of which is precisely the definition provided from Black's Law Dictionary.

You are quite wrong on this point.

[Famspear]

Ducky stumbles all over himself:

The TERM is what you see above not the TERM from BLD. Thus includes or including, includes other things within the meaning of that TERM (from the IRC)defined. It is both expanding and limiting. it expands the list to those within the same general class, limits this expansion to that class and only that class.

What a load of crap. This is not legal analysis; this is crap.

I have this picture in my mind of an accordion -- expanding and contracting, expanding and contracting. Expanding and limiting. Expanding and limiting.

No, Ducky, the terms "includes" and "including" are NOT "both expanding and limiting."

Ducky, you are simply regurgitating Pete Hendrickson's nonsensical word games. See my earlier post regarding Hendrickson's impotent attempt to get around the court decisions that have rejected his interpretation of these terms.

EDIT: In case you missed it, Ducky, this is what you and Hendrickson are doing:

The classic example of this is the section 7701 definition of "includes and including." Hendrickson uses these terms as terms of "exclusion" or of "limitation." The courts have consistently rejected that use, and have ruled that in 7701 the terms are terms of expansion, not of exclusion or limitation. My understanding (and I can't remember whether it's from reading Pete's work or reading his followers' interpretations of his work) is that Hendrickson has tried to work around this problem by convincing his followers that HE REALLY AGREES that the terms are terms of "expansion" -- but then goes on to elaborate on what he contends "expansion" really means. And when you're finished with Hendrickson's hilarious word game, it turns out that Hendrickson is just trying to pull you back to his contention that the terms are, in effect, terms of exclusion or limitation, even though he supposedly "agrees" with the court that they're not that. The classic case is in his use of the term "includes" or "including" in section 3401, relating to the definition of an "employee" -- where Hendrickson puts forth the completely nonsensical argument that "employee" does NOT "include" a regular worker (such as a worker at the local McDonald's restaurant, essentially).

No, Ducky, the terms are not "both expanding and limiting."

[Quixote]

The terms “includes” and “including” when used in a definition contained in this title [meaning the Internal Revenue Title, which is codified as title 26 of the United States Code] shall not be deemed to exclude other things otherwise within the meaning of the term defined

so let's dissect this. shall not be deemed to exclude=double negative so it means includes. other things otherwise within the meaning of the TERM defined. The use of TERM here is the lynchpin. The IRC is not referring to BLD TERM, it is referring to the TERM defined in the IRC.

But neither the word "employee" nor the term "employee" (assuming, as only TPs do, that there is a difference) are defined in the IRC. It is not possible to define a word by using the word "includes". (It is just barely possible to do so by using the awkward construction "includes only", if one is very careful.) Therefore, any statement in the IRC of the form "X includes a, b, c, etc." does not and cannot define X. It can only clarify the meaning of X as used in the IRC.

When Congress wanted to define a term from scratch they always use "means". Apparently most TPs are as confused about the meaning of "means" as they are about the meaning of confused. I can otherwise explain why they cannot understand IRC §63(a), "... the term 'taxable income' means gross income minus the deductions ...".

If “includes” in the IRC means what common English says it means, then there would be no need to define it at all. Since Congress has defined it, then it is clearly NOT the common English definition.

Which is why Congress did not define it, because all they needed to do was to clarify which of the two conflicting connotations of "include" they intended. Mathew, like all TPs, conveniently forgets inconvenient facts, such as the existence of court cases in which the issue was the meaning of "include".

[grammarian44]

Sorry to butt into this conversation, but I'm confused about two things.

First, I can't seem to find the statute or proclamation in which Barbara Keneely was appointed Queen of Tax Law for all time. Ducky, assuming your interpretation of Ms. Keneely's letter is accurate, I'm sure you can take the additional step of citing the statute that gives her such sweeping authority to set aside interpretations by the courts whenever she feels like it.

Second--and this is Iamalawman's question again--I can't seem to find anything that says that if an employer is not required to withhold tax against the wages of an employee, the employee is not liable for tax. What I find instead is that under sections 1, 61, and 63, a tax is imposed on wages and the person generally liable for paying the tax is the person who earned the wages. Employer withholding is a mechanism for collecting tax, and the withholding rules in 3401 et seq. do not alter liability when no withholding has taken place. In fact, section 3403 says that an employer is liable for payment of withheld amounts. If wages are not subject to withholding--as Ducky contends is the case--then 3403 does not apply, and the general tax liability rules of 1, 61, and 63 apply, leaving all earners of compensation for services liable for tax.

So why in the world are we making employee liability for tax contingent on statutes that have nothing whatever to do with liability? Withholding on wages is simply one collection mechanism out of several that are available to the government. In fact, under 6302(a) it's pretty clear that even if all the withholding statutes went out the window, the Secretary of the Treasury would be free to establish any other means of collection to reach any and all tax liabilities.

[Famspear]

[ . . . ] I can't seem to find anything that says that if an employer is not required to withhold tax against the wages of an employee, the employee is not liable for tax. What I find instead is that under sections 1, 61, and 63, a tax is imposed on wages and the person generally liable for paying the tax is the person who earned the wages. Employer withholding is a mechanism for collecting tax, and the withholding rules in 3401 et seq. do not alter liability when no withholding has taken place. In fact, section 3403 says that an employer is liable for payment of withheld amounts. If wages are not subject to withholding--as Ducky contends is the case--then 3403 does not apply, and the general tax liability rules of 1, 61, and 63 apply, leaving all earners of compensation for services liable for tax.

So why in the world are we making employee liability for tax contingent on statutes that have nothing whatever to do with liability? Withholding on wages is simply one collection mechanism out of several that are available to the government. In fact, under 6302(a) it's pretty clear that even if all the withholding statutes went out the window, the Secretary of the Treasury would be free to establish any other means of collection to reach any and all tax liabilities.

(bolding added)

I believe several people (myself included) have repeatedly pointed this out to Ducky.

I suspect that Ducky will either regurgitate Hendrickson's frivolous argument on this point, or will simply ignore the question.

[grammarian44]

I believe several people (myself included) have repeatedly pointed this out to Ducky.

If you agree that the withholding statutes have nothing to say about the real issue--liability for income taxes on compensation for services, including wages--then why has everyone apparently conceded this point to Ducky by trying to make the argument that his specific interpretation of "includes" in the withholding statute is incorrect? Why play the game on his turf? Why not hammer home the point that all of the statutes on which he is pinning his arguments are completely irrelevant to the issue of liability in the first place?

The goal here is not to persuade Ducky to change his mind. We both know that won't happen. The goal is to prevent others from being taken in by his arguments. The best way to achieve that goal is to attack his argument at its weakest point, which is simply to point to the fact that the statutes on which he and PH rely say nothing about the question of liability for taxes. Otherwise, you just appear to be playing his game, to no apparent benefit.

[Famspear]

I believe several people (myself included) have repeatedly pointed this out to Ducky.

If you agree that the withholding statutes have nothing to say about the real issue--liability for income taxes on compensation for services, including wages--then why has everyone apparently conceded this point to Ducky by trying to make the argument that his specific interpretation of "includes" in the withholding statute is incorrect? Why play the game on his turf? Why not hammer home the point that all of the statutes on which he is pinning his arguments are completely irrelevant to the issue of liability in the first place?

The goal here is not to persuade Ducky to change his mind. We both know that won't happen. The goal is to prevent others from being taken in by his arguments. The best way to achieve that goal is to attack his argument at its weakest point, which is simply to point to the fact that the statutes on which he and PH rely say nothing about the question of liability for taxes. Otherwise, you just appear to be playing his game, to no apparent benefit.

Dear grammarian44: Whether we appear to be playing Ducky's game, "to no apparent benefit or not," is not of primary concern to me personally. I can't speak for anyone else, but my goals are not as narrow as you have indicated.

Pointing out to Ducky that his interpretation (of "includes," as used in section 3401) is incorrect does not constitute "conceding" any other point to Ducky. Indeed, Ducky is pretty much roasted, at this point, on just about every point he has raised.

I don't feel the need to limit my discussion to attacking Ducky's argument at its weakest point. Look, my "success" in actually changing the minds of tax protesters with whom I have interacted over the years is pretty slim; I don't really expect to change anyone's mind. Occasionally, if it happens, that's great.

That doesn't mean I consider this exercise to be fruitless. My goal (besides the main goal of having fun) is to do my best to do as much good as possible -- to afford each and every tax protester with whom I interact at least some chance to pull back from the delusion.

[jg]

I suspect that Ducky will either regurgitate Hendrickson's frivolous argument on this point, or will simply ignore the question.

He will agree that what you say is true for "employees" that receive "wages" from "employers "and then insist that you are mischaracterizing his statements; as he is most definitely NOT an "employee" as that term is defined in the IRC.

[grammarian44]

I suspect that Ducky will either regurgitate Hendrickson's frivolous argument on this point, or will simply ignore the question.

He will agree that what you say is true for "employees" that receive "wages" from "employers "and then insist that you are mischaracterizing his statements; as he is most definitely NOT an "employee" as that term is defined in the IRC.

Then I would ask Ducky, "so what?", inasmuch as the liability for taxes is imposed on compensation for services, not wages of employees, which are merely one type of compensation for services. The plain language of sections 1, 61, 63 is all that is ever needed to rebut LH/PH arguments.

My real point here is that if you try to eke out a victory on the 3401 "includes" issue, you make it appear to the relatively naive reader that winning on that issue somehow matters for the purpose of determining whether PH's approach is effective. Prolonging the debate creates the impression that the debate is meaningful. It's not.

Impressions and appearances matter here. If it looks like tax deniers are holding their own, that's a de facto victory for tax deniers. I'm all for fun and games, Famspear, but not at the expense of creating the impression that there is a serious issue about whether one could interpret the word "includes" to remove liability for tax. It's a total non-issue, and the only appropriate responses are (1) to point to the statutes that do create liability for tax, and (2) invite the denier to report in PH's recommended fashion and wait for the hammer to fall, as it is already falling on Pete. Otherwise you're just giving good PR to Hendrickson's campaign.

[Famspear]

Adapted from my materials in Wikipedia (and, I believe, previously posted in roughly this form, somewhere else here in the Quatloos forum):

An argument linked to the meaning of the words "includes" and "including" is the argument that for Federal income tax purposes, the term "employee" under Internal Revenue Code section 3401(c) does not include a regular, private-sector employee. The courts have uniformly rejected this argument. The text of section 3401(c), which deals only with the employer's withholding requirements and not with the employee's requirement to report Internal Revenue Code section 61 compensation for personal services (whether called wages, salaries, or any other term), is as follows:

For purposes of this chapter, the term “employee” includes an officer, employee, or elected official of the United States, a State, or any political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing. The term “employee” also includes an officer of a corporation.

-----IRC sec. 3401(c).

In Sullivan v. United States, taxpayer Grant W. Sullivan argued that he had not received “wages” and was not an “employee” under Internal Revenue Code section 3401(c). The United States Court of Appeals for the First Circuit ruled against Sullivan, stating:

To the extent Sullivan argues that he received no “wages” in 1983 because he was not an “employee” within the meaning of 26 U.S.C. §3401(c), that contention is meritless. Section 3401(c), which relates to income tax withholding, indicates that the definition of “employee” includes government officers and employees, elected officials, and corporate officers. The statute does not purport to limit withholding to the persons listed therein.

-----Sullivan v. United States, 788 F.2d 813, 86-1 U.S. Tax Cas. (CCH) paragr. 9343 (1st Cir. 1986) (per curiam) (bolding added).

In United States v. Ferguson, taxpayer Joy Ferguson, a follower of Peter Hendrickson and Cracking the Code, argued that she was not an “employee” under section 3401(c), and that she therefore could not have “wages.” The court ruled against her, stating:

The core of the dispute before the court is Ferguson's assertion that she was not an “employee” as defined by §3401(c) of the Internal Revenue Code, and therefore did not earn any "wages." [ . . . ] As such, she argues that her Form 1040 and Form 4862 accurately reported her wages as zero. As noted by the government, Ferguson's interpretation of §3401(c) has been considered and rejected numerous times by many courts. This Court would agree with the overwhelming precedent on this issue, Ferguson's argument that she is not an employee as defined by §3401(c) is frivolous.

-----United States v. Ferguson, 2007-1 U.S. Tax Cas. (CCH) paragr. 50,461 (D. Nev. 2007).

[ . . . ]

In ''Richey v. Stewart'', the court stated:

Another familiar argument from Mr. Richey [the taxpayer] is that he is not an employee under the terms of the Internal Revenue Code, citing Section 3401(c), which states that the term “employee” includes government employees. What Mr. Richey misapprises in his reading of the statute is the inclusionary nature of the language. The Code does not exclude all other persons from taxation who are not government employees.

-----Richey v. Stewart, 84-2 U.S. Tax Cas. (CCH) paragr. 9642 (S.D. Ind. 1984).

In United States v. Charboneau, the court stated:

[ . . . ] Ms. Charboneau contends that the Code's definitions of "wage income" and "self employment income" only include income derived from individuals who work for the federal government, or whose work involves that of "the performance of the functions of a public office." Because Ms. Charboneau never worked for any federal or state government during the tax years in question, she claims that the IRS cannot make any tax assessments against her.

This nonsensical argument is belied by the plain language of the Internal Revenue Code itself. For example, 26 U.S.C. §3401 defines wages as "all remuneration (other than fees paid to a public official) for services performed by an employee for his employer...." 26 U.S.C. §3401(a) (emphasis added). The statute then goes on to define various exceptions to this broad definition of wages in certain categories of private employment, such as in the agricultural and domestic service fields, newspaper delivery, the clergy, and for wages incurred by individuals working for employers "other than the United States or an agency therof" within Puerto Rico or a possession of the United States. There is nothing in the statute limiting "wages" to solely publicly-derived income. [footnotes omitted]

Ms. Charboneau, however, focuses on §3401(c), which states that:

-----the term “employee” includes an officer, employee, or elected official of the United States, a State, or any political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing. The term “employee” also includes an officer of a corporation.

26 U.S.C. §3401(c). Setting aside the last sentence of this provision, which clearly states that officers of private corporations are considered employees for purposes of determining wages, it is obvious that within the context of this statute that the word "includes" is a term of enlargement, not of limitation, and the reference to certain public officers and employees was not intended to exclude all others. See also Sims v. United States, 359 U.S. 108, 112-13 (1959) (finding that similar provision in 26 U.S.C. §6331 dealing with levies on salaries and wages does not exclude wages of private citizens); Sullivan v. United States, 788 F.2d 813,815 ("[Section 3401(c)] does not purport to limit withholding to persons listed therein"); United States v. Latham, 754 F.2d 747, 750 (7th Cir, 1985) (the Internal Revenue Code definition of “employee” in 26 U.S.C. §3401 does not exclude privately employed wage earners);. In addition, 26 U.S.C. §7701, which provides the definitions of terms used throughout the Internal Revenue Code, states that the "terms 'includes' and 'including' when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined." 26 U.S.C. §7701(c).

---United States v. Charboneau, 2006-2 U.S. Tax Cas. (CCH) paragr. 50,507 (M.D. Fla. 2006).

In McCoy v. United States, the court stated:

McCoy argues she should not have to pay taxes for 1996-98 because under Code Section 3401 she was not an “employee” which she contends is defined as an elected or appointed employee or official of the federal government. McCoy clearly misconstrues Section 3401(c). The definition of “employee” includes private-sector employees, employees of the federal government, as well as elected and appointed officials. The very language of the Code is inclusive, not limited to the examples of included persons.

--McCoy v. United States, 2001 U.S. Dist. LEXIS 18986, 2001-2 U.S. Tax Cas. (CCH) paragr. 50,787 (N.D. Tex. 2001) (footnotes omitted).

Notice that the courts in these cases have had no problem with pointing out, to the taxpayer, that the taxpayers’ wacky interpretations of 3401 were incorrect – despite the separate and salient point that grammarian44 and I and other Quatloos regulars have made, that section 3401 does not even determine the liability of the employee for the tax anyway.

Note to Ducky: The argument that only certain types of taxpayers (such as only Federal government employees, corporations, nonresident aliens, residents of the District of Columbia, or residents of Federal territories) are subject to income tax and employment tax, and variations of this argument, have been officially identified as legally frivolous Federal tax return positions for purposes of the $5,000 frivolous tax return penalty imposed under Internal Revenue Code section 6702(a), as amended by section 407 of the Tax Relief and Health Care Act of 2006, Pub. L. No. 109-432, 120 Stat. 2922 (Dec. 20, 2006). See Notice 2008-14, I.R.B. 2008-4 (Jan. 14, 2008), Internal Revenue Service, U.S. Department of the Treasury (superseding Notice 2007-30).

[Quixote]

making money (such as the receipt of check or cash from a job completed) as a worker, not in the employ of the federal goverment, IS taxable.

As noted above, that statement, as one possible interpretation of your previous one, has been dealt with. Congress could impose a tax on the act of receiving payment for services rendered. To the best of my knowledge, Congress has never done so. Certainly no such tax is curremtly in force. Congress has imposed a tax on income. Receiving payment for services rendered usually results in income.

[LPC]

The word games being deployed are by the IRC, this, I understand no one will recognize, that is fine.(although it does boggle my mind) but it is clear that includes does not have its common meaning.

Wrong.

In ordinary, everyday English, the word “include” is normally used to describe an incomplete list, and does not necessarily exclude anything not included in the list. For example, one dictionary has explained the proper usage of “include” in this way:

Include is used most appropriately before an incomplete list of components: The ingredients of the cake include butter and egg yolk. If all the components are named, it is generally clearer to write: The ingredients are....

Usage note on “include,” American Heritage Dictionary (2d College Ed. 1985).

so let's dissect this. shall not be deemed to exclude=double negative so it means includes. other things otherwise within the meaning of the TERM defined. The use of TERM here is the lynchpin. The IRC is not referring to BLD TERM, it is referring to the TERM defined in the IRC.

What you have written here is meaningless. The "term" being defined is the term being defined. The use of the word "includes" does not exclude anything otherwise within the meaning of the term being defined. In determining what is "otherwise within the meaning of the term defined," the courts will obviously need to look outside of the IRC, and one of the references that *might* be consulted in Black's Legal Dictionary.

And courts do regularly look to dictionaries for guidance in interpreting the words used in the IRC.

What Hendrickson has argued, and you have swallowed whole, is the idea that, in determining the meaning of a term being defined using the word "includes," we can only look to the words used in the Internal Revenue Code, but such an argument makes section 7701(c) meaningless.

So applying the this to the definition of employee

the term “employee” includes [Ducky: read it; it does not say "means," it says "includes"] an officer, employee, or elected official of the United States, a State, or any political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing. The term “employee” also includes an officer of a corporation.

The TERM is what you see above not the TERM from BLD. Thus includes or including, includes other things within the meaning of that TERM (from the IRC)defined. It is both expanding and limiting. it expands the list to those within the same general class, limits this expansion to that class and only that class.

You're just parroting Hendrickon's nonsense now.

The word "employee" had a meaning before section 3401(c) was enacted, and section 7701(c) clearly states that the use of the word "includes" in section 3401(c) means that none of the people who were employees before section 3401(c) was enacted stopped being employees by reason of section 3401(c).

Every judge in the history of the United States who has heard your argument has rejected it and every judge who hears it in the future will reject it, because it violates the plain meaning of both section 7701(c) and section 3401.

See http://evans-legal.com/dan/tpfaq.html#government for examples.

Also, riddle me these:

1. If the only persons who are "employees" within the meaning of section 3401(c) are government officials and corporate officers, why does section 3401(a) contain an exception for domestic service in a private home? Read through the other exceptions listed in section 3401(a) and try to figure out why those exceptions would be needed if your understanding of "employee" were corrrect.

2. Even if a private sector employee is not an "employee" within the meaning of section 3401(c), so what? Section 3401(c) provides a definition of "employee" only "for purposes of this chapter," which is definitions used for purposes of tax withholding. The definitions in section 3401 have nothing whatsoever to do with the meaning of "gross income" in section 61, or the meaning of "taxable income" in section 63.

In fact looking at Dan's FAQ regarding including one can see that he is also very careful.

Section 7701(c) of the Internal Revenue Code confirms this usage of “include” because it expressly states that using the word “includes” in a definition does not exclude anything that would otherwise be included in the meaning of the word being defined. So a definition of “employee” to include government employees does not exclude non-government employees, and a definition of “state” to include the District of Columbia does not mean that the states of the United States are no longer considered to be states, and yet tax protesters insist that the word “employees” mean only government employees, and “United States” does not include any of the states of the United States.

No Dan it is TERM and there is a big difference when using the two. One refers to the common meaning of the word, the other refers to an already defined legal TERM. I suspect that you already know this though.

No, I didn't "know" that, because it's not true.

Section 7701(c) uses the word "term" because sometimes what is being defined is a phrase. For example, Section 7701(a) defines "United States," but "United States" is obviously two words and not one. So it could not be a "word defined" but it could be the "term defined." See also section 7701(a)(15) for another example of a "term" composed of multiple words.

And I'll be changing "word" to "term" in my FAQ so any not to lend any support to your delusions.

what do you have to say about the letter from Barbara Keneely, which states:

"In your letter you asked if section 3(a) of H.R. 97 defining the word state, and 26 U.S. Code 3121 (e) are the same. I have checked with Legislative Counsel and the Congressional Research Service about the definition. According to these legal experts the definitions are not the same. The term state in 26 U.S. Code 3121 (e) specifically includes only the named U.S. territories and possesion of the District of Columbia, Puerto Rico, the Virgin Islands, Guam and American Samoa."

Substitute the word "adds" for the word "includes" and the meaning of the sentence is clear.

For example, I have two recipes for brownies. One recipe includes walnuts and cashews and the other recipe includes only walnuts. Which recipe includes eggs and flour?

[Imalawman]

I believe several people (myself included) have repeatedly pointed this out to Ducky.

If you agree that the withholding statutes have nothing to say about the real issue--liability for income taxes on compensation for services, including wages--then why has everyone apparently conceded this point to Ducky by trying to make the argument that his specific interpretation of "includes" in the withholding statute is incorrect? Why play the game on his turf? Why not hammer home the point that all of the statutes on which he is pinning his arguments are completely irrelevant to the issue of liability in the first place?

The goal here is not to persuade Ducky to change his mind. We both know that won't happen. The goal is to prevent others from being taken in by his arguments. The best way to achieve that goal is to attack his argument at its weakest point, which is simply to point to the fact that the statutes on which he and PH rely say nothing about the question of liability for taxes. Otherwise, you just appear to be playing his game, to no apparent benefit.

Being in the position that I am, I have had the unique opportunity to rather force CTC'ers to answer that question or risk losing their "case". So far, in 100% of the cases, they have not been able to answer that question and to date, 100% of the time, they have lost their cases. The last case I won against a CTC'er they (joint filers) they actually were behind on their returns and filed 3 years worth on one date. Filed correct returns for the last 3 years, then 4 weeks later filed correct amended returns (seemingly) for the past 5 years, then filed 5 years worth of CTC returns 2-3 weeks after that. After the case concluded they owed a tidy sum in penalties and interest. Had they left the returns alone and not filed CTC, they would have about broken even and had zero liability.

This is the crux of the matter, I see firsthand the dangerous game of playing TP. Many of the people who choose this path do not have the money it takes to dig themselves out of the hole they dig with being a TP. Many, would have even received small refunds if they had left their returns alone (or paid a very small amount at year end). Greed and hubris can be a dangerous combination. If I can convince even 1 family to avoid that path, I consider it a huge success.