Quickbooks withholds zero federal tax

[Prof]

Another troll.

http://www.flayme.com/troll/

[Thule]

I see that you all are very anti-Hendrickson here. Finished this Hendrickson book and I must say he presents a very strong case.

The court disagrees.

[jg]

Hendrickson does not present a strong case.
Hendrickson may be able to string together his claims, conclusions and opinions to convince some that he has a strong case. Hendrickson has been told he is wrong by the courts. Regardless of how well he argues his claims; it remains that he is wrong.

Hendrickson claims that only certain activity is subject to the income tax; but there is no legal merit for that claim. On the contrary, there are many decision that refer to the plenary power of Congress to tax.

For example, from COMMISSIONER v. GLENSHAW GLASS CO., 348 U.S. 426 (1955)

This Court has frequently stated that this language was used by Congress to exert in this field "the full measure of its taxing power." <omit cites> Respondents contend that punitive damages, characterized as "windfalls" flowing from the culpable conduct of third parties, are not within the scope of the section. But Congress applied no limitations as to the source of taxable receipts, nor restrictive labels as to their nature. And the Court has given a liberal construction to this broad phraseology in recognition of the intention of Congress to tax all gains except those specifically exempted. <omit cites> Thus, the fortuitous gain accruing to a lessor by reason of the forfeiture of a lessee's improvements on the rented property was taxed in Helvering v. Bruun, 309 U.S. 461 . <omit cites> Such decisions demonstrate that we cannot but ascribe content to the catchall provision of 22 (a), "gains or profits and income derived from any source whatever." The importance of that phrase has been too frequently recognized since its first appearance in the Revenue Act of 1913 to say now that it adds nothing to the meaning of "gross income."

Nor can we accept respondent's contention that a narrower reading of 22 (a) is required by the Court's characterization of income in Eisner v. Macomber, 252 U.S. 189, 207 , as "the gain derived from capital, from labor, or from both combined." The Court was there endeavoring to determine whether the distribution of a corporate stock dividend constituted a realized gain to the shareholder, or changed "only the form, not the essence," of his capital investment. Id., at 210. It was held that the taxpayer had "received nothing out of the company's assets for his separate use and benefit." Id., at 211. The distribution, therefore, was held not a taxable event. In that context - distinguishing gain from capital - the definition served a useful purpose. But it was not meant to provide a touchstone to all future gross income questions. <omit cites>

Here we have instances of undeniable accessions to wealth, clearly realized, and over which the taxpayers have complete dominion. The mere fact that the payments were extracted from the wrongdoers as punishment for unlawful conduct cannot detract from their character as taxable income to the recipients. Respondents concede, as they must, that the recoveries are taxable to the extent that they compensate for damages actually incurred. It would be an anomaly that could not be justified in the absence of clear congressional intent to say that a recovery for actual damages is taxable but not the additional amount extracted as punishment for the same conduct which caused the injury. And we find no such evidence of intent to exempt these payments.

The full case, with cites, is at http://caselaw.lp.findlaw.com/scripts/g ... 8&page=426

Hendrickson tries to make a case that income subject to tax is limited to certain activity. But that is contrary to the fact that "Congress applied no limitations as to the source of taxable receipts, nor restrictive labels as to their nature. And the Court has given a liberal construction to this broad phraseology in recognition of the intention of Congress to tax all gains except those specifically exempted. "

I hope this helps to understand that Hendrickson's claims are not supported by the law regardless of how well he might string together those claims.

[Gregg]

I see that you all are very anti-Hendrickson here.
Not Anti Hendrickson, Anti-cheat on your taxes until you go to jail and convince hundreds more to ruin their lives whilst doing it
Finished this Hendrickson book and I must say he presents a very strong case.
Not as strong as about half the people in his prison
It appears to hinge on special definitions, the IRS acting outside its scope and maybe jurisdiction.
Hendrickson's nonsense does, real law, not so much
Congress legislates sometimes for the District of Columbia and sometimes for the nation - how to tell the difference?
all of the ones that say "applicable to the District of Columbia only or something along those lines, the rest of them pretty much apply to everything between Mexico, Canada, the Atlantic and Pacific a group of Islands in the Pacific and a great big land mass between Canada and the Bearing Straight
Need to research this a bit further but, if true, it points to a lot of deception which at this point of the news cycle, would not really surprise me.
If you need more research to figure this one out you're prolly gonna have to squeeze it in between tying your own shoes and potty training

BTW, my client closed the corp. and running his new business happy as a clam. Says he shouldve done it long ago. And will pay employees in lawful money i think he said whatever that means.

The thing that disturbs me most about this whole thread and that sentence is the remote possibility that you're not a troll acting like a professional with an open mind and you do in fact have clients who pay you for accounting/book keeping/taxation advice

[Prof]

Nope, he's too dumb to have passed the CPA exam (FN 1)-- he/she/it is a troll.

Don't feed the trolls -- and the best example is Harv -- and Famspear just can't resist.

FN1: And this comment is from a lawyer, who thinks anyone with the ability to take the equation "2 + 2" and make that equal "Enron" can pass the CPA exam and get a Harvard MBA!

[Gregg]

Nope, he's too dumb to have passed the CPA exam (FN 1)-- he/she/it is a troll.

Don't feed the trolls -- and the best example is Harv -- and Famspear just can't resist.

FN1: And this comment is from a lawyer, who thinks anyone with the ability to take the equation "2 + 2" and make that equal "Enron" can pass the CPA exam and get a Harvard MBA!

Yeah, I figured as much....

On the last one, I have passed the CPA exam, although my MBA is from Xavier, but I have always thought, after reading everyone's books on it, that Skilling and Fastow were guilty as hell, Lay was willfully ignorant, Sherron Watkins was a conniving little (bad word) who made sure to save her backside but didn't care much for anyone else's.
Going a layer down, Kopper was so crooked he had to screw his pants on in the morning, Glihson (sic?) was too dumb to be Treasurer of the local PTA more less a Fortune 10 company and Carl Bass at Andersen was as close to a hero as the whole mess provides....but that's another thread. (and I once had dealing with Carl Bass, full disclosure)

[LPC]

I see that you all are very anti-Hendrickson here.

I would say that we are pro-Hendrickson, but anti-stupidity, anti-lies, and anti-fraud.

Love the sinner but hate the sin.

Finished this Hendrickson book and I must say he presents a very strong case.

If you're willing to overlook the fact that that most of what he says is wrong, and that the rest is just vague, posturing gibberish.

Hendrickson's most important argument is that only government employees and corporate officers are "employees" within the meaning of section 3401(c), which is not what the statute says because it says that the word "employees" includes government employees and corporate officers, and the word "includes" does not exclude anyone. See the definition of "includes" in section 7701(c).

And, even if he were right, all it would mean is that the payments he receives are not subject to withholding. The payments he receives would still be gross income within the meaning of IRC section 61(a), and so subject to tax.

And his conclusion makes no sense whatsoever. How could Congress could possible have expected to collect trillions of dollars in tax revenues by taxing only the salaries of government employees?

It appears to hinge on special definitions,

If by "it" you mean Hendrickson's crap, then you're right, because he repeatedly twists the meanings of words to give them "special" meanings never intended by Congress. If by "it" you mean the Internal Revenue Code, then you're wrong.

“[T]he words of statutes--including revenue acts--should be interpreted where possible in their ordinary, everyday senses.” Crane v. Commissioner of Internal Revenue, 331 U.S. 1, 6 (1947); Malat v. Riddell, 383 U.S. 569, 571 (1966).

the IRS acting outside its scope and maybe jurisdiction.

Claims made without any support whatsoever.

Congress legislates sometimes for the District of Columbia and sometimes for the nation - how to tell the difference?

Congress tells you.

Need to research this a bit further

I'll say.

but, if true,

And if pigs could fly...

it points to a lot of deception which at this point of the news cycle, would not really surprise me.

So you don't like something the government has done, and now you want to believe that everyone who works for the government is lying to you? Great "logic."

[Famspear]

I see that you all are very anti-Hendrickson here.

I would say that we are pro-Hendrickson, but anti-stupidity, anti-lies, and anti-fraud.

Love the sinner but hate the sin.

What he said.

Finished this Hendrickson book and I must say he presents a very strong case.

No, he presents no case at all. Hendrickson's writing is largely pseudo-legal gibberish.

Hendrickson is a smart fellow, and he writes well in the sense that he expresses himself reasonably well in writing. His followers succumb to his nonsense for a variety of reasons, not the least of which are (1) they don't know how to perform proper legal analysis, (2) they don't realize that he does not know how to perform proper legal analysis, and (3) for psychologically technical reasons they, like Hendrickson himself, so desperately want to believe what he (or for that matter any other tax denier) writes about federal tax law that they accept whatever he writes and reject whatever the courts rule.

Hendrickson is also persuasive for many of these people because he actually understands many legal terms -- it's just that he uses them only to present the case he wants to present. His writing is not that of a lawyer preparing a typical internal memorandum that coldly analyzes the facts and the law on each side of an issue, and assesses the hazards of litigation. His writing is all geared toward trying to persuade the reader.

Even a lawyer in his or her role as a lawyer has a responsibility to the decision-maker (generally a judge) to present case law that appears to go against the conclusion the lawyer is urging. Hendrickson rarely does that, and when he does his analysis is dishonest.

He is also dishonest with his followers about his own litigation history. Let's take his own civil tax case, the erroneous refund/credit case. The government sued him to recover the erroneous refunds or credits he obtained using his Cracking the Code scam. He lost.

He therefore appealed to the United States Court of Appeals for the Sixth Circuit, and lost at the court of appeals.

He therefore petitioned the United States Supreme Court and the Supreme Court rejected his appeal.

He petitioned for a rehearing with the Supreme Court, and the Supreme Court again rejected his petition.

Now, when the Supreme Court rejects a petition in this way, it is correct to say that the denial does not constitute a ruling on the merits. However, when the Supreme Court does this, the Court lets the lower court decision stand (in this case, both the district court and the Court of Appeals decisions against Pete).

But Pete lied to his followers. If I recall correctly, Pete told them (or at least implied) that the reason the Supreme Court denied his petition was that the Supreme Court concluded that the lower court decision against Pete was "void" (and I believe Hendrickson also may have used the term "moot"). That is patent, blatant nonsense.

First, the lower court decisions are not "void." The legal effect of the denial of the petition is that the lower court decision stands (as already noted).

Second, for heaven's sake, the United States Supreme Court does look at a lower court decision, conclude that it is "void," and then -- of all things -- turn around, reverse gears, and deny the petition asking the Court to declare the lower court decision void -- by simply saying, "Hey, the question is moot." Duhhh......

The fact that Hendricksons followers swallow this kind of stupidity is a testament to the astonishing gullibility of these sad, goofy people.

[notorial dissent]

I see that you all are very anti-Hendrickson here. Finished this Hendrickson book and I must say he presents a very strong case.

Only if you close your eyes, stick your fingers in yours ears, and go la la la la la la la la la a lot, forget how to read and comprehend plain English, and turn your brain off.

[Thule]

Don't feed the trolls

Noted. However, I do like the idea that hogwash should be properly rebutted in case someone should stumble in here and take a peek at the discussions.

I guess it's up to lorne to make the next move now.

[Cathulhu]

Reality check, Lorne. You just stated a man in prison for fraud is correct.

Perhaps you can end up as cellmates!

[lorne]

wow, thought my opinion wouldn't be well received here but didn't expect this - odd forum. Look, not trying to pick a fight here, just trying to be fair to all sides. Didn't say he was correct, just that he presents a very strong case.

Yes, much hinges on the INCLUDES argument, which he addresses at length on pages 33 through 37, I won't rehash it here if you have the book. Whats your take on that? Yes “[T]he words of statutes .. should be interpreted where possible in their ordinary, everyday senses.” but where a custom definition is given that definition should rule the statute no? And as I see it, everything is excluded except the list of included items and other things within the same class as the meaning of the term defined.

"And his conclusion makes no sense whatsoever. How could Congress could possible have expected to collect trillions of dollars in tax revenues by taxing only the salaries of government employees?"

well yes, thats the point. The income tax started very slowly, took a long time to reach a trillion. It appears the IRS early on realized, hey wow folks not even liable for this are paying it, we might have something here. You know how scammers can probe and exploit everything? Im reminded of some shopping sites i used to visit. People would tell how to get a good deal - coupons, rebates etc. But then some people really pushed it - advanced techniques where you buy at one store get the rebate & then return the item for full refund at another store i think, I was like wow, that's pushing it, that borders on fraud, I would never do that. Fraud can go both ways, store can bait & switch the consumer or the consumer can scam the store. I mean who is scamming who here?

I see your court/law argument, yes he was convicted. But I also see it took them a long time, they first tried to stop the book sales and failed and then got the filing false document. But what if theres some judicial corruption at play?

My mind isn't made up here, yes there's money at stake for me, not a lot, my other business has eclipsed the prepared returns. Bit of a conundrum for me. Preparing returns for what possibly could largely be a fraud.

Lorne

[ashlynne39]

I see that you all are very anti-Hendrickson here. Finished this Hendrickson book and I must say he presents a very strong case. It appears to hinge on special definitions, the IRS acting outside its scope and maybe jurisdiction. Congress legislates sometimes for the District of Columbia and sometimes for the nation - how to tell the difference? Need to research this a bit further but, if true, it points to a lot of deception which at this point of the news cycle, would not really surprise me.

BTW, my client closed the corp. and running his new business happy as a clam. Says he shouldve done it long ago. And will pay employees in lawful money i think he said whatever that means.

Considering Hendrickson is in prison, it can't be that strong of a case.

[Cathulhu]

I don't think we're so much anti-Hendrickson as anti-idiot. Tax advice from a convicted felon who cannot define "includes"??? Don't be stupid.

[The Operative]

Yes, much hinges on the INCLUDES argument, which he addresses at length on pages 33 through 37, I won't rehash it here if you have the book. Whats your take on that? Yes “[T]he words of statutes .. should be interpreted where possible in their ordinary, everyday senses.” but where a custom definition is given that definition should rule the statute no? And as I see it, everything is excluded except the list of included items and other things within the same class as the meaning of the term defined.

But who determines the class? What you are not getting is that Pete Hendrickson, and others with reading comprehension problems, are not simplifying statutory language, they are making it more obfuscatory. Regardless, the code defines "includes" as not excluding anything otherwise within the meaning of the term defined. The code does NOT say that "includes" limits the defined term to a limited class. A private individual working for a company that has no government ties is most likely an employee as the term is defined in the dictionary and how it is defined in the IRC.

"And his conclusion makes no sense whatsoever. How could Congress could possible have expected to collect trillions of dollars in tax revenues by taxing only the salaries of government employees?"

well yes, thats the point. The income tax started very slowly, took a long time to reach a trillion.

I think you are missing the point. If the income tax is only a percentage of government employee wages, how does the government obtain the money to pay the wages? The government would be taking in a lot less than it could pay out in wages alone. How would the government fund everything else that it has to fund? Do you see how ridiculous Hendrickson's argument is?

It appears the IRS early on realized, hey wow folks not even liable for this are paying it, we might have something here.

Nonsense. If that were the case, Congress and the courts would have corrected that long ago. There are many instances where the IRS has been told by the courts that it was wrong in its interpretation of the law. However, not one person has ever been able to convince the courts that the federal income tax only applies to government employees.

You know how scammers can probe and exploit everything? Im reminded of some shopping sites i used to visit. People would tell how to get a good deal - coupons, rebates etc. But then some people really pushed it - advanced techniques where you buy at one store get the rebate & then return the item for full refund at another store i think, I was like wow, that's pushing it, that borders on fraud, I would never do that. Fraud can go both ways, store can bait & switch the consumer or the consumer can scam the store. I mean who is scamming who here?

In the situation with Hendrickson and his followers, it is they who are running the scam and not the government. To put this simply, HENDRICKSON and anyone who follows his book, are breaking the law. They should be treated with the derision that a normal person would treat any criminal.

I see your court/law argument, yes he was convicted. But I also see it took them a long time, they first tried to stop the book sales and failed and then got the filing false document.

The wheels of justice turn slowly. The fact is that the government attempts to give people every opportunity to correct their actions in regards to tax filings. Also, the DOJ only accepts certain cases involving tax crimes.

But what if theres[sic] some judicial corruption at play?

So, do you believe that every court over the past 97 years has been corrupt? The courts have explained that Pete Hendrickson is wrong. In fact, many of his arguments are not even new. He claims that all those prior court cases showing his argument wrong actually did not address his argument since they did not use his wording. That is utter nonsense. Regardless of how it's worded, Pete Hendrickson is wrong.

My mind isn't made up here, yes there's money at stake for me, not a lot, my other business has eclipsed the prepared returns. Bit of a conundrum for me. Preparing returns for what possibly could largely be a fraud. Lorne

At first, it appeared that you realized that the arguments being made by Hendrickson were bunk. Now, it appears that you lack common sense.

[wserra]

Look, not trying to pick a fight here, just trying to be fair to all sides.

Some things really don't have "both sides". If you defend a "side" which can't be defended to a group of experts in the relevant field, this is what you get. When you address Quatloos, you're addressing a group of lawyers (including at least a couple with LLMs in tax law), CPAs, EAs, actuaries and the like.

Didn't say he was correct, just that he presents a very strong case.

That's exactly like telling a group of epidemiologists that Andrew Wakefield "presents a very strong case", or trying to make the case for Krebiozen before the National Cancer Institute. The reaction is predictable, because those positions (like Hendrickson's) are completely wrong, and their chief proponent is a fraud.

It really doesn't matter what type of case you believe Hendrickson presents. The courts in every instance find his positions not only wrong but frivolous. Their opinion is the one that counts.

[Famspear]

.....Yes, much hinges on the INCLUDES argument, which he addresses at length on pages 33 through 37, I won't rehash it here if you have the book. Whats your take on that? Yes “[T]he words of statutes .. should be interpreted where possible in their ordinary, everyday senses.” but where a custom definition is given that definition should rule the statute no? And as I see it, everything is excluded except the list of included items and other things within the same class as the meaning of the term defined.

No. You see it wrong. Hendrickson sees it wrong. And the courts have ruled that Hendrickson is wrong on the meaning of the terms "includes" and "including." What you have to understand is that this is the end of the matter. It's not a proper subject of debate -- at least not in the sense of what the law is. The law is well settled.

It appears the IRS early on realized, hey wow folks not even liable for this are paying it, we might have something here.

No, it doesn't appear that way. That's just something you (or someone else made up). Yes, you claim it "appears" that way to you. If so, why? Why does it "appear" that way? What's the basis for believing or suspecting something like that? Because you read Hendrickson's book? Really? That's it?

I mean who is scamming who here?

The courts have ruled that Pete Hendrickson and his followers are scamming. By contrast, no court has ever ruled that the government is scamming people about what the law is.

I see your court/law argument, yes he was convicted. But I also see it took them a long time, they first tried to stop the book sales and failed and then got the filing false document.

What do you mean, "it took a long time"? This is another old tax protester argument. The logic is baffling. What are you talking about?

Exactly how long is "a long time"?

What does "a long time" have to do with whether Peter Hendrickson's scam is a scam or not?

With all due respect, it appears you are grasping at straws.

But what if theres some judicial corruption at play?

What if pink cows fly through the halls of the court house of U.S. Supreme Court every night after the building closes, and nobody ever sees?

Why do you even ask a question like that? Are you being serious? You are seriously implying that you REALLY suspect 99% of the tax professors, the legislators, the IRS employees, the lawyers, and the CPAs have been in on some vast conspiracy? Because that's what it would take for there to be "some judicial corruption at play." It would have to involve a lot more than just all the federal judges since the 1860s.

My mind isn't made up here, yes there's money at stake for me, not a lot, my other business has eclipsed the prepared returns. Bit of a conundrum for me. Preparing returns for what possibly could largely be a fraud.

No, it's not a conundrum for you. And the federal income tax cannot "largely be a fraud." It can be stupid and unfair and bad policy and a lot of other things, but it cannot be a "fraud," any more than the federal securities law or the environmental law or contract law or any other kind of law can be a "fraud." With all due respect, you're just spouting rhetoric.

A conundrum is "a question or problem having only a conjectural answer" or "an intricate and difficult problem." Webster's New Collegiate Dictionary, p. 248, G. & C. Merriam Co. (8th ed. 1976).

The question or problem of whether to use Hendrickson's Cracking the Code scam on one's own tax returns is not a question or problem having "only a conjectural answer." The answer is quite definite and quite clear. No one but a psychologically dysfunctional person or a severely misled person would voluntarily participate in such a scam.

No, the question is not "intricate or difficult," either. There is nothing "intricate or difficult" about NOT using a scam that has been ruled to be frivolous and false in federal court -- a scam in which the very person perpetrating it is currently serving a federal prison sentence for using that scam on his own tax return -- a scam in which he also lost his own civil tax case. The evidence, if you will, is overwhelming. There is not one iota of data to indicate that Hendrickson is honest or that his scam is not a scam.

Do you think this is rocket science or something? A "conundrum"? Are you being serious?

The whole basis for the scam is Peter Hendrickson's own book, for heaven's sake. He and his followers reject all court decisions contrary to what they believe (and every single federal court decision on the topic has rejected Hendrickson's scam).

So, what are his followers left with?

They are left with Hendrickson himself. He is their authority.

Therefore, his own credibility - his own believability -- is both legally and logically relevant to a proper evaluation of his "method" (which he says is not a method). If you reject the court decisions, you are left with only Hendrickson's own interpretation. Essentially, Hendrickson becomes your authority -- your "witness" if you will. Hendrickson has no legal or accounting training or experience. His experience is in video arcade management, and apartment complex maintenance, with (apparently) some computer knowlege, and yet he professes to have "discovered" something that 99.99% of the tax lawyers and CPAs in the United States know to be false, something that 100% of the courts in his cases have ruled to be false.

I'm sorry, but I don't believe you are being serious.

Edit: Above, I wrote:

No one but a psychologically dysfunctional person or a severely misled person would voluntarily participate in such a scam.

I left out something: A person who is simply dishonest would also voluntarily participate in such a scam.

[Nikki]

Lorne:

You are receiving compensation for preparing tax returns for others.

That puts you in a very special category. You are in the ranks of those who can GO TO PRISON for failing to prepare proper, legally-based returns.

Even if not imprisoned (YET) many less-than-proper tax return preparers have received federal injunctions effectively forbidding them to continue in their businesses.

You now have to choose between two very simple options:

1 - Forget you ever heard of CtC and go back to preparing plain, old, boring tax returns and have a nice life

2 - Start filing 'CtC educated' returns and hope that you can save up enough cash to carry you for a few years after your business in shut down AND that DoJ won't get interested in you enough to launch a criminal prosecution --- where their track record for 'guilty' verdicts is fairly impressive.

But to help you decide, I suggest that you take a look here and check out the ratio of long-term successes with CtC versus the number of people who are finding themselves down in the trenches concerning the IRS.

[LPC]

wow, thought my opinion wouldn't be well received here but didn't expect this - odd forum. Look, not trying to pick a fight here, just trying to be fair to all sides.

Bulls---

Didn't say he was correct, just that he presents a very strong case.

Bulls---

Yes, much hinges on the INCLUDES argument, which he addresses at length on pages 33 through 37, I won't rehash it here if you have the book. Whats your take on that?

It's bulls---

Yes “[T]he words of statutes .. should be interpreted where possible in their ordinary, everyday senses.” but where a custom definition is given that definition should rule the statute no? And as I see it, everything is excluded

That's bulls---

Need I go on?

[Lorax]

All of the arguments that Hendrickson has ever made regarding his CtC "theory" have been exhaustingly refuted by the courts and I am certainly not going to waste my time repeating what the courts and other posters on this website have already said. I'm just here to tell you Lorne that your BS detector is most definitely broken if you are a CPA and you didn't start laughing uncontrollably when you got to the part that says most peoples' wages are not taxable income.