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On Criminal Complaints For Filing False IRs

Getting practical on a core element of the "ignorance tax" scheme.

CtC WARRIOR ROD SCHMIDT has put together some good thoughts on the core element by which the "ignorance tax" scheme is implemented-- false "information returns". Preventing the blizzard of lies every winter would eliminate the need for filing for many folks, and would eliminate any of the balkiness by tax agencies that occasionally makes things difficult for those having to file to reclaim improperly withheld money.

Rod has crafted a simple complaint template and offered some thinking on how to use it. Rod readily admits that some of the implementation-advice may need tweaking as the procedure is deployed and more is learned, but this seems to me a very good and virtuous effort at producing something with which people can get started, and any needed refinements can be identified.

Initiating Criminal Prosecution of the Signer of a False W-2 or 1099 Form

by Rod Schmidt

We in the CtC-educated community are aware that someone who signs a W-2 or 1099 form falsely stating that you had "wages" or "income" as defined by the Internal Revenue Code, when you did not in fact receive such wages or income, has committed a crime.  But how do you report that crime?

This process is still in the early stages of development. To our knowledge, no one has yet attempted to initiate criminal proceedings against the signer of a false W-2 or 1099 that overstates "taxable income."

***

To swear out a Criminal Complaint you will need an Affidavit (or equivalently a Declaration, see 28 USC 1746) stating the facts that you know of your personal knowledge -- events that you have personally witnessed. Traditionally this went straight to a judge or magistrate (although in recent decades the common-law process has been corrupted to include gatekeepers to screen out politically inconvenient complaints) and so I would send one original to a Federal District Court judge and one to a State County/Circuit/Superior Court judge (they have different names in different states).

Also send one to the FBI and one to the IRS' CID (Criminal Investigation Division) and for good measure one to the City police and one to the County Sheriff in the city and county where the criminal lives, and one to the state police. AND I would send one by Certified Mail, Return Receipt Requested and Restricted Delivery and Signature Confirmation to "Grand Jury Foreman" at the address where the Federal Grand Jury meets, while they're in session AND the same for the State/County's Grand Jury Foreman.

The purpose of all that mail rigamarole is to get past the crooked attorney whose job is to try to control the information that gets to the grand jury so that certain people committing certain types of crimes will never be held accountable. I have a feeling (based on my reading) that the attorney would not honestly present your Declaration to the grand jury.

If I knew more, I would perhaps recommend a smaller list.

I said "one original" to each of these people. A photocopy is not good enough; it must have your wet ink signature. Preferably in color so it doesn't look like a photocopy. There can be "duplicate originals" or "multiple originals." As long as it has your wet ink signature on it, it's an original. (The phrase "original copy" is an oxymoron; don't use it or you yourself will sound like a moron.)

I would also include a brief explaining the law that was broken, and whatever official forms these people want, as, for example here. But all those things are of secondary importance, and if your materials are deficient then you will most likely be told what else is needed. Of primary importance is your affidavit or declaration setting forth facts of which you have personal knowledge, that constitute a crime.

I guarantee that the FACTS are the engine that moves everything, and specifically a SWORN STATEMENT (under penalty of perjury) made of your PERSONAL KNOWLEDGE of events that you have PERSONALLY WITNESSED. (So it's not enough to say "he violated my Constitutional rights" nor to quote laws nor to talk about things you haven't seen.)

You can get in front of a State or Federal court judge by finding out their "Ex Parte Days." Ex parte means from one Party to the dispute, in other words From One Side. For example, Ex Parte might be held every Tuesday at 10:00 a.m.  Everybody who has Ex Parte type business stands in line in the courtroom, and the judge hears them one at a time. When it's your turn, announce your name and say "I have a criminal complaint and here is my Declaration." You will be invited to hand it to the bailiff who will deliver it to the judge who will read it and ask questions and tell you if you need to do anything else.

Or you can show up at a courthouse and attend a trial or arraignment or whatever business is going on that day (check first to find out when anything is happening), and when it's over and everybody's getting ready to leave you stand up and say, "Your Honor, I have a criminal complaint, and here is my Declaration." Then the judge will either read it or tell you what to do.

Alternatively, phone up the Court Administrator (every court should have one, it's basically the clerks' boss with the job of making sure everything runs smoothly) and ask how to get in front of a judge. Maybe you can make an office appointment.

I suppose the easy way is to mail it to a judge. Ordinary first class mail should be good enough here, as you won't be trying to get around a crooked gatekeeper. Again, if there's something else you are supposed to do you will get a letter back.

You could go to a (state or federal) Court Clerk and try to file it. I don't think clerks accept criminal complaints from the public but I would love to be wrong.

BTW, you may say that this isn't worth doing because the judges and officials will do nothing. But -- first, you may be surprised. Some judge may issue an arrest warrant, or some agency may start an investigation, or the pile of ignored crime reports may mount up to the point where a new challenger for the office of District Attorney can make this a campaign issue: "look, this DA is soft on crime, look at all these crime reports that are still in limbo!"

At a minimum, you will be educating everyone who comes into contact with these Declarations (not only the officials themselves but also their staff members) about the CtC issues -- and about corruption, if they personally witness crime reports being ignored or buried or otherwise not treated the same as other crime reports.

In any event, you should report crime-- not because you expect any particular outcome, but because it is the right thing to do.

"Let Justice be done, though the Heavens fall!"

***

DECLARATION OF ____________ (your name)

IN THE NATURE OF A CRIMINAL COMPLAINT

  1. On ___/___/_____ (date), I received in the mail a W-2 or 1099 form (hereafter referred to as the "False Form") signed by __________________ (hereafter, the "Accused"). A true copy of the False Form is attached as Exhibit A. 

  2. The False Form reports that I had and received income tax-relevant gains in the form of "wages" or otherwise, in the amount of $_______.___.  

  3. However, the said number on the False Form is false as I had not engaged in any taxable activities in connection with the receipt of the reported payment(s). 

  4. I never gave the Accused any reason to believe (for example by saying so) that I had engaged in any taxable activities in connection with the receipt of the reported payment(s). 

  5. I am unaware of any reason that the Accused might have to believe that I had engaged in any taxable activities in connection with the receipt of the reported payment(s). 

  6. To the best of my knowledge, the Accused has no reason to believe that I had engaged in any taxable activities in connection with the receipt of the reported payment(s).

  7. [Check box and fill in date if applicable:] (___) On ___/___/_____ (date) I obtained from the Accused a copy of the corresponding Form W-3 or Form 1096 with which the False Form was transmitted to the government. A true copy of the said Form W-3 or Form 1096 is attached as Exhibit B.

  8. [Check box and fill in date if applicable:] (___) On ___/___/_____ (date) I notified the Accused that I had not engaged in any taxable activities in connection with the receipt of the reported payment(s), and I asked the Accused to retract or correct the False Form, and the Accused refused to retract or correct the False Form.

  9. The Accused willfully signed a Form W-2 or 1099 containing false numbers. Therefore, the Accused has committed a violation of 18 U.S.C. § 1001(a): "[W]hoever, in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States, knowingly and willfully—(1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact; (2) makes any materially false, fictitious, or fraudulent statement or representation; or (3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry; shall be fined under this title, imprisoned not more than 5 years[.]"

  10. [Check box and fill in date if applicable:] (___) On ___/___/_____ (date) I asked the Accused whether the Accused is a Federal officer, agent or employee, and received an answer in the negative. 

  11. To the best of my knowledge, the Accused is not a Federal officer, agent or employee.

  12. The Accused signed and uttered a Form W-2 or 1099 { (___) and a Form W-3 or 1096 } without being a Federal officer, agent or employee. Therefore, the Accused has committed a violation of 18 U.S.C. § 912: "Whoever falsely assumes or pretends to be an officer or employee acting under the authority of the United States or any department, agency or officer thereof, and acts as such, or in such pretended character demands or obtains any money, paper, document, or thing of value, shall be fined under this title or imprisoned not more than three years, or both."

  13. The Accused signed and uttered a Form W-2 or 1099 { (___) and a Form W-3 or 1096 } without believing that I had engaged in any taxable activities in connection with the receipt of the reported payment(s) -- and without believing that the Accused is a Federal officer, agent or employee. Therefore, the Accused has committed a violation of 26 U.S.C § 7206(1): "Any person who—Willfully makes and subscribes any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter; ... shall be guilty of a felony and, upon conviction thereof, shall be fined not more than $100,000 ($500,000 in the case of a corporation), or imprisoned not more than 3 years, or both, together with the costs of prosecution."

MEMORANDUM OF LAW

Every Federal income tax (including corporate income taxes, the U.S. Individual Income Tax, Social Security taxes, Medicare taxes) is an excise. See the U.S. Supreme Court case of Brushaber vs. Union Pacific Railroad Co., 240 U.S. 1; House Congressional Record March 27th 1943, page 2580; "Frequently Asked Questions Concerning the Federal Income Tax" (C.R.S. Report for Congress 92-303A (1992)).

An excise is a tax on the exercise of a government-granted privilege. See American Airways v. Wallace, 57 F.2d 877,880; Flint v. Stone Tracy Co., 220 U.S> 107 (1911); Nicol v. Ames, 173 U.S. 509 (1899); United States v. County of Allegheny, 322 U.S. 174 (1944). Such exercises constitute taxable activities.

"Wages" relevant to the income tax are those paid to employees of the United States or United  States possessions, territories agencies or instrumentalities, or to officers of United States corporations. See 26 U.S.C. §§ 3121(a) and 3401(a); Rowan Cos. v. United States, 452 US 247 (1981). Only payments which meet the foregoing specifications are to be made on Forms W-2 and W-3, see 26 U.S.C. § 6051. Hence, only someone acting as an officer or employee under the authority of the United States can actually make such payments, and/or report or declare of personal knowledge that such payments have been made, as is done by way of Forms W-2 and W-3, and to claim to have made such payments is to claim to be such an officers or employee.

"Non-employee compensation" or other payments relevant to the income tax and appropriately reported on Forms 1099 and 1096 are those paid by someone engaged in the performance of the functions of a United States public office. See 26 U.S.C. §§ 6041 and 7701(a)(26). Hence, only someone acting as an officer or employee under the authority of the United States can actually make such payments, and/or report or declare of personal knowledge that such payments have been made, as is done by way of Forms 1099 and 1096, and to claim to have made such payments is to claim to be such an officers or employee.

Since the income tax is an excise, imposed on gains resulting from the conduct of taxable activities, and since the Accused had no reason to believe I had engaged in any taxable activities in connection with the receipt of the reported payment(s), and since the Accused knew and believed him/herself to not be a Federal officer, agent or employee, it follows that the Accused has knowingly and willfully signed a false statement of fact, and acted as a Federal officer, without believing that all the material elements are true, in violation of 18 U.S.C. § 1001(a), 26 U.S.C § 7206(1), 18 U.S.C. § 912.

(___) Executed without the United States. I declare (or certify, verify, or state) under penalty of perjury under the laws of the United States of America that the foregoing is true and correct.

(___)  Executed within the United States, its territories, possessions, or commonwealths. I declare (or certify, verify, or state) under penalty of perjury that the foregoing is true and correct.

Executed on ___/___/_____ (date).

___________________

 (Signature)

Nice work, Rod! I hope everyone victimized by false IRs make use of your work and become part of the torrent.

Btw, I think a valuable precursor to filing a criminal complaint for the reasons described above would be to furnish the errant payer/IR-creator with something like this, and then, after a suitable interval, to ask for corrections to any false forms received (as was anticipated by Rod in item 8 of his Declaration template).