As written, the statutes in the USC say to use regulations
Section 861 to determine if income is taxable. Per the
plain language of the regulations, "Items" of income can only be
taxed if they come from taxable "sources." The list of
"sources", which is the same word as found in the 16th
Amendment, is found in Section 861.
The list of these "sources" found at Section 861 is limited to
foreign source income and foreign taxpayers. Again, per the
plain language of the regulations, wages, salaries and even capital
gains earned by ordinary Americans within the fifty states are not
The IRS does not want you to look at Section 861.
- Admit that the term "from whatever source derived" as
used in the Sixteenth Amendment does not mean that the
source of income or the situs for taxation is irrelevant
or inconsequential in determining taxable income.
- Admit that interpreting the phrase "from whatever source derived"
to mean that the source or situs is irrelevant, makes the federal income
tax applicable to any country or location in the world and renders 26
U.S.C. §861 and 26 U.S.C. §862 irrelevant and unnecessary, which clearly,
is an irrational and nonsensical conclusion to reach.
See 26 U.S.C. §861 and 26 U.S.C. §862
- Admit that the federal income tax applies only to taxable income,
which, generally speaking, is "gross income" minus allowable deductions.
"gross income" defined
- Admit that the federal income tax regulations generally define "gross
income" to mean "all income from whatever source derived, unless excluded
by law." as follows:
26 CFR § 1.61-1(a): (a) General definition. Gross income
means all income from whatever source derived, unless excluded by law.
Gross income includes income realized in any form, whether in money,
property, or services. Income may be realized, therefore, in the form
of services, meals, accommodations, stock, or other property, as well
as in cash. Section 61 lists the more common items of gross income for
purposes of illustration. For purposes of further illustration, Sec.
1.61-14 mentions several miscellaneous items of gross income not listed
specifically in section 61. Gross income, however, is not limited to
the items so enumerated.
See 26 CFR § 1.61-1(a) definition of "gross income"
- Admit that there are certain types of income which Congress
has exempted by statute as identified in 26 CFR §1.61-1(a).
- Admit that there are other types of income not enumerated
above which are not exempted by statute, but are nonetheless
excluded by law, for income tax purposes, because they
are excluded from taxation by the Constitution itself.
26 CFR § 39.21-1 (1956):
(a) The tax imposed by chapter
1 is upon income. Neither income exempted by statute
or fundamental law, nor expenses incurred in connection
therewith, other than interest, enter into the computation
of net income as defined by section 21.
26 CFR § 39.22(b)-1 (1956):
Certain items of income specified in section 22(b) are exempt
from tax and may be excluded from gross income. These items,
however, are exempt only to the extent and in the amount specified.
No other items may be excluded from gross income except (a)
those items of income which are, under the Constitution, not
taxable by the Federal Government; (b) those items of income
which are exempt from tax on income under the provisions of any act
of Congress still in effect; and (c ) the income excluded under the
provisions of the Internal Revenue Code (see particularly section
- Admit that the phrase "fundamental law" indicated above
in the older regulations means the U.S. Constitution.
- Admit that the above older regulations, 26 CFR §39.21-1
(1956) and 26 CFR § 39.22(b)-1 (1956) have never been
explicitly repealed or superceded by newer regulations
and are still in force.
- Admit that the regulations under 26 U.S.C. §863 state:
26 CFR § 1.863-1(c)
"Determination of taxable income. The taxpayer's taxable income from
sources within or without the United States will be determined under
the rules of Secs. 1.861-8 through 1.861-14T for determining taxable
income from sources within the United States."
26 CFR § 1.863-1(c)
- a. 26 USC § 61 lists some of the more common "items" of income which
are taxable, such as compensation for services, interest, and dividends,
26 USC § 61
- b. Admit that section 1.861-8(d)(2) of the federal income tax regulations
are to be consulted in determining in which situations these
"items" of income are excluded for federal income tax purposes.
26 CFR § 1.861-8(d)(2)
(2) Allocation and apportionment to exempt, excluded, or eliminated
income. [Reserved] For guidance, see Sec. 1.861-8T(d)(2).
- Admit that 26 CFR § 1.861-8T(d)(2) of the regulations
lists several types of income which are, quote, not considered
to be exempt, eliminated, or excluded income, end quote
26 CFR § 1.861-8T(d)(2)(iii)
that is not considered tax exempt. The following items
are not considered to be exempt, eliminated, or excluded
income and, thus, may have expenses, losses, or other
deductions allocated and apportioned to them:
the case of a foreign taxpayer (including a foreign sales
corporation (FSC)) computing its effectively connected
income, gross income (whether domestic or foreign source)
which is not effectively connected to the conduct of
a United States trade or business;
(B) In computing the
combined taxable income of a DISC or FSC and its related
supplier, the gross income of a DISC or a FSC;
all purposes under subchapter N of the Code, including
the computation of combined taxable income of a possessions
corporation and its affiliates under section 936(h),
the gross income of a possessions corporation for which
a credit is allowed under section 936(a); and
(D) Foreign earned income as defined in section 911 and the
regulations thereunder (however, the rules of Sec. 1.911-6 do not require
the allocation and apportionment of certain deductions, including home
mortgage interest, to foreign earned income for purposes of determining
the deductions disallowed under section 911(d)(6)).
26 CFR § 1.861-8T(d)(2)(iii)
- Admit that only income derived from certain activities related to
international or foreign commerce are included on that list of non-exempt
types of income appearing in 26 CFR § 1.861-8T(d)(2)(iii) above.
- Admit that the domestic income of most U.S. citizens is absent, and
therefore excluded, from the list appearing in 26 CFR § 1.861-8T(d)(2)(iii).
- Admit that 26 USC § 861(b), and the related regulations beginning
at 26 CFR § 1.861-8, the sections to use to determine one's taxable
income from sources within the United States, regardless of citizenship
26 USC § 861(b) and 26 CFR § 1.861-8
- Admit that for U.S. citizens living and working exclusively in the
50 states and receiving all income from within the 50 states, that 26
U.S.C. §861(b) and related regulations beginning at 26 CFR §1.861-8
do not show such income to be taxable.
26 CFR §1.861-8
- Admit that "items" of income are identified in 26 U.S.C. §61 while
"sources" of income are identified in 26 U.S.C. §861 and 26 U.S.C. §862.
26 U.S.C. §61, 26 U.S.C. §861, and 26 U.S.C. §862