THE

THE CONFUSION OVER ...

In America there seems to be alot of confusion and conflicting literary works making claims regarding the definition of certain words and terms in the law. Specifically, "State" and "United States", AND "citizen" and "nonresident alien".

Many articles claim that since the legal definition of the term "United States" appears to NOT include the 50 States, then citizens of the 50 States are technically not citizens of the United States, and therefore are not subject to the income tax because the tax is only imposed on a citizen of the United States (areas of Federal jurisdiction). Thus a Citizen of a State is a non-resident alien for purposes of the tax code, and is not subject. As already explained and shown in great detail, this argument appears to be flawed. NON RESIDENT ALIENS ARE THE ACTUAL SUBJECT, AND ONLY SUBJECT, OF THE INCOME TAX ! If you declare yourself to be a nonresident alien, you are declaring yourself subject to the tax. It will just be a matter of time before the IRS shows up at your door demanding that YOU, THE ALIEN (according to your own declaration), pay the tax.

This confusion results from the fact that THERE ARE MULTIPLE DEFINITIONS for these terms contained in the law. However, each definition is specifically attached to, and relevant for, ONLY certain code sections (generally one chapter, or one Code section) referenced in the definition itself. For instance:

Subtitle C - Employment Taxes, contains both Sections 3121 and 3306. Chapter 21, Federal Insurance Contributions Act (FICA), containes Section 3121, which states:

§ 3121. Definitions.
...
(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.

26 USC 3121

And Chapter 23, Federal Unemployment Tax Act (FUTA), contains Section 3306, which states:

§ 3306. Definitions.
...
(j) State, United States, and American employer. For purposes of this chapter -

(1) State. The term ''State'' includes the District of Columbia, the Commonwealth of Puerto Rico, and the Virgin Islands.

(2) United States. The term ''United States'' when used in a geographical sense includes the States, the District of Columbia, the Commonwealth of Puerto Rico, and the Virgin Islands.

(3) American employer. The term ''American employer'' means a person who is -
(A) an individual who is a resident of the United States,
(B) a partnership, if two-thirds or more of the partners are residents of the United States,
(C) a trust, if all of the trustees are residents of the United States, or
(D) a corporation organized under the laws of the United States or of any State.

26 USC 3306

Clearly there are supposed to be distinct differences in the extent of the taxing Authority established in each of these programs (FICA & FUTA), under each of these Chapters (21 and 23) Please note the difference in 3121(e)(2) which does not include the 50 states, and 3306(j)(2) WHICH DOES; but both sections define the United States for use within their respective chapters ONLY.

Which of these definitions is applicable and active in Chapter 22 ? NEITHER !! Chapter 22 has no Code section that REDEFINES these terms for use in that Chapter so its definitions for those terms arise under Subtitle F - Procedure & Administration, in Section 7701, which states:

§ 7701. Definitions.

(a) When used in this title, where not otherwise distinctly expressed or manifestly incompatible with the intent thereof –
(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.
...

26 USC 7701

Now Section 1 - Tax imposed, is contained in Chapter 1 - Normal Taxes & Surtaxes. Chapter 1 does not have a Code section that rederfines these terms for use within it, so the definitions are provided by Section 7701(a)(9) and (10) shown above (for the TITLE according to the opening text of subsection (a)). Does THAT definition of the United States include the 50 States ?

It is also important to remember that the Courts have ruled that you cannot add by regulation (CFR) that which is not contained in the Code (USC), so arguments based on CFR sections must be supported by statements in the USC to be winnable in court. i can't find any in the USC and neither can the Fellowship.

This is the wrong argument to base your legal claims on if you are going to try and take on the IRS in court, please do not depend on this legal argument or you will lose. This argument appears to only be relevant to FICA, not income tax.

I further would point out that Citizens CAN VOTE, and ALIENS CANNOT. If you voted (or are eligible to register to vote) then you are obviously a citizen of the united states, and cannot (and SHOULD not) claim that you are "alien" to the government for the purpose of applying the tax laws (but not the voting laws ?) !

If you want to know how to really beat the IRS, read the whole web site and join the fellowship, because citizenship is the very best tax umbrella possible - you are not subject, if you exercise your rights, and DON'T volunteer for silly programs.

This can be seen if one carefully studies the following definitions from

26 U.S.C. 7701.

(1). Person - The term "person" shall be construed to mean and include an individual, a trust, estate, partnership, association, company or corporation
....
(3) Corporation. The term "corporation" includes associations; joint stock companies, and insurance companies.

(4) Domestic. The term "domestic" when applied to a corporation or partnership means created or organized in the United States or under the law of the United States or of any State.

(5) Foreign. The term "foreign" when applied to a corporation or partnership means a corporation or partnership which is not Domestic
....
(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.
...
(26). Trade or business. - The term "trade or business" includes the performance of the functions of a public office
....
(30). United States person. - The term "United States person" means-
     (A) a citizen or resident of the United States,
     (B) a domestic partnership
     (C) a domestic corporation, and
     (D) any estate or trust (other than a foreign estate or foreign trust, within the meaning of section 7701(a)(31)).

(31). Foreign estate or trust. - The terms "foreign estate" and "foreign trust" mean an estate or trust, as the case may be, the income of which from sources without the United States which is not effectively connected with the conduct of a trade or business within the United States, is not includible in gross income under Subtitle A.

26 USC 7701

First note that the word "person" is not restricted to meaning just people. For purposes of the application of the tax laws, "person" means any entity subject to the tax laws.

Next, notice that the definition of Domestic (4) references "any State", and the definition of State (10) says that includes (only the) District of Columbia. This indicates that any entity in one of the fifty States of the Union is "foreign" to, within, and for purposes of applying, the I.R. Code because they are not under the direct jurisdiction of the U.S. government, but rather, are under the jurisdiction of the State government, not the federal; and therefore is not subject to the tax. Now this does not mean that you are a non-resident alien. it just means that you are Sovereign Citizen who is outside and above the federal jurisdiction and not subject to the control of property or rule of life (or taxation) by the Federal government. We see this understanding confirmed in the Regulations at 26 CFR 1.911-2(h) where it states:

"Reg. 1.911-2(h)
Foreign country. The term "foreign country" when used in a geographical sense includes any territory under the sovereignty of a government other than that of the United States."

When the American States united to form a central government they retained full sovereign governmental authority over their own territory and people. Leaving the "United States" as the sovereign authority over ONLY those territories and areas not yet confirmed as states or conceded by the State to the "United States" (enclaves, military bases, etc). The regulation above explains that each and every one of the fifty States is deemed to be a "foreign country" because it is under its own sovereign government. I know this sounds strange, but think about it. are you free, or are you subject, or are you (supposed to be) represented, not ruled ? You are the authority and the sovereign. Sovereigns don’t pay tax, they impose it on their subjects. Your estate is properly regarded as a "foreign estate" not under the taxing authority/jurisdiction of the United States (government).

SO it is true and correct to understand that your estate is "foreign" to the Federal government, in that it is private property, beyond jurisdictional reach of the Federal government to tax directly and NOT under their control or ownership. But that does not make you a foreigner or an alien, just a sovereign citizen who owns property that cannot be taxed directly under the Constitution. (Can the Federal government impose taxes on the people of England, or Germany ? NO . Of course NOT. Why not ? - no jurisdictional authority over that property ! right ! Well they have NO DIRECT authority or control over your property either ! (get IRS HUMBUG - One of the BEST books on the Market !) for more on this.)

Furthermore the Constitution forbids the Federal government from interfering in private contracts, like your employment contract in the private sector. Because the Constitution forbids this, the United States government has no unilateral authority over either you as an employee in the private sector, or your employer, without your/their voluntary cooperation and permission. As you will see, the law records these legal facts.