RED ALERT: TAX FREEDOM VS SLAVERY: IS COMPUTING INCOME TAX USING A W2 ILLEGAL?
1. Introduction
The Capital v. Income website discussed in this video, authored by Brian Swanson, is listed on our About->Our Friends menu above and has been on our menus when this site was first created in mid 2024. We are friends with him and we feature some of the content from his website in our writings. At the point of this interview, he doesn’t fully understand the Nonresident Alien Position but has been studying it at our urging.
We like Brian’s research, because like ours, he focuses on the affect of private property rights on taxation. Unfortunately, he only has half that equation. He doesn’t understand that the U.S. Person TAX STATUS is PUBLIC property and that invoking it is the origin of MOST of the IRS’ authority. For that side of the property issue, see:
“How You Volunteer->USPI thru Changing YOUR status to DOMESTIC” menu item above
https://ftsig.org/how-you-volunteer/uspi-thru-domestic-status/
His approach is pretty sound except for the fact that he is filing the WRONG tax return, the 1040. If he would fix that and follow our materials, we believe he would have MUCH greater success.
2. We agree that entering “wages” on the 1040NR form should NEVER happen
Brian says that “wages” should not be entered in Block 1 of the 1040 form. We disagree because:
- Everything on the 1040 form is a privilege and subject to “trade or business” deductions under 26 U.S.C. §162.
- Even the “U.S. person” status connected to the 1040 form is a privilege as we explain above.
- The use of the SSN to connect earnings from labor to the “trade or business” donates the labor to the U.S. person office created and owned by Uncle Sam.
Since he doesn’t understand the nature of the “U.S person” civil status as an agency and office within the Department of the Treasury, he thinks that office is synonymous with him, and therefore, that they are making him a slave. We prove this is the case in:
How American Nationals Volunteer to Pay Income Tax, Form #08.024
https://sedm.org/Forms/08-PolicyDocs/HowYouVolForIncomeTax.pdf
We, on the other hand, do agree with him that “wages” don’t belong on the Block 1 of the tax return, but ONLY if you file the RIGHT tax return, which is the 1040-NR. Then they clearly don’t belong there because:
- “wages” or even “compensation for services” are not listed in 26 U.S.C. §871.
- The IRS even acknowledges in the 1040NR instructions for Block 1 that you should only put Effectively Connected Income in that block, and that it is up to YOU to decide whether it is Effectively Connected. See:
The Truth About Effectively Connecting, Form #05.056
https://sedm.org/Forms/05-MemLaw/EffectivelyConnected.pdf
If he would just file the correct tax return, he could even quote the IRS’ own instructions to show that he isn’t required to put “wages” on the tax return! It’s very sad that he doesn’t realize this. We have been trying to educate him over the last several months about this but he doesn’t see the light yet. Maybe he’s just too busy grading homework as a schoolteacher.
3. What would “wages” be called in I.R.C. Subtitle A?
This video discusses 26 U.S.C. §61 as a starting point, which does list “compensation for services” as “gross income” in 26 U.S.C. §61(a)(1). However, he never explains the relationship between that phrase and whether it is equivalent to “wages” on the W-2 form or in 26 U.S.C. §3401. We discuss that issue in detail the following document:
Proof that Involuntary Income Taxes On Your Labor are Slavery, Form #05.055, Section 8.4
https://sedm.org/Forms/05-MemLaw/ProofIncomeTaxLaborSlavery.pdf
Brian’s research is featured in Section 10 of the above. It appears there with his knowledge and permission. So we definitely support his approach to capital v. income.
The term “compensation for services” does not include human labor. It really only includes services provided by one fiction to another for profit. To tax human labor directly would, in fact, be slavery as pointed out in the video.
4. Puerto Rico
He talks about Puerto Rico in this video but doesn’t seem to understand that Puerto Ricans are acknowledged in the code as NOT “citizens” mentioned in 26 C.F.R. §1.1-1(a). 26 U.S.C. §2209 explains that Puerto Ricans are:
“nonresident not a citizen of the United States” within the meaning of that term wherever used in this title,”
[https://www.law.cornell.edu/uscode/text/26/2209]
In other words, they are Nonresident Aliens! Any American national can be a nonresident alien because that is their DEFAULT status under the I.R.C.
Instead of arguing that Puerto Ricans shouldn’t be exempt and that the tax is not uniform, its better to just recognize that the “citizen of the United States” in 26 C.F.R. §1.1-1 is a VOLUNTEER and to just UNVOLUNTEER by filing as an an NRA. See the above link called “USPI thru Changing YOUR status to DOMESTIC”.
5. Pete Hendrickson’s Approach is Fatally Flawed
This video also promotes the Pete Hendrickson approach to filing income tax returns. Pete Hendrickson’s approach is fatally flawed because he promotes being a “U.S. person” instead of a “nonresident alien”. We explain this in:
Who’s Who in the Freedom Community, Form #08.009, Section 3.26
https://sedm.org/Forms/08-PolicyDocs/WhosWho.pdf
6. Dialog with Brian about this video
After we posted this article and sent Brian a link to it to review, below is the dialog that followed about this article.
COMMENT:
Congratulations on the interview!
You’re famous!
HIS RESPONSE:
Yea …. nobody cares …. the masses sleepwalk to their own destruction. Jesus healed 10 lepers and only 1 responded. 90% of humanity are morons.
Thanks – pass it around if you think it would be useful. Cheers!
OUR RESPONSE:
Well, I think you did a GREAT job and we’re proud to promote your research, friend! Nobody asleep here!
“Be diligent to [investigate and expose the truth for yourself and thereby] present yourself [and the public servants who are your fiduciaries and stewards under the Constitution] approved to God, a worker who does not need to be ashamed, rightly dividing the word [and the deeds] of truth. But shun profane babblings [government propaganda, tyranny, and usurpation] for they will increase to more ungodliness. And their message [and their harmful affects] will spread like cancer [to destroy our society and great Republic].”
[2 Tim. 2:15-17, Bible, NKJV]
“The violence [verbal, financial, and physical] of the wicked [corrupt government] will destroy them [passive believers] because they refuse to do justice [Form #05.050].”
[Prov. 21:7, Bible, NKJV]
“Better is a little with righteousness, than vast revenues without justice [Form #05.050].”
[Prov. 16:8, Bible, NKJV]
You, like us, are not asleep at the wheel by any measure. But I think you may be too busy (so far) to look at what we believe could REALLY make your approach bulletproof. If you would like to have a web conference on this, we’d be happy to discuss it and go over it with you to accelerate your learning. Doing so would also help us improve our materials to reach a broader audience, since you really care about this subject and yet still may not fully understand the most important facts to leave the matrix yet.
You’re SO CLOSE. It’s frustrating to see you flounder. We would like to help.
HIS RESPONSE:
Well remember in the video the context is: pretend you are one who owes the tax, and if you owe it and follow the IRS instructions it is still wrong. The video was not relevant to anyone who does not owe the tax.
OUR RESPONSE:
I think it’s a mistake to even PRETEND that ANY American National owes the tax. As you point out, there IS no liability statute in Subtitle A. It’s all voluntary, as we PROVE in the following:
How American Nationals Volunteer to Pay Income Tax, Form #08.024
https://sedm.org/Forms/08-PolicyDocs/HowYouVolForIncomeTax.pdf