DEBATE: Is everything paid by the government “effectively connected” without your consent?

By ftsig-admin | August 29, 2025

EDITORIAL:

FALSE STATEMENT:

In determining whether income from sources within the United States . . . is effectively connected with the conduct of a trade or business within the United States, the factors taken into account shall include whether— (emphasis added)

Now I will concede, 26 U.S.C. §864(c)(2) doesn’t seem to apply to either a Social Security payment or a government paycheck or pension payment. However, 26 U.S.C. §864(c)(3) says:

All income, gain, or loss from sources within the United States (other than income, gain, or loss to which paragraph (2) applies) shall be treated as effectively connected with the conduct of a trade or business within the United States. (emphasis added)

There’s NOTHING voluntary about either of these provisions. If (c)(2) doesn’t describe it, then (c)(3) does. Therefore, it would appear that if an American national protected by the constitution receives a government payment, its effectively connected whether you want it to be or not.

REBUTTAL:

We already dealt with this subject at:

The Truth About Effectively Connecting, Form #05.056
https://sedm.org/Forms/05-MemLaw/EffectivelyConnected.pdf

Here is a summary of our response on this subject:

1. The Unconstitutional Conditions Doctrine forbids government from extorting a kickback from you of payments they pay you for those protected by the Constitution. An income tax is an example of such a payment or bribe. See:

USPI thru Changing the Status of Your PROPERTY to Domestic, Section 3
https://ftsig.org/how-you-volunteer/uspi-thru-domestic-source/#3._Consequences

2. 26 U.S.C. §864(c)(3) seems to have the purpose that even if its not effectively connected, if you WRITE “income” on the 1040NR and thus DONATE it to a public use, then it “shall be treated” as such. This ALLOWS you to take deductions on it ANYWAY, even if it WASN’T really effectively connected because they group income and loss together.

3. The amounts indicated MUST be connected to “personal services within the United States” per 26 U.S.C. §864(b) and thus, SERVICE as a domestic “person” within the United States Inc. That “person” they CREATED and OWN is described in 26 U.S.C. §6671(b) and 7343 and is defined as an “officer or employee of a corporation or a partnership” and not CONSTITUTIONAL or PRIVATE “persons”. Otherwise, they would be illegally regulating and taxing PRIVATE conduct and property, which the constitution forbids. We know they are domestic persons because there are no implementing regulations authorizing enforcement in states of the Union. So “includes” cannot expand this public “person” to encompass PRIVATE, constitutionally protected parties and if it did, it would be unconstitutional.

4. So the question is, HOW did the the “taxpayer” become a PUBLIC/GOVERNMENT/DOMESTIC “officer or employee of a corporation or a partnership” so that they even COULD render such “personal services within the United States^Gov“? Only a lawful oath or appointment under Title 5 could do such a thing because you can’t unilaterally do it yourself. That would be a crime under 18 U.S.C. §912. Where is the partnership document or the articles of incorporation at the federal and not state level and the appointment or oath mandated by U.S. Code Title 5 for the OFFICER engaging in “the functions of a public office”? Only a public officer can lawfully handle public property and therefore execute “the functions of a public office”. Anyone else would be embezzling public property.

5. These forms of evidence don’t exist and you can’t, even by consent or election, PRETEND that they exist! If you have no evidence to prove that the corporation or partnership exists, then there is no way you can lawfully render such “personal services” and are private and “foreign” per the definition in 26 U.S.C. §7701(a)(5) and can’t earn “income” from such “personal services”.

6. Apply this to the research on foreign partnerships using Form 1065. We determined that you can register the partnership as foreign and private with no reporting or withholding requirements.

https://ftsig.org/how-to-get-a-foreign-ein-as-a-partnership-residing-in-a-constitutional-state/

If its a “foreign partnership”, then its not a partnership under 26 U.S.C. §6671(b) or §7343. Thus, those working for the partnership are not providing “personal services”. They have to work for a DOMESTIC partnership to do so.

7. 26 U.S.C. §864(c)(3) also cannot be dealing with anything other than government/PUBLIC/domestic property both before you earn it and after you receive it. Which means it has to involve a domestic entity as we point out below:

A GROSS RECEIPTS tax is a DIRECT tax on PRIVATE PROPERTY that would be unconstitutional for those standing on land protected by the constitution. To be constitutional and properly characterizable as a lawful excise, the property must be EITHER:

Earned by a privileged alien not standing on land protected by the constitution OR

PUBLIC property. It would only be PUBLIC property if:
2.1. It was PAID (sourced from) the national government and a reserved statutory property interest was retained prior to payment. An example of this would be Social Security in 26 U.S.C. §871(a)(3). OR
2.2. It was RECEIVED by a CIVIL “U.S. person” as the OWNER of the payment, which is a creation and property of the national government.

SOURCE: Section 5

https://ftsig.org/how-you-volunteer/uspi-thru-domestic-source/

Congress has not provided real consideration to even procure the right to tax or regulate. So they can’t. There is no tangible “benefit” to a “U.S. person” election as we point out in section 6.2

https://ftsig.org/how-you-volunteer/uspi-thru-domestic-source/#6.2._Why

8. So government, without consideration you asked for and received, is just a bystander and not a Merchant at that point and can’t make any rules or regulations. And in fact they HAVE NOT in the case of PRIVATE/CONSTITUTIONAL “persons” who are not “domestic”/PUBLIC. There ARE no implementing enforcement regulations for either civil or criminal enforcement for those NOT already lawfully elected or appointed to serve within United States^Gov:

https://sedm.org/Forms/09-Procs/ChalJurWorkbook.pdf

Even if you WANT to claim they are providing real consideration that would procure the power to tax or regulate, the constitution doesn’t expressly authorize the consideration, so they can only do it where the constitution DOES NOT apply, such as federal enclaves, abroad, or within territories or possessions, among LAWFULLY appointed public officers, etc.

9. Congress cannot define or convert the legal status of property it does not ALREADY own as public/domestic property without at least the consent of the owner. So everything addressed by 26 U.S.C. §864(c)(3) must ALREADY be public property. Otherwise they would be stealing. This gets us back to the questions of how the property BECAME PUBLIC property. If you can’t tell us exactly when and how that happened in the scenario where I define all efforts to do so as DURESS and indicate I don’t consent, EXACTLY when and how did that happen lawfully?

WHICH of the following methods was used to convert the earnings from PRIVATE to PUBLIC without your consent in a place protected by the constitution where rights are unalienable and thus you cannot even CONSENT to convert them?

“Men are endowed by their Creator with certain unalienable rights,-‘life, liberty, and the pursuit of happiness;’ and to ‘secure,’ not grant or create, these rights, governments are instituted. That property [or income] which a man has honestly acquired he retains full control of, subject to these limitations:

[1] First, that he shall not use it to his neighbor’s injury, and that does not mean that he must use it for his neighbor’s benefit [e.g. SOCIAL SECURITY, Medicare, and every other public “benefit”];

[2] second, that if he devotes it to a public use, he gives to the public a right to control that use; and

[3] third, that whenever the public needs require, the public may take it upon payment of due compensation.”

[Budd v. People of State of New York, 143 U.S. 517, 550 (1892);
SOURCE: https://scholar.google.com/scholar_case?case=17245612752943291505]

The above rules are described in section 7:

https://ftsig.org/how-you-volunteer/intro-to-laws-of-property/#7._Rules_for_Converting

9. 26 U.S.C. §864(c)(3) is voluntary, because the decision to engage in “personal services” as an officer of the government who is an “officer or employee of a corporation or partnership” is voluntary and can only lawfully be executed with a lawful oath or appointment or express and not tacit consent. Those personal services must ALWAYS be connected to a public office or its functions, or else they would be unlawfully regulating and taxing private conduct. That’s the ONLY way you can engage in “personal services”:

https://famguardian.org/TaxFreedom/CitesByTopic/PersonalServices.htm

If you AREN’T LAWFULLY so engaged, then 26 U.S.C. §7701(a)(5) says you are FOREIGN and PRIVATE, meaning OUTSIDE the “domestic” corporation as neither a partner nor officer of the U.S. Inc federal corporation.

STATEMENT:

Do you think federal employment is a right guaranteed under the Constitution? Is being an NCO in the military getting trained and performing IT a constitutional right?

It says what it says. If you can reason your way out of this, more power to you. But the statute is very clear.

SHALL BE TREATED creates the status of the income. THEN you put it on your 1040NR. You put it on there because it’s REQUIRED.

REBUTTAL:

Its only clear because you are assuming that “personal services” means private activity or that you can lawfully and unilaterally elect yourself into a public office in a place not expressly authorized by law and thereby unlawfully enlarge constitutional powers. That’s a crime per 18 U.S.C. §912 and anyone who does it is a de facto officer or agent.

It can only be required if the person doing so AT THE TIME is a public officer or agent and a civil “person” under 26 U.S.C. §6671(b) and §7343.

https://sedm.org/LibertyU/AvoidGovernmentObligations.pdf

ONLY THEN can ANY DUTY lawfully be imposed. How is a NRA national not engaged in a “trade or business” AT THAT TIME a public officer and can anyone be FORCED into a public office because they USED to be in one as a “U.S. person” when they earned their pension, without any consideration no less?

I don’t think so.

Nothing you do in the private sector is a private right in a constitutional sense. But when you’re dealing with a real de jure government, everything is a right and they can’t make a business out of alienating or stealing rights they were created to protect by converting it to public through trickery and sophistry. You have to decide whether you’re dealing with a REAL government or a private mafia IRS that isn’t really even part of the government. It can’t be both. Don’t equivocate. IRS currently functions as a private debt collector for the Federal Reserve and has never been part of the Department of the Treasury. See:

Origins and Authority of the Internal Revenue Service, Form #05.005
https://sedm.org/Forms/05-MemLaw/OrigAuthIRS.pdf

Either its a Article 1, Section 8 subject matter jurisdiction (SMJ) power and PUBLIC or a Article 4, Section 3, Clause 2 SMJ and PRIVATE. It can’t be both. Don’t equivocate.

Either the “income” is public or it is private AFTER it is received. Since they are dictating its status, it has to be PUBLIC after it is received. That can only happen if the owner or recipient is also a civil “person” and an “officer or employee of a corporation or partnership” and NOT a private, foreign, or constitutional person.

You still haven’t described exactly WHEN and HOW the income became PUBLIC after it was received per the above rules specified. Until you do, nothing you say will make any sense at all.

You are REALLY confused, my friend, because you haven’t analyzed the private to public conversion process carefully as we have. It’s almost like you didn’t learn ANYTHING from:

Property View of Income Taxation Course, Form #12.046
https://sedm.org/LibertyU/PropertyViewOfIncomeTax.pdf

We clearly wasted our time going over it with you in detail because you don’t seem to have learned anything from it and refuse to apply what it exposed to a real situation.

This discussion cannot be further simplified by simplistically just calling it a franchise and paying a kickback. Its much more subtle than that or the safe would have been cracked long ago. You HAVE to deal with and explain it at this level or you really don’t understand the process and will be a sitting duck if you get indicted or penalized.

STATEMENT:

I understand it. I just don’t agree with your application of the principles. You can insult me if you want to—I’m not the one you need to convince. I want you to be right and I still don’t agree with you.

Any judge is going to read the statute (the law) and intersect that with the facts (a 1099 from DFAS), and he would rule.

Your nuanced argument will go nowhere unless you bring that argument forward preemptively. If you wait for collections to ensue, you will have to overcome the facts and the law. You haven’t done that in my mind.

Don’t take offense. I just see it differently.

REBUTTAL:

1. The only facts they can bring forward are the things I say in the context of the definitions for my words I provide. My return says NOTHING I say can be construed in its CIVIL or STATUTORY sense and that the common law and constitutional and private sense is the only thing that can be implied.

2. By taking it out of the civil statutory sense, there are none of their laws to apply and only the equity, common law, private and constitutional sense may be litigated. Our members filing the 1040NR Attachment, Form #09.077 dealt with it at that level by asking them for an itemized list of benefits and promised to pay for them if they can prove the member asked for and received them and document their cost.

3. The court cannot proceed only on presumptions. The information return that would form the basis for the presumption was rebutted with the filing.

4. I’m not offended at all, but you haven’t defended your position and just abandoned the battlefield.

4.1. Exactly when and how was your labor and earnings converted to public so they can can tax or regulate it per Munn?

4.2. What “benefit” or consideration did they provide that allowed them to make any Article 4, Section 3, Clause 2 Subject Matter Jurisdiction rules for the consideration they provided. If not, they are just a third party bystander trying to trick you out of your private property?

4.3. Are we dealing with a Article 1, Section 8 Subject Matter Jurisdiction Constitutional power or a Article 4, Section 3, Clause 2 PRIVATE power?

4.4. Where is the proof that its a Article 1, Section 8 power? Without proof, its presumed to be a territorial power.

https://ftsig.org/proof-of-facts-exta-territorial-jurisdiction-of-the-national-government/

5. The arguments here HAVE been brought forward preemptively with my filing. FTSIG is incorporated by reference in the filing as my basis for belief and plausible deniability.

If you can’t answer these questions consistent with what we have agreed on so far, you’re operating out of fear, emotion, opinion, ignorance, and bias rather than reason, logic, knowledge, and law. That won’t go well in front of a jury. I don’t respond to or yield to any of that. Only cowards or incompetents do.

“Opinions (and emotions and beliefs behind them) are like assholes. Everyone has one and the all stink, including mine. And NONE of them are admissible as evidence in a court of law per Federal Rule of Evidence 610”

If you are incapable of dealing with the issues using only reason, logic, and law, you may as well pay your “protection money” to the mafia to get them to leave you alone and walk away with your tail between your legs. That appears to be your decision in this case, my friend. You can’t even explain how your position deviates from the questions we pose or positions we exhaustively articulated so that’s the only reasonable conclusion.

BE A MAN and bend over!

“If ye love wealth better than liberty, the tranquility of servitude better than the animating contest of freedom, go home from us in peace; We ask not your counsels or your arms; Crouch down and lick the hands which feed you; May your chains set lightly upon you, and may posterity forget that ye were our countrymen.”
[Samuel Adams]

STATEMENT:

I just think you need to ask yourself these questions:

Who pays your pension?
Is the payer a private or public entity?
Does Congress have any jurisdiction over the entity’s finances?
Would a reasonable person consider military pension income to constitute “income” over which Congress would have jurisdiction under 16A?
Is 16A part of the Constitution or is it a conspiracy theory?

REBUTTAL:

Answer my questions first. Stop evading please.

STATEMENT:

The constitutional provisions of 123, 194, 183 are all still in place. But when it comes to income over which Congress would have jurisdiction, 16A layers on top of other constitutional taxing provisions and functions as additional permissive criteria.

I’m not—because the questions are irrelevant to what 16A says, and what the statute says.

REBUTTAL:

Then we have nothing further to discuss on the subject. The 16A must be compatible with the Fifth Amendment and the laws of property. You want to start with a presumption that the tax instituted is a 1:8 subject matter jurisdiction and work your way backward. I want to start with the laws of property and work forward and later address the 16A in a way consistent with your prior answers.

I won’t start with any of the following presumptions. They all have to be PROVEN before we can even get to the 16A:

That its a 1:8 tax instead of a 4:3:2 kickback on public property. NO COURT and no statute has ever said its a 1:8 tax and the presumption of extraterritoriality is always in my favor.
PROOF OF FACTS: Exta-territorial jurisdiction of the national government, FTSIG
https://ftsig.org/proof-of-facts-exta-territorial-jurisdiction-of-the-national-government/
That the 16A is even relevant. Stanton v. Baltic Mining said it wasn’t.
That the I.R.C. is even relevant if the whole thing is presumption under 1 U.S.C. 204 legislative notes.
That Congress can extort money and demand a kickback without violating the unconstitutional conditions doctrine. They can’t. See:
USPI thru Changing the Status of Your PROPERTY to Domestic, Section 3, FTSIG
https://ftsig.org/how-you-volunteer/uspi-thru-domestic-source/#3._Consequences
That the exclusive jurisdiction of the states are even the target, given the geographical definitions. If its a 1:8 tax, they have to be expressly included geographically or else it fails the requirement of reasonable notice baked into the constitution.
That Congress can lawfully compel you to convert YOUR status or that of your property extraterritorially where the 13A and the 5A applies.
That Congress can lawfully convert you or your property from private to public without your consent. That’s stealing and identity theft if anyone else did it.

REAL truth is NON-NEGOTIABLE. It stands on its own and its always consistent with itself in total. You only want to look at a small piece of it and throw consistency out the window to “curve fit”. I don’t negotiate truth, and if it isn’t backed by proof and evidence, it’s not truth, but religion.

Truth fears nothing
Truth fears no lies
Truth doesn’t need to conceal anything
Truth doesn’t have to do a cover up
Truth only hurts those who are unwilling to wake up
Truth is never your enemy
Truth knows no ego
Truth doesn’t give a shit about your status symbols
Truth doesn’t care about your age, your weight or your skin colour
Truth couldn’t care less if it suits your comfort zone
Truth doesn’t need any frills, any speeches, any glamour
Truth stands for itself
and it patiently waits till you are ready for it

[SEDM]

The war is lost before its ever even begin to start with all the above presumptions. All such presumptions are a violation of due process. Presumptions are not evidence or a suitable substitute for evidence in any court. I don’t consent to any of them. You have to PROVE all these with court rulings and positive law evidence.

Requirement for Due Process, Form #05.045
https://sedm.org/product/requirement-for-due-process-of-law-form-05-045/

I don’t consent to any of the above presumptions. You have to PROVE all these with court rulings and positive law evidence. The I.R.C. is not positive law so its not evidence of ANYTHING, much less an obligation. There isn’t even a liability statute, so its just a voluntary franchise you join by claiming a status under it.

RIDICULOUS!

YOU CAN’T prove ANY of the above.

STATEMENT:

I agree—we have reached an impasse.

RESPONSE:

With all due respect, you, my friend, are practicing religion and superstition. Not law, facts, logic, evidence, and knowledge. The two are like oil and vinegar. They can’t EVER stay mixed. Just like religion and science. That religion is described below:

Socialism: The New American Civil Religion, Form #05.016
https://sedm.org/Forms/05-MemLaw/SocialismCivilReligion.pdf

And the thing you are worshipping is a man or man-made, not God made. Caesar created “taxpayers” and “U.S. persons”. God created you, me, the Heavens and the Earth:

“Therefore God also gave them up to uncleanness, in the lusts of their hearts, to dishonor their bodies among themselves, who exchanged the truth of God for the [civil statutory] lie, and worshiped and served the creature [the government] rather than the Creator, who is blessed forever. Amen.”

[Rom. 1:24-25, Bible, NKJV]

“Worship” = OBEY without reason or logic or law or even knowledge to explain why, akin to religious faith. Presumption serves as a SUBSTITUTE for that faith.

I’m not suggesting that you DON’T worship the Creator, but you put Caesar above him. At that point, Jesus is just a liability insurance salesman from the wrath and fire of hell and not a sovereign Lord who is ABOVE Caesar. That’s idolatry motivated mainly by fear and ignorance, rather than love, truth, and God’s law.

“An astonishing and horrible thing
Has been committed in the land:
The prophets prophesy falsely,
And the priests rule by their own power;
And My people love to have it so.
But what will you do in the end?
[Jer. 5: 30-31, Bible, NKJV]

You just got an F- on “Intellectual Honesty“, which is a mandatory qualification of using this site.

Lord, who may abide [reside] in Your tabernacle [Kingdom of Heaven]?
Who may dwell [have a DOMIICILE] in Your holy hill [political kingdom]?

He who walks uprightly,
And works righteousness,
And speaks the truth in his heart;
He who does not backbite with his tongue,
Nor does evil to his neighbor,
Nor does he take up a reproach against his friend;
In whose eyes a vile person is despised,
But he honors those who fear the Lord;
He who swears to his own hurt and does not change;
He who does not put out his money at usury,
Nor does he take a bribe [government “benefits” paid for with LOOT stolen] against the innocent.

He who does these things shall never be moved.

[Psalm 15, Bible, NKJV]