LOOK, FOR INSTANCE, at the ruling in Steve and Sarah Waltner's lawsuit against the IRS. The Waltner's had sued in the federal Court of Claims to compel the IRS to make refunds concerning amounts withheld during each of three years, properly-claimed by way of timely amended returns.

The Court of Claims eventually dismissed the Waltners' suit. The grounds alleged for the dismissal tell the tale.

Though it spent 42 pages of gibberish, dodges and inapposite case citations choking it out, here is what the court ended up deploying as its rationale for dismissing the Waltners' suit on the government's motion:

"[A] Form 1040 ... which ... indicate[s] zero income ... [does] not constitute a return “because [it fails] to include any information upon which tax could be calculated"."

The court is proposing that a report of $0 income is outside the scope of tax-calculating procedures. It is impossible to overstate the ludicrousness of this assertion. Here is the very first line in the 2012 "tax table" calculated and published by the IRS:

Plainly, $0 is a legitimate and recognized amount of income, and one qualifying as "information upon which tax could be calculated", since the IRS itself helpfully calculates a tax liability based on that amount of income.

This dab of poo is enough by itself to reveal the entire decision of the court as confused and incorrect, at best. But it doesn't stop there...

"Here, taxpayers submitted amended returns for 2004, 2005, and 2006 in which they replaced the income they previously reported, which was consistent with third-party information provided to the IRS, with zeros ... that directly contradicted W-2s and other forms submitted by third parties to the IRS. The taxpayers admittedly took no action to obtain “corrected” third party forms that would corroborate their claims of zero taxable income."

Note the court's careful use of the phrase "taxable income" rather than "money", in implicit acknowledgement of the distinction...

Note further that not only is the court "reasoning" that the "third party forms" are to be accepted as infallibly correct unless the same "third parties" change them, but it simultaneously suggests that the claimants in the case bear a burden of corroborating their testimony. The first of these is manifestly absurd on its face. The second is directly contrary to specific statutory mandates placing on the government the burden of attempting to prove that the such claimants are wrong.

Here the government must prove that what these folks received actually DID qualify as "taxable income", per 26 U.S.C. §§ 6201(d) and 7491(a). No attempt whatever was made to bear this burden.

 This is why the complicit court resorts to this nonsense instead of what any rational person recognizes it must be able to declare in order to rule against the couple: "The government has proven that what the claimants received was, in fact, "taxable income" in the amounts reported." Being unable to say this, everything else said by the court is irrelevant and a dodge. The court ends with the assertion that the Waltners really didn't mean it when they filed their refund claims:

"Thus, the taxpayers' amended returns for 2004, 2005, and 2006, ... do not implicate an honest and reasonable intent to supply information required by the tax code."

Summed up, then, the basis of this ruling is:

• that "zero" is not a number (at least, not if it appears on the "income received" line of a declaration);

• that a payer's assertions that a payment is of "taxable income" has to be simply accepted as true (because the payer COULDN'T have been wrong...); or

• that these inconvenient affiants don't really believe what they say (because they said something different in previous years).

In making and posting this ruling, one has to imagine that the judge and her government handlers, and those who misrepresent this dismissal as being somehow a judicial ruling against CtC, hope that the reader won't give the matter a little thought and reflect on the fact that the REAL issues in the case are:

• whether "zero" IS the correct number (and isn't the ludicrous assertion that "zero" is not a number just an obvious evasion of this real question?);

• whether the payment really WAS of "taxable income" (and isn't deeming a mere assertion to that effect infallible and unrebuttable just a blatant evasion of that real question?); and

• whether what the attestor says is TRUE (and isn't the unprovable and grossly impertinent assertion that the attestor doesn't believe his sworn declaration just an evasion of that plainly- and exclusively-relevant real question?)...

...and then wonder why the court didn't just go right to these questions, and instead evaded them with its absurd nonsense.

So, yes, Steve and Sarah Waltner were ruled-against in their lawsuit. Does that ruling prove that CtC is wrong? Or does it prove that CtC is so right that a corrupt judge, who wants to rule against someone properly invoking the law revealed in the book in order to preserve a scheme that she sees crumbling all around her, is forced to resort to blatant evasions and idiotic nonsense?

The correct answer is plainly the latter of these alternatives. And yet this is the sort of ruling the troll-community has to trot out to scare folks away from the truth. The reason? This kind of corrupt contortion is the best the trolls can come up with in their effort to suggest that "the courts have [meaningfully] ruled against CtC".

***

IN FEBRUARY OF 2016, A FEDERAL DISTRICT COURT in Wisconsin used the same dodge to avoid the substance of the CtC-educated plaintiffs' claims. The suit was brought by Scott and Debbie Gillespie and sought to compel the government to issue a claimed refund.

In this case, the district court didn't waste nearly so many words on its evasion of the real issues, saying only, "Because plaintiffs' amended return did not evince an honest attempt to satisfy the law, it did not constitute a valid claim and plaintiffs have not satisfied the statutory prerequisites for filing suit. Thus, plaintiffs' complaint fails to state a claim upon which relief can be granted."  Like the dismissal in the Waltners' case, the court here is resorting to an assertion that the Gillespies can't really believe what they're saying in order to avoid considering the validity of their claim as an objective matter.

That is, the court is evading a decision on whether Scott and Debbie's earning actually qualify for the tax, something that the government would plainly insist upon if such a decision would find that to be true, for a variety of reasons. That this question is being dodged, instead, reveals that the conclusion on that point, were it to be made, would be in the Gillespie's favor, and both the court and the government know it.

***

ANOTHER CASE CITED BY THE TROLL COMMUNITY is a tax court case brought by Steve Waltner. Steve had petitioned against an effort by the IRS to collect a "frivolous return" penalty against him.

Steve actually withdrew his petition before a ruling by the tax court, having decided to re-file in district court instead. But the case is cited by the trolls nonetheless because the tax court judge, a fellow named "Buch", clung to it on the pretext of imposing a sanction on Steve and used his ruling to spend dozens of pages purporting to critique CtC.

But like all other instances of the same sort, Buch reveals the truth he is trying to attack by the falsities and dodges to which he is compelled to resort in the effort. Further, Buch undertakes his dissembling attack on CtC while his colleagues in the IRS, its Tax Court and its Office of Chief Counsel were facing exposure for a series of forgeries and perjuries in two other CtC-related cases involving Steve Waltner and his wife Sarah.

 (CtC was not even in evidence in the Waltner case, by the way. But from the way it is brought up by the judge, and by its overall "hit-piece" character, zero actual rebuttal of anything in CtC, and steady litany of strawman pretenses, it can be surmised that the attack had been planned for some time by the ignorance tax crowd, and had been lying in wait for an opportunity to be published.)

Buch's pretense of disparaging CtC begins with a series of irrelevant smears directed at me personally. These include regurgitations of self-serving DOJ PR department misrepresentations of an 1990 indiscretion which is more accurately discussed here. Buch also-- almost comically, considering that his goal is to discredit me-- presents the "outcome" of the DOJ and judicial frauds exposed here here and here (albeit without sharing with his readers the exhibits which reveal the government crimes involved).

The ad hominem attacks are followed by strawmen set-ups and knock-downs through misrepresentations of content in the book and a ferocious exclusion of context. Buch even misrepresents statutes and other authorities, and cherry-picks inapt or out-of-context supports for his own assertions.

Buch pretends to do a chapter-by-chapter review/critique, but actually only selects individual sentences from each assemblage of chapter-length material-- absent of context and supporting or clarifying material. Or he just declares what his reader is supposed to believe is said in CtC (but isn't) without even the benefit of an excerpt. Then he attacks his own misrepresentation.

For example, Buch begins his "critique" with this, supposedly addressing what appears in the opening chapter of CtC, 'About Taxes- Direct v. Indirect':

"Starting with the premise that taxes are either direct or indirect, Cracking the Code lays the foundation for the remainder of the book on two fallacies. The first is that “federal direct taxes which affect citizens of the several states must be apportioned.” The Constitution at one time required this apportionment; however, with the adoption of the 16th Amendment in 1913, this rule no longer applies to income taxes."

TC Memo. 2014-35 p. 44

Appalling as it is to imagine of a sitting judge, even just a Tax Court judge, it appears that Buch is unfamiliar with the most basic facts about the tax (or is willing to simply lie about them). Here is what a unanimous Supreme Court says about Buch's fallacious assertion, in the reigning decision on the meaning and effect of the 16th Amendment (emphasis added):

"We are of opinion, however, that the confusion is not inherent, but rather arises from the conclusion that the 16th Amendment provides for a hitherto unknown power of taxation; that is, a power to levy an income tax which, although direct, should not be subject to the regulation of apportionment applicable to all other direct taxes. And the far-reaching effect of this erroneous assumption will be made clear by generalizing the many contentions advanced in argument to support it...”

The same court goes on to point out that the very idea of a non-apportioned direct tax is ridiculous and impossible:

“But it clearly results that the [erroneous] proposition and the contentions under it, if acceded to, would cause one provision of the Constitution to destroy another; that is, they would result in bringing the provisions of the Amendment [purportedly] exempting a direct tax from apportionment into irreconcilable conflict with the general requirement that all direct taxes be apportioned."

United States Supreme Court, Brushaber v. Union Pacific RR Co., 240 U.S. 1 (1916).

So, I think I am on pretty good ground saying, “federal direct taxes which affect citizens of the several states must be apportioned”, and I think Buch is sinking fast into deep water when he calls my statement a "fallacy".

In fact, it would appear that Buch is not just sinking, but also revealing something about himself. It's hard to imagine Judge Buch can simply misunderstand the Supreme Court. No one else does, as shown by these prominent expert analyses of the Brushaber ruling (emphases added):

“[B]y the [Brushaber] ruling, it was settled that the provisions of the Sixteenth Amendment conferred no new power of taxation, but simply prohibited the previous complete and plenary power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged, and being placed in the category of direct taxation subject to apportionment by a consideration of the sources from which the income was derived -- that is, by testing the tax not by what it was, a tax on income, but by a mistaken theory deduced from the origin or source of the income taxed.”

United States Supreme Court, Stanton v. Baltic Mining Co., 240 U.S. 103 (1916) (This is the same court that had made the Brushaber ruling a month before this one.)

The Amendment, the [Supreme] court said, judged by the purpose for which it was passed, does not treat income taxes as direct taxes but simply removed the ground which led to their being considered as such in the Pollock case, namely, the source of the income. Therefore, they are again to be classified in the class of indirect taxes to which they by nature belong."

Cornell Law Quarterly, 1 Cornell L. Q. 298 (1915-16)

"In Brushaber v. Union Pacific Railroad Co., Mr. C. J. White, upholding the income tax imposed by the Tariff Act of 1913, construed the Amendment as a declaration that an income tax is "indirect," rather than as making an exception to the rule that direct taxes must be apportioned."

Harvard Law Review, 29 Harv. L. Rev. 536 (1915-16)

"The Supreme Court, in a decision written by Chief Justice White, first noted that the Sixteenth Amendment did not authorize any new type of tax, nor did it repeal or revoke the tax clauses of Article I of the Constitution, quoted above. Direct taxes were, notwithstanding the advent of the Sixteenth Amendment, still subject to the rule of apportionment…"

Legislative Attorney of the American Law Division of the Library of Congress Howard M. Zaritsky in his 1979 Report No. 80-19A, entitled 'Some Constitutional Questions Regarding the Federal Income Tax Laws'

It's even harder to imagine honest misunderstanding when the Supreme Court goes on to say the same over the years:

"If the tax is a direct one, it shall be apportioned according to the census or enumeration. If it is a duty, impost, or excise, it shall be uniform throughout the United States. Together, these classes include every form of tax appropriate to sovereignty. Cf. Burnet v. Brooks, 288 U. S. 378, 288 U. S. 403, 288 U. S. 405; Brushaber v. Union Pacific R. Co., 240 U. S. 1, 240 U. S. 12. Whether the [income] tax is to be classified as an "excise" is in truth not of critical importance [for this analysis]. If not that, it is an "impost" (Pollock v. Farmers' Loan & Trust Co., 158 U. S. 601, 158 U. S. 622, 158 U. S. 625; Pacific Insurance Co. v. Soble, 7 Wall. 433, 74 U. S. 445), or a "duty" (Veazie Bank v. Fenno, 8 Wall. 533, 75 U. S. 546, 75 U. S. 547; Pollock v. Farmers' Loan & Trust Co., 157 U. S. 429, 157 U. S. 570; Knowlton v. Moore, 178 U. S. 41, 178 U. S. 46). A capitation or other "direct" tax it certainly is not."

U.S. Supreme Court, Steward Machine Co. v. Collector of Internal Revenue, 301 U.S. 548 (1937)

But in fact, Buch is really good at misunderstanding. In a footnote to his fallacious assertion about the meaning and effect of the 16th Amendment in defiance of ALL actual authority on the subject save only his own confused mind, Buch says this about the portions of the Brushaber decision excerpted above (which also are presented in CtC):

Brushaber merits special mention, because Cracking the Code misleadingly cites that case. A stockholder brought suit to against a corporation to prevent the corporation from paying taxes imposed by the Tariff Act of 1913. The Supreme Court summarized the stockholder’s arguments, stating: “The various propositions are so intermingled as to cause it to be difficult to classify them.” Brushaber, 240 U.S. at 10. The Supreme Court then proceeded to untangle the stockholder’s arguments, which ultimately proved to be losing arguments. Yet Cracking the Code cites the Supreme Court’s summary of the losing arguments as though it were the Supreme Court’s analysis of the underlying constitutional issues. Cracking the Code, supra note 16, at 19-20.

I find it hard to understand what Buch means when he says that I "misleadingly" cite that case "as though it were the Supreme Court's analysis of the underlying constitutional issues". Here, again, is what I cite:

"We are of opinion, however, that the confusion is not inherent, but rather arises from the conclusion that the 16th Amendment provides for a hitherto unknown power of taxation; that is, a power to levy an income tax which, although direct, should not be subject to the regulation of apportionment applicable to all other direct taxes. And the far-reaching effect of this erroneous assumption will be made clear by generalizing the many contentions advanced in argument to support it...”

“But it clearly results that the [erroneous] proposition and the contentions under it, if acceded to, would cause one provision of the Constitution to destroy another; that is, they would result in bringing the provisions of the Amendment [purportedly] exempting a direct tax from apportionment into irreconcilable conflict with the general requirement that all direct taxes be apportioned."

I cite this material as evidence of the fact that the Brushaber court slaps down the erroneous notion that the 16th Amendment authorized a non-apportioned direct tax (which was Frank Brushaber's notion and is Ronald Buch's, as well). This doesn't comprise the whole of the court's analysis of the underlying Constitutional issues (for instance, the Brushaber court also flatly declares the income tax to be an excise, as I also quote in CtC). But I think I can confidently say that what I excerpt IS part of  the court's analysis of the Constitutional issues involved in the tax and the 16th Amendment...

BTW, you can find a more complete discussion of those issues here; further, in June of 2024, the Supreme Court reiterates what I have presented in CtC and the additional authorities above, and which Buch at least pretends to disbelieve:

The Civil War income tax was recognized as an indirect tax “under the head of excises, duties and imposts.” Brushaber, 240 U. S., at 15; see also Springer v. United States, 102 U. S. 586, 598, 602 (1881)." ... "Therefore, the Sixteenth Amendment expressly confirmed what had been the understanding of the Constitution before Pollock: Taxes on income—including taxes on income from property—are indirect taxes that need not be apportioned. Brushaber, 240 U. S., at 15, 18.

Moore v. United States, 602 U.S. ___ (2024).

 Also from the Moore ruling, J. Jackson, in her concurring opinion while discussing the application of the income tax under consideration in that case, holds it valid as, "an excise tax on the privilege of doing business through a controlled foreign corporation."

LITTLE MORE NEED BE SAID to make clear that Buch is a scoundrel, and nothing he has to say should be taken seriously. He is plainly "laying the foundation for the remainder" of his mendacious attack on a fallacy, which, considering his job, is one of breathtaking proportions, and brings to mind Thomas Paine's sober observation:

"It is impossible to calculate the moral mischief, if I may so express it, that mental lying has produced in society. When a man has so far corrupted and prostituted the chastity of his mind as to subscribe his professional belief to things he does not believe he has prepared himself for the commission of every other crime."

-Thomas Paine

But we'll go a little further just to drill home the point that the man is peddling bs wholesale and retail. It's only necessary to go right to the next assertion in Buch's "critique" to hit another prize:

The second fallacy [supposedly found in CtC -PH] is that the Federal Government has legislative authority over only the District of Columbia and U.S. territories and thus lacks the authority to impose taxes within any State. The error here starts with the author’s misreading of the Constitution. The Constitution gives Congress the power

To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful Buildings * * *

From this the author leaps to the erroneous conclusion that “All other areas within the union are under the exclusive jurisdiction of one of the several States, and are thus insulated from federal authority except in regard to certain enumerated powers, and federal governmental property and contract rights.” The fact that Congress has exclusive legislative power in one area does not mean that it has no legislative power in others; it merely means that its power in those other areas is not exclusive. States and the Federal Government exercise sovereignty concurrent with one another. Or, as the Supreme Court has stated: “As every schoolchild learns, our Constitution establishes a system of dual sovereignty between the States and the Federal Government.”

TC Memo. 2014-35 p. 45, 46

Other than a couple of footnotes, this is the total of what is said regarding the "fallacy", allegedly-asserted in CtC, "that the Federal Government has legislative authority over only the District of Columbia and U.S. territories and thus lacks the authority to impose taxes within any State." But even in just that little bit of material we can see two common practices of dissemblers at work.

First, there is the bald assertion that CtC says that due to the legislative jurisdictional limitations described, the federal government, "...thus lacks the authority to impose taxes within any state." And yet, somehow Buch fails to present any language from CtC saying any such thing. There's a simple reason: CtC does not say any such thing.

In fact, while the chapter Buch is discussing is not one in which CtC presents how and where the income tax is and can be imposed (making his assertion regarding this "fallacy" at this point just an outright and particularly cheap strawman), CtC plainly says, in the opening paragraph of the section Buch is mendaciously discussing: "In addition to prescriptions as to how taxes are laid, there are also jurisdictional issues involved in taxation.  A government cannot tax-- directly or indirectly-- any thing or any activity outside either its legal or its geographical jurisdiction." ("Legal jurisdiction" being, for instance, a government's jurisdiction over its own stuff and the use or disposition of same, or over those acting on its behalf.)

Plainly, CtC acknowledges that geographical considerations are NOT the sole considerations regarding any power to tax. That power applies wherever legal jurisdiction goes, which can be in or out of union states, or anywhere in the world, for that matter.

In fact, CtC teaches that "within any state" is not even a relevant concept to the application of the income tax, because that tax is based entirely on legal jurisdiction. But because this is, in fact, the basis for the tax-- something Buch desperately want the public to misunderstand-- Buch simply misleads his readers about what CtC says.

The second dissembler's ploy used by Buch in this portion of his screed is the failure to present-- even if only to attempt an honest rebuttal-- what CtC offers in support of the book's actually very qualified assertion that federal jurisdiction is limited within state territory (not absent, as Buch suggests).

Here is what appears in the chapter concerning federal jurisdiction which Buch somehow fails to excerpt or address. This material begins with the very next word following the single sentence Buch has excerpted and attempted to misrepresent:

As was declared by counsel for the United States before the Supreme Court in United States v. Bevans, 16 U.S. 336 (1818):

“The exclusive jurisdiction which the United States have in forts and dock-yards ceded to them, is derived from the express assent of the states by whom the cessions are made. It could be derived in no other manner; because without it, the authority of the state would be supreme and exclusive therein,”

with the court, in its ruling agreeing:

“What, then, is the extent of jurisdiction which a state possesses? We answer, without hesitation, the jurisdiction of a state is co-extensive with its territory;”  

In New Orleans v. United States, 35 U.S. (10 Pet.) 662, 737 (1836), the court reiterates this principle:

“Special provision is made in the Constitution for the cession of jurisdiction from the States over places where the federal government shall establish forts or other military works. And it is only in these places, or in the territories of the United States, where it can exercise a general jurisdiction."

In 1956, the Eisenhower administration commissioned the Interdepartmental Committee for the Study of Jurisdiction Over Federal Areas within the States.  The pertinent portion of its report points out that,

“It scarcely needs to be said that unless there has been a transfer of jurisdiction (1) pursuant to clause 17 by a Federal acquisition of land with State consent, or (2) by cession from the State to the Federal government, or unless the Federal Government has reserved jurisdiction upon the admission of the State, the Federal Government possess no legislative jurisdiction over any area within a State, such jurisdiction being for exercise entirely by the States, subject to non-interference by the State with Federal functions, and subject to the free exercise by the Federal Government of rights with respect to the use, protection, and disposition of its property”. 

Pretty plainly, what is said in CtC on the issue of jurisdiction-- “All other areas within the union are under the exclusive jurisdiction of one of the several States, and are thus insulated from federal authority except in regard to certain enumerated powers, and federal governmental property and contract rights”-- is pretty thoroughly supported. (And again, what CtC goes on to explain elsewhere-- in parts of the book Buch studiously avoids-- is that the jurisdiction for the income tax is in no way geographically-related.)

THESE ARE JUST TWO QUICK DEMONSTRATIONS of Buch's dissembling-- which were found in his very first two assertions. There is no need to go on; the entire package the man presents is just more of the same careful, practiced disinformation, misrepresentation and deceit.

In fact, Buch even goes so far as to repeat the government's favorite canard, that CtC argues "that only Federal workers are subject to tax"-- Memo., p. 58, thereby revealing that he never really read the book at all. See this hoary and ridiculous false ascription thoroughly debunked and revealed for the cheap and telling lie that it is, here.

(It must be reflexive: Even in his regurgitation of the "only federal workers" fraud, Buch dissembles yet again. He airs the bogus argument ascription in the course of falsely saying that CtC warns of criminal penalties for recipients who fail to correct erroneous W-2s, and tries to support that lie using incomplete excerpted language from the passage in the book on pp.142-143 which warns against creating false W-2s.)

The dissembler finishes his screed with equally false declarations that CtC-educated filers have been prosecuted for those filings (see here for debunks of this lie) and other dire statements. These are clearly meant for dissemination by the government as part of PR campaign hoping to frighten Americans away from the individual-empowering, state-restraining information in the book.

I WILL make three further points, though:

First, as is always the case, efforts like Buch's, which rest on careful misrepresentations, simply underscore the truth of what they attack. The only time one needs to resort to misstatement is when one can't actually argue against what is really said.

Second (and this is the funny one), EVEN WHILE BUCH WAS GNASHING HIS WAY THROUGH THIS CORRUPT EXERCISE THOUSANDS OF AMERICANS WERE GETTING THEIR COMPLETE REFUNDS BY RELIANCE ON EXACTLY THE BOOK THIS FELLOW WAS STRUGGLING TO DEFAME.

In the years since Buch's contribution to the long-running campaign to suppress CtC, more tens of thousands of CtC-educated refunds have issued. All were thoroughly vetted by the same IRS for which Buch works.

What's more, this host of concrete acknowledgements of the accuracy of CtC include, as always happens a few times in any given couple of years of CtC victories, a handful in which the tax agency has vainly attempted to dodge or resist the educated filer's claims. All in all, Tax Court Judge Buch's exercise in corruption, and the effort by government trolls to exploit it by presentation to folks who aren't familiar with CtC and therefore can't recognize its mendacity, is a perfect example of the lame bs illustrated by this graphic:

***

Third, as noted above, Buch's deceitful pretense of a challenge to the accuracy of CtC just happened to take place while his agency (and particularly his division of the agency) was finding itself in the crosshairs of well-documented allegations of forgery, perjury and conspiracy, as laid out here, all committed as part of a corrupt effort to evade or overcome CtC-educated filings. I leave it to you, gentle reader, to come to your own conclusions as to what this implies about the honesty and sincerity of Buch's presentation.

(Click here to see a very comprehensive exposé of Buch's false premises and assertions about the law which I've  briefly addressed above, btw.)

THE "BOTTOM-LINE" REALITY IS THAT JUDICIAL RESPONSES TO CtC uniformly acknowledge the accuracy of the book's information, even if sometimes this is only shown by the corrupt court being forced into contrivances and contortions in its effort to rationalize an adverse outcome for the educated litigant. The reality is that no court has ever "ruled against CtC".