Capitations, other direct taxes, & shape shifting lizards

[SteveSy]

Thus, even though I have a property right, a vested property right, to receive the money, I am still not taxed on the INCOME until I receive the money. For a cash method taxpayer, merely owning the right to receive the money in the future is not a taxable event, and the "creation" of that right (which is an event) is also NOT a taxable event.

I never said its a tax on the right of ownership and I don't believe the court was either. You are taxed on the income, or accession to wealth, as an individual because it is yours and not someone else's. You are the rightful owner of that realized income, if not it would be someone else's tax to pay. You are taxed for being the owner of that income property merely because its yours, therefore you're the one liable for the tax.

Back to your attempt to weasel out of your conundrum, no direct tax that I saw in the past taxed property to which you had a right to, probably because such a tax would be impossible to assess even today, but instead it taxed the property which you owned and actually had in your control.

[Famspear]

Oh, Steve, since you brought up "substance over form", I take that as even further evidence that you understand accounting concepts to some degree. So, it's getting harder for you to feign ignorance.

The doctrine of substance over form essentially says that where the economic substance of an event materially differs from its legal form, we may in certain situations ignore the legal form and account for the event according to its economic substance.

The doctrine of substance over form is used both in financial accounting (such as GAAP type accounting) and in federal income tax accounting.

The doctrine of substance over form does not state that the federal income tax is really, in economic substance, a property tax under the United States Constitution. And if you were to try to present such an argument in a federal court case on the federal income tax, you would be laughed out of court (if you're lucky, that is; if you're not lucky, you could be sanctioned with a penalty for imposing a frivolous argument, maybe).

More to the point: The federal income tax is NOT "in economic substance", a property tax. As noted above, the mere fact that the incident of ownership arises at the same time as the income realization event (at least, in the case of an accrual method taxpayer) does not make the two concepts "in economic substance" one and the same.

The other thing about "economic substance" in federal income tax law may be bit disturbing for taxpayers to hear, but it must be said: The law is not balanced, and in that sense the law perhaps isn't "fair". What I mean by that is that THE GOVERNMENT can use the doctrine of substance over form against the taxpayer, but the taxpayer generally cannot use the same doctrine against the government (or at least, the situations where the taxpayer can use the doctrine to his advantage seem to be more limited).

[Famspear]

I never said its a tax on the right of ownership and I don't believe the court was either. You are taxed on the income, or accession to wealth, as an individual because it is yours and not someone else's. You are the rightful owner of that realized income, if not it would be someone else's tax to pay. You are taxed for being the owner of that income property merely because its yours, therefore you're the one liable for the tax.

Uh-oh. You stepped in it again, Steve. You never learn, do you? You just can't win.

No. If that were the case, then if you realized income where you didn't own the "money" (or whatever property you received), then there would be no federal income tax on that income realization event. Clearly, if you realize the income, YOU are the one on whom the federal income tax is imposed -- even if you have NO OWNERSHIP of the thing you received at the time of the income realization event!!!!

Yes, you have read that correctly. The Supreme Court has repeatedly ruled that the income can be taxed to you at the moment the income is realized, regardless of whether you own it or not!!!! Wow!

Uh-oh, what is Famspear talking about now?

Can you say Lucas v. Earl, 281 U.S. 111 (1930)? Can you say James v. United States, 366 U.S. 213 (1961)?

If the income tax were imposed only BECAUSE you OWN the property you receive, then there would be no Anticipatory Assignment of Income Doctrine, which says that you can be taxed on income as you earn it even if you have no ownership right over the income (e.g., because you transferred the right, under a perfectly legally valid, binding assignment contract, to someone else before you ever even earned the income). And there would be no rule that says the receipt of embezzled funds is taxable to the wrongdoer, even though the wrongdoer does not own the money and even though the wrongdoer has an obligation to return the funds to the rightful owner.

No, ownership of the property, money, whatever, IS NOT A LEGAL REQUIREMENT for you to be taxed on the REALIZATION OF THE INCOME at the time of the event. You are not taxed on it "because it's yours and not someone else's." You can be taxed on it EVEN IF IT'S NOT YOURS and EVEN IF SOMEONE ELSE OWNS IT. You are NOT taxed on it just because "it's yours."

You are quite wrong.

Back to your attempt to weasel out of your conundrum, no direct tax that I saw in the past taxed property to which you had a right to, probably because such a tax would be impossible to assess even today, but instead it taxed the property which you owned and actually had in your control.

This will have to wait 'til tomorrow. Or later today. Or some time. Sleepy-sleepy! Nighty-night!

[Thule]

I am reminded of a saying, originally used to describe creationists. Slightly rewritten, it would go something like:

"Tax studies is to formulate your question, examine relevant codes and cases, and use this knowledge to answer your question.

Tax studies is to formulate your question, examine relevant codes and cases, stomp your feet and scream 'DOES NOT!!!'"

I guess the last part also could say something about studying convicted criminals, dissenting opinions, 18th century economists and what some guy told me about his cousins best friends feng shui-consultant. But I'll stick as close to the original saying as possible.

[fortinbras]

The tax on income is, essentially, a tax on money in motion, as distinguished from a tax on assets that haven't moved (such as a tax on real estate). The same $10 bill can be taxed repeatedly as it appears in someone's pay envelope, then someone else's cash register, then someone else's wallet, etc.

[Imalawman]

Don't care to respond to my court cases that I cited - or do you choose to ignore anything that disagrees with your opinions?

[SteveSy]

Steve:

In specific, which of the co-authors of the constitution, which of the pre-conctitutional writings should we and, more importantly, rely on in determining the subtle meanings of the document?

We shouldn't rely wholly on any one of them specifically. But if there is a consensus on a subject then surely that should be considered as the intended meaning. Certainly if support for an opinion of a subject is nonexistent and there is evidence showing something different then the opinion is wrong.

I mean I don't know for sure that there is a moon revolving around the earth. I've never been there, nor have I held its material in my hand. However I can see it, and there's documentation WITH supportable evidence to say it is. Therefore in all likelihood its there. You in essence want me to accept their is a second moon revolving around the Earth simply becuase someone you hold in authority has said its there. That's your prerogative.

The correct answer is most likely to rely on none of them. They argued, debated, and produced a document on which they all agreed.

And when they agreed we should assume that's the meaning within the constitution.

They realized that their vision was limited and created a document which could grow with the nation and could withstand and adapt to changes over time.

Living document nonsense...there is an amendment process to take care of just that. Maybe we should use it more often instead of changing the document by fiat without consent.

Steve, you have a right to an opinion regarding Constitutional construction, but it is only that -- your opinion. And, your opinion is contrary to what the majority of courts have decided over the years. So, stop arguing as if your beliefs and opinions are fact.

So what the courts have ruled on something....they are an arm of the government. The constitution was created to limit their power. It's insane to rely wholly on their opinion of what it means, especially when there is no supporting facts in support of them.

The courts merely interpret the document, they don't change it. When its clear their opinions are unsupportable they have violated their position as "servant". WE graciously allowed them to assist us, WE can take that power away. Courts don't change reality simply because they offered an opinion. If the information is easily found disproving their opinion then their opinion is nonsense and nothing more.

So what I'll lose if I argue my position to a court, that doesn't make them right. They ultimately control the outcome regardless. The same can be said about many situations including any regimes we declare as corrupt or totalitarian like Cuba, N. Korea, China etc.
You think you're gonna win an argument against Hugo Chavez that threatens his power in court? It's no different, are system isn't immune to the same principles that enable those systems to function the way they do.

[Duke2Earl]

The courts merely interpret the document, they don't change it. When its clear their opinions are unsupportable they have violated their position as "servant". WE graciously allowed them to assist us, WE can take that power away. Courts don't change reality simply because they offered an opinion. If the information is easily found disproving their opinion then their opinion is nonsense and nothing more.

There is only two choices here. One... we live in a world where the decisions of the courts are binding on everyone and if we don't like them we try to change them through the political process, or Two... we live in a world where it's everyone for themselves and everyone gets to decide for themselves which laws are valid and which aren't and which decisions of the courts are to be followed and which aren't and if any person decides they disagree with the courts they don't have to follow them. In one case we live in a society of law and in the second we don't. The consequences of your choice here are much more frightening than anything having to do with taxes.

[SteveSy]

The courts merely interpret the document, they don't change it. When its clear their opinions are unsupportable they have violated their position as "servant". WE graciously allowed them to assist us, WE can take that power away. Courts don't change reality simply because they offered an opinion. If the information is easily found disproving their opinion then their opinion is nonsense and nothing more.

There is only two choices here. One... we live in a world where the decisions of the courts are binding on everyone and if we don't like them we try to change them through the political process

True but there is another, if enough people just don't listen to them because they've lost their respectability then that too will invoke change.

The consequences of your choice here are much more frightening than anything having to do with taxes.

I'm sure many thought as you do now when the revolution was considered. If the government can not foster respect because its found to have violated its duty to remain fair, just and impartial then it will fall.

There are many things I do not like but the reasoning is sound and supportable therefore I accept it. Simply telling me that's how it is and you don't have to explain yourself earns no respect and I'm sure there are many, perhaps the majority that believe the same. Many were doing well so what was happening behind the scenes was not so important. That's changing fast and people, right or wrong will start to question the validity of government's power. Perhaps not, but severe economic stress has caused many governments to fall when they took the position they were supreme over their people. The government is powerless without capitulation of the people it seeks to control.

[Duke2Earl]

The courts merely interpret the document, they don't change it. When its clear their opinions are unsupportable they have violated their position as "servant". WE graciously allowed them to assist us, WE can take that power away. Courts don't change reality simply because they offered an opinion. If the information is easily found disproving their opinion then their opinion is nonsense and nothing more.

There is only two choices here. One... we live in a world where the decisions of the courts are binding on everyone and if we don't like them we try to change them through the political process

True but there is another, if enough people just don't listen to them because they've lost their respectability then that too will invoke change.

The consequences of your choice here are much more frightening than anything having to do with taxes.

I'm sure many thought as you do now when the revolution was considered. If the government can not foster respect because its found to have violated its duty to remain fair, just and impartial then it will fall.

You avoid the question very neatly. Who decides? Your ultimate answer seems to be the mob decides. And somehow you aren't frightened by that. Amazing!

[SteveSy]

You avoid the question very neatly. Who decides? Your ultimate answer seems to be the mob decides. And somehow you aren't frightened by that. Amazing!

Who decides enough is enough...I suppose it would be the mob. Thankfully a mob decided enough was enough with Britain otherwise we would be discussing the finer points of the acts of parliament.

[Duke2Earl]

That says it all.

[SteveSy]

That says it all.

Sorry you're so disgusted that people have a right to accountable government and if that right is violated they have the power to end it. Its been like that since the dawn of mankind Duke. A revolution doesn't have to involve violence it can be a revolution of a way of thinking...the later is preferable. Again a government is powerless without the capitulation of its people.

[Duke2Earl]

No... the concept is "support" of its people....not "capitulation." I think your freudian slip is showing.

[Imalawman]

Care to respond to the court cases showing how they are wrong about the constitution? Or will you continue to ignore them....

[grixit]

I am reminded of a saying, originally used to describe creationists. Slightly rewritten, it would go something like:

"Tax studies is to formulate your question, examine relevant codes and cases, and use this knowledge to answer your question.

Tax studies is to formulate your question, examine relevant codes and cases, stomp your feet and scream 'DOES NOT!!!'"

Heh, original quote is mine, from talk.origins some years back.

[notorial dissent]

More to the point, Stevsie, I would like to know what you think the court has misconstrued, twisted, or lizarded to use your terminology. Just what have the done that so offends your delicate sensibilities? No whining please, just your usual poorly drawn examples.

You do a lot of whining, but are surprisingly short on actual examples.

[Nikki]

You are SO dense. The court has issued opinions with which he disagrees.

Thus, he scours every possible source to find things which support his view of the way the world should be.

[SteveSy]

More to the point, Stevsie, I would like to know what you think the court has misconstrued, twisted, or lizarded to use your terminology. Just what have the done that so offends your delicate sensibilities? No whining please, just your usual poorly drawn examples.

You do a lot of whining, but are surprisingly short on actual examples.

Poorly drawn examples? Lol, that's funny really considering I have directly quoted the sources many times.

The courts have attempted to determine what falls under the category of direct taxes. Their conclusion is based on nothing that's in existence. There is absolutely no support whatsoever for their conclusion. The truth is their conclusion is in direct contradiction as to what is available in documented history.

We would all have to believe the founders used words in the constitution that had been around for a very long time and had accepted meanings but secretly concocted a conspiracy behind the scenes to redefine these words to mean something else. More miraculously only the courts via their psychic god like powers were able to expose this conspiracy, which is now truth, because no documentation to support exists.

No country in the world defines direct taxes like the U.S. courts. Even though all of the founders came from countries that include a tax on income in the class of direct taxes. Did the founders ever say "Hey, we don't want the term direct tax to mean what it means every where else. We want it to mean whatever the court feels it should be", or anything like that? Of course not, not one single mention that the term is different than it has always meant.
More absurd is that people like LPC claim the direct tax clause was only put in the constitution to protect slave owners, it was a compromise. Wait, is he saying the people who comprised were so stupid that didn't even realize that the term "direct taxes" could change on demand? Certainly it offered no protection whatsoever....in fact slave owners were taxed on their slaves with a capitation tax soon after the adoption of the constitution. Wow, they must have been really stupid to buy that one eh?

In any case, there is a mountain of evidence saying a tax on revenue or income generally is a direct tax. While it is true we do not look to foreign law to determine our own. Its a little ridiculous to claim we don't look to foreign nations, specifically England, to determine what the founders meant when they used a term for taxation considering they were just under English rule where they fought a war to escape that taxation. Seriously, the proposition that we have a special meaning different that everyone else which no one even mentions once anywhere is so stupid its mind boggling.

Here's just a couple, there are many more. Remember nothing exists in documented history to support the courts position. At least I've never seen it and I've requested it for years. Maybe you'll have better luck. I suspect you;ll resort to using the Famspear approach and deny the courts have to support their opinions on the constitution at all, making the document meaningless.

He said that, so far as he had been able to form an opinion, there had been a general concurrence in a belief that the ultimate sources of public contributions were labor, and the subjects and effects of labor; that taxes, being permanent, had a tendency to equalize, and to diffuse themselves through a community. According to these opinions, a capitation tax, and taxes on land, and on property and income generally, were a direct charge, as well in the immediate as ultimate sources of contribution.

-
The Debates in the Several State Conventions on the Adoption of the Federal Constitution [Elliot's Debates, Volume 4] Direct Taxes. May 6, 1794

The most generally received opinion, however, is that, by direct taxes in the Constitution, those are meant which are raised on the capital or revenue of the people; by indirect, such as are raised on their expense.

- Albert Gallatin - Sketch of the Finances of the United States (1796)

[Nikki]

When will you learn that your opinion doesn't matter?

You might be 100% correct that the courts are basing their decifions on the wrong information and are coming up with totally bogus decisions.

IT DOESN'T MATTER

The structure of our government goves the courts the final word until the law is changed or the Constitution amended.

Now, since neither of those have happened, and the court's decisions have been allowed to stand, could it possibly be that the people who DO matter agree with the courts?

Could it be that you are a tiny voice screaming in the wilderness and that absolutely no one is paying any attention to you because no one at all agrees with you?

Or, could it be that you are just a really large ego attached to a keyboard?