Breaking the Chains of Tyranny

Civics 201 – Internal Revenue Code Synopsis

 

Institutionalized Tyranny

II. Application of Internal Revenue Code Taxing Authority

by Dan Meador

Application of Federal tax laws, authority of the Internal Revenue Service, and various matters relating to the Internal Revenue Code have been addressed throughout this effort, so there is no need to reproduce every detail covered to this point. However, one of the more important points that needs to be emphasized is that Title 26 of the United States Code, as other titles of the Code, is not law -- it is merely evidence of law. Where the Internal Revenue Code is concerned, it has not been enacted as positive law so doesn't even qualify as "legal evidence". It is merely "prima facie" the law.

Without hairsplitting, it is probably fair to say the Internal Revenue Code is law by appearance. In order to unravel the Code so each tax accounted for in it, and application of administrative and judicial sections in Subtitle F could be properly interpreted, it would probably be necessary to track United States tax and judicial legislation to the time Congress convened under the Constitution in 1789, which would require pouring over the complete Statutes at Large (they take about 200 feet of shelf space), Treasury orders, treaties, reorganization plans, and volumes of court decisions. In fact, the Code has been defaulted as void for vagueness as it is impossible for most so-called experts to understand -- mere mortals get impossibly lost in it. The only real favor in the thing is the general disclaimer at 26 U.S.C. § 7806:

Sec. 7806. Construction of title.

(a) Cross references.

The cross references in this title to other portions of the title, or other provisions of law, where the word "see" is used, are made only for convenience, and shall be given no legal effect.

(b) Arrangement and classification.

No inference, implication, or presumption of legislative construction shall be drawn or made by reason of the location or grouping of any particular section or provision or portion of this title, nor shall any table of contents, table of cross references, or similar outline, analysis, or descriptive matter relating to the contents of this title be given any legal effect. The preceding sentence also applies to the sidenotes and ancillary tables contained in the various prints of this Act before its enactment into law.

The fact that Title 26 has never been enacted as positive law, which would make it "legal evidence" of laws of the United States, is verified in the Preface to the 1994 edition of the United States Code, produced in the first volume of the complete Code. Therefore, it remains prima facie evidence of law, but legislative construction cannot be assumed even where one section follows another in numerical sequence, classification by subtitle, chapter, subchapter, or whatever. Each section must be tracked to its original source or sources in the Statutes at Large in order to determine legitimate application, the section must be wed to one or more general application regulations, proper lines of authority must be established, etc., before a section can be said to have "legislative construction."

Since this effort isn't intended to provide thorough treatment and a complete history of United States tax law, I've limited focus to underlying authorities and the legitimacy of agencies involved in the collection process and enforcement of the Federal taxing system. That will generally be the case in this section, although we will investigate some of the historical evolution of the current system.

One of the key questions is, "Where did the Internal Revenue Code come from?"

The first true "Internal Revenue Code" was the Internal Revenue Code of 1939. It seems that the 1939 Code was the point of demarcation for the Code we presently have as it was effected after the "Normal Tax" in the present Subtitle A, and Social Security and related taxes enacted in 1935 were on line. To that point, there was no effort to extend normal tax obligations to the general population -- the normal tax was simply a tax on officers and employees of United States government, governments of United States political subdivisions, and officers of corporations in which United States government has a proprietary interest. That remains the case today, the term "employee" defined at 26 U.S.C. § 3401(c), and "employer" at § 3401(d):

(c) Employee.

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.

(d) Employer.

For purposes of this chapter, the term "employer" means the person for whom an individual performs or performed any service, of whatever nature, as the employee of such person...

These definitions are applicable to Subtitle C, Chapter 24 -- Collection of Income Tax At Source. The requirement for withholding is at § 3402:

Sec. 3402. Income tax collected at source.

(a) Requirement of withholding.

(1) In general. Except as otherwise provided in this section, every employer making payment of wages shall deduct and withhold upon such wages a tax determined in accordance with tables or computational procedures prescribed by the Secretary...

Liability is prescribed at §§ 3403 & 3404:

Sec. 3403. Liability for tax.

The employer shall be liable for the payment of the tax required to be deducted and withheld under this chapter, and shall not be liable to any person for the amount of such payment.

Sec. 3404. Return and payment by governmental employer.

If the employer is the United States, or a State, or political subdivision thereof, or the District of Columbia, or any agency or instrumentality of any one or more of the foregoing, the return of the amount deducted and withheld upon any wages may be made by any officer or employee of the United States, or of such State, or political subdivision, or of the District of Columbia, or of such agency or instrumentality, as the case may be, having control of the payment of such wages, or appropriately designated for that purpose.

Liability for collection, and payment, ultimately falls to withholding agents, or in the event of a third-party payee, the third party. Liability is established in Chapter 25 -- General Provisions Relating to Employment Taxes and Collection of Income Taxes at Source, §§ 3504 & 3505:

Sec. 3504. Acts to be performed by agents.

In case a fiduciary, agent, or other person has the control, receipt, custody, or disposal of, or pays the wages of any employee or group of employees, employed by one or more employers, the Secretary, under regulations prescribed by him, is authorized to designate such fiduciary, agent, or other person to perform such acts as are required of employers under this title and as the Secretary may specify. Except as may be otherwise prescribed by the Secretary, all provisions of law (including penalties) applicable in respect of any employer shall be applicable to a fiduciary, agent, or other person so designated but, except as so provided, the employer for whom such fiduciary, agency, or other person acts shall remain subject to the provisions of law (including penalties) applicable in respect of employers.

Sec. 3505. Liability of third parties paying or providing for wages.

(a) Direct payment by third parties.

For purposes of sections 3102, 3202, 3402, and 3403, if a lender, surety, or other person, who is not an employer under such sections with respect to an employee or group of employees, pays wages directly to such an employee or group of employees, employed by one or more employers, or to an agent on behalf of such employee or employees, such lender, surety, or other person shall be liable in his own person and estate to the United States in a sum equal to the taxes (together with interest) required to be deducted and withheld from such wages by such employer.

(b) Personal liability where funds are supplied.

If a lender, surety, or other person supplies funds to or for the account of an employer for the specific purpose of paying wages of the employees of such employer, with actual notice or knowledge (within the meaning of section 6323(i)(1)) that such employer does not intend to or will not be able to make timely payment or deposit of the amounts of tax required by this subtitle to be deducted and withheld by such employer from such wages, such lender, surety, or other person shall be liable in his own person and estate to the United States in a sum equal to the taxes (together with interest) which are not paid over to the United States by such employer with respect to such wages. However, the liability of such lender , surety, or other person shall be limited to an amount equal to 25 percent of the amount so supplied to or for the account of such employer for such purposes.

(c) Effect of payment.

Any amounts paid to the United States pursuant to this section shall be credited against the liability of the employer.

At no point is the "employee" made liable for these taxes. The lot falls to the officer or employee designated to withhold directly from wages, or to the lender, surety, or other person who supplies funds for whatever enterprise the tax is imposed against. We could chase this in a circle, but will simply cite the definition of "withholding agent" at § 7701(a)((16) to put other statutes into play:

(16) Withholding agent. The term "Withholding agent" means any person required to deduct and withhold any tax under the provisions of sections 1441, 1442, 1443, or 1461.

Before addressing the withholding agent further, we'll cite other definitions in § 7701(a) as useful keys to unraveling the Code. Of particular import, the definitions of "United States", "State", and "Trade or business". The latter opens the door to taxes prescribed in Subtitles A & C, so it will be cited first:

(26) Trade or business. The term "trade or business" includes the performance of the functions of a public office.

By employing the two limiting principles cited earlier, the above general definition applicable to the Internal Revenue Code limits consideration to the class of "trade or business" defined by example. Private enterprise is excluded from "trade or business" where the Internal Revenue Code is concerned. The field is thus narrowed to definitions of "employee" and "employer" at §§ 3401(c) & (d). The range of applicability is further narrowed by definitions of "United States" and "State":

(9) United States. The term "United States" when used in a geographical sense includes only the States and the District of Columbia.

(10) State. The term "State" shall be construed to include the District of Columbia, where such construction is necessary to carry out provisions of this title.

We previously saw from the Downes decision that the District of Columbia, and territories and insular possessions of the United States, are not States of the Union where the Constitution is concerned. Therefore, the exclusionary language in the two definitions above, when reliant on use "in a geographical sense," must be exclusive of the several States party to the Constitution. This reinforces Paul Mitchell's contention that the Internal Revenue Code is for all practical purposes municipal law applicable in territory subject to sovereignty of the United States under Article IV § 3.2 of the Constitution. With the possible exception of the "normal tax" prescribed in Chapter 1, Subtitle A of the Internal Revenue Code, the rest of the taxes in Title 26 are applicable only in the States of the United States, which include insular possessions of the United States, except where the District of Columbia is specifically incorporated, as is the case in the definitions of "United States" and "State" at §§ 7701(a)(9) & (10). Definitions at § 3102(e), relating to the Federal Insurance Contributions Act, will be reproduced here again for comparative expediency as they are more explicit:

(e) State, United States, and citizen.

For purposes of this chapter --

(1) State. The term "State" includes the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, and American Samoa.

(2) United States. The term "United States" when used in a geographical sense includes the Commonwealth of Puerto Rico, the Virgin Islands, Guam, and American Samoa.

An individual who is a citizen of the Commonwealth of Puerto Rico (but not otherwise a citizen of the United States) shall be considered, for purposes of this section, as a citizen of the United States.

Given these definitions, a "United States trade or business" can at best be expanded to an officer or employee of United States government, and a "State trade or business" to an officer or employee of the District of Columbia, Puerto Rico, Guam, American Samoa, the Virgin Islands, the Northern Mariana Islands, and governments of other insular possessions of the United States. Application of these taxes is therefore exclusive of (1) private enterprise, and (2) public office in the Union of several States party to the Constitution. The bridge the several States have used has generally been the Buck Act, located in Title 4 of the United States Code. There are no implementing regulations for Title 4 (Title 4 of the Code of Federal Regulations pertains to Accounts, and is under administration of the General Accounting Office in conjunction with the Department of Justice), so the bridge is as much illusion as other elements of Cooperative Federalism. Definitions in the Buck Act reinforce this conclusion.

The liability issue is clarified in regulations for §§ 1441, 1442, 1443 & 1446, with applicable regulations in 26 CFR §§ 1, 31 & 301; i.e., 26 CFR § 1.1441, 31.1441 & 301.1441, etc. Consult the Parallel Table of Authorities and Rules to determine which are general application regulations, but study all regulations pertaining to these sections whether they are listed as having general application or not.

In a previous section, I made two assertions that may have seemed outrageous: First, Congress effectively hid the Treasury of the United States in June 1921 by creating the General Accounting Office and moving former Treasury personnel to the office under supervision of the Comptroller General, then via the act of Nov. 23, 1921, repealed virtually all taxes authorized by Article I and the Sixteenth Article of Amendment to the Constitution, with the various taxes, when reenacted, applicable exclusively within territory of the United States. The revenue act of Nov. 23, 1921, ch. 136, is at 42 Stat. 227; creation of the General Accounting Office and transfer of Treasury employees is at 42 Stat. 23. For purposes here, Historical and Revision Notes following 5 U.S.C. § 5512 follow:

In subsection (b) [of 5 U.S.C. § 5512], reference to the "General Accounting Office" is substituted for "accounting officers of the Treasury" on authority of the Act of June 10, 1921, ch. 18, title III, 42 Stat. 23. The words "on request of" are substituted for "if required to do so by" as more accurately reflecting the intent. Reference to the "Attorney General" is substituted for "Solicitor of the Treasury" and "Solicitor" on authority of section 16 of the Act of March 3, 1933, ch. 212, 47 Stat. 1517; section 5 of E.O. 6166, June 10, 1933; and section 1 of 1950 Reorg. Plan No. 2, 64 Stat. 1261.

Standard changes are made to conform with the definitions applicable and the style of this title as outlined in the preface to the report.

Responsibility of the Comptroller General, as head of the General Accounting Office, is preserved in the current United States Code at 31 U.S.C. § 3702, Title 31 relating to Money and Finance:

Sec. 3702. Authority of the Comptroller General to settle claims

(a) Except as provided in this chapter or another law, the Comptroller General shall settle all claims of or against the United States Government. A claim that was not administratively examined before submission to the Comptroller General shall be examined by 2 officers or employees of the General Accounting Office independently of each other...

Unless or until a claim is submitted to the Comptroller General, in his capacity as head of the General Accounting Office, courts of the United States may not adjudicate it -- suit for a claim which has not been denied by the General Accounting Office presents a claim for which relief may not be granted. Consequently, a suit against the United States, the Internal Revenue Service, or any other governmental entity will go nowhere until such time as the General Accounting Office makes a determination.

When the government makes a claim, the head of an executive or legislative agency has first responsibility for the attempted collection, as specified at 31 U.S.C. § 3711:

Sec. 3711. Collection and compromise

(a) The head of an executive or legislative agency --

(1) shall try to collect a claim of the United States Government for money or property arising out of the activities of, or referred to, the agency;

(2) may compromise a claim of the Government of not more than $100,000 (excluding interest) or such higher amount as the Attorney General may from time to time prescribe that has not been referred to another executive or legislative agency for further collection or action; and

(3) may suspend or end collection action on a claim referred to in clause (2) of this subsection when it appears that no person liable on the claim has the present or prospective ability to pay a significant amount of the claim or the cost of collecting the claim is likely to be more than the amount recovered.

(b) The Comptroller General has the same authority that the head of the agency has under subsection (a) of this section when the claim is referred to the Comptroller General for further collection action. Only the Comptroller General may compromise a claim arising out of an exception the Comptroller General makes in the account of an accountable official.

[(c) not reproduced]

(d) A compromise under this section is final and conclusive unless gotten by fraud, misrepresentation, presenting a false claim, or mutual mistake of fact. An accountable official is not liable for an amount paid or for the value of property lost or damaged if the amount or value is not recovered because of a compromise under this section.

(e) The head of an executive or legislative agency acts under --

(1) regulations prescribed by the head of the agency; and

(2) standards that the Attorney General and the Comptroller General may prescribe jointly.

(f)(1) When trying to collect a claim of the Government under a law except the Internal Revenue Code of 1986 (26 U.S.C. 1 et seq.), the head of an executive or legislative agency may disclose to a consumer reporting agency information from a system of records that an individual is responsible for a claim if... [balance of section not reproduced]

The portion of Subsection (f)(1) was included simply to demonstrate that collection of taxes prescribed in the Internal Revenue Code is included in the collection and compromise process prescribed in 31 U.S.C. § 3711. The initial collection effort, or negotiation on a claim, begins with the agency head, then goes to the Comptroller General or his delegate in the General Accounting Office if collection isn't successful or a claim against an agency isn't paid (compromised). If the Comptroller General determines that collection should be effected where a claim isn't paid, he is then responsible, via the Attorney General in his capacity as Solicitor of the Treasury, for initiating litigation. Where officers and employees of the United States subject to normal tax withholding are concerned, the necessity of this process is codified at 5 U.S.C. § 5512:

Sec. 5512. Withholding pay, individuals in arrears

(a) The pay of an individual in arrears to the United States shall be withheld until he has accounted for and paid into the Treasury of the United States all sums for which he is liable.

(b) When pay is withheld under subsection (a) of this section, the General Accounting Office, on request of the individual, his agent, or his attorney, shall report immediately to the Attorney General the balance due; and the Attorney General, within 60 days, shall order suit to be commenced against the individual.

Section 7712 tacitly provides the avenue for litigating contested assessments. Administrative withholding to satisfy a claim of the United States may be accomplished in only one of two ways: (1) consent on the part of the party withholding is from, or (2) litigation in a court of competent jurisdiction. If the "individual" the assessment is against contests and rejects whatever assessment lies against him, he "requests" that the General Accounting Office, via the Attorney General, initiate suit for collection -- he does not consent to administrative collection without proper judicial process. This is verified in the section on garnishment at 5 U.S.C. § 5520a(b):

(b) Subject to the provisions of this section and the provisions of section 303 of the Consumer Credit Protection Act (15 U.S.C. 1673) pay from an agency to an employee is subject to legal process in the same manner and to the same extent as if the agency were a private person.

There is a small encumbrance to administrative seizure and admiralty/maritime seizure (in rem and in personam) actions employed by the Internal Revenue Service. The Fifth Article of Amendment due process clause is an absolute barrier -- "No person shall ... be deprived of life, liberty, or property, without due process of law..." Per Wayman v. Southard (1825), cited earlier, the Fifth, Sixth, and Seventh Articles of Amendment assure due process in the course of the common law. Even United States government is obligated by contract to pay wages for work performed, so in the event an alleged liability is contested, the matter must be litigated in a court of competent jurisdiction in the course of the common law. Although linguistically tortured, 5 U.S.C. § 5512 preserves this constitutionally-secured right even for officers and employees of United States government.

Now back to the Internal Revenue Code, at § 7805:

Sec. 7805. Rules and regulations.

(a) Authorization.

Except where such authority is expressly given by this title to any person other than officer or employee of the Treasury Department, the Secretary shall prescribe all needful rules and regulations for the enforcement of this title...

Never-ending word games -- the Treasury Department is not the Department of the Treasury. The reference above is to the Treasury of the United States, which has always been under congressional supervision. The General Accounting Office, via the June 1921 act cited above, became general agent of the Treasury of the United States, under supervision of the Comptroller General -- due to recent legislation, GAO is now under a Director rather than the Comptroller General so titles are about to change again. Oh, what tangled webs they weave. At any rate, the Secretary isn't responsible for promulgating regulations for GAO -- consult Title 4 of the Code of Federal Regulations for most of those regulations -- but he is responsible for regulations pertaining to all other agencies that enforce Internal Revenue Code provisions.

In order to come to terms with this hocus-pocus, we're going back to definitions (11) & (12) in § 7701(a):

(11) Secretary of the Treasury and Secretary.

(A) Secretary of the Treasury. The term "Secretary of the Treasury" means the Secretary of the Treasury, personally, and shall not include any delegate of his.

(B) Secretary. The term "Secretary" means the Secretary of the Treasury or his delegate.

(12) Delegate.

(A) In general. The term "or his delegate" --

(i) when used with reference to the Secretary of the Treasury, means any officer, employee, or agency of the Treasury Department duly authorized by the Secretary of the Treasury directly, or indirectly by one or more redelegations of authority, to perform the function mentioned or described in the context; and

(ii) when used with reference to any other official of the United States, shall be similarly construed.

(B) Performance of certain functions in Guam or American Samoa. The term "delegate," in relation to the Performance of certain functions in Guam or American Samoa with respect to the taxes imposed by chapters 1, 2, and 21, also includes any officer or employee of any other department or agency of the United States, or of any possession thereof, duly authorized by the Secretary (directly, or indirectly by one or more redelegations of authority) to perform such functions.

The Treasury Department still isn't the Department of the Treasury. The delegate of the Secretary of the Treasury in the United States is, "any officer, employee, or agency of the Treasury Department..." The General Accounting Office is general agent of the Treasury of the United States; the Director, formerly the Comptroller General, is head of the General Accounting Office.

The Internal Revenue Service and the Bureau of Alcohol, Tobacco and Firearms are agencies of the Department of the Treasury, Puerto Rico, both in the lineage of the Bureau of Internal Revenue, Puerto Rico, created by the provisional government of Puerto Rico in approximately 1900. These agencies are delegates of the Secretary in insular possessions of the United States, Guam and American Samoa evidently included. They operate in the framework of authority delegated to the Secretary of the Treasury via E.O. # 10289, and redelegated to the Commissioner of Internal Revenue via T.D.O. #150-42 (1956), as amended by T.D.O. #150-01 (1986). They have absolutely no constitutional or statutory authority in the Union of several States party to the Constitution.

Our focus is on Chapter 80 -- General Rules, Subchapter A. -- Application of Internal Revenue Laws. The subchapter includes §§ 7801-7811. Via § 7806, we established that the Internal Revenue Code is merely prima facie the law, no inference of legislative construction can be given to any section in the Code, and under stipulation of whatever legislation lies behind § 7805(a), the General Accounting Office is the delegate of the Secretary as general agent of the Treasury of the United States. Granted, we've gone around Robin Hood's barn to get where we're headed, but we've finally arrived at what may be the most critical and pivotal section in the Code, § 7804, which is in Chapter 80, Subchapter A:

Sec. 7804. Effect of reorganization plans.

(a) Application.

The provisions of Reorganization Plan Numbered 26 of 1950 and Reorganization Plan Numbered 1 of 1952 shall be applicable to all functions vested by this title, or by any act applicable to all functions vested by this title, or by any act amending this title (except as otherwise expressly provided in such amending act), in any officer, employee, or agency, of the Department of the Treasury.

(b) Preservation of existing rights and remedies.

Nothing in Reorganization Plan Numbered 26 of 1950 or Reorganization Plan Numbered 1 of 1952 shall be considered to impair any right or remedy, including trial by jury, to recover any internal revenue tax alleged to have been erroneously or illegally assessed or collected, or any penalty claimed to have been collected without authority, or any sum alleged to have been excessive or in any manner wrongfully collected under the internal revenue laws. For purposes of any action to recover any such tax, penalty, or sum, all statutes, rules, and regulations referring to the collector of internal revenue, the principal officer for the internal revenue district, or the Secretary, shall be deemed to refer to the officer whose act or acts referred to in the preceding sentence gave rise to such action. The venue of any such action shall be the same as under existing law.

The Internal Revenue Code of 1954 (Vol. 68A of the Statutes at Large), as amended in 1986, is evidenced in Title 26 of the United States Code. But even Vol. 68A of the Statutes at Large is simply an amalgamation of the various Federal tax laws enacted through the years. It is not the original acts themselves, and it is in many respects incomplete. Examining historical transition of the Internal Revenue Code is important to help grasp implications of § 7804.

The biggest departure from the 1939 Code to the 1954 Code was administrative in nature, effected by the two reorganization plans listed in § 7804. Most of the administrative changes involved transfer of collection responsibilities from directly appointed revenue agents to the Bureau of Internal Revenue, a "professional" service. President Harry S. Truman's January 14, 1952 letter to Congress, which accompanied Reorganization Plan Numbered 1 of 1952, explains rationale and the process, reproduced below in relative part (full text follows § 7804 in Title 26 U.S.C.):

The task of collecting the internal revenue has expanded enormously within the past decade. This expansion has been occasioned by the necessity additional taxation brought on by World War II and essential post-war programs. In fiscal year 1940, tax collections made by the Bureau of Internal Revenue were slightly over 5 1/3 billions of dollars; in 1951, they totaled almost 50 1/2 billions. In 1940, 19 million tax returns were filed; in 1951, 82 million. In 1940, 19 million tax returns were filed; in 1951, 82 million. In 1940, there were 22,000 employees working for the Bureau; in 1951, there were 57,000...

Throughout this tremendous growth, the structure of the revenue-collecting organization has remained substantially unchanged. The present field structure of the Bureau of Internal Revenue is comprised of more than 200 field offices which report directly to Washington. Those 200 offices carry out their functions through more than 2,000 suboffices and posts of duty throughout the country. The Washington office now provides operating supervision, guidance, and control over the principal field offices through 10 separate divisions, thus further adding to the complexities of administration.

Since the end of World War II, many procedural improvements have been made in the Bureau's operations. The use of automatic machines has been greatly increased. The handling of cases has been simplified. One major advance is represented by the recently completed arrangements to expedite criminal prosecutions in tax-fraud cases. In these cases, field representatives of the Bureau of Internal Revenue will make recommendations for criminal prosecution directly to the Department of Justice. These procedural changes have increased the Bureau's efficiency and have made it possible for the Bureau to carry its enormously increased workload. However, improvements in procedure cannot meet the need for organizational changes.

Part of the authority necessary to make a comprehensive reorganization was provided in Reorganization Plan No. 26 of 1950, which was one of several uniform plans giving department heads fuller authority over internal organizations throughout their departments. The studies of the Secretary of the Treasury have culminated since that time in a plan for extensive reorganization and modernization of the Bureau. However, his existing authority is not broad enough to permit him to effectuate all of the basic features of the plan he has developed.

The principal barrier to effective organization and administration of the Bureau of Internal Revenue which plan No. 1 removes is the archaic statutory office of collector of internal revenue. Since the collectors are not appointed and cannot be removed by the Commissioner of Internal Revenue or the Secretary of the Treasury and since the collectors must accommodate themselves to local political situations, they are not fully responsive to the control of their superiors in the Treasury Department. Residence requirements prevent moving a collector from one collection district to another, either to promote impartiality and fairness or to advance collectors to more important positions. Uncertainties of tenure add to the difficulty of attracting to such offices persons who are well versed in the intricacies of the revenue laws and possessed of broadgaged administrative ability.

It is appropriate and desirable that major political offices in the executive branch of the Government be filled by persons who are appointed by the President by and with the advice and consent of the Senate. On the other hand, the technical nature of much of the Government's work today makes it equally appropriate and desirable that positions of other types be in the professional career service. The administration of our internal-revenue laws at the local level calls for positions in the latter category.

Instead of the present organization built around the offices of politically appointed collectors of internal revenue, plan No. 1 [of 1952] will make it possible for the Secretary of the Treasury to establish not to exceed 25 district offices...

Mr. Truman's rationale had the ring of sincerity, and no doubt there is some merit in what he presented. But the letter also makes important disclosures: The "archaic statutory office of collector of internal revenue," which was administratively abolished by Reorganization Plan 1 of 1952, was not attached to the Bureau of Internal Revenue or the Department of the Treasury. The collector of internal revenue was attached to the Treasury Department, a/k/a Treasury of the United States, the Treasury being under congressional rather than executive control. The position was appointed, and as the U.S. Marshal, district judges, court clerks, United States Attorneys, etc., the collector of internal revenue was required to live in whatever district he was appointed to. He was accountable to the community in the same way local public servants are.

President Franklin D. Roosevelt used somewhat the same rationale to extend Bureau of Internal Revenue authority over the Federal Alcohol Administration Act via Reorganization Plan No. III of 1940. In relative part, Mr. Roosevelt's letter to Congress of April 2, 1940 is reproduced below:

The second reorganization affecting the Treasury Department vests in the Secretary of the Treasury full authority for the administration of the Federal Alcohol Administration Act. At present the Federal Alcohol Administration occupies an anomalous position. It is legally a part of the Treasury Department, but actually it is clothed with almost complete independence under existing statutory provisions. Under certain conditions the Administration would by law become an independent agency, whereas the interest of improved management require its integration with allied activities in the Treasury Department.

I propose, therefore, that the functions of the Federal Alcohol Administration be correlated with the activities of the Bureau of Internal Revenue, particularly its Alcohol Tax Unit. The Bureau is already performing a large part of the field enforcement work of the Administration and could readily take over complete responsibility for its work. The Bureau is daily making, for other purposes, a majority of the contacts with units of the liquor industry which the Federal Alcohol Administration should but cannot make without the establishment of a large and duplicating field force. Under the provisions of this plan, it will be possible more effectively to utilize the far-flung organization of the Treasury Department, including its many laboratories, in discharging the functions of the Federal Alcohol Administration. Thus, I find the proposed consolidation will remedy deficiencies in organization structure as well as afford a more effective service at materially reduced costs.

Succession of administration of Federal law relating to distilled spirits is reflected in a note on page 762 of The United States Government Manual, 1996/97 edition:

Alcohol Control Administration, Federal

Established by E.O. 6474 of Dec. 4, 1933. Abolished Sept. 24, 1935, on induction into office of Administrator, Federal Alcohol Administration, as provided in act of Aug. 29, 1935 (49 Stat. 977). Abolished by Reorg. Plan No. III of 1940, effective June 30, 1949, and functions consolidated with activities of Internal Revenue Service.

Per Mr. Roosevelt's letter of April 2, 1940, it appears that the Bureau of Internal Revenue, predecessor of the Internal Revenue Service and the Bureau of Alcohol, Tobacco and Firearms, moved into the breach prior to Reorganization Plan III of 1940 -- his letter discloses that BIR, with no statutory authority, was already performing many of the functions of the Federal Alcohol Administration, which was to have replaced the Federal Alcohol Control Administration in August 1935. A director for the Federal Alcohol Administration was appointed, but the Administration itself was never activated as the Constantine case was pending, and it appeared that repeal of the Eighteenth Amendment in December 1933 was finally going to end concurrent State and Federal jurisdiction relating to regulation of production and distribution of alcoholic beverages. The Twenty-first Amendment placed production and distribution of drinking alcohol under State option; concurrent State and Federal jurisdiction was secured in Section 2 of the Eighteenth Amendment, had not been preserved with ratification of the Twenty-first. Therefore, Federal enforcement relating to alcohol, tobacco and firearms, now under jurisdiction of BATF, had to be limited to territory and other property of the United States, and United States admiralty and maritime jurisdiction. Reorganization Plan III of 1940 came nearly five years after the Constantine decision, long enough for Federal encroachment into certain areas to be under the cloak of forgetfulness, and for the general environment of the New Deal, launched in March 1933, to condition people to more direct involvement in everyday life. The illusion, however, didn't change the reality of law any more then than now -- Congress didn't create the Bureau of Internal Revenue, and has never implemented anything resembling statutory authority for IRS and BATF to establish revenue districts of any sort in the several States.

Both Roosevelt and Truman abolished statutory offices and agencies, replacing them with administratively-created offices, and sometimes agencies, and where the Federal tax system is concerned, progressively moved collection and enforcement activity under administration of the Puerto Rican Bureau of Internal Revenue. For about a year in the 1930s, a Bureau of Internal Revenue had been incorporated as a private enterprise in a Northeastern State, but the corporation was abolished. The Puerto Rico link was evidently sufficient, particularly since the Social Security Act of 1935 had specified administration by the Bureau of Internal Revenue, with definitions at 26 U.S.C. § 3121 & 26 CFR § 31.3121 verifying exclusive United States territorial application. Origins are also verified by definitions at 27 CFR § 250.11:

Revenue Agent. Any duly authorized Commonwealth Internal Revenue Agent of the Department of the Treasury of Puerto Rico.

Secretary. The Secretary of the Treasury of Puerto Rico.

Secretary or his delegate. The Secretary or any officer or employee of the Department of the Treasury of Puerto Rico duly authorized by the Secretary to perform the function mentioned or described in this part.

In order not to leave a stone unturned, we will go as far as possible to unearth sources, the first source being presidential authority for reorganization plans. President Roosevelt enacted reorganization plans under the act under an older reorganization plan statute, where Mr. Truman issued reorganization plans under the act of June 20, 1949, ch. 226, Sec. 3, 63 Stat. 203, which is no longer listed in the Parallel Table of Authorities and Rules, replaced by Pub. L. 89-554 of Sept. 6, 1966, 80 Stat. 394, and amended several times since. Application of current public laws will be examined momentarily, but first, the Code section evidencing authority for the President to implement reorganization plans should be considered, 5 U.S.C. § 903:

Sec. 903. Reorganization plans

(a) Whenever the President, after investigation, finds that changes in the organization of agencies are necessary to carry out any policy set forth in section 901(a) of this title, he shall prepare a reorganization plan specifying the reorganizations he finds are necessary. Any plan may provide for --

(1) the transfer of the whole or a part of an agency, or of the whole or a part of the functions thereof, to the jurisdiction and control of another agency;

(2) the abolition of all or a part of the functions of an agency, except that no enforcement function or statutory program shall be abolished by the plan;

(3) the consolidation or coordination of the whole or a part of an agency, or of the whole or a part of the functions thereof, with the whole or a part of another agency or the functions thereof;

(4) the consolidation or coordination of part of an agency or the functions thereof with another part of the same agency or the functions thereof;

(5) the authorization of an officer to delegate any of his functions; or

(6) the abolition of the whole or a part of an agency which agency or part does not have, or on the taking effect of the reorganization plan will not have, any functions.

The President shall transmit the plan (bearing an identification number) to the Congress together with a declaration that, with respect to each reorganization included in the plan, he has found that the reorganization is necessary to carry out any policy set forth in section 901(a) of this title.

[subsections (b) & (c) not reproduced]

Criteria in § 901 requires justification of reorganization plans according to standards of economy and efficiency -- there is no need to reproduce the section here. We'll simply examine authority of 5 U.S.C. § 9, and existing public laws which provide underlying authority for reorganization plans.

In the Parallel Table of Authorities and Rules, the general application regulation for 5 U.S.C. § 903 is listed as 28 CFR § 45: Title 28 -- Judicial Administration; Chapter I, Dept. of Justice (Parts 0-199); § 45, Standards of Conduct.

Public laws which replaced the 1949 act are as follows: Pub. L. 89-554, Sept. 6, 1966, 80 Stat. 394; Pub. L. 90-83, Sec. 1(99), Sept. 11, 1967, 81 Stat. 220; Pub. L. 92-179, Sec. 2, Dec. 10, 1971, 85 Stat. 574; Pub. L. 95-17, Sec. 2, April 6, 1977, 91 Stat. 30; and Pub. L. 98-614, Sec. 3(b)(10, (2), 4, Nov. 8, 1984, 98 Stat. 3192, 3193.

As in similar analysis, the public law is listed on the left, with regulations on the right:

Pub. L. 89-544 32 CFR § 716: Title 32 -- National Defense; Subsection A -- Department of Defense; Chapter VI -- Department of the Navy (Parts 700-799); Subchapter C -- Personnel; § 716, Death gratuity.

Pub. L. 90-83 No general application regulations.

Pub. L. 92-179 No general application regulations.

Pub. L. 95-17 No general application regulations.

Pub. L. 98-614 No general application regulations.

The underlying authority for presidents to promulgate reorganization plans is consistent with previous analysis relating to other subjects: The reorganization may apply solely to (1) government of the United States and political subdivisions of the United States, (2) United States admiralty and maritime jurisdiction, and (3) territories and insular possessions of the United States. There is no application to the Union of several States party to the Constitution.

We can now address the three reorganization plans: Section 2 of Reorganization Plan III of 1940, which placed administration of the Federal Alcohol Administration Act under administration of the Bureau of Internal Revenue was repealed by Pub. L. 95-258, Sec. 5(b), Sept. 13, 1982, 96 Stat. 1068, 1085. Possibly it is a relief to some that Congress finally did something decisive, but as it turns out, there are no general application regulations listed in the Parallel Table of Authorities and Rules for Pub. L. 95-258, either. Consequently, the original transfer of authority for administration of the Federal Alcohol Administration Act to the Bureau of Internal Revenue, Puerto Rico still doesn't apply to the Union of several States party to the Constitution. In light of what has already been proven, the conclusion shouldn't be overly surprising.

Next, Reorganization Plan 26 of 1950, cited in 26 U.S.C. § 7804: The four sections in this reorganization plan were repealed by 1972 & 1982 legislation, again demonstrating that Congress has a will of its own. Section 1 was repealed by Pub. L. 97-258, Sec. 5(b), Sept. 13, 1982, 96 Stat 1068, 1085, "see" references as 31 U.S.C. § 321 & 49 U.S.C. § 108; Section 2 was repealed by Pub. L. 97-258, Sec. 5(b), Sept. 13, 1982, 96 Stat. 1068, 1085, "see" reference as 31 U.S.C. § 321; Section 3 was repealed by Pub. L. 92-302, Sec. 1(d), May 18, 1972, 86 Stat. 149, "see" reference at 31 U.S.C. § 301; Section 4 was repealed by Pub. L. 97-258, Sec. 5(b), Sept. 13, 1982, 96 Stat. 1068, 1085, "see" reference at 31 U.S.C. § 321.

No general application regulations for the two public laws are listed, so it will be useful to examine the United States Code sections listed as "see" references: 31 U.S.C. §§ 301 & 321, and 49 U.S.C. § 108. There are no general application regulations listed for 31 U.S.C. § 301, Title 31 being Money and Finance, § 301 pertaining to organization of the Department of the Treasury, or 49 U.S.C. § 49, Title 49 being Transportation, and § 108 establishing the Coast Guard as a department or agency in the Department of Transportation during peacetime. There are, however, a crop of regulations for 31 U.S.C. § 321, which prescribes general authority of the Secretary of the Treasury. All the general applications regulations listed are in Title 31 of the Code of Federal Regulations, Money and Finance: Treasury, with none pertaining to Title 26. The listed regulations are as follows: 31 CFR §§ 1, 2, 10, 19, 21, 25, 26, 205, 206, 210, 337, 413 & 601. It's obvious that few if any of these regulations have much to do with the Internal Revenue Code and regulations promulgated thereunder, but true to resolve to look under every rock, each of these regulations will be accounted for:

31 CFR § 1 Title 31 -- Money and Finance: Treasury; Subtitle A -- Office of the Secretary of the Treasury (Parts 0-50); § 1, Disclosure of records.

31 CFR § 2 § 2, National security information.

31 CFR § 10 § 10, Practice before the Internal Revenue Service.

31 CFR § 19 § 19, Governmentwide debarment and suspension (nonprocurement) and governmentwide requirements for drug-free workplace (grants).

31 CFR § 21 § 21, New restrictions on lobbying.

31 CFR § 25 § 25, Prepayment of foreign military sales loans made by the Defense Security Assistance Agency and foreign military sales loans made by the Federal Financing Bank and guaranteed by the Defense Security Assistance Agency.

31 CFR § 26 § 26, Environmental review of actions by Multilateral Development Bands (MDBs).

31 CFR § 205 Subtitle B -- Regulations Relating to Money and Finance; Chapter II -- Fiscal Service, Department of the Treasury (Parts 200-399); Subchapter A -- Financial Management Service; § 205, Rules and procedures for funds transfers.

31 CFR § 206 § 206, Management of Federal agency receipts, disbursements, and operation of the Cash Management Improvements Fund.

31 CFR § 210 § 210, Federal payments through financial institutions by the automated clearing house method.

31 CFR § 337 Subchapter B -- Bureau of the Public Debt; § 337, Supplemental regulations governing Federal Housing Administration debentures.

31 CFR § 413 Chapter IV -- Secret Service, Department of the Treasury (Parts 400 -- 499); § 413, Closure of streets near the White House.

31 CFR § 601 Chapter VI -- Bureau of Engraving and Printing, Department of the Treasury (Parts 600-699); § 601, Distinctive paper for United States currency and other securities.

It's nice to see that the Secret Service has regulatory authority to close streets near the White House, which is incidentally located in the District of Columbia (this is another Department of the Treasury agency or Bureau that has little or no legitimate authority in the several States), and that the Bureau of Engraving and Printing is required to use distinctive paper for United States currency and other securities. However, none of the regulations above directly mandate filing tax returns, etc., as might be expected from regulations promulgated under authority of Reorganization Plan 26 of 1950 and Public Laws that replaced the four sections of the plan.

Next we turn to Reorganization Plan 1 of 1952. Except for repeal of Section 2(b) via Pub. L. 97-258, Sec. 5(b), Sept. 13, 1982, 96 Stat. 1068, 1085, this plan has been left intact. Subsection 2(b) established the office of Assistant General Counsel, 31 U.S.C. § 301. Section 3, which relates to appointment and compensation of Assistant Commissioners and district commissioners, now probably district directors, and the Assistant General Counsel, was amended via act of June 28, 1955, ch. 189, Sec. 12(c)(19), 69 Stat. 182. By consulting the Parallel Table of Authorities and Rules, it is found that there are no general application regulations promulgated for Reorganization Plan 1 of 1952, the act that repealed Section 2, the act that amended Section 3, or 31 U.S.C. § 301.

It would appear that authorities have been exhausted, but thanks to an IRS Internet reply to Alan Tenore (Oct. 12, 1998; IDENTIFIER: irsnash5 #83778; http://www.irs.ustreas.gov/help/email-survey.html for a survey exercise, or http://www.irs.ustreas.gov/prod/help/newmail/user.html for questions), we need to address original enactments of the Internal Revenue Code.

Per the prepared response, the Internal Revenue Code of 1954 was enacted August 16, 1954, Pub. Law 591, then amended by the Tax Reform Act of 1986, Pub. L. 99-514. Although neither of these cites is complete, the act of 1954 is Volume 68A of the Statutes at Large, and the 1968 Public Law number can be referenced in the Parallel Table of Authorities and Rules.

In the Parallel Table of Authorities and Rules, Public Law cites begin with the 80th Congress, numbering being changed to reflect the Congress and the number of the law enacted in that particular session. The first Public Law listing using this numbering system is Public Law 80-806. Prior to that, the listing is by location in the Statutes at Large. For example, the 98th volume of the Statutes at Large, page 42 = 98 Stat. 42.

By turning to page 810 of the 1996 Code of Federal Regulations Index volume, it is found that Volume 68A of the Statutes at Large is not listed. However, sections in Volumes 68 and 69 are. Consequently, the conclusion must be that there are no implementing regulations for Volume 68A of the Statutes at Large, the 1954 Internal Revenue Code, or successive Secretaries of the Treasury have been derelict in their respective duties over a period spanning approximately 44 years. However, there are regulations listed for the Tax Reform Act of 1986, Pub. L. 99-514, so there must be an explanation for oversight of some kind relating to Vol. 68A. Regulations listed for Pub. L. 99-514 go a ways toward explaining the defect.

Pub. L. 99-514 appears on page 821 of the 1996 CFR Index volume. Listed regulations are 19 CFR § 354 and 26 CFR § 31.

The first regulation is reasonably easy to dispose of: Title 19 -- Customs Duties; Chapter III -- International Trade Administration, Department of Commerce (Parts 300-399); § 354, Procedures for imposing sanctions for violation of an antidumping or countervailing duty protective order.

The regulation which on the surface appears to be problematic is 26 CFR § 31: Title 26 -- Internal Revenue, Department of the Treasury (Parts 1-799); Subchapter C -- Employment Taxes and Collection of Income Tax at Source; § 31, Employment taxes and collection of income tax at source.

The first clue to 26 CFR § 31 application is the fact that all Chapter I regulations in Title 26 of the CFR are promulgated for Internal Revenue Service administration. They must be applicable in United States territorial, and conceivably in admiralty and maritime jurisdiction and as applicable to officers and employees of the United States and it's political subdivisions. However, because we have the cited regulation as applicable under the Tax Reform Act of 1986, we should investigate further to see if 26 CFR § 31 complies with authorities thus far established.

A cursory survey of authorities listed under "Authority 26 U.S.C. 7805", which requires the Secretary to promulgate regulations (Title 26 -- Internal Revenue, volume containing parts 30-39, April 1, 1998 Edition, pages 10 & 11), fails to list Pub. L. 99-514 as any unique authority for § 31. Authority appears to emerge almost exclusively from Vol. 68A of the Statutes at Large, with the exception of § 31.6053-3(b)(5), (h) and (j)(9), § 31.6053-4, § 31.6053-3T, and § 31.6053-4T (T = temporary regulations; have no binding effect). In addition to the Internal Revenue Act of 1954, Pub. L. 98-369, 98 Stat. 1052, is listed as an authority. General application regulations for Pub. L. 98-369 are listed as 49 CFR § 89, which is Transportation, in Subtitle A -- Office of the Secretary of Transportation, § 89, Implementation of Federal Claims Collection Act.

Since Pub. L. 99-514 isn't specifically listed as authority in headnotes for 26 CFR § 31, there would appear to be inconsistency unless it can be internally demonstrated that the Tax Reform Act did not do anything significant to expand or alter application of the Internal Revenue Code of 1954.

Researchers and others interested in details of how administrative process relative to Subtitle A & C taxes is supposed to work, even for Federal employees subject to administration of the General Accounting Office, should read 26 CFR § 31, particularly Subpart G, as a multitude of procedural sins are exposed in these regulations.

Subpart A -- Introduction, §§ 31.0-1 - 31.0-4, begins on page 11, of the April 1, 1998 edition of this volume. In order to secure subject matter, the introduction is as follows:

§ 31.0-1 Introduction.

(a) In general. The regulations in this part relate to the employment taxes imposed by subtitle C (chapters 21 to 25, inclusive) of the Internal Revenue Code of 1954, as amended. References in the regulations to the "Internal Revenue Code" or the "Code" are references to the Internal Revenue Code of 1954, as amended, unless otherwise indicated. References to the Federal Insurance Contributions Act, the Railroad Retirement Tax Act, and the Federal Unemployment Tax Act are references to chapters 21, 22, and 23, respectively, of the Code. References to sections of law are references to sections of the Internal Revenue Code unless otherwise indicated. The regulations in this part also provide rules relating to the deposit of other taxes by electronic funds transfer.

(b) Division of regulations. The regulations in this part are divided into 7 subparts. Subpart A contains provisions relating to general definitions and use of terms, the division and scope of the regulations in this part, and the extent to which the regulations in this part supersede prior regulations relating to employment taxes. Subpart B relates to the taxes under the Federal Insurance Contributions Act. Subpart C relates to the taxes under the Railroad Retirement Tax Act. Subpart D relates to the tax under the Federal Unemployment Tax Act. Subpart E relates to the collection of income tax at source on wages under chapter 24 of the Code. Subpart F relates to the provisions of chapter 25 of the Code which are applicable in respect of the taxes imposed by chapters 21 to 24, inclusive, of the Code. Subpart G relates to selected provisions of subtitle F of the Code, relating to procedure and administration, which have special application in respect of the taxes imposed by subtitle C of the Code. Inasmuch as these regulations constitute Part 31 of Title 26 of the Code of Federal Regulations, each section of the regulations is preceded by a section symbol and 31 followed by a decimal point (§ 31.). Sections of law or references thereto are preceded by "Sec." or the word "section".

Those wishing to track the Social Security act and related legislation would be well served to read § 31.0-2, General definitions and use of terms, as cites for the original Social Security Act of 1935 and major amendments through 1972 are listed in the definitions. The definition at § 31.0-2(e) is the only one that will be reproduced here:

(e) Subpart E. As used in Subpart E of this part, unless otherwise expressly indicated, tax means the tax required to be deducted and withheld from wages under section 3402 of the Code.

The withholding at 26 U.S.C. § 3402 relates to the so-called "income" tax, a/k/a "normal" tax. Therefore, 26 CFR § 31 relates to Social Security and related taxes, and income tax prescribed in Subtitle A of the Internal Revenue Code. Administrative procedure addressed in Subpart G therefore relates to both Social Security and income tax, where applicable, railroad retirement tax, unemployment tax, etc.

Although the subpart is reasonably long, I'm going to reproduce § 31.0-3, Scope of regulations, nearly in its entirety as there are important elements in it which I will underscore as a means of emphasis. Of particular note, definitions are applicable for determining liability:

§ 31.0-3 Scope of regulations.

(a) Subpart B. The regulations in Subpart B of this part related to the imposition of the employee tax and the employer tax under the Federal Insurance Contributions Act with respect to wages paid and received after 1954 for employment performed after 1936. In addition to employment in the case of remuneration therefor paid and received after 1954, the regulations in Subpart B of this part relate also to employment performed after 1954 in the case of remuneration therefor paid and received before 1955. The regulations in Subpart B of this part include provisions relating to the definition of terms applicable in the determination of the taxes under the Federal Insurance Contributions Act, such as "employee", "wages", and "employment". The provisions of Subpart B of this part relating to "employment" are applicable also, (1) to the extent provided in § 31.3121(b)-2, to services performed before 1955 the remuneration for which is paid after 1954, and (2) to the extent provided in § 31.3121(k)-3, to services performed before 1955 the remuneration for which was paid before 1955. (For prior regulations on similar subject matter, see 26 CFR (1939) Part 408 (Regulation 128).)

[(b) Subpart C omitted, relates to Railroad Retirement Tax Act]

(c) Subpart D. The regulations in Subpart D of this part relate to the imposition on employers of the excise tax under the Federal Unemployment Tax Act for the calendar year 1955 and subsequent calendar years with respect to wages paid after 1954 for employment performed after 1938. In addition to employment in the case of remuneration therefor paid after 1954, the regulations in Subpart D of this part relate also to employment performed after 1954 in the case of remuneration therefor paid before 1955. The regulations in Subpart D of this part include provisions relating to the definition of terms applicable in the determination of the tax under the Federal Unemployment Tax Act, such as "employee", "employer", "employment", and "wages". The regulations in Subpart D of this part also include provisions relating to the credits against the Federal tax for State contributions. (For prior regulations on similar subject matter, see 26 CFR (1939) Part 403 (Regulations 107).)

(d) Subpart E. The regulations in Subpart E of this part relate to the withholding under chapter 24 of the Code of income tax at source on wages paid after 1954, regardless of when such wages were earned. The regulations in Subpart E of this part include provisions relating to the definition of terms applicable in the determination of the tax under chapter 24 of the Code, such as "employee", "employer", and "wages". (For prior regulations on similar subject matter, see 26 CFR (1939) Part 406 (Regulations 120).)

(e) Subpart F. The regulations in Subpart F of this part deal with the general provisions contained in chapter 25 of the Code, which relate to the employment taxes imposed by chapters 21 to 24, inclusive, of the Code. (For prior regulations on the subject matter of section 3501, see 26 CFR (1939) 411.802 and 408.803 (Regulations 114 and 128, respectively). For prior regulations on the subject matter of section 3504, see 26 CFR (1939) 406.807 and 408.906 (Regulations 120 and 128, respectively).)

(f) Subpart G. The regulations in Subpart G of this part, which are prescribed under selected provisions of subtitle F of the Code, relate to the procedural and administrative requirements in respect of records, returns, deposits, payments, and related matters applicable to the employment taxes imposed by subtitle C (chapters 21 to 25, inclusive) of the Code. In addition, the provisions of Subpart G of this part relate to adjustments and to claims for refund, credit, or abatement, made after 1954, in connection with the employment taxes imposed by subtitle C of the Internal Revenue Code of 1954, by chapter 9 of the Internal Revenue Code of 1939, or by the corresponding provisions of prior law, but not to any adjustment reported, or credit taken, in whole or in part on any return or supplemental return filed on or before July 31, 1960. The provisions of Subpart G of this part also relate to deposits of taxes imposed by subchapter B on chapter 9 of the 1939 Code or by corresponding provisions of prior law with respect to compensation paid after 1954 for services rendered before 1955. For other administrative provisions which have application to the employment taxes imposed by subtitle C of the Code, see Part 301 of this chapter (Regulations on Procedure and Administration). (The administrative and procedural regulations applicable with respect to a particular employment tax for a prior period were combined with the substantive regulations relating to such tax for such period. For the regulations applicable to the respective taxes for prior periods, see paragraphs (a), (b), (c), and (d) of this section.) Subpart G of this part also provides rules relating to the deposit of other taxes by electronic funds transfer.

Reproduction of § 31.0-3 was primarily to demonstrate that regulations in this part (1) apply to the group of taxes that issue under or in connection with the Social Security tax system, inclusive of unemployment tax, etc., and income tax prescribed in Subtitle A, and (2) definitions in 26 U.S.C. §§ 3121 & 3401 determine application of the tax.

We can dispose of whatever questions there might be concerning application of these regulations in reasonably short order by beginning with the definition of "American employer" at 26 CFR § 31.3121(g)-1:

§ 31.3121(h)-1 American employer.

(a) The term "American employer" means an employer which is (1) the United States or any instrumentality thereof, (2) an individual who is a resident of the United States, (3) a partnership, if two-thirds or more of the partners are residents of the United States, (4) a trust, if all of the trustees are residents of the United States, or (5) a corporation organized under the laws of the United States or of any State. For provisions relating to the terms "State" and "United States", see § 31.3121(e)-1.

(b) For provisions relating to services performed outside the United States by a citizen of the United States as an employee for an American employer, see paragraph (c)(3) of § 31.3121(b)-3 and paragraph (e) of § 31.3121(b)(4)-1.

We're back to definitions reproduced earlier, but the definitions of "State", "United States", and "citizen" at § 31.3121(e)-1 simply cannot be resisted:

§ 31.3121(e)-1 State, United States, and citizen

(a) When used in the regulations in this subpart, the term "State" includes the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, and Territories of Alaska and Hawaii before their admission as States, and (when used with respect to services performed after 1960) Guam and American Samoa.

(b) When used in the regulations in this subpart, the term "United States", when used in a geographical sense, means the several states (including the Territories of Alaska and Hawaii before their admission as States), the District of Columbia, the Commonwealth of Puerto Rico, and the Virgin Islands. When used in the regulations in this subpart with respect to services performed after 1960, the term "United States" also includes Guam and American Samoa when the term is used in a geographical sense. The term "citizen of the United States" includes a citizen of the Commonwealth of Puerto Rico or the Virgin Islands, and, effective January 1, 1961, a citizen of Guam or American Samoa.

Application of the definitions above have already been determined to be limited to territory of the United States, so we don't have to engage in speculation. The regulation, and the corresponding definition at 26 U.S.C. § 3121, say what they say. Social Security and kindred taxes have always been applicable only in territory of the United States, including Alaska and Hawaii prior to admission as States of the Union. There is and never has been a constitutionally enumerated power authorizing Congress to institutionalize socialistic government policy throughout the nation. This is one of the more sinister elements of Cooperative Federalism that travels hand-in-hand with the entire social welfare system -- a mathematically impossible scheme that of necessity will bankrupt the American people.

The first exclusionary provision in § 31.3121(h)-1 for "American employer" is § 31.3121(b)-3(c)(3):

(3) By a citizen of the United States as an employee for an American employer. Services performed after 1954 outside the United States by a citizen of the United States as an employee for an American employer constitutes employment provided the services are not specifically excepted under section 3121(d). For definitions of "citizen of the United States" and "American employer", see §§ 31.3121(e)-1 and 3121(h)-1, respectively.

The second exclusionary cite is § 31.3121(e)-1, and applies to "Services performed on or in connection with a non-American vessel or aircraft." It's remote enough that it won't be reproduced here.

The definition of "citizen of the United States" has been problematic for many people. "Am I a citizen of the United States?" The definition above provides clarification: Even if the Fourteenth Article of Amendment extended "citizen of the United States" status to people throughout the several States party to the Union, which it didn't, the "citizen of the United States" the Internal Revenue Code addresses is geographically determined. The Fourteenth Amendment was promulgated, never properly ratified, in order to extend citizenship status to African Americans liberated following the Civil War, and might be broadly construed to include other minorities of color who didn't enjoy the status of State citizens prior to the Civil War. Governments of the several States extended universal State citizenship without regard to race, color or creed, so as those the Fourteenth Amendment directly affected died, their lineage enjoyed the status of State citizen in their respective States, and were not "citizens of the United States" where the Fourteenth Amendment is concerned unless they went through the prescribed process necessary to become citizens of the United States.

However, Congress employed this mechanism beginning in 1917 to confer "citizen of the United States" status on people indigenous to insular possessions. The first act of this nature conferred "citizen of the United States" status on the people of Puerto Rico, then in the next decade, citizen of the United States status was conferred on people of the Virgin Islands. Dates when the indigenous people of American Samoa and Guam became "citizens of the United States" are referenced in the "citizen" definition above.

The effect is this: While the "People of the United States" (Constitution, Preamble) think of themselves as "citizens of the United States," a rhetorical claim that had no substantive existence prior to 1868, the vast majority are not "citizens of the geographical United States," as defined in § 3121(d) of the Internal Revenue Code of 1954, as amended. General application definitions of "United States" and "State" at 26 U.S.C. § 7701(a)(9) & (10) have the same effect as they include only insular possessions of the United States and the District of Columbia. In other words, being a "citizen of the United States," as created in Section 1 of the Fourteenth Article of Amendment, and a "citizen of Oklahoma" or any other State of the Union, is irrelevant where the Internal Revenue Code is concerned. In order for "citizen of the United States" status to make any difference, the status must be determined by the "citizen of the United States" being so by virtue of citizenship in the District of Columbia, Puerto Rico, the Virgin Islands, Guam or American Samoa. It is a municipal or geographically specific citizenship, not a citizenship universal throughout the several States and possessions of the United States. Consequently, even if I as a citizen of Oklahoma am also a citizen of the United States, my United States citizenship is of no consequence where the Internal Revenue Code is concerned as I am not a citizen of the United States of the District of Columbia, Puerto Rico, etc. Application of the Internal Revenue Code is geographically specific, limited to territory and insular possessions of the United States subject to the Article IV § 3.2 territorial clause.

Evidence to this effect was already established when we tracked the President's authority to establish revenue districts (26 U.S.C. § 7621) through Executive Order #10289 and Treasury Delegation Order #150-42 (1956). The only revenue districts applicable to the several States are customs districts, administered by the United States Customs Service. There is absolutely no authority, whether statutory or regulatory, for the Internal Revenue Service and the Bureau of Alcohol, Tobacco and Firearms to establish revenue districts in the several States party to the Constitution.

Possibly a comment concerning the Parallel Table of Authorities and Rules is in order: In the past a few critics have attempted to discredit the Table. However, Congress mandated construction of reliable finding aids in the Federal Register Act (44 U.S.C. § 1510), and via a court order cited earlier, the Director of the Federal Register was ordered to compile and publish the prescribed finding aids. The purpose, as articulated by the court, is to avert imposition of secret law. In other words, the Parallel Table of Authorities and Rules is a disclosure mechanism intended for use by those who need to know what application Code sections and regulations have. And as is the case for the United States Code relative to the Statutes at Large, that which is published in the Code of Federal Regulations is prima facie evidence of publication in the Federal Register. Further, responsibility for accuracy rests on the officer or agency responsible for maintaining the Table, per requirements set out at 1 CFR § 8.5:

§ 8.5 Ancillaries.

The Code shall provide, among others, the following-described finding aids:

(a) Parallel tables of statutory authorities and rules. In the Code of Federal Regulations Index or at such other place as the Director of the Federal Register considers appropriate, numerical lists of all sections of the current edition of the United States Code (except section 301 of title 5) which are cite by issuing agencies as rule-making authority for currently effective regulations in the Code of Federal Regulations. The lists shall be arranged in the order of the titles and sections of the United States Code with parallel citations to the pertinent titles and parts of the Code of Federal Regulations.

(b) Parallel tables of Presidential documents and agency rules. In the Code of Federal Regulations Index, or at such other place as the Director of the Federal Register considers appropriate, tables of proclamations, Executive orders, and similar Presidential documents which are cited as rulemaking authority in currently effective regulations in the Code of Federal Regulations.

(c) List of CFR sections affected. Following the text of each Code of Federal Regulations volume, a numerical list of sections which are affected by documents published in the Federal Register. (Separate volumes, "List of Sections Affected, 1949-1963" and "List of CFR Sections Affected, 1964-1972)", list all sections of the Code which have been affected by documents published during the period January 1, 1949, to December 31, 1963, and January 1, 1964, to December 31, 1972, respectively.) Listings shall refer to Federal Register pages and shall be designed to enable the user of the Code to find the precise text that was in effect on a given date in the period covered.

Responsibility of the various government agencies is at § 8.7:

§ 8.7 Agency cooperation.

Each agency shall cooperate in keeping publication of the Code current by complying promptly with deadlines set by the Director of the Federal Register and the Public Printer.

The Director and staff of the Federal Register set standards and provide support for agencies responsible for publishing documents in the various Federal Register publications (1 CFR, § 15), but responsibility for accuracy lies with the agencies respectively. Each agency has stiff requirements set out in 1 CFR, § 16, reproduced in applicable part below:

§ 16.1 Designation

(a) Each agency shall designate, from its officers or employees, persons to serve in the following capacities with relation to the Office of the Federal Register:

(1) A liaison officer and an alternate.

(2) A certifying officer and an alternate.

(3) An authorizing officer and an alternate.

The same person may be designated to serve in one or more of these positions.

(b) In choosing its liaison officer, each agency should consider that this officer will be the main contact between that agency and the Office of the Federal Register and that the liaison officer will be charged with the duties set forth in § 16.2. Therefore, the agency should choose a person who is directly involve in the agency's regulatory program.

(c) Each agency shall notify the Director of the name, title, address, and telephone number of each person it designates under this section and shall promptly notify the Director of any changes.

§ 16.2 Liaison duties.

Each agency liaison officer shall --

(a) represent the agency in all matters relating to the submission of documents to the Office of the Federal Register, and respecting general compliance with this chapter;

(b) Be responsible for the effective distribution and use within the agency of Federal Register information on document drafting and publication assistance authorized by § 15.10 of this chapter;

(c) Promote the agency's participation in the technical instruction authorized by § 15.10 of this chapter; and

(b) Be available to discuss documents submitted for publication with the editors of the Federal Register.

§ 16.3 Certifying duties.

The agency certifying officer is responsible for attaching the required number of true copies of each original document submitted by the agency to the Office of the Federal Register and for making the certification required by §§ 18.5 and 18.6 of this chapter.

Each document must be certified under signature as correct, the seal of the office is optional. See referenced cites.

The Parallel Table of Authorities and Rules takes up 108 pages in the 1996 Index volume of the Code of Federal Regulations, which I've used for desktop convenience in construction of this discourse rather than constantly calling up the 1998 edition on computer CD. It isn't there for nothing. Congress mandated it by law, a court ordered it, the Director of the Federal Register set out requirements by regulation, and the agency responsible for maintaining any given section is required to certify authenticity. The Table must therefore be given the same credibility as other documents reproduced in the Code of Federal Regulations -- it is prima facie evidence of publication in the Federal Register, or in this case, application of documents published in the Federal Register. If it isn't, it's a waste of time and a tremendous amount of public money.

Even at that, we haven't relied exclusively on the Parallel Table of Authorities and Rules. Instead, we've gone to the United States Code, tracked authority to original sources in the Statutes at Large, reproduced relative portions of Executive Orders, reorganization plans and presidential letters, examined regulations reproduced in the Code of Federal Regulations, reproduced original delegations of authority directly from the Federal Register, and otherwise filled gaps with principles of law and precedent court decisions.

The test is this: Is evidence of law, regulations, Executive Orders, executive delegations of authority, reorganization plans, statutory authority, et al, consistent with what the Parallel Table of Authority and Rules reflects? We've merely used the Parallel Table of Authorities and Rules as a navigation tool. Authorities it cites have proven to be authentic. By examining 26 CFR § 31, we demonstrated that the tax reform act of 1986 did not expand application of the Internal Revenue Code -- IRS jurisdiction is limited to insular possessions of the United States and the District of Columbia.

In order to demonstrate accuracy of the Table, we'll go through one more exercise that will be of considerable interest to people plagued by notices of lien and levy issued under signature of Internal Revenue Service revenue offices. To do that, we'll track 26 U.S.C. § 6331 and related sections of the Internal Revenue Code, the core section headed, "Levy and distraint". In the course of the general analysis, we'll rely to a certain extent on research pertaining to seizures and levies by John J. Schlabach, an Internal Revenue Service-enrolled agent (tax accounting, etc., certified by IRS) from Colbert, Washington. Mr. Schlabach's research reinforces conclusions we'll demonstrate when finally returning to address implications of 26 U.S.C. § 7804: That is, administrative seizures via "notice of levy", without orders of a court of competent jurisdiction, are patently illegal. We will see when returning to § 7804 that the Internal Revenue Code preserves the right to due process of law, as contemplated by the Fifth, Sixth, and Seventh Articles of Amendment, and remedies for "redress of grievance" against those responsible for fraudulently seizing assets without properly executed court orders.

We'll begin the analysis by reproduction of 26 U.S.C. § 6331(a), the general authority subsection of the levy and distraint section. This should be of interest particularly to people who have had the unfortunate experience of receiving notices of lien and levy from IRS revenue officers and the like as alleged statutory authority is reproduced on the backs of most of these instruments, but § 6331(a) isn't cited. This omission roughly falls under the axiom, "Figures don't lie, but liars figure." The subsection is as follows:

Sec. 6331. Levy and distraint

(a) Authority of Secretary

If any person liable to pay any tax neglects or refuses to pay the same within 10 days after notice and demand, it shall be lawful for the Secretary to collect such tax (an such further sum as shall be sufficient to cover the expenses of the levy) by levy upon all property and rights to property (except such property as is exempt under section 6334) belonging to such person or on which there is a lien provided in this chapter for the payment of such tax. Levy may be made upon the accrued salary on wages of any officer, employee, or elected official, of the United States, the District of Columbia, or any agency or instrumentality of the United States or the District of Columbia, by serving a notice of levy on the employer (as defined in section 3401(d)) of such officer, employee, or elected official. If the Secretary makes a finding that the collection of such tax is in jeopardy, notice and demand for immediate payment of such tax may be made by the Secretary and, upon failure or refusal to pay such tax, collection thereof by levy shall be lawful without regard to the 10-day period provide in this section.

The first obvious difficulty with this section is that it is an amalgamation or composite, as is the case for 28 U.S.C. § 132 relating to United States District Courts. At this juncture, I haven't had time to track down exactly when the amalgamation was effected, but suspect it was via the act for enactment of the Internal Revenue Code of 1954, or the act of Nov. 2, 1966, Pub. L. 89-719, title I, Sec. 104(a), 85 Stat. 520. The latter made significant changes in the entire lien and levy process as it came at approximately the time legislatures of all fifty States of the Union had fraudulently enacted the Uniform Commercial Code. The 1966 act was effected to reconcile Federal lien and levy process with the UCC. In the 1934 edition of the United States Code, the section appeared approximately as follows (portion added is left in strike-through text):

If any person liable to pay any tax neglects or refuses to pay the same within 10 days after notice and demand, it shall be lawful for the Secretary to collect such tax (an such further sum as shall be sufficient to cover the expenses of the levy) by levy upon all property and rights to property (except such property as is exempt under section 6334) belonging to such person or on which there is a lien provided in this chapter for the payment of such tax. Levy may be made upon the accrued salary on wages of any officer, employee, or elected official, of the United States, the District of Columbia, or any agency or instrumentality of the United States or the District of Columbia, by serving a notice of levy on the employer (as defined in section 3401(d)) of such officer, employee, or elected official. If the Secretary makes a finding that the collection of such tax is in jeopardy, notice and demand for immediate payment of such tax may be made by the Secretary and, upon failure or refusal to pay such tax, collection thereof by levy shall be lawful without regard to the 10-day period provided in this section.

This portion was added, possibly as early as 1939, but more probably in 1954 or 1966:

Levy may be made upon the accrued salary on wages of any officer, employee, or elected official, of the United States, the District of Columbia, or any agency or instrumentality of the United States or the District of Columbia, by serving a notice of levy on the employer (as defined in section 3401(d)) of such officer, employee, or elected official.

The employer definition at 26 U.S.C. § 3401(d) has already been cited; the employer employs officers and employees of the United States, United States political subdivisions, and officers of corporations where the United States has a proprietary interest, as defined at 3401(c). The person made liable for tax withheld at the source is the withholding agent. The balance of § 6331(a) is applicable to excise taxes in Subtitle E, most of these taxes pertaining to alcohol, tobacco and firearms.

Here we'll pick up Mr. Schlabach's line: Whatever authority the Secretary of the Treasury and/or his delegates have is prescribed by statute. The Secretary's seizure authority is at 26 U.S.C. § 7321:

Sec. 7321. Authority to seize property subject to forfeiture.

Any property subject to forfeiture to the United States under any provision of this title may be seized by the Secretary.

We're going to pick this up again, so remember the phrase, "Any property subject to forfeiture..," as it is key to understanding § 6331 and other sections that address lien, levy, and seizure. We will now consider authority of internal revenue enforcement officers, at § 7608:

Sec. 7608. Authority of internal revenue enforcement officers.

(a) Enforcement of subtitle E and other laws pertaining to liquor, tobacco, and firearms.

Any investigator, agent, or other internal revenue officer by whatever term designated, whom the Secretary charges with the duty of enforcing any of the criminal, seizure, or forfeiture provisions of subtitle E or of any other law of the United States pertaining to the commodities subject to tax under such subtitle for the enforcement of which the Secretary is responsible may --

(1) carry firearms;

(2) execute and serve search warrants and arrest warrants, and serve subpoenas and summonses issued under authority of the United States;

(3) in respect to the performance of such duty, make arrests without warrant for any offense against the United States committed in his presence, or for any felony cognizable under the laws of the Unite States if he has reasonable grounds to believe that the person to be arrested has committed, or is committing, such felony; and

(4) in respect to the performance of such duty, make seizures of property subject to forfeiture to the United States.

(b) Enforcement of laws relating to internal revenue other than subtitle E.

(1) Any criminal investigator of the Intelligence Division or the Internal Security Division of the Internal Revenue Service whom the Secretary charges with the duty of enforcing any of the criminal provisions of the internal revenue laws, any other criminal provisions of law relating to internal revenue for the enforcement of which the Secretary is responsible, or any other law for which the Secretary has delegated investigatory authority to the Internal Revenue Service, in the performance of his duties, authorized to perform the functions described in paragraph (2).

(2) The functions authorized under this subsection to be performed by an officer referred to in paragraph (1) are --

(A) to execute and serve search warrants and arrest warrants, and serve subpoenas and summonses issued under authority of the United States;

(B) to make arrests without warrant for any offense against the United States relating to the internal revenue laws committed in his presence, or for any felony cognizable under such laws if he has reasonable grounds to believe that the person to be arrested has committed or is committing any such felony; and

(C) to make seizures of property subject to forfeiture under the internal revenue laws.

[subsection (c) not reproduced]

We find authority to "make seizures of property subject to forfeiture" at §§ 7321 & 7608(a)(4) & (b)(2)(C). The language is explicit -- the Secretary and properly designated revenue officers may all seizure property subject to forfeiture. Statutory language does not go beyond that point. And as it so happens, the Internal Revenue Code is very explicit when it comes to what property is subject to forfeiture, specific statutory provisions in Chapter 75, Subchapter C -- Forfeitures. By appearance, the list is limited to Part I, Property subject to forfeiture, but there is a hidden gem in Part II that is the IRS back door out of the Internal Revenue Code. The escape hatch will be addressed in due course. The main list of property subject to forfeiture is at § 7301:

Sec. 7301. Property subject to tax.

(a) Taxable articles.

Any property on which, or for or in respect whereof, any tax is imposed by this title which shall be found in the possession or custody or within the control of any person, for the purpose of being sold or removed by him in fraud of the internal revenue laws, or with design to avoid payment of such tax, or which is removed, deposited, or concealed, with intent to defraud the United States of such tax or any part thereof, may be seized, an shall be forfeited to the United States.

(b) Raw materials.

All property found in the possession of any person intending to manufacture the same into property of a kind subject to tax for the purpose of selling such taxable property in fraud of the internal revenue laws, or with design to evade the payment of such tax, may also be seized, and shall be forfeited to the United States.

(c) Equipment.

All property whatsoever, in the place or building, or any yard or enclosure, where the property described in subsection (a) or (b) is found, or which is intended to be used in the making of property described in subsection (a), with intent to defraud the United States of tax or any part thereof, on the property described in subsection (a) may also be seized, and shall be forfeited to the United States.

(d) Packages.

All property used as a container for, or which shall have contained, property described in subsection (a) or (b) may also be seize, and shall be forfeited to the United States.

(e) Conveyances.

Any property (including aircraft, vehicles, vessels, or draft animals) used to transport or for the deposit or concealment of property described in subsection (a) or (b), or any property used to transport or for the deposit or concealment of property which is intended to be used in the making or packaging of property described in subsection (a), may also be seized, and shall be forfeited to the United States.

Property described in § 7301 is obviously related to production and distribution of distilled spirits subject to licensing under the Federal Alcohol Administration Act. It might be construed as being applicable to production of tobacco products and conceivably even firearms, but we know application is to insular possessions of the United States, not the several States. Even at that, we are narrowing the range of forfeiture by listing those things the Internal Revenue Code itemizes as subject to forfeiture.

The next section identifying property subject to forfeiture provides the approach ramp for IRS' leap from the Internal Revenue Code:

§ 7302. Property used in violation of internal revenue laws.

It shall be unlawful to have or possess any property intended for use in violating the provisions of the internal revenue laws, or regulations prescribed under such laws, or which has been so used, and no property rights shall exist in any such property. A search warrant may issue as provided in chapter 205 of title 18 of the United States Code and the Federal Rules of Criminal Procedure for the seizure of such property. Nothing in this section shall in any manner limit or affect any criminal or forfeiture provision of the internal revenue laws, or of any other law. The seizure and forfeiture of any property under the provisions of this section and the disposition of such property subsequent to seizure and forfeiture, or the disposition of the proceeds from the sale of such property, shall be in accordance with existing laws or those hereafter in existence relating to seizures, forfeitures, and disposition of property or proceeds, for violation of the internal revenue laws.

Implications of § 7302 will become evident momentarily. In the meantime, the balance of property subject to forfeiture listed in §§ 7303 & 7304 needs to be accounted for to complete the survey:

§ 7303. Other property subject to forfeiture.

There may be seized and forfeited to the United States the following:

(1) Counterfeit stamps. Every stamp involved in the offense described in section 7208 (relating to counterfeit, reused, canceled, etc., stamps), and the vellum, parchment, document, paper, package, or article upon which such stamp was placed or impressed in connection with such offense.

(2) False stamping of packages. Any container involve in the offense described in section 7271 (relating to disposal of stamped packages), and of the contents of such container.

(3) Fraudulent bonds, permits, an entries. All property to which any false or fraudulent instrument involved in the offense described in section 7207 relates.

§ 7304. Penalty for fraudulently claiming drawback.

Whenever any person fraudulently claims or seeks to obtain an allowance of drawback on goods, wares, or merchandise on which no internal tax shall have been paid, or fraudulently claims any greater allowance of drawback than the tax actually paid, he shall forfeit triple the amount wrongfully or fraudulently claimed or sought to be obtained, or the sum of $500, at the election of the Secretary.

When we consult the Parallel Table of Authorities and Rules, we find that §§ 6301 & 7302 aren't listed, regulations for § 7302 are 27 CFR §§ 24 & 252, and regulations for § 7304 are 27 CFR § 70. Title 27 of the Code of Federal Regulations includes the Federal Alcohol Administration Act, and is under Bureau of Alcohol, Tobacco and Firearms administrative jurisdiction. No general application regulations under these sections issue from Title 26 of the Code of Federal Regulations.

Remember, all judicial action to enforce forfeiture is supposed to issue as an in rem action in a United States District Court, per 26 U.S.C. § 7323, so we know that "venue" established by § 7323 is in one of the three remaining territorial courts, defined as courts of the United States at 18 U.S.C. § 23 -- the United States District Courts of Guam, the Northern Mariana Islands, and the Virgin Islands. Therefore, we know that all forfeitures must be in insular possessions of the United States, or territorial waters. This conclusion reinforces the allegation that IRS and BATF, both successors of the Bureau of Internal Revenue, Puerto Rico, have absolutely no legitimate jurisdiction in the Union of several States. The legitimate United States District Court is a territorial court that does not exercise Article III judicial authority of the United States -- it is an Article I legislative court. And beyond that, the in rem forfeiture action is admiralty-maritime in nature, proceeding in the course of the civil law, contrary to due process in the course of the common law assured by the Fifth, Sixth, and Seventh Articles of Amendment.

How is the IRS leap from the Internal Revenue Code accomplished? Via 26 U.S.C. § 7327:

§ 7327. Customs laws applicable.

The provisions of law applicable to the remission and mitigation by the Secretary of forfeitures under the customs laws shall apply to forfeitures incurred or alleged to have been incurred under the internal revenue laws.

The exit begins with § 7302, property used in violation of internal revenue laws, then the exit from the Internal Revenue Code is via § 7327, customs laws applicable. Seizures, including garnishment, are predicated on the notion of property used in violation of internal revenue laws. We know that this is the case as for the last several years, researchers across the country have decoded classification documents for literally hundreds of people subjected to IRS seizure and forfeiture. They are invariable red flagged as "illegal tax protesters", which is a trigger label, and are classified as high level and illegal drug dealers out of the Virgin Islands, Cayman Islands, etc. This is the underlying presumption IRS uses as justification for administrative seizures and/or criminal and civil prosecution in private United States District Courts situated in the Union of several States. These courts, without notice, presume to accommodate a change of venue from the District Court of the Virgin Islands under that court's concurrent maritime jurisdiction with district courts of the United States, 18 U.S.C. § 3241. The victim simply isn't informed that even if he is being prosecuted in a civil case, he is presumed to have committed an offense against customs laws of the United States in territorial waters of the Virgin Islands.

Those who haven't been exposed to the institutionalized criminal element of government have to be saying, "This can't be true! This is the most outrageous account imaginable!"

I hope that's the case, and I hope those who have read this far are sufficiently motivated to (1) take time to verify authorities that support conclusions presented in this discourse, and (2) demand that people who hold elected and appointed offices in United States government rebut conclusions with lawful authorities which satisfy criteria established in the section on five essential legal authorities. Most of this information is already in court pleadings around the country, it has been submitted to Federal judges in their respective administrative capacities, and has been submitted via the Director of the Administrative Office of United States Courts; IRS officials have failed to rebut or correct it, and various members of Congress stand mute, unwilling or unable to rebut the documented evidence. The best any of them can hope for -- that the truth doesn't reach a sufficient number of people that there is a general demand for accountability.

This is not the place for sermonizing, so we will proceed. Again consulting the Parallel Table of Authorities and Rules, regulations for 26 U.S.C. § 7327 are listed as 27 CFR § 72, regulations under BATF administration. However, at this juncture we're not concerned with BATF, so there is obviously no regulation in Title 26 of the Code of Federal Regulations with general application within the Union of several States. However, there is an unlisted regulation at 26 CFR 403 pertaining to Internal Revenue Service enforcement of customs laws. This is the Internal Revenue Code off ramp. The route is from 26 U.S.C. § 7302, property used in violation of Internal revenue laws, to § 7327, customs laws, to 26 CFR § 403, which pertains to customs laws in Title 19 of the U.S.C. The exit is predicated on classification to whoever illicit IRS actions are against, whether in civil or criminal forums, being classified as an illegal tax protestor who has drug-related operations in insular possessions and territorial waters subject to Congress' Article IV § 3.2 legislative jurisdiction.

The scope of the regulation is set out at 26 CFR § 403.1:

§ 403.1 Personal property seized by the Internal Revenue Service.

Regulations in this part relate to personal property seized by officers of the Internal Revenue Service as subject to forfeiture as being involved, used, or intended to be used, as the case may be in any violation of the internal revenue laws other than Chapters 51 (distilled spirits), 52 (tobacco) and 53 (firearms), of the Internal Revenue Code of 1954 (I.R.C.).

The object of this seizure authority is personal property valued at $100,000 or less (26 U.S.C. § 7325), and coin-operated gaming devices (§ 7326(a)).

The delegation of authority to the Commissioner of Internal Revenue (T.D. 7433, 41 FR 39312, Sept. 15, 1976, as amended by T.D. 7525, 42 FR 64334, Dec. 23, 1977), is reproduced at 26 CFR § 403.25:

§ 403.25 Personal property subject to seizure.

Personal property may be seized by the Commissioner of Internal Revenue or his delegate for forfeiture to the United States when involved, used, or intended to be used, in violation of the internal revenue laws, other than Chapter 51 (distilled spirits), 52 (tobacco) and 53 (firearms) of the I.R.C. (Sec. 7321, 68A Stat. 869; 26 U.S.C. 7321).)

What does 26 U.S.C. § 7321 relate to?

Sec. 7321. Authority to seize property subject to forfeiture.

Any property subject to forfeiture to the United States under any provision of this title may be seized by the Secretary.

As demonstrated, property subject to forfeiture within the covers of the Internal Revenue Code is specifically enumerated save that which is "used in violation of internal revenue laws" (§ 7302). Therefore, property which is the object of seizure must be personal property valued under $100,000 (§ 7325), or coin-operated gaming devices (§ 7326(a)), under applicable customs laws (§ 7327). This conclusion is locked down by Subpart D -- Remission or Mitigation of Forfeitures, at 26 CFR § 403.35:

§ 403.35 Laws applicable.

Remission or mitigation of forfeitures shall be governed by the customs laws applicable to remission or mitigation of penalties as contained in 19 U.S.C. 1613 and 19 U.S.C. 1618.

(Sec. 613, 46 Stat. 756, as amended, sec. 618, 46 Stat. 757, as amended, sec 7327, 68A Stat. 871; (19 U.S.C. 1613, 1618, 26 U.S.C. 7327))

The customs laws at issue grow out of the Tariff Act of 1930; Subtitle III -- Administrative Provisions; Part V --Enforcement Provisions, but there have been several amendments since that cast a fog over how manipulation of administration was accomplished. We'll address some of the conspicuous incongruities, but first need to see authority of 19 U.S.C. §§ 1613 & 1618:

Sec. 1613. Disposition of proceeds of forfeited property

(a) Application for remission of forfeiture and restoration of proceeds of sale; disposition of proceeds when no application has been made

Except as provided in subsection (b) of this section, any person claiming any vessel, vehicle, aircraft, merchandise, or baggage, or any interest therein, which has been forfeited and sold under the provisions of this chapter, may at any time within three months after the date of sale apply to the Secretary of the Treasury if the forfeiture and sale was under the customs laws, or to the Commandant of the Coast Guard or the Commissioner of Customs, as the case may be, if the forfeiture and sale was under the navigation laws, for a remission of the forfeiture and restoration of the proceeds of such sale, or such part thereof as may be claimed by him. Upon the production of satisfactory proof that the applicant did not know of the seizure prior to the declaration or condemnation of forfeiture, and was in such circumstance as prevented him from knowing of the same, and that such forfeiture was incurred without any willful negligence or intention to defraud on the part of the applicant, the Secretary of the Treasury, the Commandant of the Coast Guard, or the Commissioner of Customs may order the proceeds of the sale, or any part thereof, restored to the applicant, after deducting the cost of seizure and of sale, the duties, if any, accruing on the merchandise or baggage, and any sum due on a lien for freight, charges, or contribution in general average that may have been filed. If no application for such remission or restoration is made within three months after such sale, or if the application be denied by the Secretary of the Treasury, the Commandant of the Coast Guard, or the Commissioner of Customs, the proceeds of sale shall be disposed of as follows:

(1) For the payment of all proper expenses of the proceedings of forfeiture and sale, including expenses of seizure, maintaining the custody of the property, advertising and sale, and if condemned by a decree of a district court and a bond for such costs was not given, the costs as taxed by the court;

(2) For the satisfaction of liens for freight, charges, and contributions in general average, notice of which has been filed with the appropriate customs officer according to law; and

(3) The residue shall be deposited in the general fund of the Treasury of the United States.

(b) Disposition of proceeds in excess of penalty assessed under section 1592

If merchandise is forfeited under section 1592 of this title, any proceeds from the sale thereof in excess of the monetary penalty finally assessed thereunder and the expenses and costs described in subsection (a)(1) and (2) of this section or subsection (a)(1), (a)(3), or (a)(4) of section 1613b of this title incurred in such sale shall be returned to the person against whom the penalty was assessed.

(c) Treatment of deposits

If property is seized by the Secretary under law enforcement or administrated by the Customs Service, or otherwise acquired under section 1605 of this title, and relief from the forfeiture is granted by the Secretary, or his designee, upon terms requiring the deposit or retention of a monetary amount in lieu of the forfeiture, the amount recovered shall be treated in the same manner as the proceeds of sale of a forfeited item.

(d) Expenses

In any judicial or administrative proceeding to forfeit property under any law enforce or administered by the Customs Service or the Coast Guard, the seizure, storage, and other expenses related to the forfeiture that are incurred by the Customs Service or the Coast Guard after the seizure, but before the institution of, or during, the proceedings, shall be a priority claim in the same manner as the court costs and the expenses of the Federal marshal.

Sec. 1618. Remission or mitigation of penalties

Whenever any person interested in any vessel, vehicle, aircraft, merchandise, or baggage seized under the provisions of this chapter, or who has incurred, or is alleged to have incurred, any fine or penalty thereunder, files with the Secretary of the Treasury if under the customs laws, and with the Commandant of the Coast Guard or the Commissioner of Customs, as the case may be, if under the navigation laws, before the sale of such vessel, vehicle, aircraft, merchandise, or baggage a petition for the remission or mitigation of such fine, penalty, or forfeiture, the Secretary of the Treasury, the Commandant of the Coast Guard, or the Commissioner of Customs, if he finds that such fine, penalty, or forfeiture was incurred without willful negligence or without any intent on the part of the petitioner to defraud the revenue or to violate the law, or finds the existence of such mitigating circumstances as to justify the remission or mitigation of such fine, penalty, or forfeiture, may remit or mitigate the same upon such terms and conditions as he deems reasonable and just, or order discontinuance of any prosecution relating thereto. In order to enable him to ascertain the facts, the Secretary of the Treasury may issue a commission to any customs officer to take testimony upon such petition: Provided, That nothing in this section shall be construed to deprive any person of an award of compensation made before the filing of such petition.

By following references in the text of these two sections from Title 19, the link to drug-related offenses is reasonably easy to establish. However, at the moment, the link to Reorganization Plan 26 of 1950, cited in 26 U.S.C. § 7804, and subsequent authority delegated by E.O. #10289, and T.D.O. #150-42 (1956), is probably more important. The reorganization plan, and another plan promulgated in 1946, are cited as authorities in historical and revision notes following § 1613: