There is no law, state or federal, that requires every individual in America to file an income tax return. This is because the income tax (both federal and state) is a legal and constitutional excise tax that applies to gains from taxable activities, not to people directly. As held by the United States Supreme Court, the income tax is not a direct tax that applies to every individual in America. Brushaber v. Union Pacific, 240 U.S. 1. Such a tax would be unconstitutional. The 16th Amendment authorizes an indirect excise tax on constitutionally taxable “incomes”; that is, incomes within the scope and authority of federal jurisdiction. Because the income tax is an excise tax that applies to gains from taxable activities and not to any person directly, neither the 16th Amendment nor the Internal Revenue Code (nor Minnesota state law) identifies any person or individual required to pay the income tax or file a return.
Many taxes are legitimate and lawfully collected and enforced. The income tax is a legal and constitutional excise tax that lawfully applies only to taxable activities. An excellent example of taxable activities is the seminal case defining “taxable income,” Commissioner v. Glenshaw Glass, 348 U.S. 426, in which the United States Supreme Court held that a punitive damage award from a federal anti-trust lawsuit was “taxable income.” The income was constitutionally taxable income because Glenshaw Glass received profit and gain as a direct consequence of the taxable activity of asserting a federal statutory right in federal court—Glenshaw received a gain (the punitive damages money) by asserting a federal right (a federal anti-trust statutory claim) and by employing a federal privilege (using federal courts to obtain the gain). That sort of “income” is clearly within the federal government’s power and authority to tax because Glenshaw Glass would not have received it “but for” the federal anti-trust statute and “but for” its taxable activity of going to federal court to obtain the award.
The facts of every sound United States Supreme Court decision relating to the income tax make clear that the income tax is a constitutional and legal excise tax that applies to profits and gains received from taxable activities, not people directly. Several enlightened IRS agents, including former criminal investigator Joe Banister, are aware of this and have prevailed against the erroneous claim that they were legally obligated to file an income tax return when they had no taxable income.
The view that every child in America is born into an inescapable system of bondage to the federal and state governments is not only legally wrong, it is the product of a dark, collective hallucination. The root causes of this misperception are: (1) authority misinfluence (people blindly following and unconsciously obeying someone in authority even when the person in authority is doing something wrong and harmful to others, see the Milgram Experiment); (2) a “social proof” or herd mentality perhaps stemming from the federal government’s 1942 overly broad expansion of wage withholding amid war fervor and a false public belief that the income tax actually pays for public services rather than the reality that it is primarily a tool for social control and pays (only partially) the interest due on federal debt; (3) familiarity bias (this is the way I have always experienced it so it must be right); (4) incentive bias (the enforcers are government agents who actually believe that all income is taxable income because of a powerful emotional incentive to believe that way, because their actually taxable income depends upon enforcement of that belief); and (5) most fundamentally, fear.
History—including two World Wars, Nazism, and Communism—shows how people can fall victim to mass delusions fueled by these dangerous psychological errors.
The view that every person in the United States is by birth indebted to the federal (and state) government via a non-consensual and unavoidable direct wage tax does not have a factual or legal foundation. The author of the Declaration of Independence, Thomas Jefferson, would not recognize this dark, dangerous, and erroneous view because it defies the self-evident and inalienable rights of liberty and government by consent as expressed in the Declaration and as embodied in the Biblical principle of “where the Spirit of the Lord is, there is liberty.”
I do not want to defeat or evade the income tax as the state alleges. Rather it is my hope that those enforcing the income tax would enforce it within its proper and legal limits.
Finally, because the income tax is an excise tax that applies to taxable activities and not to people directly, no law specifically identifies any person who is required to file an income tax return. This is apparent from the state’s charging document against me which cites no law identifying me as a person “required to file a return.”
The state claims that I am violating a law that doesn’t exist.
William Bernard Butler
See the Blog for more details on the overbroad application and enforcement of a constitutional tax.